A forward triangular merger is a reorganization transaction involving three corporations—the issuing corporation, the acquiring corporation, and the target corporation. The acquiring corporation receives substantially all of the target corporation’s properties. In exchange, the target corporation’s shareholders receive stock of the issuing corporation, which must control the acquiring corporation.  Example: Poco Corporation (the issuing corporation) wants to acquire all the assets of Tango Corporation (the target corporation). Accordingly, it forms a new subsidiary, Solo (the acquiring corporation). Tango merges into Solo, and Tango’s shareholders receive Poco stock. Provided the transaction is effectuated pursuant to a qualified statute, it qualifies as a forward triangular merger under Code Sec. 368(a)(2)(D). Tango recognizes no gain or loss on the transfer of its assets. Solo recognizes no gain or loss on the receipt of assets. Tango’s shareholders recognize no gain or loss on the receipt of Poco stock in exchange for Tango stock. Although boot is permitted, Tango’s shareholders may not receive any Solo stock in the transaction.  §368(a)(2)(D)(1).