In this column, we will explore the income tax consequences of debt extinguishment in three types of nontaxable corporate transactions when both the debtor and creditor are members of a consolidated return group:
- Transfers to controlled corporations under Code Sec. 351
- Subsidiary liquidations under Code Sec. 332
- Acquisitive reorganizations under Code Sec. 368(a)
Unless stated otherwise, both the transferor and the transferee corporations are solvent for purposes of this tax column.