More balm for the beleaguered in latest 382 proposed regulations

Article Abstract:

IRC section 382 proposed regulations include a more flexible debt relief exception when a company is restructuring under bankruptcy than section 382(1)(5) by changing small and cash issuance segregation rules and selective triggering rules. The regulations are an appropriate balance between tax policy needs, promoting corporate restructuring and preventing abuse of the provisions. Option and segregation rules have been eased to help bankrupt corporations restart their businesses with additional capital. These changes should be analyzed by loss corporations for retroactive application.

Finance, Corporations, Corporate finance, Bankruptcy reorganizations, Bankruptcy reorganization

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Attributional nexus: waiting for the levee to break

Article Abstract:

The scope of states authority to tax the income and sales of corporations that have very limited contact with the state is based on whether a sufficient nexus with the state can be established. Taxation of corporations without direct contacts with the state, such as incorporation there, is based on analysis that is similar to Commerce Clause analysis of whether a state has the power to regulate commerce. A number of states have attempted to broaden the definition of nexus, and expand their tax base, by claiming a sufficient connection to the state via affiliated corporations.

Corporate income taxes, Jurisdiction

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New 382(1)(5) and (1)(6) regulations provide relief in certain corporate bankruptcy restructurings

Article Abstract:

Congress approved two new bankruptcy regulations, 382(1)(5) and (1)(6), to encourage troubled restructurings outside of Title 11 or similar reorganizations through reforming net operating loss limitations. Section (1)(5) removes the annual limitation on pre-ownership change losses after they have been reduced by certain interest deductions. Section (1)(6) makes the annual limitation computation more flexible. Eligibility requirements include a 50% continuity of ownership by pre-change shareholders and qualified creditors under 382(1)(5)(E).

Analysis, Tax deductions, Corporate reorganizations, Recognition of gain or loss (Taxation), Recognized gain or loss (Taxation)

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