I have a client (C-Corp private held - one member) that has similar businesses that he would like to file a consolidated return for going forward. From a tax perspective all questions has being satisfied regarding the advantages and disadvantages however, from a bank lending standpoint he is unsure how the bank will look at consolidated entities the file one return for future lending purposes. Right now the businesses obtain bank loans individually if needed and he is held personally liable for the company debt as a guarantor. I am trying to find the answer to he concern but I do not think in a bank mind. I see things from a financial and tax reporting perspective.
1. If consolidated do the parent company seek out the loan for the subs if needed? or; can each subsidiary seek bank lending separate from the group as a whole?
2. Can the entities in the be held liable for the debt of another sub instead of the bank wanting a personal guarantor on business loans.
The client concern is how would filing a consolidated return affect future lending and is it possible for him to stop being a personal guarantor?
Your feed back is greatly appreciated.
1. If consolidated do the parent company seek out the loan for the subs if needed? or; can each subsidiary seek bank lending separate from the group as a whole?
2. Can the entities in the be held liable for the debt of another sub instead of the bank wanting a personal guarantor on business loans.
The client concern is how would filing a consolidated return affect future lending and is it possible for him to stop being a personal guarantor?
Your feed back is greatly appreciated.