On Demand

Achieving Step-up in Basis of Assets in Taxable Stock Purchases of S-Corporations

1h 1m

Created on December 08, 2020





Target companies in private equity and other acquisitions are often S-corporations. When these deals are structured as stock sales, buyers frequently want to achieve step-up in the basis of the target company's assets. This course, presented by Julie Rhoades of Dickinson Wright's tax practice, will discuss various strategies for achieving this basis step-up. Specifically, this course will review the availability of 338(h)(10) and 336(e) elections as well as the "drop-down LLC" structure, offer practical insight into how to choose among these strategies, and discuss the impact that these strategies could have on the business deal and purchase agreement terms.   

Learning Objectives:

  1. Identify the availability of various strategies for achieving asset basis step-up in taxable S corp acquisitions
  2. Weigh the pros and cons of available strategies based on the deal structure
  3. Draft appropriate reps and warranties to mitigate risk
  4. Assess how the use of strategies to achieve basis step-up may impact deal terms 

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