Taxing Corporate Distributions of Appreciated Property: Repeal of General Utilities Doctrine, Releif Measures and Entity Reclassification Proposals

Professor Wolfman presents the case for outright repeal of General Utilities and its statutory offspring. Professor Wolfman traces the history of the doctrine and its procedural infirmities, and then describes how several Code sections may be eliminated or simplified. Mr. Nolan argues against the repeal of General Utilities where there is a sale or distribution of assets in complete liquidation, and further argues that the current taxation regime fosters the important social and economic policies that Congress has adopted. Mr. Hobbett discusses the reasons given for entity reclassification, and suggests that preservation of partnership status for publicly traded partnerships would offer an opportunity to experiment with full integration treatment for entities that might resemble corporations.

Mr. Hobbett concludes that, if General Utilities were repealed, taxpayers would choose the partnership as an appropriate full integration system.