dating of capricorn man - Liquidating an s corporation

Such allocations can be relatively simple where future consideration is fixed or may be problematic where future consideration is based on future events, milestones, etc.

Care must be taken in this determination because the basis allocation must be made, using all facts available, on the date of the transaction.

453B(h) will allow for a deferment of gain where the notes are distributed to the shareholder pursuant to a Sec. In addition, the character of gain is preserved as the holder of the obligation recognizes income. 453B(h) appears innocuous, as the congressional intent was to allow the S corporation to sell its assets and distribute the closing consideration in liquidation without triggering gain on the distribution of the note.

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338(h)(10) election to step up the basis of the assets.

Accordingly, the issue of the accelerated gain on the deemed liquidation would be at issue as well.

338(h)(10) election—a deemed sale of assets followed by a liquidation.

Quite often, where a buyer looks to acquire the stock of an S corporation, the buyer prefers a Sec.

This correlates the basis allocation to the current and deferred portions of the transaction for income recognition purposes.

Generally, where the S corporation receives notes in an asset or deemed asset sale, Sec.

Assume in the above example that there was no plan of liquidation and the corporation held the note until it was paid.

At the time the assets were sold, the same 0 gain is recognized immediately with the same ,400 deferred gain.

1) Sale at FMV, followed by distribution as if it were cash.2) Reduction in the distributions.' data-inline-edit-type='wysiwyg' data-inline-edit-url='/answers/482181' id='inline_edit_answer_482181_body' People come to Accountants Community for help and answers—we want to let them know that we're here to listen and share our knowledge.

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