Tax Strategies for Distressed S Corps
S Corporations can be fragile entities that easily lose their pass-through status if certain changes are made to their capital structure. When S Corps fall into financial distress, the risks to the entity and its shareholders are particularly acute, including substantially increased tax liability, loss of S Corp pass-through status, the loss of valuable tax attributes and more. This program will discuss practical restructuring strategies to help financially distressed S Corps survive and grow. Among other topics, the program will cover the often-overlooked alternative of a tax-free reorganization, deferral of cancellation of indebtedness income, and common traps when reorganizing.
- Restructuring strategies for financially distressed S Corps
- Tax-free reorganizations for S Corps
- Techniques to avoid cancellation of indebtedness income
- Special deferral of cancellation of indebtedness income under Section 108(i)
- Traps for the unwary, including inadvertent termination of S status and loss of valuable tax attributes
C. Wells Hall, III, is a partner in the Charlotte, North Carolina office of Mayer Brown LLP, where he advises clients on the tax aspects of acquisitions, reorganizations, and restructuring of business entities, and private equity transactions. He also represents taxpayers before the Internal Revenue Service and the North Carolina Department of Revenue. Mr. Hall formerly served as chair of the S Corporation Committee of the ABA Tax Section. He is a Fellow of the American College of Tax Counsel and the American College of Trust and Estate Counsel. Mr. Hall received his B.A. from North Carolina State University and his J.D. from Duke University School of Law.
