Course Category

Tax Concepts for Finance

This two-day course is designed to give those in finance functions a working knowledge of tax law and an appreciation for the impact it has on finance decisions. By developing tax literacy and awareness, participants achieve a better understanding and recognition of tax issues, aiding in their ability to converse with clients, colleagues, and tax professionals about tax-related matters. The course provides an understanding of how tax considerations alter the structuring of business transactions.

• List and describe the different components of tax law
• List different types of business entities and differentiate the tax treatment for each as well as describe the various advantages and disadvantages of these different entities. Discuss the unique tax flexibility and additional burdens that a partnership format creates.
• Explain different types of property transactions and how they result in ordinary gains and losses, capital gains and losses, or 1231 gains and losses. Calculate the netting of these different transactions, as well as demonstrate the effect of depreciation recapture on these calculations.
• Describe from a tax perspective the adversarial nature of a buyer and a seller. Explain and highlight what these two different parties involved in a transaction are attempting to establish from a tax perspective.
• Calculate the minimum quarterly estimated tax payments that corporations and individuals must pay without being subject to tax penalties for late payment.
• Describe how various states attempt to tax the income of corporations doing business in their state. Calculate how income is allocated to the various state governments.
• Determine and calculate which distributions from corporations are taxed as a dividend. Describe how dividends receive preferential treatment for both individuals and corporations.
• Discuss how capital structure can impact a firm's tax position as well as impact the shareholders.
• Describe different techniques to postpone taxability for certain property transactions. Be able to recognize when this would be most beneficial and describe how to structure these transactions.
• Explain the concept of basis and how it is determined in different situations, including exchanges, gifts, and inheritances.
• Describe the tax implications of issuing debt at a discount and also discuss the impact on the investor. Discuss the special case of HYDO securities and the concept of bifurcation.
• Discuss the implications of having debt forgiven (often discharged in a restructuring). Determine when this will result in taxable income versus the loss of valuable tax attributes.
• Describe the reasons that some corporations and individuals find themselves subject to the Alternative Minimum Tax (AMT). Discuss various planning ideas for companies who find themselves in an AMT position in order to mitigate its effects.
• List different ways for a U.S. Company to conduct business abroad. Discuss the tax implications of each of these structures. Describe the concept of a foreign tax credit and be able to calculate any limitation in its utilization. Describe how a deemed foreign tax credit from a foreign subsidiary can be determined. Discuss the concept of repatriation versus deferral. Recognize abusive situations with controlled foreign subsidiaries that would lead to the application of Subpart F of the Internal Revenue Code. Describe new non-discriminatory rules on business incentives both domestically and in the international arena.
• Explain different mechanisms for liquidating a corporation and the tax implications of each. This would include selling assets and the concept of an in-kind liquidation
• Explain how the tax rules governing corporate liquidations are tied to the rules of M&A taxation.
• Describe the special tax treatment involved when a subsidiary is liquidated in-kind.
• Explain and contrast the tax implications of taking over a company by purchasing 100% of the equity (stock certificates) versus purchasing 100% of the assets.
• Explain the different ways that goodwill is treated for tax purposes. In conjunction with goodwill explain the tax treatment of other types of intangibles.
• Explain the concept of a Section 338 election and why it is rarely used today, since the repeal of the General Utilities Doctrine.
• Explain in detail the concept of a 338(h) (10) election and when it results in an excellent tax result while at the same time allowing for business needs to be met. Explain and calculate how and why a 338(h) (10) election might be less than optimal for one party and how in these circumstances the tax attributes would have to be negotiated between an adversarial buyer and seller.
• Explain how a Net Operating Loss (NOL) is applied. Discuss the possibility of purchasing another company and succeeding to the use of their NOL’s. Calculate Section 382 limitations on the utilization of these purchased NOL’s. Be able to identify other tax issues that could affect the ability to utilize these losses.
• Describe the tax principles associated with a Tax-Free Reorganization. Be able to identify and differentiate the different types of reorganizations that are labeled Type A, B, C, D, E, F, and G. Calculate the amount (if any) taxable to the seller and the tax basis that the seller will retain after the transaction. Appreciate the structuring of the transaction so that it falls into one of the approved Types shown above.
• Describe the requirements of a Tax-Free Spin-off (Section 355 Transaction). Discuss how transactions are structured to fall into these requirements. Differentiate between a Spin-off, Split-off, and Split-up.

Lunch included for all students taking day classes.