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Olds dealers offered tax relief under federal bill

November 24, 2010
A Senate bill introduced July 12 would ease the tax burden faced by Oldsmobile dealers over the demise of the brand. Payments made to Olds dealers following General Motor's phase-out decision would be treated by the legislation as an involuntary conversion under an existing section of the Internal Revenue Code. The bill (S. 2726) would allow Olds dealers to defer federal tax consequences by reinvesting the transitional payment from GM into other dealership opportunities within two years. New Mexico Sen. Jeff Bingaman introduced the legislation, saying that allowing Olds dealers to reinvest the entire payment received from GM into replacement dealership property gives those dealers an opportunity to continue family-owned businesses and greatly benefits local economies. A similar House bill (H.R. 2374) introduced last year provides additional opportunities for legislators to attach the measure to a tax measure.