The Problematic Delta Test for Dividend Equivalents, Tax Notes
The delta test in prop. reg. section 1.871-15 can be affected by superficial labeling. We propose improved alternatives, but also show that game playing remains possible if administrative constraints impose limits, such as allowing only one-time evaluation of instruments.
Thomas Joseph Brennan, Robert L. McDonald
Brennan, Joseph Thomas, and Robert L. McDonald. 2015. The Problematic Delta Test for Dividend Equivalents. Tax Notes. 146(4): 525-532.