April 7, 2015
Proposed Treasury Regs Aim to Curb Elective Transaction Costs Treatment
As noted in this Proskauer memo:
Some taxpayers have taken the position that an acquiring corporation and a target corporation, when the target corporation is joining the acquiring corporation’s consolidated corporate group, can choose between taking certain acquisition-related expenses into account in the target’s pre-acquisition taxable year or the post-acquisition consolidated taxable year. If included in the post-acquisition consolidated taxable year, this has the effect of permitting the use of these deductions to offset the income of other group members without limitation under section 382 of the Code. On March 5, 2015, Treasury issued proposed regulations that would reverse this result.