ITB 11-22: Insurance holding company reorganization tax-free under Section 368

Insurance Tax Bulletin

In PLR201112004, the IRS ruled that a conversion of a stock insurance holding company into a mutual insurance holding company qualified as an "E reorganization" under Section 368(a)(1)(E) as an exchange of outstanding stock and/or securities for new stock and/or securities by the corporation's shareholders. The Service concluded that as an E reorganization, the transaction was simply a re-configuration of the firm's capital structure.

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