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.
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Formation, Liquidation & Reorganization
IRS will rule on leveraged spinoffs again
The IRS says it will again issue rulings on corporate leveraged spinoff transactions.
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.
Potential merger incentives resulting from proposed tax reform
The House Blueprint, if enacted, may provide incentives for certain taxpayers to merge in the future.
Leveraged spinoffs removed from IRS no-ruling list
The IRS says it will again issue rulings on corporate leveraged spinoff transactions.
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.
Uncertainty Surrounding Back-to-Back F Reorganizations
The tension between the two principles of the new regulations can cause taxpayers uncertainty.
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.
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.
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.
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.
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.
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).
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.
Tax-Free REIT Spinoffs Are Curtailed
The IRS issued regulations restricting the ability of C corporations to use this method.
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.
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.
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.
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.
IRS Finalizes Potential F Reorganization Rules
Corporations that meet six requirements will be able to effectuate F reorganizations tax-free in some cases.
TAX PRACTICE MANAGEMENT
2025 tax software survey
AICPA members in tax practice assess how their return preparation software performed during tax season and offer insights into their procedures.
