Redetermination of Tax Detriments Allocated to SSE Sample Clauses

Redetermination of Tax Detriments Allocated to SSE. On its 2013 U.S. federal consolidated income Tax Return, the Chesapeake consolidated group reports no consolidated net taxable income, an NOL of $100x, and no Tax liability. $50x of the NOL consists of Tax Items that are deemed to arise from the operation or ownership of the Chesapeake Business and the remaining $50x consists of Tax Items that are deemed to arise from the operation or ownership of the SSE Business. Because no Tax is owed on the Joint Return, no payments are required to be made under this Agreement. In 2015, the Tax Authority initiates a Tax Contest with respect to the 2013 Joint Return. In the Tax Contest, the Tax Authority asserts that an additional $100x of taxable income must be reported on the 2013 Joint Return. Such income arose from the SSE Business. Pursuant to Section 5.2(b), Chesapeake may, in its sole discretion, permit SSE to be the Controlling Party with respect to the Tax Contest. In such case, pursuant to Section 5.2(c), Chesapeake would have Non-Controlling Party participation rights with respect to the Tax Contest because such Tax Contest may result in the reduction of a Chesapeake Tax Benefit. On December 31, 2015, a date subsequent to the Spin-off Date, SSE agrees, with Chesapeake’s consent, to enter into a closing agreement with the Tax Authority to recognize $100x of additional taxable income in 2013 in settlement of the Tax Contest. As a result of the closing agreement, Section 4.3(b) requires that the amounts paid under this Agreement be redetermined. Under applicable Tax Law, SSE and Chesapeake are entitled to use the $100x NOL to completely offset the additional taxable income recognized as a result of the Tax Contest. Therefore, no additional Tax is owed as a result of the closing agreement. Pursuant to Section 2.1(b)(ii) and Section 2.1(b)(iv), SSE is entitled to take the entire $100x NOL into account as a Tax Benefit in calculating SSE Taxes, which results in SSE Taxes of $0x (viz., $100x - $100x). SSE is not required to reimburse Chesapeake for the use of the $50x portion of such NOL that arose from the operation or ownership of the Chesapeake Business. Alternatively, assume that the 2013 Joint Return did not report an NOL. As a result, the closing agreement results in $100x of consolidated net taxable income, no credits, and a Tax liability of $35x (viz., (35%)($100x)). All $100x of the consolidated net taxable income consists of Tax Items that are deemed to arise from the operation or ownership of the SSE Busi...
Sample 1
AutoNDA by SimpleDocs

Related to Redetermination of Tax Detriments Allocated to SSE

  • Allocation of Tax Items To the extent permitted by section 1.704-1(b)(4)(i) of the Treasury Regulations, all items of income, gain, loss and deduction for federal and state income tax purposes shall be allocated to the Members in accordance with the corresponding "book" items thereof; however, all items of income, gain, loss and deduction with respect to Assets with respect to which there is a difference between "book" value and adjusted tax basis shall be allocated in accordance with the principles of section 704(c) of the IRS Code and section 1.704-1(b)(4)(i) of the Treasury Regulations, if applicable. Where a disparity exists between the book value of an Asset and its adjusted tax basis, then solely for tax purposes (and not for purposes of computing Capital Accounts), income, gain, loss, deduction and credit with respect to such Asset shall be allocated among the Members to take such difference into account in accordance with section 704(c)(i)(A) of the IRS Code and Treasury Regulation section 1.704-1(b)(4)(i). The allocations eliminating such disparities shall be made using any reasonable method permitted by the Code, as determined by the Manager.

  • Tax Cooperation; Allocation of Taxes (i) Seller and Buyer agree to furnish or cause to be furnished to each other, upon request, as promptly as practicable, such information and assistance relating to the Purchased Assets and the Business as is reasonably necessary for the filing of all Tax returns, and making of any election related to Taxes, the preparation for any audit by any taxing authority, and the prosecution or defense of any claim, suit or proceeding relating to any Tax return. Seller and Buyer shall cooperate with each other in the conduct of any audit or other proceeding related to Taxes involving the Business and each shall execute and deliver such powers of attorney and other documents as are necessary to carry out the intent of this Section 5.03(e).

