Significant pre-closing transactions on the day of closing of a target acquisition and its amalgamation will result in two deemed taxation year ends

If there is an acquisition of control of Target followed by its amalgamation with Buyco on the same day and no s. 256(9) election is made, the occurrence of transactions by Target out of the normal course of business on the closing date and prior to the closing will "technically" result in there being two deemed taxation year ends. As per 2014-0523251E5 F, the same problem arises if the s. 256(9) election is made.

Neal Armstrong. Summary of 15 April 2014 T.I 2014-0527231E5 F under s. 87(2)(a).