Irc section 301

Irc section 301 DEFAULT

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S corporation redemptions: Navigating Secs. 302 and 301

Editor: Mark Heroux, J.D.

Fueled by the law known as the Tax Cuts and Jobs Act of 2017 (TCJA), P.L. 115-97, and a market of retiring Baby Boomers looking to divest ownership interests, the marketplace recently experienced a wealth of transactions. Among this crowd are S corporations engaging in shareholder redemptions — with some also contemplating a subsequent conversion to a C corporation to take advantage of the preferable C corporation tax rates.

Among clients' chief concerns is whether a redemption qualifies as a sale or exchange, or instead must be characterized and taxed as a dividend — and the resulting tax consequences. This discussion sheds light on these questions with a high-level overview of the applications of Secs. 302 and 301 to S corporation redemptions.

Redemption under Sec. 302

Pursuant to Sec. 302, a distribution in redemption of stock is treated as a sale or exchange if the redemption:

1. Is not essentially equivalent to a dividend;

2. Is substantially disproportionate;

3. Completely terminates the shareholder's interest; or

4. Is in partial liquidation of the redeeming corporation.

Not essentially equivalent to a dividend: This is a largely subjective standard applied on a case-by-case basis, looking at the relevant facts and circumstances. Due to the uncertainty surrounding the application of this standard, it is best relied on only if the other three mechanical exceptions are not met.

Substantially disproportionate: A redemption is substantially disproportionate if: (1) The shareholder's interest in the outstanding common stock of the redeeming company post-redemption is less than 80% of the shareholder's interest before the redemption (the 80% test must be met for both common voting, and common voting and nonvoting combined); and (2) immediately after the redemption, the shareholder owns less than 50% of the total combined voting power of all classes of stock entitled to vote.

Example 1: Star, an S corporation, has 1,000 shares of outstanding voting common stock. Shareholders A, B, C, D, and E are unrelated parties (no attribution under Sec. 318), and each owns 200 shares. Star redeems 150 shares from A, 75 shares from B, and 25 shares from C (for a total of 250 redeemed shares — or 25% of the total outstanding stock). Following the redemption, there are 750 outstanding shares, with A owning 50, B owning 125, C owning 175, and D and E each owning 200. A's redemption will qualify as being substantially disproportionate, as her post-redemption ownership is less than 80% of her pre-redemption ownership. (A's post-redemption ownership of 6.67% (50 ÷ 750) is less than 80% of her pre-redemption 20% ownership (20% × 80% = 16%), and her post-redemption ownership is less than 50% of the corporation's voting shares.) However, B's and C's redemptions do not meet the substantially disproportionate test, with B's post-redemption ownership share of 16.67% exceeding the 16% threshold, and C's ownership share increasing to 23%.

Constructive ownership: With closely held corporations, the application of constructive ownership under Sec. 318 is a common hurdle that prevents a shareholder from qualifying for the mechanical tests provided in Sec. 302 and is usually experienced through family attribution — either directly or through trusts (although attribution also applies to other entities). Family attribution applies to lineal descendants, where an individual is considered as owning the stock owned, directly or indirectly, by or for his or her spouse, children, grandchildren, and parents. While beyond the scope of this discussion, when ownership interests are held in trusts, one needs to determine what trust ownership will be attributed to which beneficiaries.

Example 2: Assume the same facts as Example 1, except A is the daughter of D. In determining whether A's redemption was substantially disproportionate, her father's ownership will be attributed to her. Consequently, A's pre-redemption ownership percentage is deemed to be 40% (her 200 shares plus her father's 200 shares). For A's redemption to qualify as being substantially disproportionate, her ownership would need to decrease below 32%. However, her post-redemption ownership under Sec. 318 is 33.3% (250 ÷ 750) and, therefore, does not meet the qualifying threshold.

Reattribution: It is important to note that ownership attributed to an individual from an entity can then be reattributed to that family member's lineal descendants.

Example 3: Assume the same facts as Example 2, except E is a trust from which D is attributed the 200 shares owned by E. In determining whether A's redemption was substantially disproportionate, her father's ownership, which will be attributed to her, is 400 shares. Consequently, A's pre-redemption ownership percentage is deemed to be 60% (her 200 shares plus her father's 400 shares). For A's redemption to qualify as being substantially disproportionate, her ownership would need to decrease below 48%. However, her post-redemption ownership under Sec. 318 remains at 60% (450 ÷ 750) and, therefore, does not meet the qualifying threshold.

