Corporate Tax Liquidation Checklists
Summary
TLDREl video ofrece una visión detallada de las liquidaciones completas de una corporación y sus implicaciones fiscales. Se discute la importancia de distinguir entre liquidaciones completas y otras formas de distribución de activos, como las liquidaciones parciales o las operaciones normales de la empresa. Se destaca la necesidad de verificar si se cumple con la definición de liquidación completa según la sección 346 de la ley fiscal. Se abordan dos conjuntos de listas de verificación: la regla general y la regla especial de no reconocimiento, que se aplica en el caso de la liquidación de una subsidiaria por parte de una corporación matriz. Se explica cómo se calculan las ganancias o pérdidas reconocidas tanto por la corporación como por los accionistas, y cómo se determina la naturaleza de dichas ganancias o pérdidas. Además, se menciona la disolución de los beneficios por pérdidas y la transferencia de atributos fiscales en caso de liquidación. El video concluye con una llamada a la práctica de los problemas para un entendimiento más profundo del tema.
Takeaways
- 📚 **Liquidación Corporativa Completa**: Se define en la sección 346 de la ley fiscal y es diferente a las liquidaciones parciales o distribuciones normales.
- 🔍 **Plan de Liquidación Formal**: Es necesario para documentar la intención de liquidación de la corporación y cómo se realizarán las distribuciones.
- 🤝 **Relación Accionista-Corporación**: La naturaleza de los accionistas (corporativos o individuales) influye en las reglas de liquidación que se aplicarán.
- 📈 **Ganancia o Pérdida del Accionista**: Se calcula según la sección 331, restando el basis ajustado de la cantidad recibida.
- 💰 **Carácter de la Ganancia o Pérdida**: Normalmente se trata de un activo de capital, y si la acción ha sido mantenida por más de un año, será una ganancia a largo plazo.
- 🏢 **Consecuencias para la Corporación**: Bajo la regla general (sección 336), la corporación tratará la liquidación como una venta al valor de mercado.
- 🚫 **Perdidas no Reconocidas**: Si hay una liquidación y se involucran partes relacionadas, las pérdidas pueden no ser reconocidas debido a la sección 267.
- 🔄 **Tratamiento Especial para Liquidaciones**: En el caso de una liquidación de una subsidiaria por parte de una corporación matriz, se aplica la regla de no reconocimiento de ganancia o pérdida.
- ✅ **Relación Padre-Hijo**: Se requiere para la aplicación de la regla especial, donde el padre debe tener el control (80% o más) de la subsidiaria.
- 📝 **Bases para Activos Recibidos**: Los accionistas recibirán activos a su valor de mercado, sin considerar las obligaciones.
- 🌐 **Efectos en el Patrimonio Neto**: Toda la EMP (Monto de Espera de Pérdida) se disuelve en una liquidación completa.
- ➡️ **Carácter de la Ganancia Reconocida**: La naturaleza de la ganancia o pérdida dependerá del tipo de activo que la corporación esté vendiendo o distribuyendo.
Q & A
¿Qué es una liquidación completa de una corporación?
-Una liquidación completa de una corporación es un proceso definido en la sección 346 de la ley fiscal, donde la corporación se disuelve completamente y se distribuyen sus activos a los accionistas.
¿Qué es la diferencia entre una liquidación parcial y una liquidación completa?
-Una liquidación parcial implica la venta de activos o la distribución de propiedades sin disolver la corporación, mientras que una liquidación completa conduce a la disolución de la corporación y la distribución de todos sus activos.
¿Por qué es importante determinar si hay un plan formal de liquidación?
-Un plan formal de liquidación es crucial ya que define cómo se llevará a cabo la distribución de propiedades y cómo esto afectará a las consecuencias fiscales tanto para la corporación como para los accionistas.
¿Cuál es la diferencia entre el tratamiento fiscal de un accionista corporativo y uno individual en una liquidación completa?
-Un accionista corporativo podría beneficiarse de la Regla de No Reconocimiento Especial si la transacción cumple con los requisitos de una liquidación completa, lo que podría diferir del tratamiento fiscal que recibiría un accionista individual.
¿Cómo se calcula la ganancia o pérdida que un accionista reconoce en una liquidación completa?
