Tax Concerns When Modifying or Purchasing Distressed Real Estate Debt: Borrower and Lender Concerns
Related Party Purchases. Significant Modifications, Market Discount and Loan-to-Own Transactions
Note: CPE credit is not offered on this program
Recording of a 90-minute premium CLE video webinar with Q&A
This CLE course will analyze key tax issues that should be considered in real estate loan modifications and debt purchase transactions. The panel will discuss the cancellation of indebtedness (COD) income concerns with related party purchases and significant modifications, market discount rules, and phantom tax liability associated with loan-to-own transactions.
- Loan modifications and the tax code
- Events triggering COD income
- Defining "significant modification"
- Tax liability in connection with constructive exchange of debt
- Issues to consider in purchasing distressed debt
- Related party purchases
- Market discount rules
- Purchase and subsequent foreclosure or deed in lieu: phantom tax liability
- Planning tips
The panel will review these and other important questions:
- When does a loan payoff, foreclosure, or a deed in lieu of foreclosure trigger COD or other income for the borrower?
- What kinds of loan amendments might be deemed significant modifications resulting in a constructive exchange of old debt for new?
- What does the IRC say about the tax liability for a lender who purchases a loan at a discount?
Jay L. Buchman
Mr. Buchman advises clients on the tax aspects of a broad range of domestic and international transactions. In... | Read More
Mr. Buchman advises clients on the tax aspects of a broad range of domestic and international transactions. In particular, he focuses his practice on advising private investment funds on a broad range of matters related to fund formation and operation, as well as on domestic and cross-border mergers and acquisitions, financings and joint ventures. Mr. Buchman also advises clients on the Opportunity Zone (OZ) provisions in the Tax Cuts and Jobs Act.Close
Joseph C. Mandarino
Smith Gambrell & Russell
Mandarino is a Partner in the Tax Practice of Smith, Gambrell & Russell, LLP. His practice focuses on... | Read More
Mandarino is a Partner in the Tax Practice of Smith, Gambrell & Russell, LLP. His practice focuses on corporate, tax and finance law. Mr. Mandarino is involved with a wide variety of businesses and transactions, including experience with compliance, planning and M&A activities for partnerships, individuals and corporations. Mr. Mandarino writes and speaks extensively on a wide range of business, tax and finance topics.Close