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Every deal lawyer needs to know some essential federal income tax principles. In this introductory program, Mike Schler, widely recognized as one of the most creative corporate tax lawyers in the country, discusses the basic rules and common issues arising in typical mergers and acquisitions, including taxable acquisitions, tax-free reorganizations, joint ventures, and international transactions. UCLA Professor Carla Hayn provides additional comments on the accounting treatment of the various transactions.

Basic Tax and Accounting Rules for Mergers and Acquisitions
    I. Introductions
    II. Taxable Acquisitions
        A. Acquiring a Target Parent
        B. Acquiring a Target Subsidiary
        C. Section 338(h)(10) Election
        D. Allocating the Purchase Price
        E. Allocating Land and Buildings
        F. Contingent Liabilities
        G. Contingent Purchase Price
    III. Tax-Free Reorganizations
        A. General Requirements
        B. Continuity of Interest
        C. “Substantially All” Test
        D. Types of Reorganizations
            1. “A” Reorganizations
            2. Section 368(a)(2)(D) Reorganizations
            3. Section 368(a)(2)(E), “B” and “C” Reorganizations
            4. Section 351 Transactions
        E. Advantages and Disadvantages
        F. Reorganization Questions
        G. Dividends
    IV. Spin-Offs
        A. Good Business Purpose
        B. Distribution of Control
        C. Active Business
        D. Device Test
        E. Section 355(d)
        F. Section 355(e)
        G. Acquiring After Pre-Spin-Off Discussions
        H. Section 382
    V. Consolidated Returns
        A. Consolidated Return Rules
        B. Matching Basis
        C. Advantages of Consolidated Returns
        D. Disallowed Losses
        E. Benefits of Limited Liability Companies
    VI. Joint Ventures
        A. Advantages of Joint Ventures
        B. Distributions
    VII. International Transactions
        A. Foreign Company Acquiring Foreign Target
        B. Foreign Company Acquiring U.S. Target
    VIII. Question: Tracking Stock
    IX. Accounting Rules for Mergers and Acquisitions
        A. Two Types of Accounting
        B. Elimination of Pooling
        C. Accounting for Goodwill
        D. Writing Off Goodwill
        E. Impact of New Standards
    AfterWords^SM