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Taxation of Financial Products & Transactions 2021


Speaker(s): Christina R. Lizza, Craig J. Gibian, Deborah L. Paul, Eileen Marshall, Elena V. Romanova, Erika W. Nijenhuis, Helen Yanchisin, Jay J. Klein, Jeffrey D. Hochberg, Jeffrey W. Maddrey, Jonathan R. Zelnik, Kristen M. Garry, Lena Y. Hines, Mark H. Price, Mark S. Perwien, Mark Schwed, Matthew A. Stevens, Michael K. Yaghmour, Nicholas A. Machen, Sanjeev Magoon, Sara B. Zablotney, Spence W. Hanemann, Tyler L. Arbogast
Recorded on: Jan. 11, 2021
PLI Program #: 304622

Background

Jay Klein is a Principal in the tax asset management, banking, and capital markets practices.  Jay is the Asset & Wealth Management financial products tax leader and advises funds and financial institutions on the taxation of financial products and related issues.  Jay formerly worked at Morgan Stanley as an Executive Director and as a member of the tax department at Sullivan & Cromwell LLP. 

 

Relevant experience

Jay has comprehensive expertise in taxation of financial products.  As a principal at PwC, Jay has led global tax consulting and implementation projects at international banks, advised clients on the use of financial products to achieve efficient tax structuring, formulated compliance solutions that leverage technology and interface with the systems of withholding agents, assisted many funds in creating policies and controls to facilitate compliance with various tax requirements, and has advised banks, funds and multinational clients on a variety of complex financial product tax issues.

As a member of the Morgan Stanley tax department, Jay served as a trusted advisor and risk manager to a broad spectrum of equity, fixed income and capital markets trading desks and business units, including comprehensive efforts in respect of changes in tax law.

Jay also held a leading role in lobbying activities both directly with the government and together with industry groups such as SIFMA and ISDA on a broad range of issues including 871(m), 305(c), “basket notices”, comprehensive tax reform efforts, swap upfront payment regulations, and §1.1001-4 regulatory relief. He also has extensive experience working with the IRS on audit and current matters.

 

Education and certifications

Jay holds a JD from St. John’s School of Law and a BA in Business and English from Yeshiva University


Christina is a director in PwC’s Washington National Tax Services practice.  She advises on the taxation of financial products and transactions, including the taxation of derivatives and other financial instruments in the domestic and international fixed income, equity, currency, and commodity markets, as well as the complex set of tax rules that may apply to various trading and investment strategies.

Christina is a licensed CPA in Massachusetts, the District of Columbia, and New York, and is a member of the AICPA.  She received a Bachelor of Science in Management with concentrations in Finance and Accounting from Boston College and a Master of Science in Taxation from Bentley University.


Craig Gibian is the managing principal in the Financial Instruments Group of the Washington National Tax Office of Deloitte Tax LLP.  Craig assists Deloitte’s clients in their efforts to evaluate complex financial transactions and utilize financial instruments in a tax-efficient manner.

Prior to joining Deloitte in 2013, Craig was a partner in the DC Office of a New York law firm and has over 20 years of experience in the area of the taxation of financial instruments.  His extensive work in the area covers the taxation of debt and derivatives, including in the context of mergers and acquisitions and investment management.

Craig is the former chair of the Financial Transactions Committee of the Tax Section of the American Bar Association and the Financial Products Committee of the DC Bar Taxation Section.  Craig received his bachelor’s degree from Princeton University and juris doctor from Harvard Law School.


Deborah L. Paul is a Partner in the Tax Department at Wachtell, Lipton, Rosen & Katz in New York City where she focuses on the tax aspects of corporate transactions, including mergers and acquisitions, joint ventures, spinoffs and financial instruments.  Ms. Paul has been the principal tax lawyer on numerous domestic and cross-border transactions, including strategic acquisitions and private equity buyouts. 

Ms. Paul was the 2019 Chair of the Tax Section of the New York State Bar Association and is a frequent speaker at Practising Law Institute, International Fiscal Association, New York State Bar Association and other conferences on tax aspects of mergers and acquisitions and related topics.  She is rated a leading tax lawyer by Chambers USA, Super Lawyers, the Legal 500 and Who’s Who Legal.

Prior to coming to Wachtell Lipton in 1997, Ms. Paul was an Assistant Professor at the Benjamin N. Cardozo School of Law and an Acting Assistant Professor at the New York University School of Law.  Ms. Paul clerked for Chancellor William T. Allen on the Delaware Court of Chancery. 

