United States

8 corporate and M&A tax considerations for year-end planning


2016 brought many small changes, but little in the way of major tax reform.  While corporations will be watching and waiting along with the rest of the country to see how the president-elect and the incoming Congress are likely to move on tax reform, there are some issues you should be reviewing in the near-term.

Here are eight corporate and transactional tax considerations that you should look at during your 2016 year-end close and your 2017 planning:

  • Debt-equity regulations – newly finalized section 385 debt-equity regulations were issued in October and should be considered before entering into or extending intercompany debt agreements.
  • Carryback claims of 2015 losses – Form 1130 must be filed within one year of the last day of the loss year, which for calendar year 2015 losses is Dec. 31, 2016.
  • Quick refund opportunity – if your business overpaid federal estimated taxes for 2016, you can file Form 4466 in January to obtain a refund (generally in fewer than 45 days).
  • Automatic extensions – generally speaking, most businesses will benefit from filing Form 7004 and gaining an automatic 6-month extension, which allows time to make corrections to timely filed returns without penalty.
  • Subsidiary stock losses – it may be possible to accelerate and recognize losses in the current year via the worthless stock deduction.
  • Section 481 adjustments – updated rules may allow you to accelerate section 481 adjustments in the year of a transaction, which may be useful to offset income post-transaction.
  • Changes in control – carefully review stock holdings and issuances to properly identify any section 382 changes in control that may impact filing.
  • Schedule UTP – the threshold for requiring filing Schedule UTP was lowered in 2014. If you have more than $10 million in assets on the balance sheet this year, you may be required to file.
  • Organization actions affecting basis of securities – if required, Form 8937 must be filed within 45 days or by Jan. 15, 2017 for transactions taking place in December 2016.  

Learn more about these and three more corporate tax issues, plus international and state tax considerations, in our annual tax guide: 2016 year-end tax considerations for businesses

Nick Gruidl


Nick advises businesses on M&A activity, restructuring, partnerships and NOL issues, among other topics. Reach him at nick.gruidl@rsmus.com.

Areas of focus: Corporate TaxationMergers & AcquisitionsPrivate EquityWashington National Tax