-La ganancia o pérdida que un accionista reconoce se calcula mediante la fórmula del monto recibido menos la base ajustada de las acciones que el accionista tiene en la corporación, según la Sección 331.
¿Cuál es la base que un accionista toma en una propiedad distribuida en una liquidación completa?
-El accionista toma como base la valoración justa de mercado de la propiedad distribuida, sin tener en cuenta cualquier responsabilidad, según la Sección 334.
¿Qué ocurre con las EMP (Elección para el Tratamiento de la Participación Mayor) en una liquidación completa?
-Todas las EMP se disuelven en una liquidación completa, lo que significa que desaparecen y no tienen efectos fiscales posteriores.
¿Cómo se determina si una transacción se considera una liquidación de subsidiaria bajo la Regla Especial?
-Una transacción se considera una liquidación de subsidiaria si hay una relación padre-hijo, donde el padre corporativo posee el 80% o más del poder de voto total y de todas las acciones emitidas por la subsidiaria.
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¿Qué sucede con las pérdidas en una liquidación de subsidiaria si hay partes relacionadas?
-Si hay partes relacionadas y se genera una pérdida en la liquidación de una subsidiaria, esta pérdida no puede ser reconocida debido a la Regla de Personas Relacionadas (Sección 267).
¿Cuáles son las consecuencias fiscales para el accionista minoritario en una liquidación de subsidiaria?
-El accionista minoritario debe reconocer cualquier ganancia o pérdida según las reglas generales de liquidación completa, utilizando el monto recibido menos la base de sus acciones en la subsidiaria.
¿Cómo se calcula la ganancia o pérdida para la subsidiaria en una liquidación de subsidiaria?
-La subsidiaria reconoce ganancia o pérdida con respecto a la parte de la transacción con el accionista minoritario, pero no reconoce pérdidas con respecto a la parte de la transacción con el padre corporativo.
¿Qué atributos fiscales se transfieren en una liquidación de subsidiaria bajo la Regla Especial?
-En una liquidación de subsidiaria bajo la Regla Especial, los atributos fiscales como las Pérdidas No Diferidas (NOL) y las EMP se transfieren del subsidiario al padre corporativo.
Outlines
📚 Introducción a la liquidación completa de sociedades
Este primer párrafo introduce el tema de la liquidación completa de sociedades y su importancia en el contexto del ciclo de vida de una corporación. Se destaca la necesidad de determinar si se trata de una liquidación completa según la sección 346 de la legislación fiscal. Además, se menciona la importancia de un plan formal de liquidación que incluya la distribución de propiedades y su impacto en las consecuencias fiscales para la corporación y sus accionistas. Se destaca la distinción entre liquidación completa y otras formas de distribución o operaciones normales de la empresa.
🏛 Reglas generales y consecuencias para accionistas y corporaciones
En el segundo párrafo se abordan las reglas generales que rigen las liquidaciones completas y sus efectos sobre los accionistas y las corporaciones. Se describe el cálculo de la ganancia o pérdida reconocida por los accionistas según la sección 331, teniendo en cuenta el valor recibido, el basis ajustado y las posibles ganancias o pérdidas a largo plazo. Además, se explica el impacto sobre la corporación, incluyendo el cálculo de la ganancia o pérdida y la resolución de pasivos, así como las excepciones y reglas especiales relacionadas con las partes relacionadas y la no reconocimiento de pérdidas en ciertos casos.
🔄 Regla especial de no reconocimiento en liquidaciones
Este párrafo se enfoca en la regla especial de no reconocimiento que se aplica en casos de liquidación de subsidiarias. Se menciona la sección 332 y 337 y cómo estas reglas permiten diferir la ganancia o pérdida cuando una corporación matriz liquida una subsidiaria en las que tiene un control del 80% o más. Se aclara que ninguna ganancia o pérdida se reconoce para la matriz o la subsidiaria en la transacción, pero los accionistas minoritarios sí reconocen ganancia o pérdida. Se discuten las implicaciones de las EMP y las pérdidas no operativas (NOLs) y cómo se transfieren en caso de cumplimiento de los requisitos.
