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Tax Law Roundup current law developments in U.S. taxation

Tag Archives: forward contract

10th Circuit Affirms Taxability of Variable Prepaid Forward Contracts

Posted in Economic Substance, General, Securities

The Tenth Circuit, in Anschutz v. Commissioner, affirmed a Tax Court decision taxing the disposition of appreciated stock through a Variable Prepaid Forward Contract (VPFC).  The underlying issue was whether the complex financial arrangement created a taxable constructive sale.  The transaction involved a series of contracts including (1) a “forward contract” to sell the appreciated… Continue Reading