27 Sep 2022
First Analysis: Inflation Reduction Act’s Potential Impact on M&A Transactions
There are several tax-related provisions in the Inflation Reduction Act that may affect the way companies structure M&A transactions. Stay ahead of the curve and familiarize yourself with the 1% excise tax applicable to covered corporations, the definition of “covered corporations,” and the 15% alternative minimum tax imposed on corporations based on adjusted financial statement income.
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Check out the considerations involved in a “bootstrap acquisition” transaction, including pre-closing reduction in the target’s equity value, tax on asset distributions, redemptions and capital gain treatment, pre-closing distributions as part of a tax-free reorganization, leveraged bootstrap acquisitions, and whether the incurrence of debt can be deemed a taxable distribution to the buyer.
- Tax Considerations in M&A Resource Kit
Browse a selection of practice notes, templates, checklists, and articles to build a basic understanding of tax considerations.
- Tax Covenants and Indemnification Clauses (Private Target Acquisition)
Refer to these typical tax covenants and indemnification clauses to explore buyer and seller perspectives, along with other guidance.
- Post-Acquisition Tax Concerns
Prepare your client for post-acquisition tax concerns in tax-free transactions and taxable transactions.
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