(A) Facts. When D.C. filed its tax return for the fiscal year of the FS transfer, it was aware of the requirement to submit an ARG to avoid recognition of a Section 367 benefit, point a) (1). However, given that DC anticipated the sale of Business A in the following fiscal year, which was to generate a capital loss that could be recovered in order to fully offset the profit recorded during the FS transfer, DC deliberately decided not to submit GRA. DC recognized the benefit of the FS transfer under Section 367 (a) (1) and reported the profit on its tax return in a timely manner. At the end of the following year, a large class action was filed against Business A, so that DC was not able to sell the business. As a result, DC did not realize the expected loss of capital and was unable to offset the benefit of the FS transfer. DC is now trying to submit an GRA for FS transmission. (ii) provides the guarantee in paragraph h of this section for any federal tax debt of the U.S. Cedant under the Benefit Recognition Agreement; or (ii) any recognition and recognition agreement document referred to in paragraph (d) (1) (i) of this section is completed in all significant elements. (i) the first recognition agreement and all other purchase documents that must be provided by the initial benefit recognition agreement are included in a timely tax return filed by the U.S. assignor for the year in which the initial transfer took place; and (A) the facts. At the time of the first transfer, the TFD share has a 50x base and a fair value of 100x.
As a result, the amount of profits subject to the Benefit Recognition Agreement is 50 times greater. In Year 3, UST transferred its assets to DC for 20% of DC`s outstanding assets, in accordance with an asset adjustment described in Section 368 (a) (1) (A). UST distributes DC`s portfolio to USP in accordance with the turnaround plan. (A) Facts. The UST owns f1 and TFD. The F1 stock has an underlying 100x and a fair value of 90x, and the TFD share has a 0x base and a fair value of 100x. UST also owns properties with a 10x base and a fair value of 10x. In Year 1, according to a Section 351 exchange, UST transfers the real estate, TFD and F1 shares to TFC in exchange for 20 TFC shares. UST enters into a recognition agreement for the transfer of the TFD share. The amount of the profit recognition agreement is 100x. UST takes the position that the basis of each TFC share received on the stock exchange is US$5.5x (an amount proportional to 110 times the aggregate base of the transferred property).