Waiver of family attribution: An individual or entity shareholder may waive the Sec. 318(a)(1) family attribution rules — serving to disregard their application — to a redemption made under Sec. 302(b)(3). The waiver applies only to distributions completely terminating the shareholder's interest if the redeemed shareholder:

  • Does not have a prohibited interest in the distributing corporation immediately after the distribution;
  • Does not acquire any prohibited interest (i.e., by means other than by bequest or inheritance) within 10 years following the distribution;
  • Agrees to notify the IRS if the shareholder acquires any prohibited interest within the 10 years after redemption;
  • Agrees to retain certain records; and
  • Did not make certain tax-avoidance acquisitions or dispositions of the company's stock in the 10 years before the redemption.

    Example 4: Assume the same facts as Example 2, except A's ownership interest was fully redeemed, she has no plans of acquiring any interest in Star within the next 10 years, and she did not engage in transfers of Star stock with a principal purpose of tax avoidance. By attaching a statement pursuant to Sec. 302(c)(2)(A)(iii) to her timely filed federal income tax return for the year of the redemption, A will be permitted to disregard the family attribution portion of the constructive ownership rules. Therefore, A would not be attributed her father's 200 shares.

Redemptions as a Sec. 302 sale or exchange versus a Sec. 301 distribution

If a redemption of S corporation stock fails to meet the requirements of Sec. 302, it is taxed under the mechanics of Secs. 301 and 1368. Given the comparative tax rates on capital gains and qualified dividends, it is easy to question what impact, if any, a failure to meet the requirements of Sec. 302 has on a redemption of C corporation stock. However, in the S corporation environment, shareholders may find more tax advantages from Sec. 301, as discussed below.

Tax consequence of a sale or exchange under Sec. 302: If a redemption qualifies as a sale or exchange under Sec. 302, the amount of the redemption proceeds in excess of the shareholder's basis in the redeemed stock will be taxed as a capital gain. Keep in mind that the balance of the corporation's accumulated adjustments account (AAA) and earnings and profits (E&P), if any, will be affected, with AAA being reduced in an amount equal to the ratable share of the corporation's AAA (whether negative or positive) attributable to the redeemed stock as of the date of the redemption and E&P reduced by the amount of the ratable share of E&P attributable to the redeemed stock— reducing the remaining amount of E&P, which could affect future distributions.

Tax consequence of a distribution under Sec. 301If an S corporation redemption does not qualify as a sale or exchange under Sec. 302, it instead defaults to a Sec. 301 distribution, subject to the ordering rules of Sec. 1368, which provide that the recipient shareholder must treat the redemption in the following sequence:

1. Nontaxable to the extent of the corporation's AAA balance (note that this is the corporation's total AAA balance and not the redeemed shareholder's ratable share);

2. A taxable dividend to the extent of the S corporation's accumulated E&P;

3. A nontaxable reduction in any remaining shareholder stock basis; and

4. Taxable as a capital gain distribution.

Shareholders of S corporations with significant AAA may benefit considerably due to the Sec. 1368 ordering rules (although potentially at the cost of future shareholders, who will have less AAA to work with). Redeeming shareholders with sufficient stock basis could find that a substantial portion, or all, of their redemption proceeds would not be subject to tax as a result of the redemption.

One class of stock: One area of confusion and concern among clients is whether a redemption made under Sec. 301 is considered a disproportionate distribution in violation of the identical-distribution rules under Regs. Sec. 1.1361-1(l)(1). A redemption that fails to qualify under Sec. 302 is generally not considered a disproportionate distribution that creates a second class of stock in violation of the S corporation eligibility rules (so long as the redemption agreement was not entered into to circumvent the single-class-of-stock requirement) (Regs. Sec. 1.1361-1(l)(2)(iii); see also IRS Letter Rulings 9810020 and 9404020). Therefore, a redemption made under Sec. 301 will generally not terminate an S election.

Redemptions that qualify under Sec. 302 are generally treated as sales or exchanges and are not distributions. Therefore, qualified redemptions under Sec. 302 generally do not create a second class of stock and do not terminate an S election. The potential exception involves a redemption that fails to reflect the fair market value of the redeemed shares.

Planning opportunity

The TCJA may tempt certain family businesses to revoke their S status in favor of the lower flat tax rate of 21% on C corporation income. Interesting fact patterns may include family businesses in need of succession planning.

Evaluating a conversion to a C corporation is a complex analysis that should not be made lightly and most often favors retaining S status. However, a desire for a tax-efficient redemption of a senior generation's S corporation stock could generate some interesting analyses.

