Income tax indemnifications are contractual arrangements between two parties whereby one party will reimburse the other for income taxes paid to a taxing authority related to tax positions that arose, typically, before the transaction in which the indemnification was established.
While the income tax accounting principles (ASC 740) do not apply to taxes other than income taxes, the other elements of this framework may be applied with respect to indemnifications for such taxes.
Frankly, HUD has always maintained much negotiating power in seeking indemnification, as the MRB would alternatively withdraw a lender's FHA approval if the lender did not obtain the requested indemnifications.
8, 2010, the Department of Housing and Urban Development (HUD) announced plans to strengthen the Federal Housing Administration's (FHA's) lender indemnification process.
The airline said that it will offer all necessary assistance with regard to monetary
indemnification proceedings according to a set of three principles.
The costs of
indemnification insurance also rose and threatened to become unaffordable for individuals and families.
Indemnification provisions should be designed to maximize the benefits of insurance, reduce insurance premiums, and minimize disputes among the parties and their insurance carriers.
They often seek a contractual allocation of potential environmental liabilities or use
indemnification provisions, which do not affect CERCLA liability but provide for reimbursement of the indemnified party's cleanup costs.
The seller will want to know of any potential toxic or hazardous substances on the property in order to determine what types of representations, warranties, conditions, and
indemnification provisions to include in the sales contract.
The purpose of an
indemnification clause is to contractually shift the liability and financial burden for damages suffered by a third party to the party that is at fault.