Election and statement requirements proliferate

Article Abstract:

A number of the election/statement requirements faced by consolidated return filers should be revised or eliminated to simplify tax planning and return preparation. The vast number of elections that consolidated groups face for loss disallowances, intercompany transactions and investment adjustments almost assure that filers will overlook certain opportunities. The elections and statements required should be assessed based on whether they serve the governmental interests in binding taxpayers and in notifying the IRS of possible compliance problems.

Affiliated corporations

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Special issues for consolidated groups converting to S corporation status

Article Abstract:

Revisions to S corporation eligibility rules enacted under the Small Business Job Protection Act of 1996 will expand the availability of S corporation treatment to certain affiliated groups, but S election by a parent will trigger consolidated group termination issues. A parent electing S corporation status under the new laws can also elect to have divisions treated as qualified subchapter S subsidiaries. Deconsolidation may result in questions regarding the treatment of excess loss accounts and deferred intercompany transactions.

Corporate Income Taxes, S corporations

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Anomalies in the E&P regulations

Article Abstract:

The authors discuss IRS temporary regulations under section 1.1502-33T which provide consolidated tax return accounting rules for earnings and profits in cases of certain corporate acquisitions. The authors explain when and why the rules are problematic and can create unfair, and perhaps, unintended outcomes.

United States, Tax Law, Corporate Tax Administration, Acquisitions and mergers, Profit, Accounting and auditing, Profits, Corporate taxes, Tax administration

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