In assessing potential structures, we explore whether the qualified small business stock regime is a viable option. More on Tax Credits & Incentives Advisory > Qualified Small Business Stock (Section 1202) While diligence is often thought of as identifying potential issues, we also seek to identify opportunities for the buyer in terms of more favorable tax credits, deductions, and tax planning, such as R&D tax credits or cost segregation studies. Embedded tax liabilities as a result of an improper accounting method can create a significant deal barrier depending on the structure of the transaction and the impact on future taxable income to correct the accounting method. Our professionals have extensive experience in strategic tax planning and implementation considerations related to multi-jurisdictional and cross-border transactions.Īs part of any diligence project, we assess the accuracy of the accounting methods being used by the target company. Our international tax professionals align your business strategies and desired outcomes with successful international tax strategies by providing an extensive array of international tax planning, compliance, and advisory services to help you achieve your goals. More on State & Local Tax > International Tax In any diligence project, we involve our State & Local Tax group to help understand the risks as well as the cost to mitigate them. The continued expansion of concepts such as “economic nexus” from both a sales tax and income tax perspective has created many business traps and typically creates issues for even the most sophisticated market participants, often requiring them to balance tax regulatory compliance with accepting a certain amount of business risk. A diligence process is rarely completed without discovering potential state and local tax exposure. State & Local TaxĪ variety of state and local tax issues come into play as it relates to M&A transactions. Communication throughout the process as well as assisting in quantifying any potential exposure and cost-effectively mitigating any risk is our primary objective in the tax diligence process. Working with the buyer to assess the risk factors associated with an acquisition and agreeing on the appropriate scope to address those risks is critical to a successful diligence process. In assessing alternative structures, we consider investor group entity requirements, expected holding period, presence of international operations and desire to create tax efficient equity participation by key members of management. To do so, we consider the complexity of the proposed structure and promote operationally and legally feasible alternatives where the exist. Considering both the short- and long-term objectives of the buyer, we help our clients assess alternative structures to achieve maximum tax efficiency while balancing the need for business efficiency.
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