Acquisition Advisors | C-Corp Stock Sale by “Middleman” Is Illegal
Selling or buying a company? Acquisition Advisors’ experience spans many industries: manufacturing, distribution, energy, industrial services, petrochemicals, automotive, banking, software, technology, staffing, agriculture, food, retail, consumer goods and service industries.
Acquisition Advisors, Advisor for Sellers, Advisor for Buyers, Advisor of Choice for Sellers and Buyers, Mid-Size U.S. Companies, Tulsa acquisitions, acquisitions in Oklahoma, Business Buyer Assistance, Business Seller Assistance, Management Buyout Assistance, Business Valuation, Exit and Divesture: Strategy Planning, Value Enhancement Planning, Business Purchase, Business Sale, Business Valuation
2776
post-template-default,single,single-post,postid-2776,single-format-standard,ajax_leftright,page_not_loaded,,qode-theme-ver-6.1,wpb-js-composer js-comp-ver-4.3.5,vc_responsive

12 May C-Corp Stock Sale by “Middleman” Is Illegal

There exists a tax reduction technique called “Stock-buying Middleman.” We have previously cautioned against the transaction but have since learned that this type of transaction is “listed” by the IRS. To quote from IRS Notice 2001-16:

“The Service may challenge certain transactions in which the assets of a corporation are sold following the purported sale of the corporation’s stock to an intermediary. Such transactions are designated as ‘listed transactions’ for purposes of sections 1.6011-4T(b)(2) and 301.6111-2T of the regulations.”

In short, the IRS warns taxpayers that this type of transaction does not conform to tax law, and parties involved in it may be subject to penalties or other disciplinary action.

For more information, see IRS Notice 2001-16 or call us to supply you with a copy.

No Comments

Post A Comment

Spam Prevention *