For family business S corporations that have reasons to consider a C corporation conversion and wish to retire the senior generation's stock, it might be worthwhile to strategize on pairing these two objectives. The family may evaluate using AAA to make redemptions before converting to a C corporation. Perhaps the redemption is made with an installment obligation payable to the redeemed shareholder over time (while the business is a C corporation). Doing so will provide the redeemed shareholder with a tax-efficient income stream for multiple years and permit the corporation to use the additional annual tax savings realized from the C corporation status to help meet the annual installment payments.

Analyzing a potential C corporation conversion is a complex and weighty matter in any circumstance. An even more complex and intriguing analysis includes a preconversion shareholder redemption that fails the sale-or-exchange treatment under Sec. 302. Understanding the implications and interplay of Secs. 301, 302, 318, and 1368 is essential in any such analysis. As such, clients are strongly encouraged to consult a tax adviser in considering this matter.

EditorNotes

Mark Heroux, J.D., is a principal with the National Tax Services Group at Baker Tilly Virchow Krause LLP in Chicago.

For additional information about these items, contact Mr. Heroux at 312-729-8005 or [email protected]

Unless otherwise noted, contributors are members of or associated with Baker Tilly Virchow Krause LLP.

Sours: https://www.thetaxadviser.com/issues/2018/oct/s-corporation-redemptions-secs-302-301.html
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Sec. 301. Distributions Of Property

I.R.C. § 301(a)In General—

Except as otherwise provided in this chapter, a distribution of property (as defined in section 317(a)) made by a corporation to a shareholder with respect to its stock shall be treated in the manner provided in subsection (c).

I.R.C. § 301(b)Amount Distributed
I.R.C. § 301(b)(1)General Rule—

For purposes of this section, the amount of any distribution shall be the amount of money received, plus the fair market value of the other property received.

I.R.C. § 301(b)(2)Reduction For Liabilities—

The amount of any distribution determined under paragraph (1) shall be reduced (but not below zero) by—

I.R.C. § 301(b)(2)(A)—

the amount of any liability of the corporation assumed by the shareholder in connection with the distribution, and

I.R.C. § 301(b)(2)(B)—

the amount of any liability to which the property received by the shareholder is subject immediately before, and immediately after, the distribution.

I.R.C. § 301(b)(3)Determination Of Fair Market Value—

For purposes of this section, fair market value shall be determined as of the date of the distribution.

I.R.C. § 301(c)Amount Taxable—

In the case of a distribution to which subsection (a) applies—

I.R.C. § 301(c)(1)Amount Constituting Dividend—

That portion of the distribution which is a dividend (as defined in section 316) shall be included in gross income.

I.R.C. § 301(c)(2)Amount Applied Against Basis—

That portion of the distribution which is not a dividend shall be applied against and reduce the adjusted basis of the stock.

I.R.C. § 301(c)(3)Amount In Excess Of Basis
I.R.C. § 301(c)(3)(A)In General—

Except as provided in subparagraph (B), that portion of the distribution which is not a dividend, to the extent that it exceeds the adjusted basis of the stock, shall be treated as gain from the sale or exchange of property.

I.R.C. § 301(c)(3)(B)Distributions Out Of Increase In Value Accrued Before March 1, 1913—

That portion of the distribution which is not a dividend, to the extent that it exceeds the adjusted basis of the stock and to the extent that it is out of increase in value accrued before March 1, 1913, shall be exempt from tax.

I.R.C. § 301(d)Basis—

The basis of property received in a distribution to which subsection (a) applies shall be the fair market value of such property.

I.R.C. § 301(e)Special Rule For Certain Distributions Received By 20 Percent Corporate Shareholder
I.R.C. § 301(e)(1)In General—

Except to the extent otherwise provided in regulations, solely for purposes of determining the taxable income of any 20 percent corporate shareholder (and its adjusted basis in the stock of the distributing corporation), section 312 shall be applied with respect to the distributing corporation as if it did not contain subsections (k) and (n) thereof.

I.R.C. § 301(e)(2)20 Percent Corporate Shareholder—

For purposes of this subsection, the term “20 percent corporate shareholder” means, with respect to any distribution, any corporation which owns (directly or through the application of section 318)—

I.R.C. § 301(e)(2)(A)—

stock in the corporation making the distribution possessing at least 20 percent of the total combined voting power of all classes of stock entitled to vote, or

I.R.C. § 301(e)(2)(B)—

at least 20 percent of the total value of all stock of the distributing corporation (except nonvoting stock which is limited and preferred as to dividends),

but only if, but for this subsection, the distributee corporation would be entitled to a deduction under section 243 or 245 with respect to such distribution.

I.R.C. § 301(e)(3)Application Of Section 312(n)(7) Not Affected—

The reference in paragraph (1) to subsection (n) of section 312 shall be treated as not including a reference to paragraph (7) of such subsection.

