Corporation Formation, Liquidation & Reorganization

Topics

July 12, 2017

IRS withdraws proposed net value requirement rule

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.

July 1, 2017

Potential merger incentives resulting from proposed tax reform

The House Blueprint, if enacted, may provide incentives for certain taxpayers to merge in the future.

May 10, 2017

Leveraged spinoffs removed from IRS no-ruling list

The IRS says it will again issue rulings on corporate leveraged spinoff transactions.

April 1, 2017

Proposed ‘hot dog stand’ regulations for spinoffs

The proposed regulations are intended to further limit a corporation’s ability to separate business assets from nonbusiness assets in a tax-free manner.

February 1, 2017

Uncertainty Surrounding Back-to-Back F Reorganizations

The tension between the two principles of the new regulations can cause taxpayers uncertainty.

February 1, 2017

When Entity Simplification Is Not So Simple

Carrying over E&P from one entity to another and administrative burdens can lead to
headaches down the road.

January 1, 2017

IRS Eliminates No-Rule Policy for Business Purpose and Device Rule Issues

The application of the business purpose and device rules often involves both legal and factual questions.

January 1, 2017

How to Document a Tax-Free D Reorganization With a Split-Off

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.

November 1, 2016

Acquired Taxpayer Is Not Eligible for Success-Based Fee Safe Harbor of Rev. Proc. 2011-29

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.

November 1, 2016

Transaction Pursuant to Qualified Stock Purchase Treated as Distribution in Liquidation

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.

July 15, 2016

IRS Provides Safe Harbors for Acquisition of Control in Certain Corporate Transactions

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).

July 1, 2016

Double and Triple Drops With Liquidations Clarified in Pair of Revenue Rulings

This item discusses these rulings along with the technical aspects surrounding their issuance and addresses whether the IRS reached the right results.

June 7, 2016

Tax-Free REIT Spinoffs Are Curtailed

The IRS issued regulations restricting the ability of C corporations to use this method.

May 1, 2016

New Legislation Restricts Tax-Free REIT Spinoffs

The legislation curbs a popular tax planning strategy by severely restricting the application of tax-free spinoff treatment.

May 1, 2016

Gain and Loss Recognition Under Sec. 356(c)

The Tax Court discussed the application of the “boot” rules under Sec. 356 in a tax-free reorganization.

March 21, 2016

Regulations Finalize Coordination Rules for Outbound Reorganizations

The IRS issued regulations that eliminate an exception to the coordination rule between asset transfers and indirect stock transfers for certain outbound asset reorganizations and modify an exception to the coordination rule.

February 1, 2016

Final F Reorganization Regs. Might Make Treatment Available for Reverse Mergers

A company that uses a reverse merger to go public generally would like to structure the merger as a tax-free reorganization.

December 1, 2015

IRS Finalizes Potential F Reorganization Rules

Corporations that meet six requirements will be able to effectuate F reorganizations tax-free in some cases.

November 1, 2015

Acquisition of Partnership Interest Constitutes an Expansion of Distributing Corporation’s Business

The IRS ruled that a distributing corporation’s
acquisition of an interest in a partnership was not an acquisition of a new or different business.

October 1, 2015

IRS Expands Range of D Reorganizations, Highlights Importance of the Form of a Taxpayer’s Transaction

IRS rules expand the range of transactions that qualify as type D acquisitive asset reorganizations and signaled a greater willingness to accept a taxpayer’s chosen form of reorganization transaction.