Stef Tucker and John Coe
Bio
Stefan (Stef) Tucker is a Senior Partner at Venable LLP in Washington, D.C. His practice encompasses mergers and acquisitions, entity planning, structuring and formation, asset protection and preservation, business transactions, and family business planning and wealth preservation. In addition, Mr. Tucker has extensive experience in federal and state income, estate, and gift taxation.
Stef served as chair of the American Bar Association Section of Taxation from 1998 to 1999, having previously served as chair-elect, vice-chair of committee operations, council member, and chair of its committees on real estate and continuing legal education. Professor Tucker also served on the D.C. Tax Revision Commission in 2014–2015, the recommendations of which were adopted by the D.C. Council, resulting in major changes in personal and business income and other taxes in Washington, D.C.
He was an active member of the ABA Section of Taxation Task Force on Tax System Restructuring, with a particular focus on real estate. In addition, he is a member of the District of Columbia Bar Division of Taxation, having previously served as a member of its steering committee.
Professor Tucker was a professorial lecturer at law at George Washington University Law School from 1970 to 1990, and an adjunct professor of law at Georgetown University Law Center from 1990 to 2015, in both cases teaching Tax Planning for Real Estate Transactions.
Education
- J.D. Order of the Coif, University of Michigan Law School, 1963
- B.B.A., University of Michigan, 1960
Bar Admissions
Professional Memberships and Activities
- Member, American Bar Association, Section of Taxation; member, Task Force on Tax System Restructuring; past chair, 1998 – 1999
- Member, District of Columbia Bar, Division of Taxation; past member, Division of Taxation Steering Committee
- Member, American Law Institute
- Member, American College of Real Estate Lawyers
- Member, American College of Tax Counsel
- Member, American College of Trust and Estate Counsel
- DISTINGUISHED SERVICE AWARD, 2015, American Bar Association, Tax Division
- Member, DC Tax Revision Committee – tasked with advising the Mayor and Council of DC on suggested changes in the DC tax landscape
- Professorial lecturer of law, George Washington University Law Center, 1970 – 1990
- Adjunct professor, Georgetown University Law Center, 1990 – 2015
- Adjunct professor, University of Michigan Law School, 2010 – present
- Advisory board member, Real Estate Taxation (LexisNexis)
- Advisory board member, Practical Tax Strategies (Thomson Reuters)
Show Notes
Current Role & Origins
- Thought 55 years billing by the tenth of the hour was enough. Still counseling people on a pro bono basis. He teaches at Michigan Law- Business Planning and Taxation and at Georgetown- Course in Entrepreneurship (5:05)
- He is a Michigan undergraduate and law school graduate and likes to go the Big House in Ann Arbor almost every Fall (6:45)
- Roots- Born in Detroit and moved to Flint, MI (8:00)
- His Dad was an insurance salesman
- Went to Flint Central HS (8:35)
- Then went to Flint Community College (8:55)
- Went to Michigan Business School undergraduate and then on to Michigan Law School (9:00)
Education- Michigan Business then Law Schools
- Always going to law school but did not want to be a litigator (10:30)
- His Uncle was a CPA and advised him to take business courses (10:50)
- Didn’t want to take financial risk that business people took (11:30)
- Took tax accounting in business school and was hooked by the tax code and its complexity and “alternatives” (12:10)
- Loved the “puzzle” of tax law (14:00)
- Professor L. Hart Wright– Famous Tax Law Professor (14:30)
- Helped develop sections of the IRS Code
- Loved Property Law (Michigan now doesn’t require property law) (16:25)
- Didn’t like Criminal Law, but all the others he enjoyed (17:10)
- Loved learning (17:25)
- No interest in litigation (17:35)
- Doesn’t understand how to “defend” people that were criminals (18:50)
- Wouldn’t represent someone he was not comfortable working with. (19:30)
- Met his wife at Michigan and his children went there (20:15)
- Never pulled an “all nighter” in school (21:30)
- JD- 9th out of 300 in his law school class (22:00)
Career
- Career- Left Michigan for DC (23:10)
- Took U.S. Tax Court clerkship out of law school (23:40)
- Subsequently interviewed at Arent Fox…his only interview and became the 23rd lawyer in the firm (24:10)
Arent Fox
- Arent Fox- 1964- 1974 (25:30)
- Great learning experience with several great lawyers (25:50)
- Started at $7,500/yr. and billed at $30/hour (26:20)