🤝 Consecuencias para los accionistas minoritarios y la subsidiaria liquidada
El cuarto y último párrafo explora las consecuencias fiscales para los accionistas minoritarios y la subsidiaria en proceso de liquidación. Se indica que los accionistas minoritarios sí reconocerán ganancia o pérdida según las reglas generales, mientras que la subsidiaria reconocerá ganancia pero no pérdida debido a la regla de prevención de abuso. Se resume cómo se determina el carácter de la ganancia o pérdida y se hace hincapié en la importancia de la práctica y la comprensión de estos conceptos complejos.
Mindmap
Keywords
💡Liquidación Corporativa Completa
💡Sección 346
💡Plan de Liquidación
💡Reglas Generales y Especiales
💡No Reconocimiento de Ganancia o Pérdida
💡Relación Matriz-Subsidiaria
💡EMP (Pérdidas no Compensadas por el Trabajo)
💡Sección 331 y 334
💡Activo no Compensado por el Trabajo (NOL)
💡Anti-Abuso
💡Reconocimiento de Ganancia o Pérdida
Highlights
The video discusses the tax implications of complete corporate liquidations, which are different from partial liquidations, redemptions or normal distributions.
A complete liquidation is defined under tax law in Section 346. It is important to verify if a liquidation qualifies as complete before applying specific rules.
If a formal plan exists stating the corporation's intent to liquidate and distribute property, it is relevant to the complete liquidation.
Different checklists apply depending if the shareholder is an individual or a corporation, due to the potential for a non-recognition rule in certain cases.
Under the general rule, shareholders realize and recognize gain or loss on the distribution based on the amount realized minus adjusted basis.
The character of the gain or loss to shareholders is typically capital gain or loss, unless the shareholder is a dealer in securities.
Shareholders receiving property other than cash take a basis in the property equal to its fair market value under Section 334.
For the corporation, the general rule under Section 336 treats the liquidation as if the corporation sold its assets at fair market value.
If there are liabilities on the property being distributed, the corporation gets relief equal to the greater of the FMV or the liabilities.
Related party losses may not be recognized if the distribution is not pro rata and involves disqualified property under Section 267.
The character of any gain or loss recognized by the corporation depends on the specific asset being distributed.
In a complete liquidation under the general rule, all earnings and profits (E&P) of the corporation are dissolved.
The special rule under Sections 332 and 337 provides mandatory non-recognition treatment for liquidations of subsidiary corporations by parent corporations.
For the parent corporation, there is no gain or loss recognized in a Section 332 liquidation. The basis of any property received is a carryover basis.
Any NOLs and E&P of the subsidiary roll over to the parent corporation in a Section 332 liquidation.
A minority shareholder recognizes gain or loss on the distribution based on the general rules, using the amount realized minus adjusted basis in their stock.
The liquidating subsidiary recognizes gain but not loss on the transaction with the minority shareholder under Section 336.
The character of any gain recognized by the liquidating subsidiary depends on the specific asset transferred to the minority shareholder.
