26 U.S.C. § 341 — Untitled legal text

Page 1118 TITLE 26—INTERNAL REVENUE CODE [§ 341 Jan. 12, 1983, 96 Stat. 2403; Pub. L. 99–514, § 2, Oct. 22, 1986, 100 Stat. 2095, provided that: ‘‘(1) IN GENERAL.—The amendments made by this sec- tion [enacting this section and amending sections 168, 318, 334, 336, 337, 381, and 617 of this title] shall apply to any target corporation (within the meaning of section 338 of the Internal Revenue Code of 1986 [formerly I.R.C. 1954] as added by this section) with respect to which the acquisition date (within the meaning of such section) occurs after August 31, 1982. ‘‘(2) CERTAIN ACQUISITIONS BEFORE SEPTEMBER 1, 1982.— If— ‘‘(A) an acquisition date (within the meaning of sec- tion 338 of such Code without regard to paragraph (5) of this subsection) occurred after August 31, 1980, and before September 1, 1982, ‘‘(B) the target corporation (within the meaning of section 338 of such Code) is not liquidated before Sep- tember 1, 1982, and ‘‘(C) the purchasing corporation (within the mean- ing of section 338 of such Code) makes, not later than November 15, 1982, an election under section 338 of such Code, then the amendments made by this section shall apply to the acquisition of such target corporation. ‘‘(3) CERTAIN ACQUISITIONS OF FINANCIAL INSTITU- TIONS.—In any case in which— ‘‘(A) there is, on July 22, 1982, a binding contract to acquire control (within the meaning of section 368(c) of such Code) of any financial institution, ‘‘(B) the approval of one or more regulatory au- thorities is required in order to complete such acqui- sition, and ‘‘(C) within 90 days after the date of the final ap- proval of the last such regulatory authority granting final approval, a plan of complete liquidation of such financial institution is adopted, then the purchasing corporation may elect not to have the amendments made by this section apply to the ac- quisition pursuant to such contract. ‘‘(4) EXTENSION OF TIME FOR MAKING ELECTIONS; REV- OCATION OF ELECTIONS.— ‘‘(A) EXTENSION.—The time for making an election under section 338 of such Code shall not expire before the close of February 28, 1983. ‘‘(B) REVOCATION.—Any election made under section 338 of such Code may be revoked by the purchasing corporation if revoked before March 1, 1983. ‘‘(5) RULES FOR ACQUISITIONS DESCRIBED IN PARAGRAPH (2).— ‘‘(A) IN GENERAL.—For purposes of applying section 338 of such Code with respect to any acquisition de- scribed in paragraph (2)— ‘‘(i) the date selected under subparagraph (B) of this paragraph shall be treated as the acquisition date, ‘‘(ii) a rule similar to the last sentence of section 334(b)(2) of such Code (as in effect on August 31, 1982) shall apply, and ‘‘(iii) subsections (e), (f), and (i) of such section 338, and paragraphs (4), (6), (8), and (9) of subsection (h) of such section 338, shall not apply. ‘‘(B) SELECTION OF ACQUISITION DATE BY PURCHASING CORPORATION.—The purchasing corporation may se- lect any date for purposes of subparagraph (A)(i) if such date— ‘‘(i) is after the later of June 30, 1982, or the acqui- sition date (within the meaning of section 338 of such Code without regard to this paragraph), and ‘‘(ii) is on or before the date on which the election described in paragraph (2)(C) is made.’’ SAVINGS PROVISION For provisions that nothing in amendment by section 401(d)(1)(D)(vii) of Pub. L. 115–141 be construed to affect treatment of certain transactions occurring, property acquired, or items of income, loss, deduction, or credit taken into account prior to Mar. 23, 2018, for purposes of determining liability for tax for periods ending after Mar. 23, 2018, see section 401(e) of Pub. L. 115–141, set out as a note under section 23 of this title. TREATMENT OF CERTAIN CORPORATION ORGANIZED ON FEBRUARY 22, 1983 Pub. L. 99–514, title XVIII, § 1804(e)(9), Oct. 22, 1986, 100 Stat. 2804, provided that: ‘‘In the case of a Rhode Island corporation which was organized on February 22, 1983, and which on February 25, 1983— ‘‘(A) purchased the stock of another corporation, ‘‘(B) filed an election under section 338(g) of the In- ternal Revenue Code of 1986 with respect to such pur- chase, and ‘‘(C) merged into the acquired corporation, such purchase of stock shall be considered as made by the acquiring corporation, such election shall be valid, and the acquiring corporation shall be considered a purchasing corporation for purposes of section 338 of such Code without regard to the duration of the exist- ence of the acquiring corporation.’’ SPECIAL RULES FOR DEEMED PURCHASES UNDER PRIOR LAW Pub. L. 98–369, div. A, title VII, § 712(k)(10), July 18, 1984, 98 Stat. 953, as amended by Pub. L. 99–514, § 2, Oct. 22, 1986, 100 Stat. 2095, provided that: ‘‘If, before October 20, 1983, a corporation was treated as making a quali- fied stock purchase (as defined in section 338(d)(3) of the Internal Revenue Code of 1986 [formerly I.R.C. 1954]), but would not be so treated under the amend- ments made by paragraphs (5) and (6) [amending subsec. (h) and section 318(b)(4) of this title] of this subsection, the amendments made by such paragraphs shall not apply to such purchase unless such corporation elects (at such time and in such manner as the Secretary of the Treasury or his delegate may by regulations pre- scribe) to have the amendments made by such para- graphs apply.’’ EXCEPTION FOR STOCK PURCHASES IN CONTEMPLATION OF TARGET CORPORATION AS MEMBER OF AFFILIATED GROUP Pub. L. 97–448, title III, § 306(a)(8)(A)(ii), Jan. 12, 1983, 96 Stat. 2402, as amended by Pub. L. 98–369, div. A, title VII, § 722(a)(3), July 18, 1984, 98 Stat. 973; Pub. L. 99–514, § 2, Oct. 22, 1986, 100 Stat. 2095, provided that: ‘‘If— ‘‘(I) any portion of a qualified stock purchase is pursuant to a binding contract entered into on or after September 1, 1982, and on or before the date of the enactment of this Act [Jan. 12, 1983], and ‘‘(II) the purchasing corporation establishes by clear and convincing evidence that such contract was negotiated on the contemplation that, with respect to the deemed sale under section 338 of the Internal Revenue Code of 1986 [formerly I.R.C. 1954], the target corporation would be treated as a member of the af- filiated group which includes the selling corporation, then the amendment made by clause (i) [amending sub- sec. (h)] shall not apply to such qualified stock pur- chase.’’ [SUBPART C—REPEALED] [§ 341. Repealed. Pub. L. 108–27, title III, § 302(e)(4)(A), May 28, 2003, 117 Stat. 763] Section, act Aug. 16, 1954, ch. 736, 68A Stat. 107; Pub. L. 85–866, title I, § 20(a), Sept. 2, 1958, 72 Stat. 1615; Pub. L. 87–834, § 13(f)(4), Oct. 16, 1962, 76 Stat. 1035; Pub. L. 88–272, title II, § 231(b)(4), Feb. 26, 1964, 78 Stat. 105; Pub. L. 88–484, § 1(a), Aug. 22, 1964, 78 Stat. 596; Pub. L. 89–570, § 1(b)(4), Sept. 12, 1966, 80 Stat. 762; Pub. L. 91–172, title II, § 211(b)(4), title V, § 514(b)(1), Dec. 30, 1969, 83 Stat. 570, 643; Pub. L. 94–455, title II, § 205(c)(2), title XIV, § 1402(b)(1)(B), (2), title XIX, §§ 1901(b)(3)(A), (I), 1906(b)(13)(A), Oct. 4, 1976, 90 Stat. 1535, 1731, 1732, 1792, 1793, 1834; Pub. L. 97–34, title V, § 505(c)(2), Aug. 13, 1981, 95 Stat. 332; Pub. L. 97–248, title II, § 222(e)(5), Sept. 3, 1982, 96 Stat. 480; Pub. L. 98–369, div. A, title I, §§ 43(c)(1), 65(a)–(c), 135(a), title IV, § 492(b)(2), title X, § 1001(b)(2), (e), July 18, 1984, 98 Stat. 558, 584, 669, 854, 1011, 1012; Pub. L. 99–514, title VI, § 631(e)(6), title XVIII, Page 1119 TITLE 26—INTERNAL REVENUE CODE § 346 §§ 1804(i)(1), 1899A(8), Oct. 22, 1986, 100 Stat. 2273, 2807, 2958; Pub. L. 100–647, title I, § 1006(e)(18), Nov. 10, 1988, 102 Stat. 3403; Pub. L. 104–188, title I, § 1702(h)(7), Aug. 20, 1996, 110 Stat. 1874; Pub. L. 106–170, title V, § 532(c)(2)(D), Dec. 17, 1999, 113 Stat. 1930; Pub. L. 107–147, title IV, § 417(24)(B)(i), Mar. 9, 2002, 116 Stat. 57, related to collapsible corporations. Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF REPEAL Repeal applicable, except as otherwise provided, to taxable years beginning after Dec. 31, 2002, see section 302(f) of Pub. L. 108–27, set out as an Effective and Ter- mination Dates of 2003 Amendment note under section 1 of this title. [§ 342. Repealed. Pub. L. 94–455, title XIX, § 1901(a)(47), Oct. 4, 1976, 90 Stat. 1772] Section, act Aug. 16, 1954, ch. 736, 68A Stat. 110, re- lated to liquidation of certain foreign personal holding companies. Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF REPEAL Repeal effective for taxable years beginning after Dec. 31, 1976, see section 1901(d) of Pub. L. 94–455, set out as an Effective Date of 1976 Amendment note under section 2 of this title. SUBPART D—DEFINITION AND SPECIAL RULE Sec. 346. Definition and special rule. Editorial Notes AMENDMENTS 1982—Pub. L. 97–248, title II, § 222(e)(8)(A), Sept. 3, 1982, 96 Stat. 481, inserted ‘‘and Special Rule’’ in sub- part heading, and substituted ‘‘Definition and special rule’’ for ‘‘Partial liquidation defined’’ in item 346. § 346. Definition and special rule (a) Complete liquidation For purposes of this subchapter, a distribution shall be treated as in complete liquidation of a corporation if the distribution is one of a series of distributions in redemption of all of the stock of the corporation pursuant to a plan. (b) Transactions which might reach same result as partial liquidations The Secretary shall prescribe such regulations as may be necessary to ensure that the purposes of subsections (a) and (b) of section 222 of the Tax Equity and Fiscal Responsibility Act of 1982 (which repeal the special tax treatment for par- tial liquidations) may not be circumvented through the use of section 355, 351, or any other provision of law or regulations (including the consolidated return regulations). (Aug. 16, 1954, ch. 736, 68A Stat. 110; Pub. L. 97–248, title II, § 222(d), Sept. 3, 1982, 96 Stat. 479; Pub. L. 99–514, title VI, § 631(e)(7), Oct. 22, 1986, 100 Stat. 2273.) Editorial Notes REFERENCES IN TEXT Subsections (a) and (b) of section 222 of the Tax Eq- uity and Fiscal Responsibility Act of 1982, referred to in subsec. (b), are subsecs. (a) and (b) of Pub. L. 97–248, title II, § 222, Sept. 3, 1982, 96 Stat. 478, which amended sections 331(a) and 336(a) of this title. AMENDMENTS 1986—Subsec. (b). Pub. L. 99–514 struck out ‘‘337,’’ after ‘‘351,’’. 1982—Subsec. (a). Pub. L. 97–248 substituted provision that a distribution shall be treated as in complete liq- uidation if the distribution is one of a series in redemp- tion of all the stock pursuant to a plan for provision that a distribution was to be treated as in partial liq- uidation if the distribution was one of a series in re- demption of all the stock pursuant to a plan, or the dis- tribution was not essentially equivalent to a dividend, was in redemption of part of the stock pursuant to a plan, and occurred within the taxable year or the next taxable year of the plan being adopted, including but not limited to a distribution which met the require- ments of former subsec. (b) of this section, and that for the purposes of sections 562(b) and 6043 of this title, a partial liquidation included a redemption of stock to which section 302 of this title applied. Subsec. (b). Pub. L. 97–248 added subsec. (b) and struck out former subsec. (b) which provided that a dis- tribution was to be treated as in partial liquidation of a corporation if the distribution was attributable to the cessation of a business which had been carried on for the previous 5-year period and had not been ac- quired by the corporation in a transaction involving recognition of gain or loss during that time, and if the distributing corporation was actively involved in a trade or business immediately after the distribution under the terms described above for the business being liquidated, and that compliance with the above require- ments would be determined without regard to whether or not the distribution was pro rata with respect to all the shareholders of the corporation. Subsec. (c). Pub. L. 97–248 struck out subsec. (c) which provided that the fact that, with respect to a shareholder, a distribution qualified under section 302(a) by reason of section 302(b) would not be taken into account in determining whether the distribution, with respect to such shareholder, was also a distribu- tion in partial liquidation of the corporation. Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF 1986 AMENDMENT Amendment by Pub. L. 99–514 applicable to any dis- tribution in complete liquidation, and any sale or ex- change, made by a corporation after July 31, 1986, un- less such corporation is completely liquidated before Jan. 1, 1987, any transaction described in section 338 of this title for which the acquisition date occurs after Dec. 31, 1986, and any distribution, not in complete liq- uidation, made after Dec. 31, 1986, with exceptions and special and transitional rules, see section 633 of Pub. L. 99–514, set out as an Effective Date note under section 336 of this title. EFFECTIVE DATE OF 1982 AMENDMENT Amendment by Pub. L. 97–248 applicable to distribu- tions after Aug. 31, 1982, with exceptions for certain partial liquidations, see section 222(f) of Pub. L. 97–248, set out as a note under section 302 of this title. PART III—CORPORATE ORGANIZATIONS AND REORGANIZATIONS Subpart A. Corporate organizations. B. Effects on shareholders and security holders. C. Effects on corporations. D. Special rule; definitions. SUBPART A—CORPORATE ORGANIZATIONS Sec. 351. Transfer to corporation controlled by trans- feror.