History
The original Morris Trust structure was the result of a favorable ruling in IRS v. Morris Trust in 1966. The original Morris Trust structure is similar to the above Reverse Morris Trust structure, however instead of a former subsidiary merging with a target company, the parent company would merge with target company.
Following several leveraged Morris Trust transactions similar to the original Morris Trust transaction, but involving cash and bank loans rather than mere stock, Congress enacted Internal Revenue Code Section 355(e) in 1997. This imposes additional taxation on the distribution in the spin-off step whenever 50% interest in a spun off company is transferred tax-free in the two years following a spin-off.
Read more about this topic: Reverse Morris Trust
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“The custard is setting; meanwhile
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Unfinished concepts that can never bring themselves to the point
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—John Ashbery (b. 1927)
“Yet poetry, though the last and finest result, is a natural fruit. As naturally as the oak bears an acorn, and the vine a gourd, man bears a poem, either spoken or done. It is the chief and most memorable success, for history is but a prose narrative of poetic deeds.”
—Henry David Thoreau (1817–1862)
“Only the history of free peoples is worth our attention; the history of men under a despotism is merely a collection of anecdotes.”
—Sébastien-Roch Nicolas De Chamfort (1741–1794)