To B or not to B: distinctions between B and reverse triangular reorganizations defy logic but provide flexibility in restructuring

Article Abstract:

B reorganizations and reverse triangular mergers allow for greater freedom in planning corporate restructurings than do Subchapter C reorganizations. Reverse triangular mergers are allowed by IRC Sections 368(a)(1)(A) and 368(a)(2)(E) while B or stock-for-stock reorganizations are allowed by Section 368(a)(1)(B). These restructurings use different approaches to allow acquiring corporations and their targets to trade stock while keeping the target firm in existence. Stock basis and debt discharge income are among the factors that determine which approach is more advantageous.

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Bootstrap acquisitions and (all of) the loss disallowance rules

Article Abstract:

Corporations' tax benefit from disallowing losses related to bootstrap acquisitions has been limited by Sections 337 and 267 of the Internal Revenue Code. This type of acquisition consists of stock sales structured as redemptions of stock by the target of the acquisition. Corporations planning such a bootstrap structure should consult both sections to find out to what extent they can disallow their losses.

Taxation, Acquisitions and mergers, Corporate taxes, Corporations, Income tax

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New rules of the game: the SEC regulates tax opinions

Article Abstract:

This article reviews and evaluates new SEC policies on tax opinions issued as part of corporate reorganizations.

United States, Tax law, Practice, Powers and duties, Disclosure (Securities law), United States. Securities and Exchange Commission

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