  • Allocation of Taxable Income If any Fund delivers to its Auction Agent a notice in the form of Exhibit I to the Auction Agency Agreement designating all or a portion of any dividend on shares of any series of MuniPreferred of such Fund to consist of net capital gains or other income taxable for Federal income tax purposes, and BD is a Broker-Dealer for such series, such Auction Agent shall deliver such notice to BD on the Business Day following its receipt of such notice from such Fund. On or prior to the Auction Date referred to in such notice, BD will contact each of its customers that is a Beneficial Owner of shares of such series of MuniPreferred or a Potential Beneficial Owner of shares of such series of MuniPreferred interested in submitting an Order in the Auction to be held on such Auction Date, and BD will notify such Beneficial Owners and Potential Beneficial Owners of the contents of such notice. BD will be deemed to have notified such Beneficial Owners and Potential Beneficial Owners if, for each of them, (i) BD makes a reasonable effort to contact such Beneficial Owner or Potential Beneficial Owner by telephone, and (ii) upon failing to contact such Beneficial Owner or Potential Beneficial Owner by telephone BD mails written notification to such Beneficial Owner or Potential Beneficial Owner at the mailing address indicated in the account records of BD. The Auction Agent for any series of MuniPreferred shall be required to notify BD if it is a Broker-Dealer for such series within two Business Days after each Auction of such series that involves an allocation of income taxable for Federal income tax purposes as to the dollar amount per share of such taxable income and income exempt from Federal income taxation included in the related dividend.

  • Allocation of Tax Liability In the event that any tax is imposed on the Trust, such tax shall be charged against amounts otherwise distributable to the Owners in proportion to their respective Sharing Ratios. The Owner Trustee is hereby authorized to retain from amounts otherwise distributable to the Owners sufficient funds to pay or provide for the payment of, and then to pay, such tax as is legally owed by the Trust (but such authorization shall not prevent the Owner Trustee from contesting any such tax in appropriate proceedings, and withholding payment of such tax, if permitted by law, pending the outcome of such proceedings).

  • Allocation of Tax Liabilities The provisions of this Section 2 are intended to determine each Company's liability for Taxes with respect to Pre-Distribution Periods. Once the liability has been determined under this Section 2, Section 5 determines the time when payment of the liability is to be made, and whether the payment is to be made to the Tax Authority directly or to another Company.

  • Allocation of Taxes For purposes of determining the amount of Taxes that relate to Pre-Closing Tax Periods and Straddle Periods for purposes of any obligation to indemnify for Taxes under Section 4.2(b) the parties agree to use the following conventions:

  • Treatment of Tax Indemnity and Tax Benefit Payments In the absence of any change in Tax treatment under the Code or other applicable Tax Law,

  • Apportionment of Tax Attributes (i) If the Parent Consolidated Group has a Tax Attribute, the portion, if any, of such Tax Attribute apportioned to SpinCo or any member of the SpinCo Consolidated Group and treated as a carryover to the first Post-Distribution Taxable Period of SpinCo (or such member) shall be determined by Parent in accordance with Treasury Regulation Sections 1.1502-21, 1.1502-21T, 1.1502-22, 1.1502-79 and, if applicable, 1.1502-79A.

  • Allocation of Profits and Losses The Company’s profits and losses shall be allocated to the Member.

  • Limitation on Allocation of Net Loss To the extent that any allocation of Net Loss would cause or increase an Adjusted Capital Account Deficit as to any Holder, such allocation of Net Loss shall be reallocated (x) first, among the other Holders of Partnership Common Units in accordance with their respective Percentage Interests with respect to Partnership Common Units and (y) thereafter, among the Holders of other classes of Partnership Units as determined by the General Partner, subject to the limitations of this Section 6.4.A(vi).

Time is Money Join Law Insider Premium to draft better contracts faster.