Ms. Paul received an A.B. from Harvard University with a concentration in Philosophy, a J.D. from Harvard Law School and an LL.M. in Tax from New York University School of Law.


Eileen Marshall is a partner in the tax practice at Cooley LLP, based in the Washington D.C., and Palo Alto offices.  Eileen represents life sciences and technology companies and other growth enterprises at every stage of their development, as well as the venture firms, private equity firms and investment banks that finance and advise them.  Eileen's practice includes all aspects of domestic and cross-border mergers, acquisitions, divestitures, restructurings, tax-free reorganizations, spin-offs, and formation transactions.  She also has significant experience advising on tax issues in connection with public and private equity and debt financings and restructurings.


Elena Romanova is a partner in the New York office of Latham & Watkins. She brings extensive experience in tax matters related to equity derivatives and other financial products as well as U.S. taxation of multinational financial institutions. Ms. Romanova provides clients with firsthand industry experience and a deep understanding of unique tax issues faced by broker-dealers and banks in both institutional and retail businesses. Ms. Romanova is regularly called upon to speak at tax conferences to discuss issues relating to derivatives and to the financial industry.

Prior to joining Latham, Ms. Romanova was a Managing Director at Citigroup, where she served as the Global Head of the Business Tax Advisory, supporting the Institutional Clients Group and the Consumer Bank. She also practiced for several years at another major New York firm and prior to that, served as a Tax Policy Fellow at the US Treasury Department, Office of Tax Policy. During her tenure at Citigroup, Ms. Romanova served on the Board of Directors of the Wall Street Tax Association.


Erika Nijenhuis is Senior Counsel with the Office of the International Tax Counsel, Office of Tax Policy, at the Department of the Treasury.  Since joining ITC in September 2019, she has worked on financial products and markets and crypto asset taxation matters and on a range of international tax matters relating to financial institutions and cross-border capital markets transactions.

Previously, Ms. Nijenhuis was a tax partner at Cleary Gottlieb Steen & Hamilton LLP, where she was a leading expert on the taxation of financial products and financial institutions.  She has published numerous articles on financial product and financial market issues and on related international tax issues.  She was Chair of the Tax Section of the New York State Bar Association in 2009-2010.

Ms. Nijenhuis received an LLM in Taxation from New York University School of Law, a J.D. from the University of Pennsylvania School of Law and a B.A. from the University of Pennsylvania.


Helen Yanchisin is a managing director in the Washington National Tax Office of Deloitte Tax LLP.  Helen has practiced in the area of the taxation of financial instruments for twenty years.  Her practice includes debt offerings, debt restructurings, distressed debt, convertible debt, hedging, derivatives, and structured products. 


Jeff Hochberg joined Sullivan & Cromwell’s Tax Group in 1995 and became a partner in 2004. His practice is primarily focused on the taxation of capital markets transactions, financial instruments and products, private equity and real estate transactions, cross-border structured investments, structured finance transactions and ERISA-related matters. He also has extensive experience in advising clients as to the tax consequences of domestic and cross-border mergers, acquisitions and restructurings and has worked on numerous debt exchanges and refinancings.

Mr. Hochberg is a 1995 graduate of Columbia Law School and he serves on the Board of Advisors of the Columbia Journal of Tax law.

Jeff is a two-time recipient of the Burton Award for Distinguished Legal Writing and is a member of the Tax Forum and the Tax Club.   He served for eight years on the Executive Board of the Tax Section of the New York State Bar Association where he served as co-chair of the Tax Accounting Committee and the Real Property Committee.  He has written many bar reports and articles on a variety of tax topics, and he regularly speaks before industry and professional groups on federal income tax matters.


Jeff Maddrey is a principal in the National Tax Office of PricewaterhouseCoopers LLP. Jeff advises on international and financial transaction planning issues.  In addition, Jeff has a significant ruling and controversy practice that in financial products matters.  Jeff works extensively with alternative asset managers on both trading and tax structuring issues as well as with US and foreign headquartered multinationals.

Jeff began his career at the IRS National Office as an attorney-advisor in the Financial Institutions and Products division of the National Office.  While there, Jeff participated in drafting significant regulations addressing tax accounting for debt instrument and derivatives.  From 1997 to 2000, Jeff moved to the United States Treasury Department’s Office of Tax Policy where he was first an attorney-advisor and then an Associate Tax Legislative Counsel.

