Abstract
In the 1918-1921 period, Congress enacted tax laws to grant a tax reprieve to business combinations aimed at helping them to withstand the vicissitudes of the marketplace. However, since that time business combinations have been subject to Congressional indecisiveness, judicial flip-flop, and taxpayer abuse. Given disputes regarding the tax status of combinations, taxpayers and the IRS resolve their disputes in one of four mutually exclusive courts. Two logistic regression decision models were developed to determine IRS and taxpayer strategies in resolving their conflicts. The dependent variable for the IRS's model is whether or not the IRS chooses to litigate its disagreement with combining parties. The dependent variable for the taxpayer's decision model is the choice of four mutually exclusive courts. The primary purpose of the dissertation is to uncover IRS and taxpayer strategies in resolving business combination conflicts. To a lesser extent, the dissertation is aimed at assessing whether structural differences exist among the courts because of specialization of Tax Court judges, a sympathy posture of the district court, and mandatory prepayment in the district court and Claims Court. The dissertation provides evidence that taxpayers are more likely to select the district court over the Tax Court as the magnitude of their tax carryovers increases. The IRS, on the other hand, is likely to initiate litigation as the ratio of the target firm's assets to the acquiring firm's assets increases and where taxpayers pay a premium for target firm's tax carryovers.
Billings, Boysie Anthony (1986). Business combinations : litigation and taxpayer strategy. Texas A&M University. Texas A&M University. Libraries. Available electronically from
https : / /hdl .handle .net /1969 .1 /DISSERTATIONS -22024.