What is the congressional purpose for allowing tax deferral

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21. [LO 3] What is the Congressional purpose for allowing tax deferral on transactions that meet the definition of a corporate reorganization?

22. [LO 3] Why do publicly-traded corporations use a triangular form of Type A reorganization in acquiring other corporations?

23. [LO 3] What are the key differences in the tax law requirements that apply to forward versus reverse triangular mergers?

24. [LO 3] What are the key differences in the tax law requirements that apply to a Type A stock-for-assets acquisition versus a Type B stock-for-stock acquisition?

25. [LO 4] How does the form of a regular §338 election compare and contrast to a §338(h)(10) election?

26. [LO 4] What tax benefits does the buyer hope to obtain by making a §338 or §338(h)(10) election?

27. [LO 4] What is the difference between the inside tax basis and the outside tax basis that results from an acquisition? Why is the distinction important?

28. [LO 4] What is the presumption behind the continuity of ownership interest (COI) requirement in a tax-deferred acquisition? How do the target shareholders determine if COI is met in a Type A reorganization?

29. [LO 4] W Corporation will acquire all of the assets and liabilities of Z Corporation in a Type A merger, after which W Corporation will sell off all of its assets and liabilities and focus solely on Z Corporation's business. True or False? The transaction will be taxable because W Corporation fails the continuity of business enterprise test. Explain.

30. [LO 4] Compare how a shareholder computes her tax basis in stock received from the acquiring corporation in a straight Type A merger versus a Type B merger.

Reference no: EM131123684

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