On March 1, Tonkon Torp attorney Kate Roth was a featured panelist at a tax event hosted by the Tax Section of the Dallas, Texas Bar Association. Kate joined a panel of two other tax experts to share the ins and outs of Cancellation of Debt Income (CODI) for businesses and financial Institutions, which is codified in Sections 61(a)(11) and Section 108 of the Internal Revenue Code.
Kate’s segment of the panel focused on the exclusions to CODI that would otherwise be included in a taxpayer’s gross income and the potential reduction of tax attributes. The primary exclusions include discharge of debt in a Title 11 bankruptcy proceeding, insolvency, qualified farm indebtedness, property exchanged for nonrecourse debt, and principal residence. She also shared a number of other lesser-used exclusions, and examined the most recent IRS guidance for the treatment of forgiven Paycheck Protection Program (PPP) loans.
Kate is an associate in Tonkon Torp’s Tax and Executive Compensation & Employee Benefits practice groups. Her practice focuses on federal and state tax impacts on business transactions, including taxation of corporations, partnerships, and LLCs. Kate also works with Lewis & Clark’s Low Income Taxpayer Clinic to represent pro bono clients before the Internal Revenue Service. Before joining the firm, she served a two-year judicial clerkship at the U.S. Tax Court where she gained unique insight into federal taxation matters.