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This video discusses Type C tax-free reorganizations, where the purchasing corporation, such as Jalapeno Pancakes, transfers voting stock and possibly some cash (boot) to the target corporation. At least 80% of the consideration must be voting stock, with the remaining 20% being cash or other assets. However, if the purchasing corporation assumes liabilities from the target, the 20% can be reduced dollar for dollar for each liability assumed. If the liabilities exceed 20% of the consideration, the purchasing corporation must give voting stock. In general, Type C reorganizations do not require boot beyond the 20% threshold.