I.R.C. § 301(e)(4)Regulations—

The Secretary shall prescribe such regulations as may be necessary or appropriate to carry out the purposes of this subsection.

I.R.C. § 301(f)Special Rules
I.R.C. § 301(f)(2)—

For distributions in complete liquidation, see part II (sec. 331 and following).

I.R.C. § 301(f)(3)—

For distributions in corporate organizations and reorganizations, see part III (sec. 351 and following).

I.R.C. § 301(f)(4)—

For taxation of dividends received by individuals at capital gain rates, see section 1(h)(11).

(Aug. 16, 1954, ch. 736, 68A Stat. 84; Feb. 2, 1962, Pub. L. 87-403, Sec. 2(a), 76 Stat. 5; Oct. 16, 1962, Pub. L. 87-834, Sec. 5(a), (b), 13(f)(2), 76 Stat. 977, 1035; Feb. 26, 1964, Pub. L. 88-272, title II, Sec. 231(b)(2), 78 Stat. 105; Aug. 22, 1964,Pub. L. 88-484, Sec. 1(b)(1), 78 Stat. 597; Sept. 12, 1966, Pub. L. 89-570, Sec. 1(b)(2), 80 Stat. 762; Nov. 13, 1966, Pub. L. 89-809, title I, Sec. 104(f), 80 Stat. 1559; Dec. 30, 1969, Pub. L. 91-172, title II, Sec. 211(b)(1), (2), title IX, Sec. 905(b)(2), 83 Stat. 570, 714; Dec. 10, 1971, Pub. L. 92-178, title III, Sec. 312(a), 85 Stat. 526; Oct. 4, 1976, Pub. L. 94-455, title II, Sec. 205(c)(1)(B), (C), title XIX, Sec. 1901(a)(41), (b)(32)(A), 1906(b)(13)(A), 90 Stat. 1535, 1771, 1800, 1834; Nov. 10, 1978, Pub. L. 95-628, Sec. 3(a), (b), 92 Stat. 3627; July 18, 1984, Pub. L. 98-369, div. A, title I, Sec. 54(b), 61(d), title VII, Sec. 712(i)(1), 98 Stat. 569, 582, 948; Oct. 22, 1986, Pub. L. 99-514, title VI, Sec. 612(b)(1), title XVIII, Sec. 1804(f)(2)(B), 100 Stat. 2250, 2805; Dec. 22, 1987,Pub. L. 100-203, title X, Sec. 10222(b)(1), 101 Stat. 1330-411; Nov. 10, 1988, Pub. L. 100-647, title I, Sec. 1006(e)(10)-(12), title II, Sec. 2004(j)(3)(B), 102 Stat. 3401, 3402, 3605; May 28, 2003,Pub. L. 108-27, title III, Sec. 302(e)(2), 117 Stat. 752; Pub. L. 113-295, Div. A, title II, Sec. 221(a)(41)(G), Dec. 19, 2014, 128 Stat. 4010.)

1988--Pub. L. 100-647, title I, 1006(e)(8)(C), Nov. 10, 1988, 102 Stat. 3401, struck out item for part VII “Miscellaneous corporate provisions”.

1984--Pub. L. 98-369, div. A, title I, 75(d), July 18, 1984, 98 Stat. 595, added item for part VII.

1976--Pub. L. 94-455, title XIX, 1901(b)(15), Oct. 4, 1976, 90 Stat. 1796, struck out item for part VII “Effective date of subchapter C.”

1969--Pub. L. 91-172, title IV, 415(b), Dec. 30, 1969, 83 Stat. 614, redesignated item for part VI as VII and added part VI.

This subpart is referred to in sections 311, 351, 355 of this title.

2014 - Subsec. (e)(2). Pub. L. 113-295, Div. A, Sec. 221(a)(41)(G), amended par. (2) by striking “, 244,”.

2003 - Subsec. (f)(4). Pub. L. 108-27, Sec. 302(e)(2), added par. (4).

1988 - Subsec. (b)(1). Pub. L. 100-647, Sec. 1006(e)(10), amended par. (1) generally. Prior to amendment, par. (1) contained subpars. (A) to (D) which provided what the amount of any distribution would be for noncorporate distributees, corporate distributees, certain corporate distributees of foreign corporations, and foreign corporate distributees.

Subsec. (d). Pub. L. 100-647, Sec. 1006(e)(11), amended subsec. (d) generally. Prior to amendment, subsec. (d) contained pars. (1) to (4) which provided what the basis of property received would be for noncorporate distributees, corporate distributees, foreign corporate distributees, and certain corporate distributees of foreign corporations.

