Tax Allocation Clause Samples
The Tax Allocation clause defines how tax liabilities and responsibilities are distributed between the parties involved in an agreement. Typically, it specifies which party is responsible for paying certain taxes, such as sales, use, or transfer taxes, that may arise from the transaction. For example, in a business sale, the buyer might be responsible for transfer taxes while the seller covers income taxes related to the sale proceeds. This clause ensures clarity and prevents disputes by clearly assigning tax obligations, thereby reducing the risk of unexpected financial burdens for either party.
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Tax Allocation. Buyer and Seller shall cooperate in good faith in allocating the Adjusted Purchase Price and any other items properly treated as consideration for U.S. federal income Tax purposes among the Assets (including the assets of the Trust attributable to the Subject Trust Units), consistent with the principles of Section 1060 of the Code and the Treasury Regulations thereunder (the “Tax Allocation”). To the extent consistent with Code Section 1060 and any Treasury Regulations promulgated thereunder, the Tax Allocation shall be consistent with the Purchase Price Allocation, as adjusted for any changes (including changes to the Allocated Values). The Tax Allocation shall be revised in a manner consistent with Section 1060 of the Code to take into account any further adjustments to the Adjusted Purchase Price pursuant to this Agreement, including any indemnification payments pursuant to Article XII. The Tax Allocation shall be reflected on a completed Internal Revenue Service Form 8594 (Asset Acquisition Statement under Section 1060) which will be timely filed separately by Seller and Buyer with the Internal Revenue Service pursuant to the requirements of Section 1060(b) of the Code. Each Party agrees not to take any position inconsistent with the Tax Allocation for Income Tax purposes unless required by Law or with the consent of the other Party; provided, however, that nothing contained herein shall prevent either Party from settling any proposed deficiency or adjustment by any Governmental Authority relating to the Tax Allocation, and neither Party shall be required to litigate before any court any proposed deficiency or adjustment by any Governmental Authority challenging such Tax Allocation.
Tax Allocation. (i) With respect to the Compression Group Entities and the assets of the Compression Group Entities, the Contributor Parties shall be allocated and bear all Taxes attributable to any Pre-Closing Tax Period and Acquiror shall be allocated and bear all Taxes attributable to any Tax period or portion thereof beginning after the Closing Date. The Contributor Parties shall defend, indemnify and hold Acquiror harmless from and against and be liable for all Liability arising out of or related to any and all Taxes (or the non-payment thereof) (1) of or with respect to the Compression Group Entities or the assets of the Compression Group Entities for all Pre-Closing Tax Periods, (2) attributable to any failure to comply with any covenant or agreement of the Contributor Parties (including any obligation to cause any of the Compression Group Entities to take, or refrain from taking, any action under this Agreement), (3) as a result of any Compression Group Entity (or any predecessor of any Compression Group Entity) being a member of an affiliated, consolidated, combined or unitary group prior to the Closing Date, including pursuant to Treasury Regulations Section 1.1502-6 or any analogous or similar state, local or foreign law or regulation, and (4) of any Person imposed on any of the Compression Group Entities for any period as a transferee or successor with respect to a transaction occurring before the Closing Date, by applicable Law, contract or otherwise; provided however, notwithstanding anything in this Agreement to the contrary, the Contributor Parties shall not be required to defend, indemnify or hold Acquiror harmless from or against or be liable for (x) Taxes that are included as a current liability in the calculation of Closing Date Net Working Capital, or (y) Transfer Taxes allocable to Acquiror pursuant to Section 5.12(c).
(ii) In the case of any Straddle Period, the amount of any Taxes based on or measured by income, gain, profits, receipts, employment, social security, payroll, sales, use, or other transaction-based Taxes of the Compression Group Entities for the portion of the Straddle Period ending on the Closing Date shall be determined based on a closing of the books as of the close of business on the Closing Date, and the amount of other Taxes of the Compression Group Entities for a Straddle Period that relates to the portion of the Straddle Period ending on the Closing Date shall be deemed to be the amount of such Tax for the entire taxable perio...
