A few weeks back, we reported on a story about Hyatt Classic Residence’s (n/k/a Vi) dispute with the IRS over the treatment of CCRC fees. According to a report from TaxAnalysts.com, it seems that the IRS is backing down from its original position. Based upon the ruling, the IRS is stating that its treatment was incorrect to increase its taxable income by the refundable portion of entrance fees paid by residents. The IRS maintains that the entrance fees at issue were rental income that must be included in taxable income in the year of receipt.
For the summary, click here.