Taxpayer Materially Participated in Activity Moved to New Entity in Reorganization
In the case of Rogerson v. Commissioner, TC Memo 2022-49[1] the taxpayer argued that, following a reorganization of the S corporation he owned 100% of into multiple corporations, he had not materially participated in the activities of one of these resulting corporations for the three years following the reorganization. He took this position despite not separating this particular activity from other activities of the prior corporation in earlier years, treating the operations of that S corporation as a single activity in which he actively participated.
Read More