Restructuring Debt? S Corporations Must be Savvy to Tax Impact, Says RSM McGladrey Expert

ARLINGTON, Va., July 9 /PRNewswire/ -- In today's economic environment many companies are considering and obtaining debt restructuring from creditors. For an S corporation and their shareholders, there are several significant tax provisions which could impact the results of a debt discharge or debt modification. Tax Issues with Regard to Forgiveness of Debt of an S Corporation, a new BNA audioconference presented by RSM McGladrey Tax Director Lewis Taub, July 29, 12:30 - 2:00 pm, addresses both the basics and the tax ramifications and decisions that must be made in order to arrive at the best tax consequence resulting from any debt forgiveness of an S corporation.

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In this 60-90 minute audioconference, participants will understand:

  • The new rules with regard to electing the deferral of income resulting from the discharge of debt
  • What constitutes a debt discharge
  • Impact of making the election on an entity level
  • What factors would accelerate deferral of income
  • When would it be disadvantageous to defer the income
  • Proposed regulations concerning the reduction of tax attributes upon the discharge of debt of an insolvent or bankrupt S corporation
  • How the rules concerning debt discharge of an insolvent or bankrupt S corporation impact both the tax basis of the shareholders and their utilization of entity level losses
  • The interplay between the provisions available to S corporations and considerations in obtaining the most favorable result

Following the audioconference, participants will be able to:

  • Identify debt modifications that could have a significant taxable impact on an S corporation
  • Apply the tax rules to any situation of an S corporation which has a discharge of debt
  • Minimize the tax effect from debt modifications of either a solvent or insolvent S corporation
  • Understand certain circumstances and complexities which the IRS has not yet addressed

"Designed to facilitate debt restructurings in the current economic downturn, the section 108(i) deferral election nevertheless raises many questions," says BNA senior tax analyst Allen Calhoun. "The fact that the election is made at the entity level creates fiduciary responsibility risks in S corporations. Also, an S corporation must choose between the deferral election and the bankruptcy and insolvency exclusions (with attribute reductions) under Section 108. An S corporation must be fully informed of the risks of the election and the principles of attribute reduction before making the decision. This audioconference provides the information needed to make the right decision."

To register for this audioconference and obtain further information about CLE and CPE credits, go to: call 1-800-372-1033, menu Option 6, then Option 1. The fee is $249 for BNA subscribers, $299 for nonsubscribers.

To receive automatic, email notification of upcoming BNA audioconferences that may be of interest to you, go to:

About BNA Tax & Accounting Audioconferences

Designed for today's busy practitioners, BNA Tax & Accounting audioconferences offer the same expertise and relevance that are the hallmark of BNA Tax Management resources. In just 60-90 minutes, practitioners gain in-depth knowledge on a current tax or accounting topic from experts in that area -- and benefit from practical applications that can be put to work immediately. Conference attendees have the opportunity to ask the speakers questions, and may be eligible to earn CLE or CPE credits -- all from the convenience of their own office or conference room.

    Press Contact:
    Mark Carrington

SOURCE BNA Tax & Accounting


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