Critical Tax Considerations for M&A Transactions: NOL Limitations, Deemed Income, Withholding Tax on Sales, and More

The new tax law significantly impacts mergers and acquisitions, requiring counsel and advisers to reconcile the new provisions with negotiating and structuring M&A transactions. The tax-related aspects of M&A transactions require careful analysis and due diligence to avoid unintended tax liabilities for buyers and sellers.

The intent of several provisions in the new tax bill is to raise revenue, with some of them having a particular impact on M&A activities. Specifically, the limitations on the deductibility of interest, the limitations on the use of NOLs, a required withholding tax on the purchase price paid in certain transactions, the imposition of the transition tax, and other factors may impact the structuring, pricing, and negotiation of an M&A transaction.

Listen as our panel discusses the complex tax laws impacting M&A transactions and best practices and tips for structuring M&A transactions post-tax reform.

1. Overview of the impact of tax reform on M&A transactions
2. The transition tax and potential tax liability for U.S. companies with foreign subsidiaries
3. Asset vs. stock sale and the immediate expensing of property costs
4. New interest deduction limitations and impact on leveraged M&A transactions
5. New NOL deduction limitations and impact on pricing M&A transactions
6. New minimum tax regimes for multinational groups
7. New withholding tax on the sale of partnership interests
8. Tips and techniques for M&A counsel post-tax reform

The panel will review these and other issues:

• Challenges for structuring M&A transactions after tax reform
• Tax issues associated with targeting U.S. companies with foreign subsidiaries or assets
• Immediate expensing of costs of property under the new tax law and sales structure
• New limitations on interest and NOL deductions; impact on M&A negotiations and structuring
• The sale of a partnership interest and potential withholding tax
• Best practices for M&A counsel in light of recent tax law

Learning Objectives

After completing this course, you will be able to:

• Identify the tax laws impacting M&A transactions
• Recognize methods to avoid tax pitfalls in M&A transactions
• Determine the new NOL limitations in structuring transactions
• Discern the application of the new withholding tax on sales of partnership interests

• Field of Study: Taxes
• Level of Knowledge: Intermediate
• Advance Preparation: None
• Teaching Method: Seminar/Lecture
• Delivery Method: Group-Internet (via computer)
• Attendance Monitoring Method: Attendance is monitored electronically via a participant's PIN and through a series of attendance verification prompts displayed throughout the program
• Prerequisite: Three years+ business or public firm experience at mid-level within the organization, preparing complex tax forms and schedules; supervisory authority over other preparers/accountants. Working knowledge of partnership/corporate structure, debt financing, merger, and liquidation.

Strafford Publications, Inc. is registered with the National Association of State Boards of Accountancy (NASBA) as a sponsor of continuing professional education on the National Registry of CPE Sponsors. State boards of Accountancy have final authority on the acceptance of individual courses for CPE Credits. Complaints regarding registered sponsons may be submitted to NASBA through its website: www.nasbaregistry.org.

IRS Approved Provider

Strafford is an IRS-approved continuing education provider offering certified courses for Enrolled Agents (EA) and Tax Return Preparers (RTRP).