Originally published in State Tax Notes, July 23, 2012.

This is the first installment in a series that will examine state and local tax (SALT) questions implicated by the purchase, sale, and reorganization of business enterprises. The goal of the series is to share tax knowledge ranging from broad discussions of topical themes to detailed analyses and critiques of current merger and acquisition (M&A) controversies and developments.

One area in which sustained M&A activity is predicted for 2012 involves tax-free spinoffs by companies trying to create value for their shareholders. This is good news because it suggests that as economic growth and global commerce continue to heal from the traumas wrought by the Great Recession, overall M&Aactivity should pick up in 2012 and into 2013.