Corporate Taxes, Section 355, IRS

Today in Tax: Spin-off Structures in Mergers & Acquisitions

Miller Nash LLP on 11/17/2021

Brief commentary on the past week’s cases, rulings, notices, and related federal tax guidance. Corporations Permitted to Rely on Public Shareholder Data to Confirm Qualification for Tax-Free Spin-off and Subsequent Merger...more

IRS Ruling May Further Signal a Relaxation of “Collection of Income” Prong of Tax-Free Spin-off Active Trade or Business Test

Wilson Sonsini Goodrich & Rosati on 3/12/2020

On February 28, 2020, the Internal Revenue Service (IRS) released private letter ruling 202009002 (the PLR), which concluded that an absence of income does not, under the facts of the PLR, prevent a line of business from...more

You Can Spin It Off Or Split It Up, But Keep It Active

Farrell Fritz, P.C. on 1/13/2020

A couple of months back, a local business reporter asked whether I could identify one kind of corporate transaction that was occupying more of my time than any other. When I asked whether they were referring to any specific...more

Spin-off Revival: IRS Rethinks the Active Trade or Business Requirement

Smith Anderson on 1/28/2019

The “five-year active trade or business” or “ATB” requirement of section 355 is notorious for defeating many otherwise promising tax-free spin-off transactions. Consider the following common scenarios... Originally...more

IRS May Relax Collection of Income Prong of Section 355 Active Trade or Business Test for R&D Companies

Wilson Sonsini Goodrich & Rosati on 9/28/2018

On September 25, 2018, the Internal Revenue Service (the IRS) released a statement announcing a study of the "active trade or business" test for tax-free spin-offs under Section 355 (the ATB Test), as applied to...more

IRS Resumes Issuing Transactional Spin-Off Rulings

Proskauer - Tax Talks on 9/25/2017

On September 21, 2017, the Internal Revenue Service (the “IRS”) issued Revenue Procedure 2017-52 (the “Rev. Proc.”), introducing an 18-month “pilot program” in respect of corporate “spin-off,” “split-up” and “split-off”...more