The proposed Section 338 regulations: some good news from General Utilities repeal
Article Abstract:
The IRS on Jan 29, 1992 issued Proposed Regulations that would greatly limit the applicability of the consistency rules of IRC Sections 338(e) and (f). Consistency rules control the how much tax a corporation must pay when it buys the stock or assets of a liquidating corporation. The simplification and narrowing of consistency rules was necessitated by the 1986 repeal of the General Utilities doctrine that prevented liquidating firms from profiting from the sale of assets. The Proposed Regulations would abolish stock consistency rules except when needed to support asset consistency rules.
Publication Name: Journal of Corporate Taxation
Subject: Law
ISSN: 0094-0593
Year: 1993
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Loss corporations on the threshold of an ownership change: "safe" transactions under Section 382
Article Abstract:
Section 382 of the Internal Revenue Code allows loss corporations a significant degree of flexibility in planning ownership changes despite limiting the carrying forward of net operating losses and other tax attributes. Loss corporations can gain flexibility by using transactions with options such as buying-in options. Also, corporations can use transactions involving stock that will have a minimal impact on the 'owner shift' posture. These devices will help avoid the losses that otherwise would result from Section 382.
Publication Name: Journal of Corporate Taxation
Subject: Law
ISSN: 0094-0593
Year: 1992
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Using Class B stock to avoid Subpart F income: the continuing saga
Article Abstract:
Corporations with Subpart F income should consider adopting a new structure in which earnings from controlled foreign corporations (CFCs) are deferred from taxation. The new structure consists of a CFC-1 that controls a US subsidiary that in turn controls a tax-haven CFC-2 through 100% ownership of Class B nonvoting stock. This structure allows parent corporations to avoid deferred tax on CFC income by not attributing it to US shareholders. Such an ownership structure is permitted by the Internal Revenue Code.
Publication Name: Journal of Corporate Taxation
Subject: Law
ISSN: 0094-0593
Year: 1992
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