Tax Allocation. For federal, state, and local income tax purposes the income, gains, losses, deductions and credits of the Company, including the character and type thereof, shall be allocated among the Members in the same manner that each such item is allocated among the Capital Accounts.
Tax Allocation. The allocation of the Purchase Price for tax purposes shall be set forth in a statement prepared in accordance with Section 1060 of the Internal Revenue Code of 1986, as amended, which statement shall be prepared in a manner generally consistent with the form of Internal Revenue Service Form 8594 and a manner consistent with the Purchase Price allocation provided under Section 1.4. Buyer and Seller shall cooperate in the preparation of such statement of allocation and each party hereto shall file a copy of such statement as, and if, required by applicable law.
Tax Allocation. Sellers and Buyer shall allocate that portion of the Aggregate Purchase Price allocated to Mission US among the assets and liabilities of Mission US in accordance with Section 1060 of the Code, and such allocation shall be binding on the parties for all Tax purposes. Sellers and Buyer shall allocate a portion of the Aggregate Purchase Price to the Mission UK Shares, subject to a maximum amount of $7,500,000 in respect of such allocation. In addition, but subject to the foregoing, Sellers and Buyer shall allocate the Aggregate Purchase Price under this Agreement and the aggregate purchase price under the Goodwill Purchase Agreement, and such allocation shall be final and binding on the parties for all Tax Purposes. Specifically, within sixty (60) days after Closing, the Sellers shall prepare and deliver a draft allocation to Buyer for Buyer's review and approval, such approval not to be unreasonably withheld, conditioned or delayed. Buyer shall have fifteen (15) Business Days to review, approve or object to such allocation. If Buyer objects to such allocation, the parties shall negotiate in good faith to resolve the disputed items. If Buyer and Sellers are unable to reach agreement within thirty (30) days after such objection has been given, all unresolved disputed items shall be promptly referred to the Independent Accountant. The Independent Accountant shall be directed to render a written report on the unresolved disputed items as promptly as practicable, but in no event longer than thirty (30) days after such submission to the Independent Accountant, and to resolve only those unresolved disputed items set forth in the objection notice. If unresolved disputed items are submitted to the Independent Accountant, Buyer, on the one hand, and Sellers, on the other hand, shall each furnish to the Independent Accountant such work papers, schedules and other documents and information relating to the unresolved disputed items as the Independent Accountant may reasonably request. The Independent Accountant shall resolve the disputed items based solely on the applicable definitions and other terms in this Agreement and the presentations by Buyer, on the one hand, and Sellers, on the other hand (and not by independent review). The resolution of the dispute shall be final and binding on the parties hereto. The fees and expenses of the Independent Accountant shall be borne by Sellers, on the one hand, and Buyer, on the other hand, in proportion to the amounts by which ...
Tax Allocation. 1The income, gains, losses, deductions and credits of the Partnership will be allocated for federal, state and local income tax purposes among the Partners so as to reflect as nearly as possible the allocation of such income, gains, losses, deductions and credits among the Partners for computing their Capital Accounts. Notwithstanding the preceding sentence, if the basis for federal income tax purposes of any property held by the Partnership differs from the basis of such property on the Partnership's books, any gain or loss arising from such property shall be allocated among the Partners so as to take into account the difference between the tax basis and the book basis of such property in any manner authorized by the Treasury Regulations under Section 704(c) of the Code and selected by the General Partner.