Subsec. (e). Pub. L. 100-647, Sec. 2004(j)(3)(B), added par. (3) and redesignated former par. (3) as (4).

Pub. L. 100-647, Sec. 1006(e)(12), redesignated subsec. (f) as (e) and struck out former subsec. (e) which related to special rule for holding period of appreciated property distributed to corporation.

Subsecs. (f), (g). Pub. L. 100-647, Sec. 1006(e)(12), redesignated subsec. (g) as (f). Former subsec. (f) redesignated (e).

1987 - Subsec. (f)(1). Pub. L. 100-203 substituted ‘subsections (k) and (n)’ for ‘subsection (n)’.

1986 - Subsec. (f)(3). Pub. L. 99-514, Sec. 1804(f)(2)(B), substituted ‘this subsection’ for ‘this section’.

Subsec. (g)(4). Pub. L. 99-514, Sec. 612(b)(1), struck out par. (4) which provided: ‘For partial exclusion from gross income of dividends received by individuals, see section 116.’

1984 - Subsec. (e). Pub. L. 98-369, Sec. 54(b), added subsec. (e). Former subsec. (e) redesignated (f).

Subsec. (e)(2). Pub. L. 98-369, Sec. 712(i)(1), substituted ‘complete liquidation’ for ‘partial or complete liquidation’ in subsec. (e)(2), which became subsec. (g)(2).

Subsec. (f). Pub. L. 98-369, Sec. 61(d), added subsec. (f). Former subsec. (f) redesignated (g).

Pub. L. 98-369, Sec. 54(b), redesignated former subsec. (e) as (f).

Subsec. (g). Pub. L. 98-369, Sec. 54(b), 61(d), redesignated former subsec. (e) successively as subsec. (f) and as subsec. (g).

Subsec. (g)(2). Pub. L. 98-369, Sec. 712(i)(1), substituted ‘complete liquidation’ for ‘partial or complete liquidation’ in subsec. (e)(2), which became subsec. (g)(2).

1978 - Subsec. (b)(1)(B)(ii).Pub. L. 95-628, Sec. 3(a), substituted ‘amount of gain recognized to the distributing corporation on the distribution’ for ‘amount of gain to the distributing corporation which is recognized under subsection (b), (c), or (d) of section 311, under section 341(f), or under section 617(d)(1), 1245(a), 1250(a), 1251(c), 1252(a), or 1254(a)’.

Subsec. (d)(2)(B). Pub. L. 95-628, Sec. 3(b), substituted ‘amount of gain recognized to the distributing corporation on the distribution’ for ‘amount of gain to the distributing corporation which is recognized under subsection (b), (c), or (d) of section 311, under section 341(f), or under section 617(d)(1), 1245(a), 1250(a), 1251(c), 1252(a), or 1254(a)’.

1976 - Subsec. (b)(1)(B)(ii).Pub. L. 94-455, Sec. 205(c)(1)(B), substituted ‘1252(a), or 1254(a)’ for ‘or 1252(a)’.

Subsec. (b)(1)(C). Pub. L. 94-455, Sec. 1906(b)(13)(A), struck out ‘or his delegate’ after ‘Secretary’.

Subsec. (d)(2)(B). Pub. L. 94-455, Sec. 205(c)(1)(C), substituted ‘1252(a), or 1254(a)’ for ‘or 1252(a)’.

Subsec. (e). Pub. L. 94-455, Sec. 1901(a)(41), (b)(32)(A), redesignated subsec. (g) as (e). Former subsec. (e), which related to exceptions for certain distributions by personal service corporations, was struck out.

Subsec. (f). Pub. L. 94-455, Sec. 1901(b)(32)(A), struck out subsec. (f) which related to special rules for distribution of antitrust stock to corporations.

Subsec. (g). Pub. L. 94-455, Sec. 1901(b)(32)(A), redesignated subsec. (g) as (e).

1971 - Subsec. (b)(1)(B).Pub. L. 92-178, Sec. 312(a)(1), substituted ‘corporation, unless subparagraph (D) applies’ for ‘corporation’ where first appearing.

Subsec. (b)(1)(D). Pub. L. 92-178, Sec. 312(a)(2), added subpar. (D).

Subsec. (d)(2). Pub. L. 92-178, Sec. 312(a)(3), substituted ‘corporation, unless paragraph (3) applies’ for ‘corporation’ where first appearing.

Subsec. (d)(3), (4). Pub. L. 92-178, Sec. 312(a)(4), added par. (3) and redesignated former par. (3) as (4).

