Restructuring Tax Services
Bringing clarity to uncertain situations
In times of economic uncertainty, debt restructuring is oftentimes a necessary and even beneficial option that can preserve and enhance a company’s value. However, the unique scenarios brought on through refinancing or modifying debt obligations have significant and sometimes unique tax consequences.
RSM’s mergers and acquisitions tax professionals help you give careful consideration to debt restructuring or bankruptcy filing and can guide you through what can be a difficult process. We understand the complexities of working through a bankruptcy or debt restructuring and can help you achieve the most tax-advantageous outcome for your situation.
Our professionals can also help with other types of corporate transactions including the determination of the taxability of corporate dividends.
In a merger, a shareholder received stock and cash. His receipt of cash was taxable “boot” to the extent he realized gain.
“Investment asset’’-rich spinoffs, similar to Yahoo’s Alibaba spinoff, and spinoffs followed by REIT/RIC elections, fall victim to “no-rule” policy.
Related-party traps can lead to ordinary income, as opposed to capital gain, recognition by pre-transaction target entity shareholders.
Failure to avoid legal or substantive stapling of debt and equity could result in lost tax deductions.