Tax Allocation Clause Samples
The Tax Allocation clause defines how tax liabilities and responsibilities are distributed between the parties involved in an agreement. Typically, it specifies which party is responsible for paying certain taxes, such as sales, use, or transfer taxes, that may arise from the transaction. For example, in a business sale, the buyer might be responsible for transfer taxes while the seller covers income taxes related to the sale proceeds. This clause ensures clarity and prevents disputes by clearly assigning tax obligations, thereby reducing the risk of unexpected financial burdens for either party.
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Tax Allocation. (i) Not later than sixty (60) days after the final resolution of the Final Purchase Price, as adjusted pursuant to Section 2.3, the Buyer shall prepare and deliver to the Seller a schedule allocating the sum of the Final Purchase Price, and other relevant items treated as purchase price for Income Tax purposes, among the assets of the Company, in a manner consistent with the allocation set forth on Schedule 7.8(h), which, for the avoidance of doubt, shall be determined for U.S. federal Income Tax purposes in accordance with Section 1060 of the Code and the Treasury Regulations thereunder (and any similar provisions of state, local, or non-U.S. Law, as appropriate) (the “Allocation Schedule”). If reasonably requested by the Seller, the Buyer shall provide reasonably sufficient work papers and backup documents related to the preparation of the Allocation Schedule. If the Seller does not object to the Allocation Schedule within thirty (30) days of receipt thereof, such Allocation Schedule shall be deemed final and binding for all purposes of this Agreement. If the Seller objects to the Allocation Schedule, it shall notify the Buyer in writing of such disputed item (or items), its basis for objection in reasonable detail, and proposed changes within thirty (30) days of the receipt of the Allocation Schedule, and the Parties shall negotiate in good faith and shall use reasonable efforts to resolve any such dispute. Any dispute that cannot be resolved through negotiations shall be resolved using the principles of the dispute resolution procedures set forth in Section 7.8(c)(iii).
(ii) Notwithstanding Section 7.8(h)(i), the Parties agree that the allocation pursuant to the Allocation Schedule shall be further adjusted to reflect any indemnification payments made pursuant to Article 10 that are treated as adjustments to the Final Purchase Price pursuant to Section 10.10, in a manner consistent with the allocation agreed upon pursuant to Section 7.8(h)(i) and Section 1060 of the Code and the Treasury Regulations thereunder.
(iii) Each of the Parties and their respective Affiliates shall, unless otherwise required by a final “determination” (within the meaning of Section 1313(a) of the Code), (A) prepare and file all Tax Returns, including all IRS Forms 8594, in a manner consistent with the Allocation Schedule, as finally determined pursuant to this Section 7.8(h), and (B) take no position in any Tax Return, Tax Contest, proceeding or otherwise that is incon...
Tax Allocation. For purposes of this Agreement, in the case of a taxable period that begins on or before, and ends after, the Closing Date, Taxes of B▇▇▇▇▇ and SLZ shall be allocated to the portion of the period ending on the Closing Date as follows: (a) all income Taxes, sales Taxes, employment Taxes and other Taxes that are readily apportionable based on an actual or deemed closing of the books shall be allocated based on the amount that would be payable if the taxable year ended on the Closing Date, and (b) all property and other Taxes that are imposed on a periodic basis and not described in clause (a) shall be allocated based on the amount of such Tax for the entire period multiplied by a fraction, the numerator of which is the number of days in the portion of a period ending on the Closing Date and the denominator of which is the number of days in the taxable period, provided that, in the case of any Taxes determined on an arrears basis, such Taxes shall be allocated to the taxable period to which such Taxes relate.
Tax Allocation. Sellers and Buyer shall allocate that portion of the Aggregate Purchase Price allocated to Mission US among the assets and liabilities of Mission US in accordance with Section 1060 of the Code, and such allocation shall be binding on the parties for all Tax purposes. Sellers and Buyer shall allocate a portion of the Aggregate Purchase Price to the Mission UK Shares, subject to a maximum amount of $7,500,000 in respect of such allocation. In addition, but subject to the foregoing, Sellers and Buyer shall allocate the Aggregate Purchase Price under this Agreement and the aggregate purchase price under the Goodwill Purchase Agreement, and such allocation shall be final and binding on the parties for all Tax Purposes. Specifically, within sixty (60) days after Closing, the Sellers shall prepare and deliver a draft allocation to Buyer for Buyer's review and approval, such approval not to be unreasonably withheld, conditioned or delayed. Buyer shall have fifteen (15) Business Days to review, approve or object to such allocation. If Buyer objects to such allocation, the parties shall negotiate in good faith to resolve the disputed items. If Buyer and Sellers are unable to reach agreement within thirty (30) days after such objection has been given, all unresolved disputed items shall be promptly referred to the Independent Accountant. The Independent Accountant shall be directed to render a written report on the unresolved disputed items as promptly as practicable, but in no event longer than thirty (30) days after such submission to the Independent Accountant, and to resolve only those unresolved disputed items set forth in the objection notice. If unresolved disputed items are submitted to the Independent Accountant, Buyer, on the one hand, and Sellers, on the other hand, shall each furnish to the Independent Accountant such work papers, schedules and other documents and information relating to the unresolved disputed items as the Independent Accountant may reasonably request. The Independent Accountant shall resolve the disputed items based solely on the applicable definitions and other terms in this Agreement and the presentations by Buyer, on the one hand, and Sellers, on the other hand (and not by independent review). The resolution of the dispute shall be final and binding on the parties hereto. The fees and expenses of the Independent Accountant shall be borne by Sellers, on the one hand, and Buyer, on the other hand, in proportion to the amounts by which ...