1969 - Subsec. (b)(1)(B)(ii).Pub. L. 91-172, Sec. 211(b)(1), 905(b)(2), substituted ‘1250(a), 1251(c), or 1252(a)’ for ‘or 1250(a)’ and inserted reference to section 311(a).

Subsec. (d)(2)(B). Pub. L. 91-172, Sec. 211(b)(2), 905(b)(2), substituted ‘1250(a), 1251(c), or 1252(a)’, for ‘or 1250(a)’ and inserted reference to section 311(a).

1966 - Subsec. (b)(1)(B)(ii).Pub. L. 89-570 included reference to section 617(d)(1).

Subsec. (b)(1)(C). Pub. L. 89-809 substituted ‘gross income which is effectively connected with the conduct of a trade or business within the United States’ for ‘gross income from sources within the United States’ in cl. (i), ‘gross income which is not effectively connected with the conduct of a trade or business within the United States’ for ‘gross income from sources without the United States’ in cl. (ii), and inserted text following cl. (ii) setting out the treatment to be accorded gross income for any period before the first taxable year beginning after December 31, 1966.

Subsec. (d)(2)(B). Pub. L. 89-570 included reference to section 617(d)(1).

1964 - Subsec. (b). Pub. L. 88-484 included amount of gain recognized under section 341(f).

Pub. L. 88-272 inserted reference to section 1250(a).

Subsec. (d). Pub. L. 88-484 included amount of gain recognized under section 341(f).

Pub. L. 88-272 inserted reference to section 1250(a).

1962 - Subsec. (b)(1)(B).Pub. L. 87-834, Sec. 13(f)(2), substituted ‘subsection (b) or (c) of section 311 or under section 1245(a)’ for ‘subsection (b) or (c) of section 311’.

Subsec. (b)(1)(C). Pub. L. 87-834, Sec. 5(a), added subpar. (C).

Subsec. (d)(2). Pub. L. 87-834, Sec. 13(f)(2), substituted ‘subsection (b) or (c) of section 311 or under section 1245(a)’ for ‘subsection (b) or (c) of section 311’.

Subsec. (d)(3). Pub. L. 87-834, Sec. 5(b), added par. (3).

Subsecs. (f), (g). Pub. L. 87-403 added subsec. (f) and redesignated former subsec. (f) as (g).

EFFECTIVE DATE OF 2014 AMENDMENT

Amendments by Pub. L. 113-295, Div. A, Sec. 221(a)(41), effective on the date of the enactment of this Act [Enacted: Dec. 19, 2014]. Pub. L. 113-295, Div. A, Sec. 221(a)(41)(K), provided that:

“(K) The amendments made by this paragraph shall not apply to preferred stock issued before October 1, 1942 (determined in the same manner as under section 247 of the Internal Revenue Codeof 1986 as in effect before its repeal by such amendments).”

Section 221(b)(2) of Pub. L. 113-295, Div. A, provided the following Savings Provision:

“(2) SAVINGS PROVISION.—If—

“(A) any provision amended or repealed by the amendments made by this section applied to—

“(i) any transaction occurring before the date of the enactment of this Act [Enacted: Dec. 19, 2014],

“(ii) any property acquired before such date of enactment, or

“(iii) any item of income, loss, deduction, or credit taken into account before such date of enactment, and

“(B) the treatment of such transaction, property, or item under such provision would (without regard to the amendments or repeals made by this section) affect the liability for tax for periods ending after date of enactment, nothing in the amendments or repeals made by this section shall be construed to affect the treatment of such transaction, property, or item for purposes of determining liability for tax for periods ending after such date of enactment.”

EFFECTIVE DATE OF 2003 AMENDMENT

Amendment by Sec. 302 of Pub. L. 108-27 effective for taxable years beginning after December 31, 2002. Sec. 302(f)(2) of Pub. L. 108-27, as amended by Pub. L. 108-311, Sec. 402(a)(6), provided that:

“(2) Pass-thru Entities.--In the case of a pass-thru entity described in subparagraph (A), (B), (C), (D), (E), or (F) of section 1(h)(10) of the Internal Revenue Code of 1986, as amended by this Act, the amendments made by this section shall apply to taxable years ending after December 31, 2002; except that dividends received by such an entity on or before such date shall not be treated as qualified dividend income (as defined in section 1(h)(11)(B) of such Code, as added by this Act).”

Sec. 303 (Sunset of Title) of Pub. L. 108-27, as amended by Sec. 102 of Pub. L. 109-222 and Sec. 102 of Pub. L. 111-312, and struck by Pub. L. 112-240, Sec. 102(a) (effective for taxable years beginning after Dec. 31, 2012), provided that: “All provisions of, and amendments made by, this title shall not apply to taxable years beginning after December 31, 2012, and the Internal Revenue Code of 1986 shall be applied and administered to such years as if such provisions and amendments had never been enacted.”

