This would mean that income splitting is difficult if not impossible and it would certainly make delaying the recognition of income for tax purposes impossible.

FORBES: Ken Livingstone's Tax Dodging Ways

This artificial manipulation of the interests, if permitted, would allow Owner to control the recognition of income or loss on distributions from the entity or dispositions of its interests in the entity for federal tax purposes.

FORBES: Chief Counsel Squashes Mysterious Technique

Asher Rubinstein, Estate Planning Moves To Consider Before 2010 Is Done, Forbes.com, Nov. 10, 2010 (discussing various timely strategies, including speeding up recognition of income in 2010, selling appreciated assets in 2010, and setting up dynasty trusts, charitable remainder trusts, and family limited partnerships).

FORBES: "A Perfect Storm" In 2010: It's Not Too Late To Speak To Your Estate Planning Adviser

So, having elected to go the company, corporate, route Livingstone faced the choice of, having delayed that income recognition for his own personal tax purposes (it would have been taxed at the lower rate of corporation tax though) he has a choice as to how to extract that income from the company.

FORBES: Ken Livingstone's Tax Dodging Ways