- Al Arent, Ed Kahn, David Osnos,Earl Colson
- Grown to 130 lawyers by 1974 (27:00)
- Story about meeting someone who had been at the firm for two years he had never met and thought it was “too big” (27:15)
- David Osnos, Earl Colson, Jack Sexton taught him the real estate law practice (28:00)
- Ed Kahn & Jack Sexton story about represented PMI- Kingdon Gould and Nick Antonelli– Meeting with Nick Antonelli and was told “don’t you dare screw up this deal” on a ground lease for the corner of Connecticut and M St. NW (28:20)
- Mantra for young lawyers- stay away from business decisions and be counselors (30:00)
- His law school professors knew he would be a “practical” counsel not a theoretician (30:30)
- He takes “practical” approaches to things (31:00)
- David Osnos story- Phil Chenier story and then reference to Steven Covey’s “Seven Habits…” book about listening. Osnos preached listening and “don’t impede a deal” (33:20)
- Don’t talk first
- Keep the end in mind
- Too many lawyers think they are smarter than others (35:45)
- Attitude out of Harvard Law was different (36:00)
- #1 non-governmental business was real estate in 1964. #2 business then was printing due to government document needs (37:00)
- Government Printing Office (38:05)
- Began teaching Corporate Tax law at George Washington University in 1969 (38:25)
- Decided he didn’t want to be beholden on transactions so he diverted to tax law advisory practice
- Judge Tannenwald recommended him (39:15)
- Realized that there was no book for tax planning for real estate owners and he built a course and a practice around it (40:30)
- Only a few law firms have focus on tax implications in real estate- Limited Partnerships (41:00)
- Starts with basis (41:40)
- Entity formation (41:50)
- Liability issues (42:00)
- Deductibility
- Capitalization, Depreciation
- Wrote a treatise on real estate tax law from 1984-1989 (42:30)
- Pre- 1986 Tax Law thought process (42:45)
- Lending was overly aggressive and financing was absurdly underwritten (43:00)
- Stories about institutions who went down and didn’t look at fundamentals (44:30)
- Classes at GW had up to 125 students during the period between 1969-89 (46:00)
- Real estate tax law course- he told his students about “cycles” (45:45)
- Negative capital account issues (48:00)
- Using loan as basis creates a real tax problem when values dropped below their basis and they were taxed on income that was “phantom” due to tax write-offs (48:15)
- Reference to Bob Kettler on land acquisitions (50:35)
- Discussion about syndications (52:00)
- Represented the National Realty Committee looking at limited accounting losses (52:20)
- Tax Reform bill of 1986 treatment of income (53:15)
- Active, Investments, Passive (53:30)
- One deal that changed the law- Marriott Corporation (54:50)
- Real estate is a “dead asset” for companies not in the real estate business (56:00)
- Land is a “dead asset” except for value appreciation (56:30)
- Bender family (Blake Real Estate)- Met them through one of his students (58:00)
- Gary Rappaport (59:00)
- His “Grandfather” (59:30)
- Robert Gottlieb helps with transactions
- Told Gary how to structure his first deal (1:00:30)
- Gary uses examples to “put skin in the deal” (10% typically) (1:01:15)
- Carried Interest and Promote- virtually the same thing (1:01:40)
- Focused on capital gain (1:02:25)
- “Sweat equity”- Receive say 5% of a transaction, yet no cash flow until investors received a return on capital and of capital (1:02:50)
- 1031 Tax Deferred Exchange- limited to real estate (“Like Kind Exchange”) (1:04:50)
- Story of over financing a property in 1988 where a broker contacts him about an exchange possibility (paid off the debt and provided excess proceeds) (1:06:30)
Tucker Flyer
- 1975- Start of Tucker, Flyer law firm (1:08:40)
- Michael Flyer was founding partner with him (1:09:00)
- Bring in enough business to cover $250,000 in cost (1:10:00)
- Brought in small clients (1:10:30)
- M.B. Hariton and Company– Accounting firm that referred business to him (1:11:00)
- Used Estate Planning to bring people into the firm (his hook) to help them think through tax planning, M&A (1:11:30)
- Fear of personal liability was the driver to his business (1:12:50)
- Carve outs of personal liability from loan documents- waste, fraud, environmental risk (1:13:30)
- Tax consequences of bankruptcy (1:15:00)
- Make sure you would handle the workout and not let a trustee to muddle the tax aspects (1:15:30)
- Recourse vs. Non-recourse issues are not “equity” issues they are statutory (1:17:40)
- Tax implications affected workouts with banks (1:18:00)
