M&A and Tax Reform: New Deal Structure Considerations

Capital Expensing, Transition Tax, Business Interest Deduction, NOL Carryforwards, Executive Compensation and More

Recording of a 90-minute CLE webinar with Q&A


Conducted on Thursday, March 15, 2018

Recorded event now available

or call 1-800-926-7926
Program Materials

This CLE webinar will examine provisions of the new tax reform law that could have a significant impact on the structuring of mergers and acquisitions. The panel will discuss the steps counsel should take now with M&A deals in process, and upfront issues to consider in transactions going forward.

Description

Recently enacted tax reform will affect mergers and acquisitions in several important respects. M&A counsel must be able to structure M&A deals to properly address the new tax provisions.

Beginning in 2018, taxpayers will not be able to fully deduct net operating losses (NOL); application of certain NOL carryforwards against net operating income will therefore also be limited. The business interest expense deduction is now limited to only 30% of adjusted taxable income of a taxpayer. Buyers and sellers will likely model pricing to reflect the impact of these new limitations on their M&A transactions.

The tax law imposes a one-time transition tax which may result in a tax liability for a U.S. company that is a target in an M&A transaction and owns foreign subsidiaries or other foreign investments. It also allows taxpayers to immediately expense 100% of the cost of certain property acquired and placed in service through 2022. This provision could incentivize a buyer to press for an asset sale structure as opposed to a stock sale structure. Changes in the corporate tax rate will also impact the value of the “tax shield” in an acquisition.

Listen as our authoritative panel analyzes these and other provisions of the tax law that will impact M&A transactions. The panel will discuss the new rules on NOL carryforwards, transition tax, capital expensing, sale of partnership interests, business interest expenses, executive compensation and more.

READ MORE

Outline

  1. Tax reform—background and timeline for implementation
  2. Limitations on use of net operating losses
  3. Transition tax on deferred foreign income
  4. Immediate capital expensing
  5. Tax on sale of foreign partnership interests
  6. Limitations on business interest expense deductions
  7. Changes to Code §162(m)—executive compensation

Benefits

The panel will review these and other key issues:

  • How has tax reform changed the analysis of a stock sale vs. asset sale structure?
  • What is the significance of the new limitations on the deductibility of NOLs and business interest expenses?
  • What is the one-time transition tax and might it impact deal structure?
  • How could the changes to Code §162(m) impact executive compensation packages for a target company?

Faculty

Bridgers, Griffin
Griffin H. Bridgers

Atty
Hutchins & Associates

Mr. Bridgers' practice encompasses all areas of private wealth and family business. In addition to estate...  |  Read More

Daniel, Russell
Russell A. Daniel

Partner
Grant Thornton

Mr. Daniel leads Grant Thornton’s Southeast Region Mergers & Acquisitions Tax Services practice. He assists...  |  Read More

Greiner, Scott
Scott P. Greiner, LL.M. (Tax)

Partner
Moye White

Mr. Greiner counsels clients on how to effectively structure clients' businesses, oil and gas and real estate...  |  Read More

Other Formats
— Anytime, Anywhere

Strafford will process CLE credit for one person on each recording. All formats include program handouts. To find out which recorded format will provide the best CLE option, select your state:

CLE On-Demand Video

$297

Download

$297