In the United States, in order for a spin-off to be nontaxable, the following must be the case:

Question

Quizplus · Accepted Answer

For a spin-off to be nontaxable in the United States, the IRS requires that the parent company must have owned at least 80% of the subsidiary (B), and both the parent and the spun-off entity must have been actively conducting a trade or business for at least five years prior to the spin-off (A). There is no requirement that they be in the same industry (C), making D the correct answer.

In the United States, in Order for a Spin-Off to Be