Section 29 Liquidation of a Subsidiary

LibraryBus Trans 2005

A corporation that wishes to restructure its organization to eliminate subsidiaries can generally accomplish this on a tax-free basis by liquidating the subsidiary or subsidiaries under I.R.C. § 332. In this type of restructuring, consideration should also be given to the tax-free conversion of a subsidiary into a single-member limited liability company.

The general rule added by the Tax Reform Act of 1986, Pub. L. No. 99-514, 100 Stat. 2085, relating to the corporate recognition of gain or loss on...

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