IRS PLR: Reorganization Qualifies for No Gain or Loss Recognition (IRC § 368)

Taxpayer’s First Controlled Contribution and Distribution will qualify as a reorganization under sections 368(a)(1)(D) and 355 of the Internal Revenue Code. 1) No gain or loss will be recognized by Distributing upon the transfer of property to Controlled in the First Controlled Contribution, or by Controlled on receipt of such property; 2) Controlled’s basis in the property received equals Distributing’s basis, and the holding periods carry over; 3) No gain or loss will be recognized by Foreign Parent upon receiving Controlled stock in the Distribution, or by Distributing on the Distribution; and 4) Foreign Parent’s holding period in the Controlled ...