EFFECTIVE DATE OF 1988 AMENDMENT

Amendment by section 1006(e)(10)-(12) of Pub. L. 100-647 effective, except as otherwise provided, as if included in the provision of the Tax Reform Act of 1986, Pub. L. 99-514, to which such amendment relates, see section 1019(a) of Pub. L. 100-647, set out as a note under section 1 of this title.

Amendment by section 2004(j)(3)(B) of Pub. L. 100-647 effective, except as otherwise provided, as if included in the provisions of the Revenue Act of 1987, Pub. L. 100-203, title X, to which such amendment relates, see section 2004(u) of Pub. L. 100-647, set out as a note under section 56 of this title.

EFFECTIVE DATE OF 1987 AMENDMENT

Section 10222(b)(2) of Pub. L. 100-203, as amended by Pub. L. 100-647, title II, Sec. 2004(j)(4), Nov. 10, 1988, 102 Stat. 3605, provided that:

‘(A) In general. - The amendment made by paragraph (1) (amending this section) shall apply to distributions after December 15, 1987.

For purposes of applying such amendment to any such distribution -

‘(i) for purposes of determining earnings and profits, such amendment shall be deemed to be in effect for all periods whether before, on, or after December 15, 1987, but

‘(ii) such amendment shall not affect the determination of whether any distribution on or before December 15, 1987, is a dividend and the amount of any reduction in accumulated earnings and profits on account of any such distribution.

‘(B) Exception. - The amendment made by paragraph (1) shall not apply for purposes of determining gain or loss on any disposition of stock after December 15, 1987, and before January 1, 1989, if such disposition is pursuant to a written binding contract, governmental order, letter of intent or preliminary agreement, or stock acquisition agreement, in effect on or before December 15, 1987.’

EFFECTIVE DATE OF 1986 AMENDMENT

Section 612(c) of Pub. L. 99-514 provided that: ‘The amendments made by this section (amending this section and sections 584, 642, 643, 702, 854, and 857 of this title, repealing section 116 of this title, and enacting provisions set out as a note under section 584 of this title) shall apply to taxable years beginning after December 31, 1986.’

Amendment by section 1804(f)(2)(B) of Pub. L. 99-514 effective, except as otherwise provided, as if included in the provisions of the Tax Reform Act of 1984, Pub. L. 98-369, div. A, to which such amendment relates, see section 1881 of Pub. L. 99-514, set out as a note under section 48 of this title.

EFFECTIVE DATE OF 1984 AMENDMENT

Amendment by section 54(b) of Pub. L. 98-369 applicable to distributions after July 18, 1984, in taxable years ending after July 18, 1984, see section 54(d)(2) of Pub. L. 98-369, set out as a note under section 311 of this title.

Section 61(e)(4) of Pub. L. 98-369 provided that: ‘The amendment made by subsection (d) (amending this section) shall apply to distributions after the date of the enactment of this Act (July 18, 1984) in taxable years ending after such date.’

Amendment by section 712(i)(1) of Pub. L. 98-369 effective as if included in the provision of the Tax Equity and Fiscal Responsibility Act of 1982, Pub. L. 97-248, to which such amendment relates, see section 715 of Pub. L. 98-369, set out as a note under section 31 of this title.

EFFECTIVE DATE OF 1978 AMENDMENT

Section 3(d) of Pub. L. 95-628 provided that: ‘The amendments made by this section (amending this section and section 312 of this title) shall apply to distributions made after the date of the enactment of this Act (Nov. 10, 1978).’

EFFECTIVE DATE OF 1976 AMENDMENT

Amendment by section 205(c)(1)(B), (C) of Pub. L. 94-455 effective for taxable years ending after Dec. 31, 1975, see section 205(e) of Pub. L. 94-455, set out as an Effective Date note under section 1254 of this title.

Amendment by section 1901(a)(41), (b)(32)(A) ofPub. L. 94-455 effective for taxable years beginning after Dec. 31, 1976, see section 1901(d) of Pub. L. 94-455, set out as a note under section 2 of this title.

EFFECTIVE DATE OF 1971 AMENDMENT

Section 312(b) of Pub. L. 92-178 provided that: ‘The amendments made by subsection (a) (amending this section) shall apply with respect to distributions made after November 8, 1971.’