Jeff is a member of the New York State Bar Association Tax Section Executive Committee and a co-chair of its Financial Transactions Committee.  Jeff is a past chair of the ABA Financial Transactions committee.  Jeff is a regular speaker at tax conferences, has authored numerous articles addressing taxation of derivatives, and has authored a Bloomberg BNA Portfolio (Maddrey, 181 T.M. Time Value of Money – Holders of Debt Instruments.) 

Jeff received his L.L.M. from Georgetown University, his J.D. from University of Maryland School of Law, and his B.A. from Duke University.


Jonathan Zelnik is a principal in the Financial Institutions and Products group of KPMG LLP's Washington National Tax practice. His practice focuses on the taxation of financial products and debt. He routinely advises financial services clients with respect to their lending, investing, and market-making activities, and clients in a wide range of industries with respect to their debt issuances, re-financing, and hedging activities.  Previously, he was at the IRS Office of Chief Counsel as a Senior Counsel to the Chief Counsel.  He is the update author for Federal Taxation of Financial Instruments & Transactions.


Kristen Garry is a tax partner in Shearman & Sterling’s Washington D.C. office.  She regularly advises financial institutions and other domestic and foreign clients on issues relating to financial products, cross-border structured finance, securitizations and mergers and acquisitions.  Kristen has represented numerous international and U.S. corporations in connection with private and SEC-registered securities offerings (both debt and equity).  She is a “leading lawyer” in Financial Products, as well as a member of Shearman & Sterling’s Tier 1-ranked Tax team, according to Legal 500 (2020).  She also assists clients with IRS audits, appeals and tax litigation.  Kristen represents a broad range of clients including Ardagh, Barclays, Citigroup, Jefferies, Marriott International, Nokia and Susquehanna International Group LLP.

 

Relevant experience includes representation of: 

  • Anglo American on its offering of $1,000 million 2.625% senior notes due 2030 and $500 million 3.950% senior notes due 2050.
  • BofA Securities, Inc. and HSBC Securities (USA) Inc. as dealer managers on Argentina’s historic debt restructuring in which it obtained the consents required from investors to exchange and/or modify 99.01 percent the country’s outstanding $65 billion in international bonds.
  • the underwriters in connection with The Royal Bank of Scotland Group’s (RBSG) offering of $1.5 billion aggregate principal amount of 6.000% reset perpetual subordinated contingent convertible additional tier 1 capital notes.
  • the initial purchasers on Boeing’s $25 billion bond offering, which represented the largest non-M&A bond offering of the time.
  • Valvoline Inc. on its Rule 144A/Regulation S offering of $600 million of 4.250 percent senior notes due 2030. Valvoline intended to use the net proceeds to fund the redemption of senior notes due 2024 and repay $100 million of indebtedness under a loan facility.

 

Prior to joining the firm, Kristen clerked with the U.S. Tax Court.  Kristen received both her J.D. and LL.M. in Taxation from New York University School of Law and her B.A., magna cum laude, from Cornell University.


Lena is a principal in EY’s National Tax Department and is based in Los Angeles, California.  She has over 15 years of experience in the taxation of financial transactions and instruments in the fixed income, equity, commodity and currency markets. 

She consults on domestic and international tax-planning opportunities involving complex financing structures.  She provides tax advice on ordinary course financing transactions, tax hedges and complex debt investments; supports the audit function in connection with tax provision reviews; consults on issues implicating foreign currency tax regimes; and drafts formal and informal written advice documenting support for tax technical positions.  Lena is experienced in addressing IRS audits, and preparing requests for method of accounting changes, private letter rulings and closing agreements regarding financial derivatives, original issue discount, market discount, bond premium and deductible repurchase premium related to debt repurchases.  

Lena develops and presents tax discussions on technical issues at conferences sponsored by the American Bar Association, the District of Columbia Bar Association, the Practising Law Institute and the Tax Executive Institute.      

She is a member of the District of Columbia Bar – Taxation Section / Financial Products Committee (Chair 2017 – 2019); the American Bar Association; and the State Bar of California - Taxation Law Section. 

Lena holds degrees from UCLA (B.A.), UCLA School of Law (J.D.) and Georgetown University Law Center (LL.M. / Taxation).  She is a member of UCLA’s Advisory Council for the Academic Advancement Program, the National Association of Black Accountants and the Association for Latino Professionals for America.


Mark Price is the principal-in-charge of the Financial Institutions and Products group of Washington National Tax. During his time at KPMG, he has worked closely with clients and firm professionals on tax issues arising from capital markets transactions and the treasury function, including derivatives transactions, issuances of debt, securitizations, debt restructurings, and cash management. He has also worked with oil and gas clients, power and utility clients, and banks on issues relating to commodity and power hedging and trading and emissions credits.

