KPMG PPT - Tax Executives Institute, Inc.
KPMG PPT - Tax Executives Institute, Inc.
KPMG PPT - Tax Executives Institute, Inc.
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Section 267(f) – Final Regulations Example 4<br />
10% of<br />
T stock<br />
B<br />
(Foreign)<br />
B<br />
(Foreign)<br />
S<br />
50%<br />
S<br />
60%<br />
T Stock:<br />
(aggregate)<br />
AB=$100<br />
FMV=$10<br />
50%<br />
T<br />
40%<br />
T<br />
•<br />
►<br />
►<br />
B is foreign. T is solvent.<br />
S sells 10 percent of the T stock<br />
to B for $1. S’s $9 loss is<br />
deferred under § 267(f).<br />
►<br />
►<br />
T liquidates in a taxable<br />
transaction.<br />
Under the final regulations, S’s<br />
$9 loss continues to be deferred<br />
until S and B (and their<br />
successors) are no longer in a<br />
controlled group relationship.<br />
©2012 <strong>KPMG</strong> LLP, a Delaware limited liability partnership and the U.S. member firm of the <strong>KPMG</strong> network of independent member<br />
firms affiliated with <strong>KPMG</strong> International Cooperative (“<strong>KPMG</strong> International”), a Swiss entity. All rights reserved.<br />
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