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Course Details

Course Information
  • smart_display Format

    On-Demand

  • signal_cellular_alt Difficulty Level

    Intermediate

  • work Practice Area

    Corporate Tax

Date & Time
  • event Date

    Thursday, February 10, 2022

  • schedule Time

    1:00 p.m. ET./10:00 a.m. PT

  • timer Program Length

    110 minutes

Credit Information

  • BARBRI is a NASBA CPE sponsor and this 110-minute webinar is accredited for 2.0 CPE credits.

  • BARBRI is an IRS-approved continuing education provider offering certified courses for Enrolled Agents (EA) and Tax Return Preparers (RTRP).

$247.00
CPE
ALL

This course will compare and contrast the elections to treat stock purchases as asset purchases for federal income tax purposes under Sections 336(e), 338(h)(10), and 338(g). Our panel of merger and acquisition experts will explain the tax considerations of making each election, eligibility, and the related reporting requirements.

Faculty

Eric Brauer
Tax Manager
RSM US, LLP

Mr. Brauer has over seven years of experience in corporate tax law, including three years at the Office of Chief Counsel (Corporate). He has extensive experience in reorganizations, spinoffs, corporate acquisitions, restructurings, and consolidated return regulations. Mr. Brauer advises clients as part of the M&A group of Washington National Tax.

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Patrick Phillips
Principal
RSM US, LLP

Mr. Phillips is a Senior Manager in RSM’s Washington National Tax practice, focusing on Mergers and Acquisitions since April of 2019. He has significant experience in taxable and tax-free acquisitions and dispositions. Mr. Phillips also has extensive experience with consolidated return issues, loss companies and debt workout transactions. His experience also extends to cross border issues in M&A. Over his career, Mr. Phillips has served as an advisor to public companies, closely held businesses and partnerships. He spent the first 13 years of his career in M&A with the Philadelphia office of PwC. During that time, Mr. Phillips completed a “tour of duty” through PwC’s Washington National Tax Practice.

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Description

Generally, an asset purchase, as opposed to a stock purchase, is preferred by buyers. Buying assets allows the purchaser to step up the basis in assets acquired to fair market value, often allowing accelerated depreciation deductions on these assets. On the other hand, Sellers prefer a stock sale taxed at capital gains rates and often require a higher purchase price to offset the unfavorable tax consequences of an asset sale.

A Section 338(h)(10) election allows buyers to treat certain stock purchases as asset purchases for federal income tax purposes. Legally, the purchase remains a stock purchase. Many qualifications must be met by the buyer and seller making the election. For example, the election is only available to sellers who are a U.S. corporate subsidiary or an S corporation. Both the buyer and seller (and all shareholders) must make the election. Ineligible buyers, like partnerships or individuals, may want to consider a Section 336(e) election.

Foreign businesses may want to consider the corollary Section 338(g) election. A domestic corporation acquiring the stock of a foreign corporation may benefit from treating the purchase as an asset purchase. Unlike the Section 338(h)(10) election, only the purchaser makes this election and it results in tax at the corporate and shareholder levels. The tax consequences and mechanics of making these elections are complex.

Listen as our panel of acquisition and disposition experts details the benefits and caveats of making elections under Sections 336(e), 338(h)(10), and 338(g).

Outline

  1. Stock vs. asset purchases and sales
  2. Section 338(h)(10) election
  3. Section 336(e) election
  4. Section 338(g) election
  5. Filing Form 8023, Elections Under Section 338 for Corporations Making Qualified Stock Purchases
  6. Filing Form 8883, Asset Allocation Statement Under Section 338

Benefits

The panel will cover these and other critical issues:

  • Eligibility requirements for corporations making an election under section 338(h)(10)
  • Foreign tax consequences of making an election under Section 338(g)
  • Properly completing Form 8023, Elections Under Section 338 for Corporations Making Qualified Stock Purchases
  • The effect of Section 338 elections on tax attributes
  • The benefits and availability of a section 336(e) electioin

NASBA Details

Learning Objectives

After completing this course, you will be able to:

  • Identify corporations eligible to make a Section 338(h)(10) election
  • Determine foreign corporations that may benefit from an election under Section 338(g)
  • Decide the tax consequences of making an election under 338(h)(10)
  • Ascertain critical differences between 338(h)(10) and 336(e) eligibility requirements

  • Field of Study: Taxes
  • Level of Knowledge: Intermediate
  • Advance Preparation: None
  • Teaching Method: Seminar/Lecture
  • Delivery Method: Group-Internet (via computer)
  • Attendance Monitoring Method: Attendance is monitored electronically via a participant's PIN and through a series of attendance verification prompts displayed throughout the program
  • Prerequisite: Three years+ business or public firm experience preparing complex tax forms and schedules, supervising other preparers or accountants. Specific knowledge and understanding of corporate taxation, including taxation of businesses, accounting methods, net operating losses and loss limitations; familiarity with net operating loss carry-backs and carry-forwards.

Strafford Publications, Inc. is registered with the National Association of State Boards of Accountancy (NASBA) as a sponsor of continuing professional education on the National Registry of CPE Sponsors. State boards of Accountancy have final authority on the acceptance of individual courses for CPE Credits. Complaints regarding registered sponsons may be submitted to NASBA through its website: www.nasbaregistry.org.

IRS Approved Provider

Strafford is an IRS-approved continuing education provider offering certified courses for Enrolled Agents (EA) and Tax Return Preparers (RTRP).