- National influences have impact on the market (1:19:30)
- Meeting with Trammell Crow told him about leasing as the basis (1:20:20)
- Leases are the most important document in real estate (1:21:00)
- Smaller players find their niche (1:22:00)
- Cited EYA (1:23:00)
- Dichotomy between large companies and smaller firms (1:23:10)
- NAREIT (1:24:15)
- Sam Zell- Fraternity brother of his buying homes in Ann Arbor during school (1:24:30)
- Venable merger (1:26:00)
- Lifestyle makes a good law firm (1:26:15)
- Considered clients to be “partners” (1:28:00)
- In late 1990s they were representing a few tech companies and didn’t have securities practice for IPOs and other SEC expertise
- Entrepreneurs were clients
- Looked at Sutherland, and then Piper Marbury and finally Venable in 1999 to merge (Michigan connection) (1:29:15)
- Business development (1:33:30)
- Learned to answer questions while teaching (1:34:00)
- Focus on CPAs, life insurance agents, and financial advisors (1:34:20)
- Give & Take, by Adam Grant- he became a “matcher” who would refer back to him when he referred to them (1:34:50)
- UPREIT and CMBS Markets (1:35:45)
- Involved with Taubman Company with UPREIT strategies (1:36:00)
- Contribute to a partnership and had no gains (1:36:50)
- Umbrella Partnership Real Estate Investment Trust (1:37:00)
- Contribution of partnership interests to keep tax basis for 15 years entering into the REIT ownership
- REITs started in 1960 (1:39:15)
- 1970s- Mortgage REITs (1:39:40)
- Wash REIT (1:40:00)
- CarrAmerica, Smith Residential (1:40:45)
Philosophies, Teachings and Practices
- Advisors to clients and we are not at risk- Explain facts for alternatives (1:41:30)
- People are visual- show diagrams (1:42:30)
- Punch points (1:42:45)
- Never respond on a complex issue online- will call to discuss (1:43:00)
- Advised clients not to do something where they may not take his advice (1:43:45)
- Tax advice can go awry sometimes requiring significant planning, but he has never been sued for an error (1:44:00)
- Never revised document on the internet (1:44:45)
- Uses different colors for noting (1:45:00)
- Purple- Essential
- Red- Premise
- Green- View
- Blue- Dictum
- Couldn’t stay up late and had two jobs while in law school (1:46:45)
- 18 points he cites (see link) (1:47:45)
- He shares his experiences with his mentors (1:50:00)
- Wendy White philosophy discussion
- His credo for his practice (1:51:00)
- Listen and hear what they are saying
- Understand they are your client
- You are not smarter than your client
- Desire for speed is a problem today (1:52:00)
- His top rate was $750/hr. and some partners charged $1200-1500/hr. (1:52:30)
- Associates need time to review and be thorough (1:53:15)
- Artificial Intelligence may have some relevance in forms; however, some forms don’t address all the issues (cites Notice provisions) (1:54:20)
- Negotiations (1:56:15)
- Listen before talking
- Keep the end game in mind
- Don’t yell, but get quieter
- Learned how to read “upside down” writing
- Clients on other side would call him (1:58:15)
- See 18 points (cited)
- Pandemic influence in law firms (2:00:00)
- Already reducing space prior to pandemic
- Mentoring young associates is hard to do with informal teaching (2:03:00)
- Body language (2:03:25)
- Less space
- Hoteling (2:04:00)
- Law is now a business and not a “profession” that he remembers (2:06:00)
- Steve Guttman– Storage in old office buildings in Long Island, NY (2:08:00)
- Believes office will convert to storage and distribution
- Citation of Charlie Nulsen redevelopment of self storage to office
- Learnings as a teacher (2:11:15)
- Evolution of students wanting to learn to wanting a “certificate” and not as much to learn (2:11:40)
- Undergraduate students usually want to learn (2:12:15)
- Practicum- He teaches a practical negotiation of a document with a large corporation and entrepreneurial person (2:12:50)
- Customer Service (2:15:00)
- Washington Prime bankruptcy- evidence of regional mall evolution (2:16:15)
- Haft Family representation of Robert Haft against his father, Herbert Haft (2:17:00)
- Citation of Kathy Bonnafe testimony in bankruptcy court for Combined Properties
- Steph discusses the strife caused by the Haft family battles
- Westreich family (2:18:00)
- Story about drafting a will (2:20:30)
- ESG- He discusses liability on environmental issues (2:21:20)
- Family first…giving back he was on a scholarship and set up a scholarship at U-M Law School (2:23:15)
- Advice to 25 yr. old self- Listen and take on more things as well as understanding a broader sense (2:24:00)
- “Never stop learning“(2:25:25)
