The Resource Like-kind exchanges pursuant to Section 1031 Internal Revenue Code and their consequences under German CFC rules

Like-kind exchanges pursuant to Section 1031 Internal Revenue Code and their consequences under German CFC rules

Label
Like-kind exchanges pursuant to Section 1031 Internal Revenue Code and their consequences under German CFC rules
Title
Like-kind exchanges pursuant to Section 1031 Internal Revenue Code and their consequences under German CFC rules
Creator
Subject
Language
eng
Summary
On the basis of sound economic reasoning, numerous tax systems have provisions that allow for tax-free exchanges of like-kind property. When the property is sold after the exchange the gain will usually be taxed so that it is in fact not a tax-free exchange but rather a deferral of taxation until the sale of the property. After a brief overview of the basic like-kind exchange rules under the US Internal Revenue Code (IRC) and the basic concepts of the German Controlled Foreign Corporations (CFC) rules, this article discusses the possible consequences of a like-kind exchange of US property by a US corporation, owned and controlled by shareholders resident in Germany under German CFC-rules. As a few examples will demonstrate, a like-kind exchange under US law could - if certain conditions are met - lead to the application of German CFC-rules thereby reversing the non-recognition event. In these instances, German CFC legislation overreaches the basic purpose of CFC-rules - to prevent or reduce abuse and designs for tax evasions
Citation source
In: Intertax. - Alphen aan den Rijn. - Vol. 41 (2013),
http://library.link/vocab/creatorName
  • Kraft, G
  • Zielinski, S
Language note
English
http://library.link/vocab/subjectName
  • like-kind exchange
  • CFC
Label
Like-kind exchanges pursuant to Section 1031 Internal Revenue Code and their consequences under German CFC rules
Instantiates
Publication
Label
Like-kind exchanges pursuant to Section 1031 Internal Revenue Code and their consequences under German CFC rules
Publication

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