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Unformatted text preview: 15%. The corporation then made a long-term loan of the after-tax cash to Mr. Palmers family-run business. The IRS concluded that the Mr. Palmer had no bona fide business purpose for creating the new corporation other than tax avoidance. It disregarded the creation of the new corporation and treated Mr. Palmer as the seller of the asset. As a result he had to pay tax on the gain at the 35-percent rate....
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This note was uploaded on 09/09/2011 for the course TAX 6845 taught by Professor Kelliher,c during the Fall '08 term at University of Central Florida.
- Fall '08