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ARTICLE · 14 MAY 2024

Internal Revenue Service Alters Its View On Section 355 Spin-Offs

Jones Day
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The Internal Revenue Service ("IRS") recently issued important guidance identifying new positions the IRS is considering on critical aspects of tax-free spin-offs.

United StatesTax
Joseph A. Goldman
Joseph A. Goldman
Edward Kennedy
Edward Kennedy
Amie Colwell Breslow
Amie Colwell Breslow
Andrew Eisenberg
Andrew Eisenberg
Peter Izanec
Peter Izanec
Richard Nugent
Richard Nugent
L. Matthew Waterhouse
L. Matthew Waterhouse
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The Internal Revenue Service ("IRS") recently issued important guidance identifying new positions the IRS is considering on critical aspects of tax-free spin-offs, and significantly expanding the information that taxpayers must supply to obtain an advance ruling confirming their spin-off's tax-free status.

On May 1, 2024, the IRS issued Notice 2024-38 (the "Notice") identifying new positions it contemplates taking on critical aspects of section 355 "tax-free" spin-offs, and it issued Revenue Procedure 2024-24 (the "Rev. Proc.") updating the representations and related information a taxpayer must supply to obtain a private letter ruling (an "advance ruling") confirming a spin-off's tax-free status.

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