Court's Piccadilly Decision Draws Bright Line

Law360, New York (July 11, 2008, 12:00 AM EDT) -- The ability to sell assets during the course of a Chapter 11 case without incurring transfer taxes customarily levied on such transactions outside of bankruptcy often figures prominently in a potential debtor’s strategic bankruptcy planning.

However, the circumstances under which a sale and related transactions (e.g., mortgage recordation) qualify for the tax exemption have been a focal point of vigorous dispute in bankruptcy and appellate courts for over a quarter-century, resulting in a split on the issue among the federal circuit courts of appeal and, finally,...
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