The course is on the taxation of corporations and their shareholders. The course assumes you know basic concepts of taxable income from the Federal Income Tax course, including basis, calcultion of gain and loss, capital gains and treatment of nonrecognition transactions. . But the issues come from transactions, rather than operating income. including, for instance, the formation of a corporation, distributions to shareholders, redemptions of stock, liquidations of corporations, and corporate reorganizations. The substance over form doctrine often taxes a transaction not according to its form but according to its underlying substance.
Rate changes in recent years mean that the corporation is no longer the entity of choice for small business, except by mistake. Partnership taxation will be a more important second course for general business lawyers. But Corporate Tax will also cover Sub S Corporations, which are commonly the choice of entity for small businesses.
The course uses a combination of the problem method and a discussion of cases and IRS rulings. The grade for the course will be based on a final, open book examination. Three Units.
Prerequisite: Federal Income Tax.