Alston & Bird Tax Blog

Federal Tax Advisory

Federal Tax Advisory – Eliminating a Domestic Sandwich LTR 201250004

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This advisory discusses LTR 201250004, which involved a domestic corporate Parent’s purchase of a foreign group that had one domestic subsidiary, and summarizes the specific steps that were taken in this situation.

The advisory is provided in PDF on the Alston & Bird website: 
www.alston.com/advisories/federal-tax-advisory-january-2013

Federal Tax Advisory – GLAM 2012-007

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This advisory discusses a general legal advice memorandum (GLAM) in which the IRS Chief Counsel advises the field that a subsidiary does not enter a corporate group when the common parent buys the stock needed for affiliation for a note carrying below-market interest so as to compel the seller to exercise its right to take the stock back after two years. The advisory is provided in PDF on the Alston & Bird website: www.alston.com/advisories/federal-tax-advisory-december-2012 [...]Read more

Federal Tax Advisory – World’s Longest Letter Ruling

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This advisory discusses LTR 201240017—the world’s longest letter ruling, 111 pages in PDF format. Not surprisingly, it is a Section 355 ruling. It was issued three-and-a-half months after the original submission, with those dates bridging Christmas and New Year’s Day. There were seven additional submissions from the taxpayer in the interim. The release of the ruling was delayed for a couple of months. As best as this reader can tell from spending a couple of hours with the ruling, there is not groundbreaking legal news in it, but then you can’t be sure about 111 pages. [...]Read more

Federal Tax Advisory: F Reorganizations and Double Dummies

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This advisory discusses LTR 201222014, which ruled that persons contributing property to a new corporation in exchange for stock can form a control group with other persons contributing the stock of another corporation (target), and therefore enjoy Section 351 nonrecognition treatment. This might seem obvious to practitioners familiar with combined reorganization/351 contributions that were first treated favorably under Section 351 by LTR 9143025. The transaction often takes the form of a double dummy drop down, whereby a new holding company puts the contributed property in one subsidiary and holds [...]Read more

Federal Tax Advisory – Short Sales and CFCs

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Short sales are either everyday events or mysterious to most people. This advisory discusses the tax implications of short sales in the corporate world, as featured in a recent transaction in which a controlled foreign corporation bought its parent’s publicly traded stock and used the stock as part of the acquisition currency to buy a domestic subsidiary. The advisory is provided in PDF on the Alston & Bird website: www.alston.com/advisories/federal-tax-advisory-august-2012 [...]Read more