According to the Wall Street Journal, an inversion works like this:
"A U.S. company buys a foreign target and adopts its home country's domicile ... with a tax rate lower than the U.S.'s. Shareholders of the acquired company must receive stock ... amounting to at least 20-percent of the resulting entity."
Inversions are controversial. The U.S. Treasury, Congress, and contractors are paying close attention.
Tom Spulak, chairman of the government advocacy and public policy group at King & Spaulding, explained how corporate inversions impact the contracting community.
Click the play icon above to watch his interview with Government Matters.