Stephen A. Sherman

Stephen serves as Counsel to the Firm in Stoll Keenon Ogden’s Louisville office and has been with SKO for more than 10 years. He contributes to the Tax practice and also the Business Services practice with a focus on Health Care.

Tax: Working with clients ranging from individual persons to publicly traded companies, Stephen offers his expertise in matters concerning all areas of taxation, including corporate and personal income tax, wage assessments, excise tax and property tax as well as tax exemptions, credits and tax-related issues. Involved in all aspects of local, state and federal taxation, Stephen has extensive experience in complex tax planning, audit defense and tax controversies. He has represented clients before state revenue agencies, the IRS, and state and federal courts. He has significant expertise in tax-motivated transactions and the negotiation and implementation of tax incentives, including like-kind exchanges, corporate income tax credits, property tax abatements, New Markets Tax Credit Program and Historic Rehabilitation Tax Credit.

Health Care: Stephen represents providers from both nonprofit and for-profit organizations in various general business matters, such as employment matters, practice sales, mergers and acquisitions, and separations. He supports his clients in regulatory matters by applying for and challenging Kentucky Certificates of Need and other licensure requirements and assisting in Medicare and Medicaid audits and reimbursement disputes. He also advises on compliance with state and federal laws, including the Stark Law, Anti-Kickback Statute and False Claims Act.

Business Services: Stephen’s proficiency in tax law, along with his knowledge of business concerns, including the unique challenges faced by health care systems, makes him a valuable asset to clients involved in business activities spanning from mergers and acquisitions to contract negotiations.

Civic Leadership

• Community Catholic Center, Inc., Board Member, 2009-2012

• St. Martin of Tours, Parish Council, 2018-present

• Knights of Columbus

• Angels in Disguise, Board Member and Secretary, 2022-Present

Work Highlights

Tax Planning

Represented two major ophthalmology practices in the sale of their Kentucky and Indiana-based practices and associated ambulatory surgery centers to another business based in Missouri. The first $33 million transaction was structured as an asset purchase and the Second $30 million transition was structured as a stock purchase.

Related Practices: Business Services, Tax, Healthcare

Sale of Kentucky and Indiana-based Ophthalmology Practices

Represented two major ophthalmology practices in the sale of their Kentucky and Indiana-based practices and associated ambulatory surgery centers to another business based in Missouri. The first $33 million transaction was structured as an asset purchase and the second $30 million transition was structured as a stock purchase.

Related Practices: Business Services, Healthcare, Mergers & Acquisitions

Reorganization, Refinancing and Acquisition of Major Healthcare Entity

Stoll Keenon Ogden represented a major healthcare services entity, its affiliated upstream and sister companies, its owners and its founding management team in comprehensive reorganization, refinancing and acquisition transactions totaling more than $300 million. The matters resulted in the closing of a senior secured term loan and revolving credit facilities secured by owned senior care facilities in four states with a 9-member syndicate of commercial banks; the requisition of waivers, consents and estoppels from various property lessors on leased senior care facilities in four states; restructuring of upstream holding companies and combination of two upstream ownership groups and boards of managers; the creation of a management company; the introduction of healthcare facility management agreements; the migration of payroll and benefits for more than 7,000 employees; the related restructuring of multiple lease and debt financing and supplier relationships; the creation and reorganization of multiple SPE organizations accompanied by extensive non-consolidation analysis and issuance of a substantive non-consolidation opinion to the lending syndicate; the exercise of purchase option and acquisition of multiple senior care facilities; the contribution of additional equity capital from the client’s majority owners; and the amendment and restructuring of multiple Master Lease and inter-creditor agreements.

Related Practices: Business Services, Labor, Employment & Employee Benefits, Tax, Bankruptcy & Financial Restructuring, Corporate Finance & Lending, Healthcare, Mergers & Acquisitions

Local Hotel Taxes

Successfully defended online travel companies in litigation by three local governments seeking to collect local hotel taxes. Louisville/Jefferson County Metro Govt., Lexington-Fayette Urban County Govt., et al. v. Hotels.com, L.P., et al., 590 F.3d 381 (6th Cir., 2009).

Related Practices: Tax, Class Action

Utility Gross Receipts License Tax

Successfully represented a provider of utility services in an appeal of a utility gross receipts license tax assessment that reduced their liability by $2.5 million.

Related Practices: Tax

Planning

Advised client with respect to like-kind exchanges of multiple properties under Section 1031 of the Internal Revenue Code involving exchange proceeds in excess of $17 million.

Related Practices: Tax

Purchase of Gas/Food Marts

Represented an oil company in the purchase of the assets and business of six gas and food mart locations.

Related Practices: Business Services, Tax, Mergers & Acquisitions

News

Seven SKO Attorneys Selected for Community Leadership Roles, Aug. 13, 2012

Publications

SUMMARY OF 2022 KENTUCKY TAX REFORM LEGISLATION, Mar. 4, 2022

Beware! Some CARES Act Relief is Exclusive of Others, Apr. 28, 2020

Early 401(K) Distributions in a Time of COVID, Apr. 23, 2020

Delayed Tax Return And Payment Due Dates, Apr. 15, 2020

Summary of KY H.B. 351 (2020) and Related Revenue Measures, Apr. 15, 2020

CARES Act Alters Charitable Deduction, Apr. 8, 2020

Few Options for Local Government to Address Increased Pension Obligations, May 21, 2019