Mark is also the National Tax Leader for Banking & Finance.  In this role, he is responsible for supporting the financial services practice, particularly the commercial and investment banks, finance companies, and other lending institutions. Mark has worked with these clients on tax issues related to their lending and investment activities, servicing activities, and their funding needs. 


Mark Schwed is a partner in Weil’s Tax Department and is based in New York. Mr. Schwed advises public companies and private equity sponsors and their portfolio companies on their domestic and international acquisitions, investments, divestitures, joint ventures, financings and restructurings. Mr. Schwed also has significant experience advising on SPAC initial public offerings, financings and business combinations. He also regularly advises on the structuring and negotiating of complex real estate transactions, including the formation of REITs.

Mr. Schwed’s clients include American Securities, Aterian Investment Partners, Avista Capital Partners, Berkshire Partners, Blackstone, CPP Investments, Centerbridge Partners, Cornell Capital, Genstar Capital, Goldman Sachs, Gores Group, Lindsay Goldberg, MGM Resorts International, MGM Growth Properties LLC, Ontario Teachers’ Pension Plan Board, Providence Equity Partners, SoftBank Vision Fund, Tishman Speyer and TPG.

Mr. Schwed is a member of the executive committee of the New York State Bar Association Tax section. He is recognized as a leading lawyer for Tax in New York by Chambers USA, where clients note "he's super practical, very commercial and has the industry experience to advise across a broad range of matters." Mr. Schwed is also recognized as a “Next Generation Partner” for both US Taxes: Non-Contentious and International Tax by Legal 500 US and as a “Bankruptcy Tax Specialist” by Turnarounds & Workouts magazine.

 

Education

New York University Law (LL.M., 2005)

Cardozo Law School (J.D., 2005)

Ramapo College of New Jersey (B.A., 2002)

 


Matthew Stevens, a principal in the Capital Market group within International Tax Services at Ernst & Young LLP, handles planning and controversy matters regarding the U.S. federal income tax consequences of transactions, specializing in the design, structuring and implementation of domestic and international financial transactions.  He advises hedge funds, private equity funds, high net worth individuals (both U.S. and non-U.S.), insurance companies, and foreign and domestic multinational corporations.

Matthew serves as chair of the annual Practicing Law Institute program “Taxation of Financial Products and Transactions.”  He has served as chair of the Financial Transactions Committee of the Tax Section of the District of Columbia Bar, and as the chair of the Financial Transactions Committee of the Tax Section of the American Bar Association.  He has co-taught the Georgetown University Law Center class entitled “United States Taxation of International Income – II.”  He has published a number of articles dealing with international aspects of U.S. income tax and with the taxation of financial products and transactions.  Matthew is listed in Chambers USA:  America’s Leading Lawyers for Business.   From 2002 to 2004, Matthew served as special counsel to the Chief Counsel for the Internal Revenue Service. There, he advised the Chief Counsel regarding published guidance on a wide range of tax issues involving financial products and cross border transactions.

Education

Harvard University
(J.D., 1990)

University of Kansas
(B.A., 1987)


Michael Yaghmour is a principal in Ernst & Young’s National Tax Department in Washington, D.C.  At EY, he is a member of the International Tax and Transaction Services Capital Markets practice where he focuses on the taxation of financial transactions and instruments, including the taxation of debt instruments, foreign currency transactions, and derivative instruments.

Mr. Yaghmour is a contributing author on the most recent edition of the “Federal Income Taxation of Debt Instruments,” the leading treatise on that subject.  He is a past chair of the Financial Products Committee of the D.C. Bar Tax Section.

Prior to joining EY, Mr. Yaghmour was a member of PwC’s National Tax Services office in Washington D.C.  Mr. Yaghmour has also worked as a tax attorney with Fannie Mae and began his career as an associate with Dewey Ballantine, LLP.

Mr. Yaghmour speaks frequently at tax industry meetings on financial transactions and has authored several articles on the subject.


Mr. Machen is the global Tax Head for Markets and BCMA at Citigroup.  He works on a variety of internal tax planning efforts, and supports Citi’s corporate treasury and other business lines by providing advice on the taxation of corporate finance, derivatives and other financial products.  Prior to joining Citigroup, Mr. Machen was a tax lawyer at Davis Polk & Wardwell LLP, where his practice focused on all manner of financial products, mergers and acquisitions, and tax controversy.


