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The 2026 archive

Everything Fortress published in 2026, newest first — the developments and planning windows that defined the year.

16 pieces in this view

Tax AlertJune 20268 min read

Notice 2026-40: Two Opportunity Zone Regimes, One Hard Deadline

IRS Notice 2026-40, issued in June 2026, is the first transitional guidance on the Qualified Opportunity Zone program after the One Big Beautiful Bill Act (Public Law 119-21, § 70421) rebuilt it. The notice draws a hard line at December 31, 2026: investments made on or before that date stay on the original rules and face a mandatory deferred-gain inclusion in the taxable year that includes that date, while investments made on or after January 1, 2027 move onto a new permanent regime with a rolling five-year inclusion, a 10 percent basis step-up (30 percent for qualified rural opportunity funds), a fresh designation period running January 1, 2027 through December 31, 2036, and a 30-year ceiling on the gain-exclusion election. Two narrow safe harbors let previously designated zones keep functioning through December 31, 2047. Proposed regulations are forthcoming.

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Tax AlertMay 20267 min read

California PTET Extended Through 2030: Missing the June 15 Prepayment No Longer Voids the Election

As California pass-through owners approach the June 15, 2026 prepayment, the calculus has changed. Senate Bill 132, signed by Governor Newsom on June 27, 2025, extends the state's elective pass-through entity tax through the 2030 tax year and removes the all-or-nothing trap that had cost owners their entire election for a single missed or short prepayment. Beginning with tax years that start in 2026, missing or underpaying the mandatory June 15 prepayment no longer voids the election. Instead, it reduces each owner's pass-through entity credit by 12.5 percent of that owner's pro rata share of the amount due but not paid. The forfeiture cliff is gone; the June 15 date is now a cost-benefit decision.

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Tax AlertMay 20266 min read

IRS Conservation Easement Settlement: 90-Day Window, 10% Penalty — Then Terms Worsen

On May 13, 2026, the IRS announced IR-2026-65, a time-limited settlement initiative for more than 1,100 syndicated conservation easement disputes — roughly 740 docketed in Tax Court and 400 still in examination. Eligible taxpayers who accept within an initial 90-day window concede the charitable contribution deduction (recovering only an "other deduction" for approximate out-of-pocket costs) and pay a 10% gross valuation misstatement penalty under § 6662(h); that penalty rises to 20% in a subsequent, final 45-day window, with no extensions. Decline, and the case reverts to a hazards-of-litigation posture against a record in which courts have allowed, on average, about 6% of the claimed deduction and generally imposed 40% penalties.

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AnalysisMay 20264 min read

An ERC Disallowance Starts a Two-Year Clock — and the IRS Just Built a Pressure Valve

A denied Employee Retention Credit claim is not the end of the matter, but it does start a clock: a taxpayer generally has two years from the disallowance letter to resolve the claim or sue for the refund. In April 2026, the IRS introduced a process — Notice CP320B and Form 907 — to extend that deadline for taxpayers still waiting on the agency to review their response. For businesses with claims caught in the backlog, this is the difference between preserving the right to sue and losing it.

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AnalysisMay 20264 min read

"No Tax on Tips" Is Now Final: What the April 2026 Regulations Settle for Employers

Treasury and the IRS finalized the new tip deduction in regulations published April 13, 2026, fixing an exhaustive list of 71 tipped occupations and narrowing what counts as a qualified tip. The deduction belongs to workers, but the compliance burden lands on employers — payroll systems, W-2 coding, and occupation classification all change for 2026. This is a reporting project for any business with a tipped workforce.

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AnalysisApril 20265 min read

The IRS Is Withdrawing Its Partnership Basis-Shifting Rules — Read the Tempo, Not Just the Headline

In March 2026, Treasury proposed to remove the reporting regulations that, a year earlier, had branded certain related-party partnership basis adjustments as "transactions of interest." Combined with a sharply smaller IRS workforce, the move reads like a retreat from partnership enforcement. It is a real reduction in disclosure exposure — but it is not a signal that aggressive structures have become safe. The substantive law has not changed, and the cases still in litigation are being decided for the government.

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AnalysisApril 20269 min read

The $15 Million Exemption Is Permanent: Why Pre-Sunset Bypass Trusts and SLATs May Now Work Against Your Clients

OBBBA made the estate, gift, and GST exemption permanent at $15 million per person, ending the multiyear sunset rush that drove private-client planning since 2022. The cliff is gone, but the structures built to beat it remain: formula-funded credit shelter trusts that mechanically over-fund the bypass and forfeit a second basis step-up, aggressive SLATs and IDGTs that now carry grantor-trust income-tax drag for no transfer-tax purpose, and disclaimer plans whose default has quietly become outright passage. The right response is not to re-announce the number but to re-read the documents against it.

