When must a hedge be identified and accounted for tax purposes? Taxpayers must identity each hedging transaction and the item it hedges. A taxpayer must clearly identify a hedging transaction “before the close of the day on...more
What is the “tax character” of a hedge? A taxpayer receives ordinary gain or loss on qualified hedges that have been properly identified in accordance with Treasury Regulation § 1.1221-2. This allows a taxpayer to ensure that...more
Enterprise Risk Management is widely used in many industries and businesses. Risk managers use increasingly sophisticated approaches, methods, analytics, and frameworks to manage complex, interrelated, and interconnected...more
Wind farm owners and project sponsors have increasingly turned to corporate power purchase agreements (PPAs) and other hedging alternatives to secure predictable cash flows. Depending on the structure of these agreements,...more
Reuters has an interesting article about a no-action letter the CFTC issued to Southwest Airlines to permit a 15 calendar day delay in reporting oil derivative transactions. Southwest apparently convinced the CFTC that rapid...more