Text Resize

Monday September 1, 2014

Washington News

Washington Hotline

Whopper of an Inversion

Burger King, Inc. announced this week that it would acquire the Canadian restaurant chain Tim Hortons, Inc. Following the acquisition, Burger King will move its corporate headquarters to Ontario. The “inversion” will save an estimated $8 million per year in U.S. corporate taxes.

Burger King’s lead product is the Whopper. This oversized hamburger with a quarter pound patty has been very popular. Burger King now has more than 11 million customers per day and over 13,000 restaurants in 95 countries.

Burger King shareholders will receive 0.99 share of the new company and 0.01 share of a Canadian partnership for each share of common stock. Generally, shareholders may choose to receive partnership units rather than stock shares in the new company.

Alex Behring is Executive Chair of Burger King. He commented on the inversion, "While I know there has been a great deal of discussion in the media about the motivations for the transaction, I want to point out that it is a strategic transaction that is creating a new global leader in the sector and is not being driven by tax rates. We will continue to pay federal, state, and local taxes in the United States."

Congress is considering two bills to limit inversions. The Stop Corporate Inversions Act of 2014 (H.R. 4679) and No Federal Contracts for Corporate Deserters Act of 2014 (H.R. 5278) include a 50% limit for U.S. ownership after an inversion. However, both bills permit an exception for "substantial business activity" in a foreign country. Under that standard, the Burger King inversion might still qualify.

Sen. Dick Durbin (D-IL) opposed the inversion. He noted, “With every new corporate inversion, the tax burden increases on the rest of us to pay what these corporations don’t. That burden is made worse when these corporations profit off of all the public benefits that help American companies succeed and then run from their U.S. tax responsibility. I'm disappointed in Burger King's decision to renounce their American citizenship. I call on companies currently mulling this tax dodge to reconsider, and on Congress to protect U.S. taxpayers from more of these schemes.”

Congressional Budget Office Director Douglas Elmendorf also expressed concern. He stated, “Our projections of corporate tax receipts over the coming decade do incorporate some erosion of the corporate tax base through a variety of tax reduction strategies. One factor there would be corporate inversions."

Published August 29, 2014

Previous Articles

Koskinen Warns of IRS Problems

Con Artists Posing as IRS Agents

Senators Welcome Walgreens’ Decision

Highway Bill Rolls Through Congress

House Passes Single Higher Education Credit


Beneficiary Designations Language

All beneficiary designations should be made to "the Board of Regents of The University of Texas System for the use and benefit of The University of Texas Health Science Center at San Antonio. This gift shall be used for the further benefit of [College, School, Department] and shall be used to _________________."

View and download:
   Sample Bequest language
   Sample Beneficiary language
   Estate Intention Letter

Charitable Gift Annuity
Single Rates from the American Council of Gift Annuities

Age Rate
60 4.40%
65 4.70%
68 4.90%
70 5.10%
72 5.40%
74 5.70%
76 6%
78 6.40%
80 6.80%
82 7.20%
84 7.60%
86 8%
88 8.40%
90 9%

CGA's are also available for two lives and can be deferred

UT Health Science Center San Antonio

Office of Institutional Advancement, MC – 7835
7703 Floyd Curl Drive
San Antonio, Texas 78229-3900
Phone: 210-567-5001 | Fax: 210-567-3156

Copyright 2011-2013 UT Health Science Center San Antonio
© 2014 Crescendo Interactive, Inc. PRIVACY STATEMENT

Links from web sites affiliated with The University of Texas Health Science Center at San Antonio’s web site (www.uthscsa.edu) to other web sites
do not constitute or imply university endorsement of those sites, their content, or products and services associated with those sites.