Corporate Tax Transactions

Domestic and foreign clients regularly retain Steptoe & Johnson LLP to represent them in all aspects of domestic tax and business planning.  We represent numerous types of entities, including publicly traded corporations, closely held corporations, S corporations, partnerships, limited liability companies, and tax-exempt entities.  We frequently obtain private letter rulings from the Internal Revenue Service or issue opinion letters with respect to transactions.

We regularly assist our clients in planning and negotiating taxable and tax-free acquisitions, restructurings, dispositions, LBOs, spin-offs, and joint venture arrangements.  In addition, we advise affiliated groups with respect to consolidated return issues, often negotiating and drafting tax-sharing agreements in the context of acquisition transactions.  We also address many other corporate tax issues that are collateral to our transactional tax planning, such as debt restructuring, tax accounting, and capital recovery issues.

Steptoe attorneys advise numerous types of clients engaged in business and investment ventures through partnerships, limited liability companies, and S corporations.  Clients using such pass-through entities include cross-border investors, tax-exempt organizations, and high-net-worth individuals.  Our clients also include corporations using partnerships and limited liability companies in corporate restructurings in order to provide new capital to an ongoing venture or to avoid multiple levels of tax.  In addition, we regularly advise clients on the use of entities disregarded for tax purposes to minimize cross-border taxation, isolate liabilities, and effect the transfer of wealth across generations.

We are often called upon by clients to assist them in lobbying and other tax policy matters or to advocate their positions before the IRS, the Treasury Department, or the US Congress.  Steptoe tax attorneys have significant experience organizing and managing coalitions of taxpayers to advocate a particular position.

Steptoe’s significant experience in tax audits, administrative appeals, and litigation enables our attorneys to anticipate issues raised by a proposed transaction and to address those issues in the planning stage (as well as at the audit, appeal, and litigation stages, if necessary).  This is especially helpful when working with our clients in evaluating the risks and benefits of alternative transaction structures.

Noteworthy

• Ranked, Chambers USA 2007, America’s Leading Lawyers; Tax: Corporate (National)

Representative Matters

Large Transactions 

• Advised a large foreign-based multinational consumer products group on a multibillion-dollar tax-free split-off transaction and internal restructuring
• Advised a large US-based group on a tax-free internal restructuring and disposition of its oil business, and obtained a closing agreement with the IRS as to the tax consequences of the transaction
• Advised a multinational specialty chemical and fuel additives manufacturer on a tax-free internal restructuring and spin-off, and obtained a private letter ruling with the IRS as to the tax consequences of the transaction
• Advised a large US-based multinational oil and gas company on a tax-free split-off transaction and internal restructuring  

Planning & Structuring  

• Advised on the conversion of the parent of a large, closely held consolidated group to S corporation status and on the application of various consolidated return and corporate tax rules
• Assisted a large closely held consolidated group in restructuring debt of affiliated partnerships
• Advised a nationwide retailer on the disposition of its toy division in a taxable transaction
• Advised a large non-US advertising company on a multi-billion-dollar repurchase agreement (repo) financing transaction
• Advised a closely held investment company in connection with the recapitalization of subsidiaries
• Evaluated prior tax positions and possible internal restructuring for a foreign luxury goods manufacturer, distributor, and retailer
• Advised an insurance company regarding the distribution of cash in connection with the disposition of a subsidiary
• Drafted partnership agreements for various types of businesses, including investment advisory, real estate, electric utility, defense contracting, and entertainment businesses
• Represented a large closely held investment company with respect to several S corporation issues, including conversion from C corporation status to S corporation status and the application of certain corporate-level taxes after the conversion
• Represented a large multinational media company in connection with the restructuring of one of its business units abroad, which included issues related to the sharing of partnership liabilities and allocations of tax items under section 704(b) and section 704(c)
• Advised a large multinational natural resources company in connection with a partnership redemption transaction coupled with a subsequent tax-free reorganization, which included issues related to the “hot asset” rules for partnership distributions and disguised sales of property
• Advised a large multinational scientific equipment and services provider in connection with a proposed disposition of a business unit and the departure of an investor in another business unit, which included several “mixing-bowl” issues and section 731(c) marketable securities issues
• Advised a high-net-worth individual with respect to the use of certain trusts as shareholders of an S corporation  

Investment Fund & Private Equity  

• Developed advantageous structure for a foreign pension fund’s sponsorship and capitalization of US real estate-related investment funds
• Represented a large closely held foreign investment fund with respect to complex restructuring of US partnership investments  
• Represented a high-net-worth family on all aspects of their substantial foreign business and investment holdings  

Tax Policy & Government Advocacy  

• Represented a large consumer products company before Congress and the Treasury Department in connection with proposed legislation to amend the section 355 spin-off provisions  
• Represented a multinational scientific equipment and services provider before Congress and the Treasury Department to obtain amendments to the section 355 spin-off provisions and related regulations  
• Assisted a large telecommunications company to obtain an advance ruling from the IRS regarding the application of the section 355 spin-off provisions
• Organized a coalition of companies to obtain a global settlement from the IRS on the so-called “contingent liability tax shelter”  
• Organized a coalition of companies to lobby Congress for corporate capital gains tax relief
• Represented clients before the Congress and Treasury regarding the application of the tax-exempt use loss rules to pass-through entities  
• Represented a large closely held investment company before Treasury regarding the application of the AMT to shareholders in S corporations
• Represented clients before the Congress and Treasury in an effort to reduce or eliminate the double tax on certain S corporation income  

Controversy  

• Represented a large multinational media company before the IRS Appeals Office in connection with a proposed adjustment involving a significant consolidated returns intercompany transaction
• Represented a large natural resources company in litigation with the Department of Justice in connection with the formation of an environmental remediation subsidiary and the contribution of contingent environmental liabilities to the subsidiary; obtained a settlement prior to trial  
• Represented a large railroad company on audit and before the IRS Appeals Office in connection with a proposed adjustment involving several like-kind exchanges and involuntary conversions  
• Represented a large natural resources company in litigation with the Department of Justice in a dispute over the use of the long-term contract method of accounting  
• Assisted a large multinational media company to resolve on audit a potential billion-dollar tax liability relating to a spin-off transaction
• Advised a high-net-worth individual in connection with an IRS audit regarding several structured transactions utilizing partnerships and S corporations  
• Advised a multinational chemicals company before the Appeals Office of the IRS regarding its partnership investments in low-income housing  
• Obtained a pre-filing agreement regarding the valuation of a large closely held investment company’s assets for purposes of applying the “built-in gains” tax applicable to S corporations

News

• Steve Teplinsky and Lisa Zarlenga to Speak at Federal Bar Association Annual Tax Law Conference
• Tax Partner Kassim Meghjee Joins International Tax Team in London Office

Events

• Codification of Economic Substance Doctrine - Is It an Idea Whose Time has Come and Gone?

Speaking Engagements

• The Use of LLC’s in Corporate Transactions, Including Sec. 355 Spin Offs
• Matt Lerner on DC Bar Panel: Recent Developments in the Economic Substance and Business Purpose Doctrines—What Does It Mean for Corporate Tax Planning?
• Steve Teplinsky at New York University's 65th Institute on Federal Taxation: Hot Topics in Corporate Tax

Publications

• Tax Treatment of Reorganization Costs
  June 2008
• Use of Limited Liability Companies in Corporate Transactions
  April 25, 2008
• UK Tax Law Update - 2008 UK Budget
  March 2008
• UK Tax Law Update, Issue 2
  November 2007