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IRS scrutinizes certain corporate buyouts involving debt

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The next big private equity buyout will likely involve an offshore affiliate, a flurry of money exchanges, a lower tax bill, and higher returns. But the IRS is knocking.

By Lynnley Browning

FORTUNE -- Private equity firms, buffeted by challenges to long-held tax breaks and growing scrutiny from regulators, have an ugly new headache: a wary look by the Internal Revenue Service at one of their preferred acquisition techniques.

The technique involves MORE


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