Tax Allocation. The allocation of the Purchase Price for tax purposes shall be set forth in a statement prepared in accordance with Section 1060 of the Internal Revenue Code of 1986, as amended, which statement shall be prepared in a manner generally consistent with the form of Internal Revenue Service Form 8594 and a manner consistent with the Purchase Price allocation provided under Section 1.5. Buyer and Seller shall cooperate in the preparation of such statement of allocation and each party hereto shall file a copy of such statement as, and if, required by applicable law.
Tax Allocation. For federal, state, and local income tax purposes the income, gains, losses, deductions and credits of the Company, including the character and type thereof, shall be allocated among the Members in the same manner that each such item is allocated among the Capital Accounts.
Tax Allocation. The allocation of the Purchase Price to the Purchased Assets shall be as set forth in Schedule 5.2 hereto so as to comply with Section 1060 of the Internal Revenue Code of 1986, as amended.
Tax Allocation. 1The income, gains, losses, deductions and credits of the Partnership will be allocated for federal, state and local income tax purposes among the Partners so as to reflect as nearly as possible the allocation of such income, gains, losses, deductions and credits among the Partners for computing their Capital Accounts. Notwithstanding the preceding sentence, if the basis for federal income tax purposes of any property held by the Partnership differs from the basis of such property on the Partnership's books, any gain or loss arising from such property shall be allocated among the Partners so as to take into account the difference between the tax basis and the book basis of such property in any manner authorized by the Treasury Regulations under Section 704(c) of the Code and selected by the General Partner.
Tax Allocation. The Non-Income Taxes imposed on a periodic basis (including real, personal and intangible property Taxes or ad valorem property Taxes) (“Property Taxes”) for which Seller shall be and remain liable is the amount of Property Taxes (other than the Assumed Seller Taxes) assessed with respect to the ownership or operation of the Assets for (i) any Tax period ending prior to the Closing Date and (ii) any Straddle Period multiplied by a fraction, the numerator of which is the number of days in the Straddle Period ending immediately prior to the Closing Date and the denominator of which is the number of days in the entire Straddle Period. The Production Taxes and Non-Income Taxes (except for Property Taxes) for which Seller shall be and remain liable is the amount of such Taxes (other than the Assumed Seller Taxes) assessed with respect to the ownership or operation of the Assets for (i) any Tax period ending prior to the Closing Date and (ii) any Straddle Period, the Production Taxes or Non-Income Taxes that would be payable with respect to the ownership or operation of the Assets as of the end of the day immediately prior to the Closing Date as if such period were treated as ending as of the end of the day prior to the Closing Date. All Non-Income Taxes and Production Taxes with respect to the ownership or operation of the Assets arising on or after the Closing Date (including all Straddle Period Taxes not apportioned to Seller) shall be allocated to and borne by Buyer. The portion of Non-Income Taxes and Production Taxes to be borne by Seller and not paid by Seller on or prior to Closing shall be satisfied by a downward adjustment to the Purchase Price pursuant to Section 7.02(b)(iv). To the extent the actual amount of any such Non-Income Taxes and Production Taxes is not determinable at Closing, the most recent information available will be used to estimate the Purchase Price adjustment pursuant to Section 7.02. Upon determination of the actual amount of estimated Production Taxes and Non-Income Taxes, and once no further payments are required under Section 7.02(g), (x) Seller shall pay to Buyer any additional amount necessary to satisfy its allocated share of Production Taxes and Non-Income Taxes no later than five (5) Business Days prior to the due date for such Taxes or (y) Buyer shall increase the Credit Bid portion of the Purchase Price by any amount necessary to satisfy its allocated share of Production Taxes and Non-Income Taxes, as applicable.
Tax Allocation. 6.3.1. For income tax purposes, except as otherwise provided by Laws, all items of income, gain, loss, deduction and credit of the Company for any Fiscal Year shall be allocated among the Members in the same manner that Profits and Losses (and items thereof) are allocated for that year. Any elections or decisions related to tax allocations (to the extent not otherwise provided for in this Section 6) shall be made by the Manager with the consent of all Members in any manner that reasonably reflects the purpose and intention of this Agreement, consistent with applicable Treasury Regulations.
6.3.2. In accordance with Code Section 704(c) and the Treasury Regulations promulgated under the Code, income, gain, loss and deduction with respect to any property contributed to the capital of the Company shall be allocated among the Members, solely for tax purposes, so as to take into account any variation between the adjusted basis of such property to the Company for federal income tax purposes and its fair market value upon contribution.
Tax Allocation. The portion of any Tax related to a Straddle Period that is allocable to the portion of a Straddle Period ending on and including the Closing Date shall be (i) in the case of property and similar ad valorem Taxes and any other Taxes not described in clause (ii) below, equal to the amount of such Taxes for the entire Straddle Period multiplied by a fraction, the numerator of which is the number of days during the Straddle Period that fall prior to the day after the Closing Date and the denominator of which is the number of days in the entire Straddle Period and (ii) in the case of Taxes based on income, receipts, remuneration, sales, proceeds, profits or similar items and other Taxes that are readily apportionable based on an actual or deemed closing of the books, computed as if such taxable period ended as of the close of business on the Closing Date. The portion of any Tax related to a Straddle Period that is allocable to the portion of the Straddle Period beginning the day after the Closing Date is the portion of such Tax not allocable to the portion of the Straddle Period ending on and including the Closing Date under this Section 5.7(c). Notwithstanding anything to the contrary in this Agreement, any transaction that occurs on the Closing Date but prior to the actual time of the Closing and that is not in the ordinary course of business shall be deemed to occur in a Pre-Closing Tax Period or the portion of a Straddle Period ending on and including the Closing Date.