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New Regulation Helps Plan Stock Redemptions
The U.S. Treasury Department has promulgated a final tax regulation intended to remove the uncertainty surrounding the tax treatment of stock redemptions that resulted from recent case law. Treasury Decision 9035, 68 Fed. Reg. 1534 (Jan. 10). The final regulation adopts and expands upon the proposed regulations that were issued by the Department in August 2001.
To understand the significance of the final regulation, it is helpful to review the transaction pattern that these regulations address. In our example, Spouse B (the business spouse) operates a business that is owned by a corporation (X Corp.), all the stock of which is owned by B or by B and N (the non-business spouse) as marital property. Pursuant to the marital settlement agreement between B and N, B will end up owning all the stock of the corporation, through which B will continue to operate the business, and N will be paid his or her share in cash, usually through deferred payments. The parties anticipate that the income used to make the deferred payments will be generated by the business, and that payments to N for N's marital share will be made ' directly or indirectly ' by X Corp. The income used for this purpose is taxable to either or both spouses. How much and to whom will depend on the structure of the settlement worked out by the parties.
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Bankruptcy Sales: Finding a Diamond In the Rough
There is no efficient market for the sale of bankruptcy assets. Inefficient markets yield a transactional drag, potentially dampening the ability of debtors and trustees to maximize value for creditors. This article identifies ways in which investors may more easily discover bankruptcy asset sales.
Judge Rules Shaquille O'Neal Will Face Securities Lawsuit for Promotion, Sale of NFTs
A federal district court in Miami, FL, has ruled that former National Basketball Association star Shaquille O'Neal will have to face a lawsuit over his promotion of unregistered securities in the form of cryptocurrency tokens and that he was a "seller" of these unregistered securities.
Why So Many Great Lawyers Stink at Business Development and What Law Firms Are Doing About It
Why is it that those who are best skilled at advocating for others are ill-equipped at advocating for their own skills and what to do about it?
Blockchain Domains: New Developments for Brand Owners
Blockchain domain names offer decentralized alternatives to traditional DNS-based domain names, promising enhanced security, privacy and censorship resistance. However, these benefits come with significant challenges, particularly for brand owners seeking to protect their trademarks in these new digital spaces.
Coverage Issues Stemming from Dry Cleaner Contamination Suits
In recent years, there has been a growing number of dry cleaners claiming to be "organic," "green," or "eco-friendly." While that may be true with respect to some, many dry cleaners continue to use a cleaning method involving the use of a solvent called perchloroethylene, commonly known as perc. And, there seems to be an increasing number of lawsuits stemming from environmental problems associated with historic dry cleaning operations utilizing this chemical.