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Rev. Rul. 2008-18 posits two situations in which an S corporation becomes a qualified subchapter S subsidiary (QSub) of a newly formed corporation that will qualify as an F reorganization. The ruling also provides new guidance on the proper employer identification number (EIN) to be used by the entities in each situation.
Background
Rev. Rul. 73-526 explains which EIN may be used by the surviving corporation in certain transactions. Situation 3 of Rev. Rul. 73-526 involves an F reorganization under which the shareholders of Oldco form Newco, and Oldco merges with and into Newco, with Newco surviving. The IRS ruled that because Newco is the alter ego of Oldco, Newco should continue to use Oldco's EIN following the...
