Agent owns 100% of sub-s "A" and wishes to transfer his "Book" of business to 100% owned sub-s "B". Transfer of the book means that B would be able to receive substantial future commissions on renewals, etc. The agent would be required to sign new contracts with all insurance providers at the same time, and any commission rights would transfer to B at that time. Questions: 1. Would the transfer of the book be a taxable event subject to ordinary or capital gain taxes?
2. If it is a taxable event, how would the transaction be valued?
3. Could the book be transferred for something as small as $1?