The U.S. IRS has issued Revenue Procedure 2018-12, which covers safe harbor methods that taxpayers may use to value certain stock received by a target corporation’s shareholders in a potential (tax-free) reorganization for purposes of determining whether the continuity of interest (COI) requirement is met. These include:
- Average of the Daily Volume Weighted Average Prices;
- Average of the Average High-Low Daily Prices; and
- Average of the Daily Closing Prices.
Provided that a reorganization…