Ratable

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Ratable

1. Describing a property of which an appraisal is possible. For example, a farm is a ratable property because its value is able to be assessed.

2. See: Taxable.

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382 limitation 200,000 Prechange income 1,000,000 Postchange loss (500,000) Taxable income--change year $ 500,000 Ratable Closing of allocation the books Prechange $ 250,000 $ 500,000 Postchange 250,000 0 Taxable income before NOL 500,000 500,000 NOL (350,000)(*) (500,000) Taxable income after NOL 150,000 0 NOL carryforward to 1996 (subject to Sec.

Example 3: Daily Ratable Allocation Election L Corp.: NOL carryforward from 12/31/94 $1,000,000 Change date July 1, 1995 Sec.

In Example 3, on page 81, while the taxpayer ends up with the same amount of NOL carryforward, the ratable allocation method yields $100,000 as a postchange loss, which is not limited by Sec.

Closing of the books election pursuant to regs. sec. 1.382-6

Thus, it makes no sense to attempt to determine the ratable share of E&P in a corporation in which the shareholders do not have any stock ownership.

Although reference is made to each shareholder's "ratable share" of Acquiring's E&P, there is nothing in the letter ruling that would effectively limit this to their share of the appropriate target's E&P.

Most of the other letter rulings issued since Clark that dealt with acquisitive reorganizations declined to specify whose E&P was being used.(24) Instead, they simply stated that the transferor shareholders had dividend income to the extent of their ratable share of undistributed E&P.

For example, what percentage stock ownership should be used to determine the shareholder's "ratable" share of E&P?

The correct E&P for measuring Sec. 356(a)(2) dividend income

382 limitation while, under ratable allocation, some portion of the loss would be allocated to the prechange period and subject to limitation.

Limitation increase rule revoked by proposed regulations

Payment method with the recurring item exception: This method applies to taxpayers who have not elected the ratable accrual method but who have elected the recurring item exception.

Ratable accrual method: The ratable accrual method applies to taxpayers who elect it under Sec.

For its 1992 return, under the ratable accrual method, X can deduct both the May 5, 1993 and Nov.