Mr. Perwien is Senior Advisor, Financial Products for the Director of Enterprise Activities. He is an expert in the taxation of financial derivatives. Prior to joining the Large Business and International Division, he was a Special Counsel in the Office of the Associate Chief Counsel (Financial Institutions and Products). He worked on Wall Street for many years, advising the sales and trading desks on the tax consequences of their activities both for the firms and the customers. He has also helped design many financial products to insure their tax efficiency. While on Wall Street he served as the Chair of the North American Tax Committee of the International Swap and Derivatives Association.

He has spoken on the taxation of financial products to many groups including the Tax Section of the American Bar Association, the Tax Section of the NYS Bar Association, The NYS Society of CPAs, the Tax Executives Institute, the DC Bar Tax Section, the Practicing Law Institute, and the Wall Street Tax Association. 

He received his B.A. in Urban Studies and B.S. in Economics from the University of Pennsylvania, his M.B.A. from Wharton, his J.D. from Stanford University, and his L.L.M. in taxation from New York University. 


Sanjeev is a Principal with PwC's real estate tax practice in New York.  Sanjeev has advised leading financial institutions, hedge funds and REITs on various tax issues, including structuring CLOs, REITs, REMICs, TMPs and other asset-backed securitization transactions and tax accounting for complex debt instruments and hedging transactions.  He has developed and implemented financial products for mortgage agencies and major financial institutions, including credit-risk transfer structures, contingent convertibles and integrated call-spread convertibles.  He has also developed and analyzed financial models, including option amortization schedules, cash-flow models for prepayable instruments and contingent and foreign-currency debt accrual schedules. 

Prior to joining PwC, Sanjeev was a counsel in the tax group at Shearman & Sterling LLP where he served as Freddie Mac's outside tax counsel for 17 years for all of their tax matters, including their REMIC securitization, credit-risk transfer programs and debt and hedging transactions.  

Sanjeev obtained his Master of Laws in Taxation from Georgetown University Law Center, his Juris Doctor from the University of Virginia School of Law, and his Bachelor of Science in Business Administration from Georgetown University. 


Sara Zablotney is a tax partner in the New York office of Kirkland & Ellis LLP. She is widely recognized as one of the top transactional tax lawyers in the country. Her practice is broad-based and encompasses all manner of complex transactions, focusing on the tax aspects of mergers, acquisitions, divestitures, joint ventures and spin-offs, both domestic and cross-border. She also advises clients on the tax aspects of securities issuances, bankruptcy and restructuring. Chambers USA has praised her as “practical, quick on her feet and proactive” and “extremely knowledgeable with good judgment.” Sara has been recognized by Chambers USA for Tax [NY] from 2017–2020, as a “Rising Star” by Law360 for Tax Law in 2014, and is recommended by The Legal 500 U.S.   Sara received her B.A. from Duke University (magna cum laude) in 1999 and her J.D. from New York University School of Law (cum laude) in 2002, where she received the Leonard J. Schreier Memorial Prize in Ethics and the Norma Z. Paige Award.  She speaks frequently on topics relating to mergers and acquisitions and private equity.  She is a member of the New York State Bar Association Tax Section’s Executive Committee, where she is Co-Chair of the Partnerships Committee.  She currently sits on the Advisory Board for the Kenan Institute of Ethics at Duke University, and formerly sat on the Advisory Board for the Sarah P. Duke Gardens.


Spence is a Senior Counsel in the IRS Office of Chief Counsel, where he has worked since 2009.  He received his JD from Boston College Law School in 2007 and his LLM in taxation from Georgetown University Law Center in 2012.  Since 2012, Spence has focused on the taxation of financial products and the tax exemption for state and local bonds. Prior to 2012, he worked on procedural and administrative aspects of tax, such as penalties, interest, returns, and refunds.


Tyler L. Arbogast is a senior manager in the National Tax Department of Ernst & Young LLP specializing in the taxation of financial instruments and products. He is a contributing author to the treatise Federal Income Taxation of Debt Instruments, published by CCH, a co-author of several articles related to financial products, and has spoken several times at tax industry meetings related to debt instruments and related issues and frequent contributor to bar association reports. Tyler advises issuers and holders with respect to debt refinancing, restructurings and workouts. His work also includes tax structuring related to an array of complex fixed-income products for issuers, credit funds, hedge funds and financial institutions. Tyler received his B.B.A. with special distinction from the University of Oklahoma in 2006 and his J.D. from Boston College Law School in 2009.