The ruling permitted Parent to distribute the proceeds
of Target's D business to the Parent's shareholders and gave Parent the option to distribute the proceeds
of the sale of the C business later, as long as those proceeds
were distributed within one year of the adoption of the plan to distribute the D business.
REFLECTIONS: The IRS reached a similar result in Letter Ruling 200304038, in which a deceased spouse designated her estate as the sole beneficiary and the surviving spouse transferred the IRA proceeds
from the estate to his own IRA.
They should draft a memorandum justifying the transfer of a percentage of the net forfeited proceeds
to the assisting government.
Asset forfeiture laws at the federal level, and in most states, allow law enforcement to use proceeds
of certain seizures for equipment and other needs, especially when the seized property is drug related and there are no victims to compensate.
While awaiting the outcome of the litigation, however, the estate filed a federal estate tax return that excluded one-half of the insurance proceeds
as representing a one-half community property share not owned by the decedent.
More often than not, the stock or asset sale agreement provides for some portion of the sales proceeds
to be placed in escrow, or otherwise held back from the sales proceeds
due the seller at closing.
The IRS says a new mortgage loan used solely to repay existing indebtedness does not qualify under the section 461(g)(2) exception because the proceeds
are not used to purchase or improve the taxpayer's principal residence.
paid to corporations engaged in providing "legal services" are reportable under Sec.
from eligible stock sales must be rolled over into an SSBIC within 60 days from the date of sale.
69 million of principal proceeds
were used to redeem the senior secured note balance and cure the senior secured IC test on Nov.
A portion of the liquidation proceeds
relating to shares in the loan suspense account was paid to the plan in 1996, to be used by the plan to repay the remaining balance of its 1993 stock acquisition indebtedness.
But what if the insurance proceeds
exceed the individual's increased living expenses during the loss period?
Approximately $50 million of the proceeds
from the rights offering are expected to be used to redeem approximately $50 million principal amount of the 8 5/8% Senior Subordinated Notes due 2008 of Revlon Consumer Products Corporation, Revlon's wholly-owned operating subsidiary ("RCPC"), with the remainder of such proceeds
expected to be used to repay indebtedness outstanding under RCPC's $160 million multi-currency revolving credit facility, without any permanent reduction in that commitment, after paying fees and expenses incurred in connection with the rights offering.
TC Memo 1997-298, illustrates how a taxpayer may be able to control the taxation of the sale of a secured asset and the assignment of the proceeds
to the secured creditor, coupled with a related forgiveness of the nonrecourse debt.
Life insurance can be an attractive financial planning tool because the proceeds
payable on the death of an insured generally are exempt from taxation.