step transaction doctrine
- A theory in tax regulations where multiple separate yet linked transactions may be treated as one single transaction, determining the tax implications according to this combined transaction instead of each separate interaction
- The step transaction doctrine was applied to a several real estate sales, treating them as one larger transaction for tax purposes.
- To avoid tax evasion, the tax authority might use the step transaction doctrine when several transactions appear to be intertwined.
- Under the lens of the step transaction doctrine, the IRS could view the series of equity transactions as a single big deal.