Roby Corporation, a Tennessee corporation, decides to change its state of incorporation to Delaware to take advantage of its more favorable state corporation laws. Roby Corporation can take advantage of the Type F reorganization rules by

Question

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To take advantage of Type F reorganization rules, Roby Corporation can exchange the Tennessee corporation's assets for the Delaware corporation's stock and then liquidate the Tennessee corporation. This allows Roby Corporation to satisfy the requirements for a reorganization under IRC Section 368(a)(1)(F), which includes transferring all of the assets and liabilities of the old corporation to the new corporation in exchange for stock, and then liquidating the old corporation. This transfer of assets and liabilities for stock does not trigger any recognition of gain or loss, making it a favorable choice for Roby Corporation.

Roby Corporation, a Tennessee Corporation, Decides to Change Its State