KPMG PPT - Tax Executives Institute, Inc.

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PLR 201149015 HC2 HC1 S1 S2 S3 HC2 P3 HC1 HC2 P HC1 HC2 S1 S2 S3 S1 S2 S1 Subs Rulings: ► “Provided that the requirements of § 165(g) (taking into account the provisions of [Treas. Reg. §1.1502-80(c)]) are satisfied, [HC1 may claim a worthless stock deduction under § 165(g)(3) upon the dissolution of [HC2], subject to the application of [Treas. Reg. §1.1502-36].” ► “For purposes of the § 165(g)(3)(B) ‘gross receipts’ test, [HC2] will include in its aggregate gross receipts all amounts of gross receipts received in intercompany transactions that are described in [Treas. Reg. §1.1502-13] (as effective/applicable on or after July 12, 1995) (‘Intercompany Transactions’), and such amounts from Intercompany Transactions will be treated as ‘gross receipts from passive sources’ to the extent they are attributable to the Intercompany Transactions’ counterparty’s ‘gross receipts from passive sources’ (‘Look-Through Approach’). See [Treas. Reg. §1.1502-13(a), (b) and (c)] (as effective/applicable on or after July 12, 1995).” ► “For purposes of computing [HC2’s] ‘gross receipts’ under § 165(g)(3)(B), [HC2] will take into account the historic gross receipts of any transferor corporation in a transaction to which § 381(a) applied, provided, however, that [HC2] will eliminate gross receipts from Intercompany Transactions with any such transferor corporation, as appropriate, to prevent duplication.” ©2012 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. 16
PLR 201149015 HC2 HC1 S1 S2 S3 HC2 P3 HC1 HC2 P HC1 HC2 S1 S2 S3 S1 S2 S1 Subs Rulings: ► “In applying the Look-Through Approach, for purposes of computing the ‘gross receipts from passive sources’ of [HC2’s] counterparty in an Intercompany Transaction or any other counterparties in Intercompany Transactions, the counterparty will include in its aggregate gross receipts all amounts of gross receipts it received in Intercompany Transactions, and such amounts from Intercompany Transactions will be treated as ‘gross receipts from passive sources’ to the extent they are attributable to its counterparty's ‘gross receipts from passive sources.’ In other words, [HC2’s] ‘gross receipts from passive sources’ is determined by looking at all of [HC2’s] gross receipts from Intercompany Transactions (even if on its face the Intercompany Transaction appears not to be "gross receipts from passive sources") and sourcing the gross receipts based on [HC2’s] counterparty's ‘gross receipts from passive sources.’ Furthermore, [HC2’s] counterparty in Intercompany Transactions (and [HC2’s] counterparty’s counterparty, and so on until it reaches an ultimate counterparty) will apply a similar rule.” ©2012 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. 17
Page 1 and 2: Tax Executives Institute Corporate
Page 3 and 4: Built-in Loss on Subsidiary Stock
Page 5 and 6: Section 267(f) - Background P P Unr
Page 7 and 8: Intercompany Sale of Stock at a Los
Page 9 and 10: Section 267(f) - Final Regulations
Page 11 and 12: Section 267(f) - Final Regulations
Page 13 and 14: Worthless Stock Loss Requirements f
Page 15: PLR 201149015 HC2 HC1 S1 S2 S3 HC2
Page 19 and 20: GLAM 2012-006 Situation 1 P $10 deb
Page 21 and 22: GLAM 2012-006 Situation 3 P $10 deb
Page 23 and 24: GLAM 2012-003 M Year 1 Year 2 Year
Page 25 and 26: Unified Loss Rules © 2011 KPMG LLP
Page 27 and 28: Unified Loss Rules $100 P S FMV $10
Page 29 and 30: Unified Loss Rules ► Basis redete
Page 31 and 32: Unified Loss Rules Basis Redetermin
Page 33 and 34: Unified Loss Rules Basis Reduction
Page 35 and 36: Unified Loss Rules Basis Reduction
Page 37 and 38: Unified Loss Rules Attribute Reduct
Page 43 and 44: CERT Rules If an “applicable corp
Page 45 and 46: Applicable Corporations ► An acqu
Page 47 and 48: Corporate Equity Reduction Interest
Page 49 and 50: Proposed CERT Rules On September 13
Page 51 and 52: Proposed CERT Rules Consolidated CE

KPMG PPT - Tax Executives Institute, Inc.

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