Tax Allocation. The portion of any Tax related to a Straddle Period that is allocable to the portion of a Straddle Period ending on and including the Closing Date shall be (i) in the case of property and similar ad valorem Taxes and any other Taxes not described in clause (ii) below, equal to the amount of such Taxes for the entire Straddle Period multiplied by a fraction, the numerator of which is the number of days during the Straddle Period that fall prior to the day after the Closing Date and the denominator of which is the number of days in the entire Straddle Period and (ii) in the case of Taxes based on income, receipts, remuneration, sales, proceeds, profits or similar items and other Taxes that are readily apportionable based on an actual or deemed closing of the books, computed as if such taxable period ended as of the close of business on the Closing Date. The portion of any Tax related to a Straddle Period that is allocable to the portion of the Straddle Period beginning the day after the Closing Date is the portion of such Tax not allocable to the portion of the Straddle Period ending on and including the Closing Date under this Section 5.7(c). Notwithstanding anything to the contrary in this Agreement, any transaction that occurs on the Closing Date but prior to the actual time of the Closing and that is not in the ordinary course of business shall be deemed to occur in a Pre-Closing Tax Period or the portion of a Straddle Period ending on and including the Closing Date.
Tax Allocation. The allocation of the Purchase Price to the Purchased Assets shall be as set forth in Schedule 5.2 hereto so as to comply with Section 1060 of the Internal Revenue Code of 1986, as amended.
Tax Allocation. (a) Straddle Period Allocation. Purchaser shall be responsible for all taxes payable with respect to the Property that relate to a taxable period (or portion thereof) beginning on or after the Closing Date. With respect to a taxable period that includes, but does not end on, the Closing Date (each such period, a “Straddle Period”), (i) all real property taxes, personal property taxes, and similar ad valorem obligations levied or imposed with respect to the Property for a Straddle Period will be apportioned between Seller and Purchaser based on the number of days of such Straddle Period included in the period ending on (and including) the Closing Date and the number of days of such taxable period included in the period after the Closing Date and (ii) taxes (if any) other than taxes described in clause (i) of this sentence levied or imposed with respect to the Property shall be allocated using a “closing of the books” methodology as of the end of the Closing Date; provided that, (x) exemptions, allowances, or deductions that are calculated on an annual basis shall be allocated between the period ending on the Closing Date and the period beginning subsequent to the Closing Date in proportion to the number of calendar days in each period and (y) the taxable period in respect of a particular real property tax, personal property tax, or any other similar ad valorem obligation shall begin on the date on which ownership of the applicable asset gives rise to the liability for the particular tax and shall end on the day immediately prior to the next such applicable date. If Closing occurs before that year’s tax bills are available, the proration will be based on the most recent tax rate and assessment; provided, after the taxes for the year in which the Closing occurs are finally assessed, upon written demand, Purchaser shall refund to Seller any amount overpaid by Seller or Seller shall pay to Purchaser the amount of any deficiency in the proration in accordance with Section 9.4 (and without duplication of any amounts already taken into account under that section). For the avoidance of doubt, Purchaser shall be responsible for the payment of all ad valorem taxes (including, without limitation, all so-called “roll-back taxes”) which may be levied, assessed, charged or collected by any taxing authority with respect to any change of use of the Property occurring after Closing, whether such taxes or assessments are levied, assessed, charged or collected at Closing or ...
Tax Allocation. For purposes of this Agreement, in the case of a taxable period that begins on or before, and ends after, the Closing Date, Taxes of B▇▇▇▇▇ and SLZ shall be allocated to the portion of the period ending on the Closing Date as follows: (a) all income Taxes, sales Taxes, employment Taxes and other Taxes that are readily apportionable based on an actual or deemed closing of the books shall be allocated based on the amount that would be payable if the taxable year ended on the Closing Date, and (b) all property and other Taxes that are imposed on a periodic basis and not described in clause (a) shall be allocated based on the amount of such Tax for the entire period multiplied by a fraction, the numerator of which is the number of days in the portion of a period ending on the Closing Date and the denominator of which is the number of days in the taxable period, provided that, in the case of any Taxes determined on an arrears basis, such Taxes shall be allocated to the taxable period to which such Taxes relate.