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AnalysisApril 20269 min read

After *Liberty Global*: Technical Code Compliance No Longer Shields a Transaction From the Economic Substance Doctrine

On April 21, 2026, a divided Tenth Circuit affirmed the disallowance of an approximately $2.4 billion Section 245A dividends-received deduction in *Liberty Global, Inc. v. United States*, No. 23-1410, holding that the codified economic substance doctrine of Section 7701(o) reaches a tax-motivated, integrated transaction even when each step mechanically complies with Title 26. The decision is now the leading appellate authority on Section 7701(o), and it confirms that ordinary M&A building blocks — Section 351 contributions, entity-classification elections, intercompany reorganizations — are not categorically exempt when embedded in a plan that exploits a result Congress did not intend. Because Section 6662(b)(6) attaches a strict-liability accuracy penalty to economic-substance disallowances with no reasonable-cause escape, the planning and documentation stakes for sophisticated structures have risen materially.

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Tax AlertApril 20269 min read

The 1% Remittance Transfer Tax: Cash and Money-Order Transfers Are Taxed, Electronic Transfers Are Not

New Internal Revenue Code §4475, enacted in the One Big Beautiful Bill Act, imposes a 1% excise tax on outbound remittance transfers funded with cash, a money order, a cashier's check, or any similar physical instrument, for transfers occurring after December 31, 2025. Account-funded and card-funded transfers are excluded from the tax under §4475(d). The sender owes the tax, but the remittance transfer provider must collect it and becomes liable if it does not. Providers report on Form 720 with semimonthly deposits — the first was due January 29, 2026 — and on April 13, 2026 Treasury and the IRS published proposed regulations (REG-114499-25; announced April 10, 2026 in news release IR-2026-48) with comments due June 12, 2026. Notice 2025-55 supplies limited deposit-penalty relief that runs only through the third quarter of 2026.

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AnalysisMarch 20264 min read

The SALT Cap Rose to $40,400 — and the Pass-Through Workaround Still Matters

OBBBA raised the state and local tax deduction cap to a $40,000 base, indexed to roughly $40,400 for 2026, with a phase-down for high earners. For some clients that materially loosens a constraint that has bound returns since 2018. But the higher cap phases down above $500,000 of income and reverts to $10,000 in 2030 — and states are extending, not repealing, their pass-through entity tax regimes. The PTET election is still a live planning item for 2026.

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AnalysisFebruary 20264 min read

Domestic R&D Is Deductible Again — and the Catch-Up Window Closes July 6, 2026

OBBBA created IRC § 174A, restoring immediate expensing of domestic research costs for tax years beginning after December 31, 2024 — undoing the capitalization regime that strained cash flow since 2022. The procedural rules in Rev. Proc. 2025-28 also open a retroactive catch-up for prior years, but the small-business election and the recovery of previously capitalized amounts run on a hard deadline: the earlier of July 6, 2026, or the refund statute of limitations. For research-intensive businesses, this is a 2026 action item, not a year-end one.

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AnalysisFebruary 20264 min read

The Estate Exemption Cliff Is Gone: Planning at a Permanent $15 Million

For two years, estate planning ran against a clock: the federal exemption was scheduled to roughly halve at the end of 2025. OBBBA removed that clock. The basic exclusion amount is $15 million per person for decedents dying in 2026, indexed going forward, and made permanent. The use-it-or-lose-it pressure that defined recent planning is gone — but "permanent" is a statutory word, not a constitutional one, and the case for using exemption has not disappeared with the deadline.

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AnalysisJanuary 20264 min read

Bonus Depreciation Is Permanent Again: Reading Notice 2026-11 Before You File

The One Big Beautiful Bill Act restored 100% first-year bonus depreciation and made it permanent. In January 2026, the IRS issued Notice 2026-11 with interim guidance on the mechanics — including the acquisition-date line that determines whether property qualifies for the full deduction. For capital-intensive businesses, the planning question is no longer whether to expense, but how to time and document it.

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Tax AlertJanuary 20267 min read

Form 6765 Section G Is Mandatory for 2026: What R&D Credit Claimants Must Report Now

The optional period is over. Under the Instructions for Form 6765 (Rev. December 2025), Section G — Business Component Information — becomes mandatory for most research-credit claimants for tax years beginning after December 31, 2025. For calendar-year filers, that means the 2026 return filed in 2027 is the first required year. Companies must itemize qualified research expenses (QREs) by individual business component, covering at least 80% of total QREs in descending order and capped at 50 components, with each component broken into six expense buckets. Two narrow exceptions survive. The IRS has also extended the amended-return refund-claim perfection window through January 10, 2027.

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Tax AlertJanuary 20266 min read

OBBBA Charitable Deduction Floors: What the 0.5% Itemizer Rule and 1% Corporate Rule Mean for 2026 Giving

The One Big Beautiful Bill Act (P.L. 119-21, signed July 4, 2025) rewrote the federal charitable deduction in IRC §170 for tax years beginning after December 31, 2025. Three coordinated changes are now live: a new 0.5%-of-AGI floor that itemizers must clear before any gift is deductible (§170(b)(1)(I)), a 1%-of-taxable-income floor for corporations beneath the retained 10% ceiling (§170(b)(2)(A)), and a permanent above-the-line deduction of up to $1,000 (single) or $2,000 (married filing jointly) for cash gifts by standard-deduction filers. A separate 35-cents-on-the-dollar cap on the value of itemized deductions further compresses the benefit for top-bracket donors. The math of giving changed on January 1, and the planning window for clients who can shift timing is now.

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