Bipartisan bill would change tax treatment of certain mergers

McKnight’s Senior Living March 25, 2024
Kathleen Steele Gaivin

Bipartisan bill would change tax treatment of certain mergers

Certain mergers would be treated differently for tax purposes if a bill introduced Thursday by Sens. JD Vance (R-OH) and Sheldon Whitehouse (D-RI) becomes law.

The Stop Subsidizing Giant Mergers Act would end tax-free mergers and taxpayer subsidies for acquisitions involving firms that had combined average annual gross receipts of more than $500 million during the previous three years. Exceptions would be made for mergers involving small businesses and for corporations that would be negatively affected during a “purely internal reorganization.”

The legislation “would remove a cornerstone of the corporate tax code and potentially reshape dealmaking,” the Wall Street Journal reported.

When one corporation is sold to or merges with...

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