Kentucky General Assembly Passes $105 Million Tax Decrease, Mar. 15, 2019

Kentucky General Assembly Passes $395-500 Million Tax Increase, Apr. 18, 2018

Lowering the FBAR, Mar. 20, 2018

Because Divorce Wasn’t Rough Enough, Let’s Toss in Some Tax, Jan. 10, 2018

COST FALL 2017 – Kentucky State and Local Tax Developments, Oct. 10, 2017

Kentucky Claims Commission Holds Tax Credits Must Be Excluded from Value of Low-Income Housing, July 25, 2017

Kentucky Supreme Court Strikes Down Provision of State’s Telecommunications Tax, July 10, 2017

Growing Your Business? Don’t Forget About State and Local Economic Development Incentives, Apr. 18, 2017

Relying on Tax Advice Versus Delegating Duties, Apr. 6, 2017

COST SPRING 2017 – Kentucky State and Local Tax Developments, Apr. 4, 2017

COST FALL 2016 – Kentucky State and Local Tax Developments, Oct. 4, 2016

COST SPRING 2016 – Kentucky State and Local Tax Developments, Apr. 4, 2016

Kentucky’s Highest Property Tax Rate Applied to “Private” Aircraft, Oct. 5, 2015

Federal Court Finds Kentucky Owes Refund of Fuel Taxes, Sep. 4, 2015

The Kentucky Board of Tax Appeals Finds Agricultural Valuation Methodology for Woodlands Valid, June 24, 2015

Spring 2015 Kentucky State and Local Tax Developments, May 26, 2015

Fall 2014 Kentucky State and Local Tax Developments, Oct. 1, 2014

Kentucky Department of Revenue Adopts Emergency Regulation for New Markets Development Program, July 1, 2014

Regulatory Change to Telecommunications Resale Exclusion Conformed to Statutes and Was Valid, July 1, 2014

The Limestone Tax Credit is Not Limited to Sales Consummated Outside Kentucky, Mar. 10, 2014

“Goods Stored in a Warehouse” Must Leave and Never Return to Obtain Property Tax Exemption, Feb. 1, 2014

What You Should Know About a New IRS Rule for 2014, Jan. 24, 2014

Amended Regulation Reflects New Law Increasing the Likelihood of “Addback” of Intercompany Management Fees, Dec. 21, 2013

Everything is Different if the Land is Agricultural, Dec. 21, 2013

Accountability for Kentucky’s Ghost Governments – 2013 HB 1, Apr. 29, 2013

Kentucky Attorney General Rules Constitutional Amendment Required for Authorization of Local Option Sales Tax, Jan. 6, 2013

Analysis: What is the Fiscal Cliff?, Dec. 1, 2012

Seminars

Presentation to Kentucky Investors and Developers, Overview of Federal Opportunity Zone Legislatio, 2018

Presentation to the Kentucky Association of Manufacturers, Annual Business Briefing, Tax Incentives for Manufacturers, 2017

Presentation to MainSource Bank, Kentucky State Tax Incentives, 2017

Tax Incentives for Manufacturers, Kentucky Association of Manufacturers Business Briefing, 2016

Presentation to Council on State Taxation, Mid-West Regional State Tax Seminar, Special Report: State Tax Issues Related to IRC 385 Regulations and State Tax Haven Legislation, 2016

Presentation to Stock Yards Bank & Trust Company, Kentucky State Tax Incentives, 2016

Special Report: State Tax Issues Related to IRC 385 Regulations and State Tax Haven Legislation, Council on State Taxation, Mid-West Regional State Tax Seminar, 2016

Kentucky State Tax Incentives, Stock Yards Bank & Trust Company, 2016

Sales and Use Tax in Kentucky, National Business Institute, 2015

Like-Kind Exchanges, University of Louisville Grief Institute, 2014

Limited Liability Entity Taxation and Planning, University of Louisville Grief Institute, 2013

Kentucky Sales and Use Tax for Manufacturers, Hitachi Automotive Products, 2013

12 Tax Topics in 120 Minutes, Louisville Bar Association, 2012

The Fiscal Cliff, Marion County Economic Development Office, 2012

Let the Government Be Your Silent Partner: Tax Incentives in Kentucky, Kentucky Society of CPAs, 2011

Saving Green by Going Green in the Bluegrass: Kentucky Tax Incentives for Green Businesses, Greater Louisville Inc., 2011

Interest Charge Domestic International Sales Corporations, Greater Louisville Inc., 2011

Tax Credits, Government Loans, Government Guarantees and Other Incentives Available for Businesses, SKO 22nd Annual Spring Keeneland Seminar, 2011

Independent Contractor versus Employee: Why it Matters, Louisville Association of Paralegals, 2011

Kentucky Local Occupational License Taxation, Louisville Grief Institute, 2010

Kentucky Economic Development Incentives: A Summary of 2009 House Bill 3 Incentives for a New Kentucky, Kentucky Commercial Real Estate Alliance, 2010

Ethics and the Standard of Care for Tax Practitioners: Guidelines in Practicing Tax, Louisville Bar Association, 2010

Affiliations

• American Bar Association

• Louisville Bar Association

• Kentucky Bar Association

• Council on State Taxation

• Kentucky Association of Economic Development

• Louisville Bar Association, Leadership Academy, 2012

• Louisville Bar Association, Taxation Section Chair, 2012, Vice-Chair, 2011

• Kentucky Bar Association, Health Care Law Section, Secretary, 2018-2022, Chair-Elect 2022-Present