Annotated Bibliography On Corporate Reorganization

Betty Wilson’s venture of opening a Christian Coffee House in Belmont, NC, presents her with abundant opportunities in selecting a business form. She is considering the following types of entities: 1) franchise, 2) sole proprietorship, 3) partnership of some sort, 4) corporation of some sort, 5) LLC, or 6) even as a joint venture. We will briefly explore each business option and give Betty concise recommendations as to what business form to pursue as well as what business partners to engage.

1) Section 351: Since Individual will be in control (80%+ ownership) of future corporation, he will not incur a taxable event

If this individual receiving all voting stock and then transfer to his children, he actually “control” the corporation and his children will have ability to “control” the corporation in fact. It will be qualified to recognize no gain or loss during the transaction.

1. Section 351 (which permits transfers to controlled corporations to be tax deferred) can be justified under the

Part I: Discuss the various forms of organization that are available to Penelope, Mark and John. There are a few different options from which you can chose to organize your business under. For example: partnership, LLP, S Corporation, C Corporation for which I know you are all familiar with. It is my duty to give you my own educated and unbiased opinion to which would be most beneficial to all of you.

Corporate reorganization is definitely an available option. The company should be structured as a parent-subsidiary controlled group. The restructuring should be performed in conformance to any and all tax-saving codes and provisions.

In the United States today there are millions of corporations in many different industries. All of them must abide by the current taxation rules and regulations that have been set by IRS and congress. The Internal Revenue Code, which was originally founded in 1939, set the foundation for the codification that we have in place today. The code arranged all Federal Tax provisions in a logical order and placed them in a separate part of the federal status. Over the years, congress has updated and amended the tax code in 1954, in 1986 Tax Reform Act, and is constantly updating the code due to its importance in assessing judicial and administrative decisions. The

b. A parent transfers the net assets of a wholly owned subsidiary into the parent and liquidates the subsidiary. That transaction is a change in legal organization but not a change in the reporting entity.

deduction in its draft tax return, resulting in a $40 reduction to taxes payable. There is uncertainty over

In accordance with the liquidation, distribution laws Javier would have to recognize a gain of $20,000 at the end of the year as he only had $100,000 basis but is receiving $120,000 (12*10000). The partnership will not have to recognize a gain or a loss according to the information provided.

* The ownership of the partners is dissolved and they become mere employees who are responsible to the shareholders and Board of Directors

The McGee Cake Company, currently operating as a sole proprietorship, may benefit from forming a limited liability company (LLC). An LLC is a comparatively new type of business entity. With an LLC there are reduced legal formalities in comparison to setting up a corporation. In addition, unlike a corporation, the McGees could set up an LLC yet remain the sole owners of the company. Another advantage as the owners of an LLC, the McGees are taxable only for personal income and not for the income of your LLC. Therefore, they would not pay double income tax. An LLC also has a long

Many companies emphasize a culture of continuous improvement. While never being satisfied with the status quo can drive

The purpose of this report was to examine organization restructuring. Research for the report included literature based on organizational restructuring and the various processes involved in restructuring. The major findings indicate that the two methods commonly used for organizational restructuring to be downsizing and reengineering of business processes(Cummings & Worley, 2008). Downsizing assist the company to reduce its workforce, and this saves cost in terms of payroll reduction. Reengineering allows a company to change and adapt to the way it

Daren Stevens has owned and operated a golf driving range (Dog Leg Golf Course) for a number of years. The sole proprietorship has been successful and grown to the point where it now also offers golf lessons and sponsors tournaments and other activities. Daren has been advised that incorporating his proprietorship would give him an opportunity to restructure the business debt and to acquire additional working capital at more favorable rates.