Corporate Liquidations, Taxable Acquisition Transactions, and Nontaxable Reorganizations"

• IRC Section 338 allows a deemed sale election generating immediate taxation to the target corporation and a stepped-up or stepped-down basis to the price paid by the acquiring corporation for the target corporation stock plus liabilities on the deemed sale. Examine at least one (1) benefit of a Section IRC 338 liquidation election for a target corporation. Create a scenario that would demonstrate a favorable IRC Section 338 liquidation election for a target corporation.

Answer rating: 100% (QA)

Under Section 1367 a 1 where the purpose of the Scorporation is to profit from the operation of the ... View the full answer