Transcripts
hello in this video we're gonna look at
corporate tax complete liquidations now
whenever we have to deal with corporate
taxation remember that it helps
tremendously to look at where we are in
the lifecycle of the corporation
we started in other videos talking about
corporate formation and contribution we
also talked about capital financing
specifically debt per sec WA t issues
then we talked about normal operations
distributions and redemptions which
happened during the normal operations of
the business finally when the
corporation is going to wind up
operations if they do we have complete
liquidations now it's important to note
that complete liquidations are not the
same topic as partial liquidation
redemptions or a normal distribution
that happens during the normal
operations of the business so this
checklist is meant to help you go
through the consequences of a complete
corporate liquidation so the first
question do we actually have a section
346 complete liquidation so this is
something defined under the tax law in
section 346 and under the regulations
okay so you need to make sure you
specifically have a complete liquidation
now if you're taking me for a class I'm
going to make it specific whether it's a
complete liquidation or not but you
might have another teacher where you
have to figure this out of course in
practice it's very important we look at
the regs the revenue rulings whatnot
just note that unless you have a
complete liquidation you do not have
only when you have completed a ssin do
you apply these checklist these specific
rules for liquidations so the second
question is once we have a complete
liquidation is there a formal plan
stating the corporation's plan to
liquidate including distributing
property if so that has to do with the
complete liquidation plan and exactly
how exactly the distributions as a
result of elation how they play out
which is going to have an effect on the
corporate and the shareholders and
determining tax consequences next is a
shareholder or corporation or individual
the reason why that's important is
because you're going to see that we have
to complete liquidation sets of
checklists we have the general rule and
then we have the specialist
City area liquidation non-recognition
rule we'll talk more about that but just
note that if you have a corporate
shareholder you might be able to get
that special rule non-recognition for if
the transaction qualifies as a complete
limitation so again we talked about if
it's not a complete elimination you
don't apply these checklists if it does
we continue with the checklist that
you're gonna see below again the two
sets if it's not a completely complete
elimination but there's a distribution
then we're going to look at distribution
checklist under section 301 or if it's a
Redemption we look at section 302
checklists for redemptions but again
these checklists focus on complete
liquidation the corporation has a plan
in place and under Section 3 446 will be
liquidating okay
so once you've determined with a
complete liquidation we now we're going
to look at the two sets of checklists
when we're looking at the checklist it's
important to remember we're gonna focus
on the corporate consequences or the
corporation's consequences and the
shareholders consequences let's start
with a general rule so this is the
general rule and within the general rule
we're gonna look at the shareholder
first okay so we're looking at the
consequences of the shareholder under
the general rule the first thing is how
much gain are lost
does the shareholder realize and
recognize so under Section 331 what
we're going to do is we're going to
apply the normal section 1001 amount
realized minus adjusted basis the amount
realized is the amount that the
shareholders receiving using the normal
amount realized formula right actual
cash receipt plus constructive cash
received plus non-cash property minus
selling expenses the adjusted basis this
is important is gonna be the adjusted
basis in the stop that that shareholder
has in the corporation that's important
that's where some students when they're
learning this topic or in practice God
keep straight that's where things get
kind of confusing because you're gonna
see when we look at the the consequences
of corporation we use the adjusted basis
of the property being distributed with
respect to the corporation okay so that
gives us to realize that recognize gain
or loss under the general rule there's
no
recognition so the realized gain or loss
will be recognized second question
what's the character of the gain or loss
so the shareholder has stock and a
corporation so almost always it's gonna
be a capital asset under Section 12 21
because it's gonna be an investment
property unless it's a dealer or broker
and securities and then o be treated as
inventory and therefore ordinary income
but almost all shareholders will be tree
as a capital asset under Section 12 21
and therefore capital gain or loss if
the stock is held for more than a year
long term your last short term okay the
next issue if the shareholders receiving
property other than cash which we know
cash always takes the basis of the face
value what is the basis that the
shareholder takes so let's say the
corporation distributes in complete
liquidation some land to a shareholder
we go through again the amount realized
the fair market value of the land
there's no liabilities we don't worry
about that - the adjusted basis okay in
the in the stock given up that gives us
our realize and recognize gain it's
going to be a capital let's say it's
been held for more than a year long-term
capital gain so the next question is
what's the basis the shareholder takes
in the land this is always going to be
fair market value fair market value
under Section 334 okay fair market value
without regard to any liabilities so
there's any liabilities on the land even
if the liabilities exceeds the fair