EFFECTIVE DATE OF 1969 AMENDMENT

Section 211(c) of Pub. L. 91-172 provided that: ‘The amendments made by this section (enacting section 1251 of this title and amending this section and sections 312, 341, 453, and 751 of this title) shall apply to taxable years beginning after December 31, 1969.’

Amendment by section 905(b)(2) of Pub. L. 91-172 effective with respect to distributions made after Nov. 30, 1969, see section 905(c) of Pub. L. 91-172, set out as a note under section 311 of this title.

EFFECTIVE DATE OF 1966 AMENDMENTS

Amendment by Pub. L. 89-809 applicable with respect to taxable years beginning after Dec. 31, 1966, see section 104(n) of Pub. L. 89-809, set out as a note under section 11 of this title.

Amendment by Pub. L. 89-570 applicable to taxable years ending after Sept. 12, 1966, but only in respect of expenditures paid or incurred after such date, see section 3 of Pub. L. 89-570, set out as an Effective Date note under section 617 of this title.

EFFECTIVE DATE OF 1964 AMENDMENTS

Amendment by Pub. L. 88-484 applicable with respect to transactions after Aug. 22, 1964, in taxable years ending after such date, see section 2 of Pub. L. 88-484, set out as a note under section 341 of this title.

Amendment by Pub. L. 88-272 applicable to dispositions after Dec. 31, 1963, in taxable years ending after such date, see section 231(c) of Pub. L. 88-272, set out as an Effective Date note under section 1250 of this title.

EFFECTIVE DATE OF 1962 AMENDMENTS

Section 5(d) of Pub. L. 87-834 provided that: ‘The amendments made by this section (amending this section and section 245 of this title) shall apply to distributions made after December 31, 1962.’

Amendment by section 13(f)(2) of Pub. L. 87-834 applicable to taxable years beginning after Dec. 31, 1962, see section 13(g) of Pub. L. 87-834, set out as an Effective Date note under section 1245 of this title.

Section 2(b) of Pub. L. 87-403 provided that: ‘The amendments made by this section (amending this section) shall apply only with respect to distributions made after the date of the enactment of this Act (Feb. 2, 1962).’

STUDY OF CORPORATE PROVISIONS

Section 634 of Pub. L. 99-514 provided that: ‘The Secretary of the Treasury or his delegate shall conduct a study of proposals to reform the provisions of subchapter C of chapter 1 of the Internal Revenue Code of 1986. Not later than January 1, 1988, the Secretary shall submit to the Committee on Ways and Means of the House of Representatives and the Committee on Finance of the Senate a report on the study conducted under this section (together with such recommendations as he may deem advisable).'

(The due date for the report referred to in section 634 of Pub. L. 99-514, set out above, extended to Jan. 1, 1992, byPub. L. 101-508, title XI, Sec. 11831(b), Nov. 5, 1990, 104 Stat. 1388-559.)

PLAN AMENDMENTS NOT REQUIRED UNTIL JANUARY 1, 1989

For provisions directing that if any amendments made by subtitle A or subtitle C of title XI (Sec. 1101-1147 and 1171-1177) or title XVIII (Sec. 1800-1899A) of Pub. L. 99-514 require an amendment to any plan, such plan amendment shall not be required to be made before the first plan year beginning on or after Jan. 1, 1989, see section 1140 of Pub. L. 99-514, as amended, set out as a note under section 401 of this title.

Sours: https://irc.bloombergtax.com/public/uscode/doc/irc/section_301
Section 302 Redemptions (U.S. Corporate Tax)

Ruslan and I exclaimed in chorus just when Kolya entered the steam room, hiding behind his hands. Kolya, Sergey promised to do a massage, Ruslan hurried to share the news. I don't want to, Kolya muttered and sat down on the lowest shelf. It was felt that he was not comfortable.

Section 301 irc

Into these redheads of her, abaldened just such hair on the grass, into this black manicurist, into this tiny, slimy, just like this to amazement, into these orange, shifted. Swimming trunks, into these parted, graceful and thin thighs like that. !!!. All this beauty, together with her red and shameless, wet hair like that, belongs to me now and, as proof of this, she is.

Section 301 Distributions

I'm coming to you with all my heart, I'm telling you everything, I was waiting for you, getting ready, but you don't believe me. I only love you, and I will always be faithful to you. She fell onto the bed and burst into tears. Roman once again believed in the girls rightness, and knew for sure that she pronounced the second half of the phrase sincerely.

-Lerochka, honey, I love you too.

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he indifferently gave himself up to Kostya's unceremonious actions, who unbuttoned his trousers, lowered his panties and released a long cock. Sasha. Was already obediently bending down in front of Kostya, when suddenly Kostya's cock began to grow incredibly and powerfully.



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