Be wary of tax risks when assessing IP holding companies
When the Talbots Company went public in 1993, it loaned $103 million to a subsidiary to purchase the Talbots trademark and collect royalties, permitting the parent company to shave over $1.1 million from its annual state tax bill. But the holding company returned over 96% of royalties to its parent—and in Talbots v. Mass. Comm’r [...]
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