Something I've always wondered. What is the purpose of a holding company?
Example... Norfolk Southern Corporation is a holding company whose sole purpose is to own Norfolk Southern Railway, Inc. which is actually the railroad.
UAL, Inc. owns United Airlines, Inc. the airline.
Or in the case of Washington Mutual Corp holding company it owned Washington Mutal Bank. The bank went broke it was the holding company's only asset so now the holding company just flounders as a shell on paper.
Why don't the actual companies that run the RR (or airline in the case of United) just exist on their own. Why a holding company? It results in double taxation. The NSRwy gets taxed, then the income is passed to NSCorp who also pays tax. What's the purpose? Seems like double accounting, double tax, double work!
Example... Norfolk Southern Corporation is a holding company whose sole purpose is to own Norfolk Southern Railway, Inc. which is actually the railroad.
UAL, Inc. owns United Airlines, Inc. the airline.
Or in the case of Washington Mutual Corp holding company it owned Washington Mutal Bank. The bank went broke it was the holding company's only asset so now the holding company just flounders as a shell on paper.
Why don't the actual companies that run the RR (or airline in the case of United) just exist on their own. Why a holding company? It results in double taxation. The NSRwy gets taxed, then the income is passed to NSCorp who also pays tax. What's the purpose? Seems like double accounting, double tax, double work!