martindale.com
Legal Library
|
IRS Asserts Variable Prepaid Forward Contract with Share Lending is a
Present Sale by Mark P. Howe
Cadwalader, Wickersham & Taft LLP - Washington Office
David S. Miller
Cadwalader, Wickersham & Taft LLP - New York Office
Daniel J. Mulcahy
Cadwalader, Wickersham & Taft LLP - Washington Office
Shlomo M. Boehm
Cadwalader, Wickersham & Taft LLP - New York Office
Dashiell C. Shapiro
Cadwalader, Wickersham & Taft LLP - Washington Office
|
|
April 4, 2008
Previously published on February 21, 2008
On February 6, 2008, the IRS published Coordinated Issue Paper LMSB-04-1207-077 (the "Issue
Paper"). The Issue Paper reiterates the position (taken in a prior Technical Advice Memorandum
and Generic Legal Advice Memorandum) that a variable prepaid forward contract ("VPFC") that
includes or involves a share lending agreement or other similar arrangement and which allows the
counterparty to borrow the pledged shares ("Share Lending VPFCs") results in a current taxable
sale of the underlying shares, and that a taxpayer that fails to pay the resulting tax could be subject
to penalties. This position is now binding on all IRS examiners.1
|
The views expressed in this document are solely the views of the author and not Martindale-Hubbell. This document is intended for informational purposes only and is not legal advice or a substitute for consultation with a licensed legal professional in a particular case or circumstance. |
| | View More Library Documents By... | | | |
| | | | Cadwalader, Wickersham & Taft LLP Overview |
Practice Area Resource Centers
|
|