Source: http://taxtv.com/code/00294-USCODE-2011-title26-subtitleA-chap1-subchapC-partI-subpartA-sec304/
Timestamp: 2017-10-21 11:55:35
Document Index: 379119767

Matched Legal Cases: ['§304', '§304', '§304', '§4', '§226', '§712', '§1875', '§10223', '§2004', '§1013', '§6010', '§215', '§6010', '§1013', '§712', '§712', '§712', '§712', '§712', '§226', '§226', '§215', '§2004', '§2']

IRC §304. Redemption through use of related corporations - TaxTV.com
IRC §304. Redemption through use of related corporations
View related content: IRC §304
then (unless paragraph (2) applies) such property shall be treated as a distribution in redemption of the stock of the corporation acquiring such stock. To the extent that such distribution is treated as a distribution to which section 301 applies, the transferor and the acquiring corporation shall be treated in the same manner as if the transferor had transferred the stock so acquired to the acquiring corporation in exchange for stock of the acquiring corporation in a transaction to which section 3 (a) applies, and then the acquiring corporation had redeemed the stock it was treated as issuing in such transaction.
(3) Coordination with section 3
Except as otherwise provided in this paragraph, subsection (a) (and not section 3 and not so much of sections 357 and 358 as relates to section 3 ) shall apply to any property received in a distribution described in subsection (a).
In the case of an acquisition described in section 3 , subsection (a) shall not apply to any liability—
(iii) Special rule in case of BHC’s formed before 1985
The term “affiliated group” has the meaning given such term by section 1504(a).
(i) which are attributable (under regulations prescribed by the Secretary) to stock of the acquiring corporation owned (within the meaning of section 958(a)) by a corporation or individual which is—
(I) a United States shareholder (within the meaning of section 9 (b)) of the acquiring corporation, and
(i) paragraph (2)(C) of section 318(a) shall be applied by substituting “5 percent” for “50 percent”, and
(ii) paragraph (3)(C) of section 318(a) shall be applied—
(I) by substituting “5 percent” for “50 percent”, and
(Aug. 16, 1954, ch. 736, 68A Stat. 89; Pub. L. 88–554, §4(b)(1), Aug. 31, 1964, 78 Stat. 763; Pub. L. 97–248, title II, §226(a)(1)(A), (2), (3), Sept. 3, 1982, 96 Stat. 490, 491; Pub. L. 98–369, div. A, title VII, §712(l)(1)–(5)(A), July 18, 1984, 98 Stat. 953, 954; Pub. L. 99– 4, title XVIII, §1875(b), Oct. 22, 1986, 100 Stat. 2894; Pub. L. 100–203, title X, §10223(c), Dec. 22, 1987, 101 Stat. 1330–411; Pub. L. 100–647, title II, §2004(k)(2), Nov. 10, 1988, 102 Stat. 3605; Pub. L. 105–34, title X, §1013(a), (c), Aug. 5, 1997, 111 Stat. 918; Pub. L. 105–206, title VI, §6010(d), July 22, 1998, 112 Stat. 814; Pub. L. 111–226, title II, §215(a), Aug. 10, 2010, 124 Stat. 2399.)
2010—Subsec. (b)(5)(B), (C). Pub. L. 111–226 added subpar. (B) and redesignated former subpar. (B) as (C).
1998—Subsec. (b)(5)(B), (C). Pub. L. 105–206, §6010(d)(1), redesignated subpar. (C) as (B) and struck out heading and text of former subpar. (B). Text read as follows: “For purposes of subparagraph (A), the rules of section 1248(d) shall apply except to the extent otherwise provided by the Secretary.”
1997—Subsec. (a)(1). Pub. L. 105–34, §1013(a), amended last sentence generally. Prior to amendment, last sentence read as follows: “To the extent that such distribution is treated as a distribution to which section 301 applies, the stock so acquired shall be treated as having been transferred by the person from whom acquired, and as having been received by the corporation acquiring it, as a contribution to the capital of such corporation.”
1988—Subsec. (b)(4)(A). Pub. L. 100–647 substituted “stock from 1 member” for “stock of 1 member”.
1987—Subsec. (b)(4). Pub. L. 100–203 added par. (4).
