South Beach — Death And Taxes Assured

Law360, New York (September 02, 2010, 5:51 PM ET) -- Preservation of favorable tax attributes, such as net operating losses (NOLs) that might otherwise be forfeited under applicable nonbankruptcy law, is an important component of a business debtor's Chapter 11 strategy. However, if the principal purpose of a Chapter 11 plan is to avoid paying taxes, rather than to effect a reorganization or the orderly liquidation of the debtor, the Bankruptcy Code contains a number of tools that can be wielded to thwart confirmation of the plan.

The Seventh Circuit Court of Appeals was recently called...
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