
James F. McDonough
Of Counsel
732-568-8360 jmcdonough@sh-law.comFirm Insights
Author: James F. McDonough
Date: August 4, 2014
Of Counsel
732-568-8360 jmcdonough@sh-law.comCorporate inversions, in which a U.S.-based multinational acquires a smaller, foreign firm in order to re-domicile in a new, lower-tax country, have become a serious issue in American politics recently. Now, it appears that this issue may be a powerful motivator in the upcoming midterm House and Senate elections this November, according to The Wall Street Journal
A renewed push coming from the White House brought the issue even further into the public spotlight, alongside a coordinated drive from the Democratic party to effect legislation that will limit or halt the practice, the news source explained. Many Republicans agree that the issue should be addressed, but are halting bills that would curb the practice, hoping instead for a complete overhaul of the corporate income tax. These right-wing politicians note that the U.S. has the highest on-paper corporate income tax rate in the developed world. They say that they haven’t seen any proposals from the White House that would solve the problem.
Democrats have made a number of proposals that would alter the corporate tax code, including one that would change the requirement regarding the acquired company’s ownership share of the joint company that is created in an inversion, according to the Journal. Currently, the requirement is that the foreign company’s shareholders must be given at least a 20 percent share in the new company, meaning that it is frequently in the best interests of shareholders in the U.S. company to give up a portion of their shares in exchange for a significantly lower tax burden. A proposal from Sen. Carl Levin, D-Michigan, would raise this requirement to 50 percent.
“This is an issue that understandably gets people very angry,” Rep. Chris Van Hollen, D-Maryland, told the news source. “If Republicans are going to oppose our efforts in this area, they are going to have to explain why they are shielding American corporations that are deserting the U.S. in order to dodge their obligations to the country and American taxpayers.”
It seems that 2014 is the year of corporate tax inversions. Frank Brunetti and I have written about this topic at tremendous length due to all the new information brought to light about this subject. Find out more about the companies involved in corporate tax inversion and what Washington is doing about it here:
No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.
Breach of contract disputes are the most common type of business litigation. Therefore, nearly all New York and New Jersey businesses will likely have to deal with a contract dispute at least once. Understanding when to file a breach of contract lawsuit and how long you have to sue for breach of contract is essential […]
Author: Brittany P. Tarabour
Closing your business can be a difficult and challenging task. For corporations, the process includes formal approval of the dissolution, winding up operations, resolving tax liabilities, and filing all required paperwork. Whether you need to understand how to dissolve a corporation in New York or New Jersey, it’s imperative to take all of the proper […]
Author: Christopher D. Warren
Commercial leases can take a variety of forms, which is often confusing for both landlords and tenants. Understanding the different types, especially the gross lease structure, is important when selecting the lease that best suits your needs. One key distinction between lease types is how rent is calculated and paid. This article addresses the two […]
Author: Robert L. Baker, Jr.
Over the past year, brick-and-mortar stores have closed their doors at a record pace. Fluctuating consumer preferences, the rise of online shopping platforms, and ongoing economic uncertainty continue to put pressure on the retail industry. When a retailer seeks bankruptcy protection, a myriad of other businesses are often impacted. Whether you are a supplier, customer, […]
Author: Brian D. Spector
Since his inauguration two months ago, Donald Trump’s administration and the Congress it controls have indicated important upcoming policy changes. These changes will impact financial services policies and priorities. The changes will particularly affect cryptocurrency, as well as banking rules and regulations. Key Regulatory Changes in Cryptocurrency For example, in the burgeoning cryptocurrency business environment, […]
Author: Dan Brecher
The retail sector has experienced a wave of bankruptcy filings over the last year. Brick-and-mortar businesses in financial distress include big-name brands like Big Lots, Party City, The Container Store, and Vitamin Shoppe. When large retailers seek bankruptcy protection, they are not the only businesses impacted. Landlords can be particularly hard hit. While commercial landlords […]
Author: Brian D. Spector
No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.
Consider subscribing to our Firm Insights mailing list by clicking the button below so you can keep up to date with the firm`s latest articles covering various legal topics.
Stay informed and inspired with the latest updates, insights, and events from Scarinci Hollenbeck. Our resource library provides valuable content across a range of categories to keep you connected and ahead of the curve.
Let`s get in touch!
Sign up to get the latest from the Scarinci Hollenbeck, LLC attorneys!