Tax Changes Could Help Fuel M&A Boom

Next year's tax increases for individuals may trigger a tax driven M&A boom before year end. Beginning in 2011, tax rates for individuals will increase at the end of this year when the Bush-era tax cuts are due to expire. Long-term capital gains will be taxed at 20 percent (from its current 15 percent) and dividends will be taxed at 39.6 percent when the current preferential 15 percent tax rate on "qualified dividends" expires. In a recent article published in Buyouts magazine, Isaac Grossman and Michael Kearney of Morrison Cohen LLP highlight different ways in which taxpayers can accelerate the recognition of capital gains and dividends this year to avoid the impact of higher tax rates next year. Click on the PDF link above to read the full article.