market value the basis is always going
to be fair market value fair market
value okay so those are the consequences
to the shareholder what about the
consequences to the corporation under
the general rule the general complete
liquidation rules okay the first
question how much gain or loss is the
corporation realized and recognized all
right so the general rule for the
general rule you know it's getting a
little it's just like the tax bill right
we have this general rule the exception
to the general rule all that stuff the
general rule is found under section 336
and it's going to be as if the
corporation was selling it using fair
market value okay fair market value all
right unless there's liabilities we'll
talk about that in a moment so it's
going to be a mount real
- adjust the basis the amount realized
is going to be looking at fair market
value and the liability it's going to be
the greater of the fair market value or
the liability attached that the
shareholder is going to take that the
corporation has relief okay so liability
relief now the adjusted basis used in
this calculation is gonna be the
adjusted basis of the property so this
says adjust the basis of the stock this
should be adjust the basis of the
property okay my apologies that should
be probably see I caught myself there
you gotta be careful the adjusted basis
of the property not the stock the stock
was used with a shareholder property is
used for the property that the
Corporations giving up is used for the
corporation to terminate tax
consequences so the next bullet point
which I just mentioned says that if
there's liabilities of the property
liability relief to the corporation the
rule for amount realized is the greater
of fair market values or the liabilities
liability relief liabilities attached
now there's a special rule here and this
is not the second set of check lists
we'll still talk about that in a moment
the special rule says if there's a loss
here and there's related parties then
the loss cannot be taken okay the loss
may not be recognized the corporation
may not recognize loss emphasis to
section 267 related party okay and the
distribution is not pro rata the
distribution is of disqualified property
all right it's a not it's not a pro rata
distribution okay not pro rata and the
distribution so if everybody gets the
same percentage of stuff right then
that's viewed as a pro rata but if if it
isn't pro rata right everyone's or
people getting different things then
that's when this rule comes into play
also the distribution is of disqualified
property which I have here any property
acquired by section 351 transaction so
or as a contribution to capital during
the five-year period ending on the date
of distribution the related person rules
are found in section 267 so we look at
family members we look at entities all
those different things which I have some
rules here summarized but you can look
at that section 267 okay what about the
character of the gain or loss calculated
the character is going to be
specifically looking at the specific
asset that the corporation holds so
however that corporation held that asset
lets whether it's a section 1231 asset
whether it's a capital asset whatever it
is all right final question what about
the effect of EMP when a complete
liquidation we're under the general rule
all EMP is dissolved all EMP is going to
be dissolved and therefore it's going to
be gone okay all going to be gone
therefore EMP disappears disappears okay
so that is the complete liquidation
general rule checklist now we're going
to take a look at the special rule so
under the special rule which is a non
recognition rule you might recall
non-recognition rules like section 1031
like-kind exchanges section 1033
involuntary conversion even section 351
corporate formation these are all
non-recognition rules where gain or loss
system is going to be deferred now this
is going to be a mandatory
non-recognition rule and the idea here
is a liquidation of a subsidiary so when
we have a liquidation of a subsidiary
Congress basically says you know what it
makes sense under the number of
condition themes of liquidity issues and
economics efficiency issues for the
normal condition rule to apply so these
are found in section 332 and 337 332 the
actual number condition rule 337 is the
basis corresponding basis rule that
defers the gain or loss provides that
neither the parent shareholder nor the
liquidating subsidiary okay those are
important so neither the parent
shareholder nor the liquidating
subsidiary recognizes gain or loss so
the idea here is that we have
corporation a parent corporation
that owns of subsidiary corporation
alright and it controls which remember
control is viewed as 80% or more 80% or
more right greater than or equal to 80
percent if we have a liquidation of the
subsidiary we're no longer will exists
and it's gonna roll up into the parent
no gain or loss will be recognized by
the parent or the subsidiary on the
transaction now an interesting issue
though happens what if you have a parent
corporation and you have another
shareholder minority shareholder well
the minority shareholder that will still
have to recognize gain and then the
subsidiary you have to recognize gain
with respect to the minority shareholder
okay so if we have a minority
shareholder whether it's an individual
or parent let's say they own 20% or less
that one does have to recognize gain or
loss that one does that transaction so
what we do is we actually view the gain
or loss on that part but not this part
this part goes unrecognized not
recognized and deferred okay so going
through the checklists the first
question is their complete liquidation
pursuant to the requirements of section
332 B so we need that complete
liquidation as we talked about we've
already actually looked about that
looked at that we looked at section 346
complete liquidation the next question
is there a parent-subsidiary
relationship so parents of city
