Corporate Overview (Portfolio 750)
Corporate Overview is designed to provide a general overview of the taxation of Subchapter C corporations.
Bloomberg Tax Portfolio, Corporate Overview, No. 750, is designed to provide a general overview of the taxation of subchapter C corporations. Although the entire Code contains statutory provisions applicable to corporations, the bulk of the provisions pertaining solely to corporations reside in Subchapter C of the Internal Revenue Code. Subchapter C consists of five effective parts containing the 300-series of Code sections: Part I, Distributions by corporations (§§301–307); Part II, Corporate liquidations (§§331–341); Part III, Corporate organizations and reorganizations (§§351–368); Part IV, Repealed; Part V, Carryovers (§§381–384); Part VI, Treatment of certain corporate interests as stock or indebtedness (§385); and Part VII, Repealed. Each Part pertains to one or more types of transactions involving the stock of a corporation, and focuses primarily on the separation of entity and owner for purposes of taxing business earnings. Consequently, they address the tax consequences of distributing income and property, and significant changes to the ownership of a business, whether that involves liquidating, reorganizing, or exchanging the business assets or stock for stock of another corporation.
In addition to the Subchapter C rules, this portfolio provides a brief overview of the taxation of a C corporation’s ongoing operations. This includes the corporate income tax (§11 and related provisions); the alternative minimum tax (§§55–59); and the two penalty taxes: the accumulated earnings tax (§§531-537) and the personal holding company tax (§§541–547).
While Subchapter C applies to all corporations, certain other chapters and subchapters create special classes of corporations. At times, these additional rules serve merely as an overlay to the Subchapter C provisions. In other situations, these other provisions supersede or render inapplicable the Subchapter C rules. This portfolio limits its discussion to corporations not meeting the requirements of a special class of corporations and, therefore, discusses Subchapter C as it applies to a single, general corporation.
Information regarding the special treatment of corporations outside of the scope of this portfolio, and references to portfolios discussing them in greater detail, are as follows: (1) Affiliated Corporations (754 T.M., Consolidated Returns — Elections and Filings and 755 T.M., Consolidated Returns — Investment in Subsidiaries); (2) Multinational Corporations (Foreign Income Series of the Bloomberg Tax Management Portfolios); (3) Pass-through Corporations (710 T.M., Partnerships — Conceptual Overview,et seq., 730 T.M., S Corporations: Formation and Termination, and 731 T.M., S Corporations: Operations); (4) Other Special Classes, such as insurance companies, regulated investment companies, tax-exempt organizations, and banking institutions; and (5) Multistate Corporations (783 T.M., State Taxation of Mergers and Acquisitions).
Table of Contents
I. Organization of a C Corporation
II. C Corporation Operations
III. Multiple Corporations
IV. Corporate Distributions
V. Stock Dividends
VI. Complete Liquidations
VII. Taxable Sale of C Corporation Business
VIII. Tax-Free Reorganizations
IX. Corporate Divisions
X. Corporate Tax Attributes
XI. Landmark Cases in Subchapter C Arena
Tax Research Director
Warner Tax Consulting LLC
Gravel & Shea PC
Instructor Of Accounting
Florida Atlantic University
Tax Management Portfolio Authors