Stock Acquisitions with No Liquidation (2 of 2) Purchaser corp consequences Purchaser has a new subsidiary Basis in target stock is acquisition cost >Purchasers basis in targets stock (outside basis) may be >targets basis in its assets No adjustment to basis of targets assets Tax attributes of target transfer to purchaser7 Stock Acquisitions with No Liquidation (2 of 2) Purchaser corp consequences –Purchaser has a new subsidiary –Basis in target stock is acquisition cost »Purchaser’s basis in target’s stock (outside basis) may be > target’s basis in its assets –No adjustment to basis of target’s assets Tax attributes of target transfer to purchaser