Substantive consolidation: A tale of two cases
Because there is no clear statutory guidance for how a bankruptcy judge determines if a trustee’s request to apply substantive consolidation should be granted, each case is different.
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Because there is no clear statutory guidance for how a bankruptcy judge determines if a trustee’s request to apply substantive consolidation should be granted, each case is different.
Meeting the active trade or business requirement is critical to ensuring a corporation leasing farmland qualifies for a tax-free divisive reorganization.
The IRS is introducing an 18-month pilot program under which it will once again issue letter rulings concerning the general income tax effects of stock distributions under Sec. 355.
The IRS ruled on how the distribution of stock is treated in a tax-free reorganization and whether there is any potential recognition of gain.
The IRS withdrew rules it proposed in 2005 that would have required certain corporate formations and reorganizations to meet net value requirements before they would qualify for nonrecognition treatment.
The IRS is introducing an 18-month pilot program under which it will once again issue letter rulings concerning the general income tax effects of stock distributions under Sec. 355.
The IRS says it will again issue rulings on corporate leveraged spinoff transactions.
The IRS withdrew rules it proposed in 2005 that would have required certain corporate formations and reorganizations to meet net value requirements before they would qualify for nonrecognition treatment.
The House Blueprint, if enacted, may provide incentives for certain taxpayers to merge in the future.
The IRS says it will again issue rulings on corporate leveraged spinoff transactions.
The proposed regulations are intended to further limit a corporation’s ability to separate business assets from nonbusiness assets in a tax-free manner.
Carrying over E&P from one entity to another and administrative burdens can lead to headaches down the road.
The tension between the two principles of the new regulations can cause taxpayers uncertainty.
The application of the business purpose and device rules often involves both legal and factual questions.
A taxpayer that treats a split-off transaction as a tax-free D reorganization must be able to prove to the IRS that the transaction meets all requirements.
A Sec. 338 election can provide benefits to buyer and seller, but the transaction must be structured so that it satisfies the conditions to be a qualified stock purchase.
An S corporation was not eligible to elect the safe harbor since it was the target of the acquisition, and it must capitalize the success-based fees that it claimed as an expense.
The IRS issued guidance that provides safe harbors for corporations, under which the IRS will not assert that a distributing corporation lacks control of another corporation within the meaning of Sec. 355(a)(1)(A).
This item discusses these rulings along with the technical aspects surrounding their issuance and addresses whether the IRS reached the right results.
The IRS issued regulations restricting the ability of C corporations to use this method.
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TAX RELIEF
Quirks spurred by COVID-19 tax relief
This article discusses some procedural and administrative quirks that have emerged with the new tax legislative, regulatory, and procedural guidance related to COVID-19.