1986—Subsec. (a)(1). Pub. L. 99– 4 substituted “To the extent that such distribution is treated as a distribution to which section 301 applies” for “In any such case” in last sentence.
1984—Subsec. (b)(2). Pub. L. 98–369, §712(l)(1), consolidated former subpars. “(A) Where subsection (a)(1) applies” and “(B) Where subsection (a)(2) applies” in one paragraph, inserted provision respecting source of dividend, and incorporated in cls. (A) and (B) former subpar. (A) and (B) provisions which had required determination of amount which is a dividend to be made by reference to earnings and profits of the acquiring corporation and as if the property were distributed by the acquiring corporation to the issuing corporation and immediately thereafter distributed by the issuing corporation.
Subsec. (b)(3)(A). Pub. L. 98–369, §712(l)(2), substituted “section 3 and not so much of sections 357 and 358 as relates to section 3 ” for “part III”.
Subsec. (b)(3)(B)(i). Pub. L. 98–369, §712(l)(3)(A)(i), substituted “In the case of an acquisition described in section 3 , subsection (a)” for “Subsection (a)”.
Subsec. (b)(3)(C). Pub. L. 98–369, §712(l)(4), inserted following cl. (iii) “For purposes of this subparagraph, any assumption of (or acquisition of stock subject to) a liability under subparagraph (B) shall not be treated as a distribution of property.”
Subsec. (c)(3). Pub. L. 98–369, §712(l)(5)(A), designated existing first sentence as subpar. “(A) In general” and substituted subpar. (B) for former second sentence which read “For purposes of the preceding sentence, sections 318(a)(2)(C) and 318(a)(3)(C) shall be applied without regard to the 50 percent limitation contained therein.”
1982—Subsec. (b)(2)(A). Pub. L. 97–248, §226(a)(3), substituted “as if the property were distributed by the issuing corporation to the acquiring corporation and immediately thereafter distributed by the acquiring corporation” for “soley by reference to the earnings and profits of the acquiring corporation” after “dividend shall be made”.
Subsec. (c)(2), (3). Pub. L. 97–248, §226(a)(2), added par. (2), redesignated former par. (2) as (3) and substituted “this section” for “paragraph (1)” after “determining control under”.
1964—Subsecs. (b)(1), (c)(2). Pub. L. 88–554 inserted reference to section 318(a)(3)(C) of this title.
Pub. L. 111–226, title II, §215(b), Aug. 10, 2010, 124 Stat. 2400, provided that: “The amendments made by this section [amending this section] shall apply to acquisitions after the date of the enactment of this Act [Aug. 10, 2010].”
Section 1013(d) of Pub. L. 105–34 provided that:
Section 10223(d) of Pub. L. 100–203, as amended by Pub. L. 100–647, title II, §2004(k)(3), (4), Nov. 10, 1988, 102 Stat. 3605, 3606, provided that:
“(C) Distributions covered by prior transition rule.—The amendments made by this section shall not apply to any distribution to which the amendments made by subtitle D of title VI of the Tax Reform Act of 1986 [sections 631 to 634 of Pub. L. 99– 4, see Tables for classification] do not apply.
Section 712(l)(7) of Pub. L. 98–369, as amended by Pub. L. 99– 4, §2, Oct. 22, 1986, 100 Stat. 2095, provided that:
“(B) Election by taxpayer to have amendments apply earlier.—Any taxpayer may elect, at such time and in such manner as the Secretary of the Treasury or his delegate may prescribe, to have the amendments made by paragraphs (1) and (3) apply as if included in section 226 of the Tax Equity and Fiscal Responsibility Act of 1982 [section 226 of Pub. L. 97–248, which amended this section and section 306 of this title and enacted Effective Date of 1982 Amendment note set out below].
Section 226(c) of Pub. L. 97–248 provided that:
“(1) In general.—Except as provided in paragraph (2), the amendments made by this section [amending this section and sections 306 and 3 of this title] shall apply to transfers occurring after August 31, 1982, in taxable years ending after such date.
For purposes of this paragraph, the term ‘BHC’ means a bank holding company (within the meaning of section 2(a) of the Bank Holding Company Act of 1956 [section 1841(a) of Title 12, Banks and Banking]).”