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Jim McCarten

James M. McCarten

PH: (404) 532-7236
Fax: (404) 817-3244
Email: James
Paralegal
PH: (615) 724-3238
Legal Secretary
Brenda Allen ()
PH: (404) 685-4315

Jim is a Partner in the Firm's Tax, Trusts and Estates and Corporate practice groups, where his practice is best described as a general tax practice. Jim works with a broad spectrum of clients, including start-up businesses, mid-market family businesses, publicly traded entities, and retired corporate executives and business owners. His practice encompasses the entire range of tax planning, including, mergers and acquisitions, structuring and forming start-up businesses, asset protection, family business planning and estates, trusts and wealth preservation. In addition to his transactional planning practice, Jim is active in representing clients during audits by the IRS and/or states Department of Revenue. Finally, as the parent of a young adult on the autism spectrum, Jim is very involved in special needs planning for clients who have family members with a disability.

Jim is a Fellow in the American College of Trust and Estate Counsel and has a broad range of tax experience including: representing clients during audits by the IRS and/or Tennessee Department of Revenue, crafting tax structures for new businesses, counseling clients on the tax aspects of business exit strategies and business succession issues, designing tax-effective executive compensation packages, creating appropriate estate plans, and counseling families on special needs planning.

Jim began his professional tax career with the “Big 8” public accounting firm of Coopers & Lybrand. Following law school, he litigated tax cases for the federal government as a member of the U.S. Department of Justice. In 1994, Jim was a founding member of one of East Tennessee’s largest and most respected law firms.

Jim is admitted to practice law in Tennessee, Georgia, and Missouri. He has been named to The Best Lawyers for America since 2003 in the areas ...

  • Represented an East Tennessee economic development organization in resolving a seven figure sales and use tax dispute with the State of Tennessee.
  • Represented one of two shareholders of a substantial rehabilitation facility during a business divorce eventually resolved by a sale to a white knight and negotiated the put-call arrangement with the venture firm to maximize capital gains, minimize ordinary income and increase the client's total return.
  • Active in structuring the planned gift of $25M for a community foundation.
  • Through a combination of family partnerships, Tennessee Investment Services (Dynasty) Trusts, charitable and defined-value gifting, and sales to grantor trusts, Mr. McCarten assisted in the transfer of a Tennessee service business and other family business assets worth more than $50M to the second generation at a minimal Federal transfer tax cost.
  • Worked on reorganizations of and acquisitions and mergers of various professional practices in the medical, accounting, architecture, engineering and legal communities.
  • Reorganized a single charitable organization into two charities and three for-profit enterprises owned by the charities which now generate significant taxable income.
  • Has organized several charitable cooperatives for health care organizations.
  • Assisted several publicly-traded financial institutions with the design and documentation of their non-qualified deferred compensation programs for directors and key executives under Section 409A and other tax statutes.
  • Represented a for-profit enterprise in the design of a joint venture with a non-profit hospital and several local physicians.
  • Worked with plaintiff's counsel to structure the settlement of a $10M medical malpractice case by having the award paid to a special needs trust ("SNT"), thereby protecting the child's access to Medicaid/TennCare coverage. This representation also included the joint purchase of a home for the family by the SNT and the parents and utilized insurance trusts to protect the value of the award for the remainder of the family.
  • Structured the legal documents creating a museum for a community in Tennessee and worked with the client throughout the IRS exemption application process.
  • Subsequently obtained a six figure award of attorneys fees under code Section 7430 for that same taxpayer. Smokey Mountain Secrets, Inc. v. U.S., 78 AFTR 2d 96-7603 (D.C. Tn. 1996).
  • Lead counsel for the taxpayer in a multimillion dollar employment tax case involving whether certain workers were employees or independent contractors. Smokey Mountain Secrets, Inc. v. U.S., 76 AFTR 2d 95-6974 (D.C. Tn. 1995).
  • Represented a major Tennessee non-profit in exempting significant portions of its real property from property tax.
  • Main author of the Tennessee Revised Non-Profit Limited Liability Company Act Section 48-101-801, et. seq. (2006).
  • Organized and structured the Community Reuse Organization East Tennessee and its various single-member LLCs.
  • Has successfully represented business owners and taxpayers in investigations and recommendations for prosecution by IRS Criminal Investigation Divisions, several times convincing the Department of Justice to decline IRS recommendations for prosecution.
  • Brunswick Corp. v. Commissioner, Tennessee Department of Revenue. Successfully represented national company in settling separate franchise and excise tax and sales tax disputes with the Tennessee Department of Revenue.
  • Eli Lilly & Company v. Commissioner, Tennessee Department of Revenue. Represented pharmaceutical company in significant refund litigation over Tennessee franchise and excise tax liabilities. Successfully settled.
  • Counsel for a number of community foundations throughout Tennessee.
  • Represented ex-spouse of "Final 4" accounting firm partner in a successful "innocent spouse" defense against assessment of taxes, penalties and interest exceeding $3 million.
  • Has successfully represented certified public accountants in administrative proceedings brought by the government to disbar them from practice before the IRS (under Circular 230).
  • Transferred ownership of a closely-held Tennessee manufacturing concern to the owner's children and trusts for the grandchildren using self-cancelling installment notes ("SCINs") saving the family roughly $15M in transfer taxes.
  • Represented one of two shareholders of a substantial rehabilitation facility during a business divorce eventually resolved by a sale to a white knight and negotiated the put-call arrangement with the venture firm to increase capital gains, minimize ordinary income and maximize the client's total return.
  • Working closely with IP counsel, formalized several unique business and manufacturing enhancements developed by the business owner followed by a tax-free reorganization of the underlying business to minimize the business owner's income taxes, but maximize the family's cash-flow when the business was acquired by a national enterprise.

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