Mergers and Acquisitions of Pass-Through Entities: Structuring to Minimize Taxes and Maximize Deal Value
M&A Pros and Cons of LLCs, Partnerships, S Corps, and C Corp Conversions
Course Details
- smart_display Format
Live Online with Live Q&A
- signal_cellular_alt Difficulty Level
Intermediate
- work Practice Area
Commercial Law
- event Date
Wednesday, August 6, 2025
- schedule Time
1:00 p.m. ET./10:00 a.m. PT
- timer Program Length
90 minutes
-
This 90-minute webinar is eligible in most states for 1.5 CLE credits.
This CLE course will examine entity structuring alternatives when acquiring or selling a pass-through entity, emphasizing their differing impacts on sellers and purchasers such as the impact on tax basis step-up, financing considerations, rollover and tax deferral issues, and incentive equity and self-employment matters. The panel will also discuss conversions of pass-through entities into C corporations, hybrid structures, and the treatment of asset vs. equity purchases.
Mr. Wynacht concentrates his practice in the area of federal tax law and has significant experience giving practical tax advice in a variety of complex transactional matters. He represents both domestic and foreign individuals and business entities in day-to-day operational matters and complex business transactions including business start-ups, mergers and acquisitions, business and capital restructurings, and U.S.-inbound and U.S.-outbound investment matters. Mr. Wynacht recently represented various private equity firms on dispositions and acquisitions of portfolio companies. He also recently represented a large domestic manufacturer in a $1 billion (plus) financing transaction.
Mr. Falevich focuses his practice on domestic and cross-border mergers and acquisitions, corporate and partnership reorganizations, and real estate, partnership, limited liability and joint venture transactions.
Purchasers and sellers in M&A deals seeking to improve the deal value and maximize income tax savings through flow-through structures need to consider various alternatives and impacts on both sellers and purchasers, such as maximizing tax basis step-up, allowing for tax deferral of a rollover, determining best acquisition financing methods and considering self-employment constraints on rollover and incentive equity holders.
Pass-through entities (i.e., partnerships and S corporations) are still often preferred for M&A transactions due to, among other attributes, their single level of taxation. Still, whether buying into a flow-through structure or trying to fit a target into a purchaser's current flow-through structure, parties on both the buy-side and sell-side of a deal have to consider structuring to achieve various objectives of both the sellers and purchasers. A proper structuring determination requires analyzing the tax burdens on operating income, distributions, and exit transactions and reviewing legal and practical business considerations.
In planning a transaction, a purchaser may wish to take advantage of expensing purchased assets and a tax basis step-up in the assets. However, the chosen transaction structure may influence whether expensing is available.
Listen as our authoritative panel discusses the pros and cons of corporate and pass-through entity structures in M&A transactions.
I. Choice of entity
A. C corporations
B. Pass-through entities (i.e., partnerships and S corporations)
C. Hybrid structures
D. Pros and cons
II. Asset vs. entity sales
III. Transaction structures and considerations
IV. Issues relating to financing and rollover
V. Incentive equity and self-employment matters
VI. Corporate conversions: pros and cons
The panel will review these and other key issues:
- dvantages and disadvantages of using partnerships and S corporations as compared to C corporations
- Factors to consider in asset vs. entity sales
- Various considerations with different types of transaction structures
- Financing considerations to maximize tax benefits for buyers and sellers