relationship we just talked about that
the idea is that a parent corporation
owns a subsidiary corporation
specifically 80 percent or more of total
voting power and all outstanding stock
requirements okay of all so you need
both of those okay you need 80 percent
or more of voting 80 percent or more of
all outstanding stock okay just so you
know now certain non-voting preferred
stock has ignored okay
I don't really test on the non-voting
preferred but some faculty members do
some professors do and of course in
practice you have to worry about it so I
would just focus on common but remember
it's all voting and all classes of stock
as well so if you have non-voting a
voting common number three has a
complete liquidation Ben
opted so again we have to look at the
complete elimination plan and we do have
a complete liquidation then we have to
continue with the plan we've been
currently already focusing on that the
reason I key in on that is sometimes
with a parent subsidiary there's special
relationships relationships with what
exactly is going on and there's special
rules under 332 if we meet those
requirements then we have section 332
and again section 332
is going to be we have the special
checklist which are below if not we
apply the normal general rules for
complete liquidation all right so the
liquidation of a subsidiary the parent
corporation tax consequences so if we
have section 332 there's going to be no
gain or loss to the parent corporation
that's under Section 332 okay no gain or
loss to the parent corporation what's
the basis of any property received by
the parent corporation that's gonna be a
transfer basis and tacked holding period
all tacking so we get to roll over the
basis from the subsidiary to the parent
and we get all tacking additional
considerations EMP as well as any NOLs
they roll over okay these all roll over
there's other tax attributes that roll
over but the main ones are any NOLs of
the subsidiary head as well as EMP EMP
now by the way if this is 100% it's the
full amount but if it's 80% let's say or
90% you're going to take the portion of
that okay what about the tax
consequences of the minority shareholder
right so we did an example earlier where
we had parent corporation owns 80
percent of the voting in all classes of
subsidiary corporation and then we had
minority shareholder who's let's say
it's an individual owns 20% so 80
percent here okay we just talked about
the consequences the parent 20% owned by
minority shareholder what about the
consequences of minority shareholder so
to the minority shareholder we apply the
normal general rules any gain or loss
will be recognized applying the same
checklist under the general rules we
just talked about 331 so I'm
realize what's received - adjusted basis
in the stock gives us the realized gain
or loss I'll be recognized by the
minority shareholder what basis is taken
by the property it's going to be the
fair market value basis under 334 again
under the general rules just like we saw
and again EMP that's not an issue that
goes away in that situation all right
the liquidating subsidiary so let's
think about the situation here with the
parent and the subsidiary in minority
and the subsidiary corporation so with
respect to the liquidating subsidiary
how much gain or loss is recognized
so in determining the gain or loss
recognize the consequences need to be
broken up and the idea is that the gain
or loss with respect to this transaction
to the subsidiary will not be recognized
will not be recognized but the gainer
loss on this transaction will be
recognized both to the minority and to
the subsidiary corporation so we have to
break up the transaction so what's the
effect of the complete term complete
liquidation distribution to the parent
with respect to the minority that's
gonna be no gain or loss no gain or loss
so if we have a transaction where it's
just the parent subsidiary parent owns
100% no gain or loss recognize the
parent no gain or loss recognize a
subsidiary but we don't have that we
have we have partial no gain or loss
recognition but then this side we have
gain or loss recognition so the
consequences with respect to breaking it
up to the parent no gain or loss what
about if this subsidiary owes a debt to
its parent then any property that's
subject in a debt as treat as a
distribution subject to the general
non-recognition rules that's with
respect to liabilities and debts what
about the effects that's the one part
that is the parent to the subsidiary and
that's the 80% what about the minority
shareholder to the subsidiary where we
have the
20% 20% so in that and with respect to
that transaction the subsidiary must
recognize the gain or loss under Section
336 since the liquidating subsidiary
corporation so liquidating subsidiary
recognizes gain or loss with respect to
this part so not here but here here it
does so we have to look at the
consequences just with respect to that
transaction so any any assets
transferred to the minority shareholder
you look at any gain or loss with
respect to that however liquid
subsidiary does not recognize a loss
never loss never a loss on the
transaction never lost and that's
because of anti-abuse rule this is very
important so in this transaction only
gain only subsidiary can recognize game
but not lost when your deal with the
minority shareholder never a loss
okay not loss if it's a loss it's going
to be anti-abuse rule on the losses now
can we recognize what's the character of
any gain recognize it's going to be
looking at this specific asset just like
we saw in the other in the general
checklist so we look at this specific
asset all right so that finishes up the
the subsidiary liquidation special rule
and we've completed all the checklists
now for all the different complete
limitations so I hope you've enjoyed
this video now it's important to go
practice some problems
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