§ 337. Nonrecognition for property distributed to parent in complete liquidation of subsidiary
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(a)In general No gain or loss shall be recognized to the liquidating corporation on the distribution to the 80-percent distributee of any property in a complete liquidation to which section 332 applies.
(b)Treatment of indebtedness of subsidiary, etc.
(1)Indebtedness of subsidiary to parent If—
(A)a corporation is liquidated in a liquidation to which section 332 applies, and
(B)on the date of the adoption of the plan of liquidation, such corporation was indebted to the 80-percent distributee,
for purposes of this section and section 336, any transfer of property to the 80-percent distributee in satisfaction of such indebtedness shall be treated as a distribution to such distributee in such liquidation.
(2)Treatment of tax-exempt distributee
(A)In general Except as provided in subparagraph (B), paragraph
(1)and subsection
(a)shall not apply where the 80-percent distributee is an organization (other than a cooperative described in section 521) which is exempt from the tax imposed by this chapter.
(B)Exception where property will be used in unrelated business
(i)In general Subparagraph
(A)shall not apply to any distribution of property to an organization described in section 511(a)(2) if, immediately after such distribution, such organization uses such property in an activity the income from which is subject to tax under section 511(a).
(ii)Later disposition or change in use If any property to which clause
(i)applied is disposed of by the organization acquiring such property, notwithstanding any other provision of law, any gain (not in excess of the amount not recognized by reason of clause (i)) shall be included in such organization’s unrelated business taxable income. For purposes of the preceding sentence, if such property ceases to be used in an activity referred to in clause (i), such organization shall be treated as having disposed of such property on the date of such cessation.
(c)80-percent distributee For purposes of this section, the term “80-percent distributee” means only the corporation which meets the 80-percent stock ownership requirements specified in section 332(b). For purposes of this section, the determination of whether any corporation is an 80-percent distributee shall be made without regard to any consolidated return regulation.
(d)Regulations The Secretary shall prescribe such regulations as may be necessary or appropriate to carry out the purposes of the amendments made by subtitle D of title VI of the Tax Reform Act of 1986, including—
(1)regulations to ensure that such purposes may not be circumvented through the use of any provision of law or regulations (including the consolidated return regulations and part III of this subchapter) or through the use of a regulated investment company, real estate investment trust, or tax-exempt entity, and
(2)regulations providing for appropriate coordination of the provisions of this section with the provisions of this title relating to taxation of foreign corporations and their shareholders.
(Added Pub. L. 99–514, title VI, § 631(a), Oct. 22, 1986, 100 Stat. 2271; amended Pub. L. 100–203, title X, § 10223(a), Dec. 22, 1987, 101 Stat. 1330–411; Pub. L. 100–647, title I, § 1006(e)(4), (5)(A), Nov. 10, 1988, 102 Stat. 3400.)
Connections75 cite this · traces to 4
Cited by 75 sections · top 43
U.S. Code
statutes-at-large
- Public Law 87–834
- Public Law 85–866
- Public Law 403
- Public Law 100–647To make technical corrections relating to the Tax Reform Act of 1986, and for other purposes
- Public Law 95–628To revise miscellaneous timing requirements of the revenue laws, and for other purposes
- Public Law 96–223To impose a windfall profit tax on domestic crude oil, and for other purposes
- Public Law 95–600To amend the Internal Revenue Code of 1954 to reduce income taxes, and for other purposes
- Public Law 96–499To provide for reconciliation pursuant to section 3 of the First Concurrent Resolution on the Budget for the fiscal year 1981
- Public Law 97–248To provide for tax equity and fiscal responsibility, and for other purposes
- Public Law 96–471To amend the Internal Revenue Code of 1954 to revise the rules relating to certain installment sales
- Public Law 96–589To amend the Internal Revenue Code of 1954 to provide for the tax treatment of bankruptcy, insolvency, and similar proceedings, and for other purposes
- Public Law 94–455To reform the tax laws of the United States
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- Rules and RegulationsFinal and temporary regulations
- Rules and RegulationsNotice of proposed rulemaking
- NoticesFinal and temporary regulations
- Proposed RulesNotice of proposed rulemaking by cross-reference to temporary regulations
- NoticesFinal regulation
- Rules and RegulationsFinal and temporary regulations
- Proposed RulesNotice of proposed rulemaking
- Rules and RegulationsFinal regulations and removal of temporary regulations
- Rules and RegulationsTemporary regulations
- Proposed RulesNotice of proposed rulemaking by cross-reference to temporary regulations
- Rules and RegulationsFinal regulations
- Rules and RegulationsNotice of proposed rulemaking and notice of public hearing
- Rules and RegulationsNotice of proposed rulemaking by cross-reference to temporary regulations and notice of public hearing
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39 references not yet in our index
- Pub. L. 99–514, title VI, § 631(a)
- 100 Stat. 2271
- Pub. L. 100–203, title X, § 10223(a)
- 101 Stat. 1330–411
- Pub. L. 100–647, title I, § 1006(e)(4)
- 102 Stat. 3400
- Pub. L. 99–514
- 100 Stat. 2085
- Aug. 16, 1954, ch. 736
- 68A Stat. 106
- Pub. L. 85–866, title I, § 19
- 72 Stat. 1615
- Pub. L. 94–455, title XIX
- 90 Stat. 1772
- Pub. L. 95–600, title VII, § 701(i)(1)
- 92 Stat. 2904
- Pub. L. 95–628, § 4(a)
- 92 Stat. 3628
- Pub. L. 96–223, title IV, § 403(b)(2)(A)
- 94 Stat. 304
- Pub. L. 96–471, § 2(c)(2)
- 94 Stat. 2254
- Pub. L. 96–589, § 5(c)
- 94 Stat. 3405
- Pub. L. 97–248, title II, § 224(c)(5)
- 96 Stat. 489
- Pub. L. 99–514, title XVIII, § 1804(e)(7)(A)
- 100 Stat. 2803
- Pub. L. 99–514, § 631(a)
- Pub. L. 100–647, § 1006(e)(4)(A)
- Pub. L. 100–647, § 1006(e)(4)(C)
- Pub. L. 100–647, § 1006(e)(5)(A)
- Pub. L. 100–203
- Pub. L. 100–647, title I, § 1006(e)(5)(B)
- 102 Stat. 3401
- Pub. L. 100–647
- section 1019(a) of Pub. L. 100–647
- section 10223(d) of Pub. L. 100–203
- section 633 of Pub. L. 99–514
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cites case law
§ 337
Nonrecognition for property distributed to parent in complete liquidation of subsidiary
Fed. Reg.×49
Stat.×23
U.S.C.×3
Pub. L.Pub. L. 99–514, title VI, § 631(a)
Stat.100 Stat. 2271
Pub. L.Pub. L. 100–203, title X, § 10223(a)
Stat.101 Stat. 1330–411
Pub. L.Pub. L. 100–647, title I, § 1006(e)(4)
Cites 43 · showing 9Cited by 75 across 3 sources