Federal joint and several liability rules

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Graeter Corporation acquired all of the stock of Lesser Corporation in 2009, and the entities have filed a state and Federal consolidated income tax return ever since. In 2012, an audit notice from the state unemployment tax administration makes it clear that lesser underpaid its 2010 state and Federal payroll taxes by $2 million. Lesser's cash flow at this time is poor and it has insufficient funds to pay the delinquent amount plus interest and penalties. Can the state revenue agency collect the outstanding payroll tax from greater under the Federal joint and several liability rules for tax obligation of consolidated return affiliates?

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The task pertains to answering the question based on the South West Federal Taxation. The question has been answered based on the provisions and the relevant regulations of the Federal taxation. The recovery of the liability from the parent company has been discussed in detail in the solution.

Reference no: EM1310917

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inf10917

1/17/2018 4:33:55 AM

Thanks a lot to you for helping me with my homework assignment, I got very good marks in this task. Please convey the expert I really value everything.

inf10917

12/18/2017 4:56:28 AM

With your solution to the question on Graeter and Lesser corporations. What tax code would back the decision for the “joint and several liabilities” federal tax law 26 CFR 1.1502-6 - Liability for tax. Further, the link is as follows: https://www.law.cornell.edu/cfr/text/26/1.1502-6

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