Page:United States Statutes at Large Volume 100 Part 3.djvu/997

 PUBLIC LAW 99-514—OCT. 22, 1986

100 STAT. 2805

(C) The subsection heading for subsection (c) of section 312 is amended by striking out ", ETC.".

(D) Subsection (n) of section 312 is amended by striking out paragraph (4) and by redesignating paragraphs (5), (6), (7), (8), and (9) as paragraphs (4), (5), (6), (7), and (8), respectively. (E) Paragraph (8) of section 312(n) (as redesignated by subparagraph (D)) is amended by striking out "subsection (k)(4)" and all that follows and inserting in lieu thereof the following: "subsection (k)(4)— "(A) paragraphs (4) and (6) shall apply only in the case of taxable years beginning after December 31, 1985, and "(B) paragraph (5) shall apply only in the case of taxable years beginning after December 31, 1987." (F) Any reference in subsection (e) of section 61 of the Tax Reform Act of 1984 to a paragraph of section 312(n) of the Internal Revenue Code of 1954 shall be treated as a reference to such paragraph as in effect before its redesignation by subparagraph (D). (2) CLERICAL AMENDMENTS.—

(A) Subsection (a) of section 1275 is amended— (i) by redesignating the paragraph added by section 61 of the Tax Reform Act of 1984 as paragraph (5), and (ii) by striking out "TO CORPORATIONS" in the heading

of such paragraph and inserting in lieu thereof "BY CORPORATIONS".

(B) Paragraph (3) of section 301(f) is amended by striking out "this section" and inserting in lieu thereof "this subsection". (3) EFFECTIVE DATE FOR TREATMENT OF REDEMPTIONS.—Para-

graph (7) of section 312(n) of the Internal Revenue Code of 1954 (as redesignated by paragraph (1)(D) of this subsection), and the amendments made by section 61(a)(2) of the Tax Reform Act of 1984, shall apply to distributions in taxable years beginning after September 30, 1984. (g) AMENDMENTS RELATED TO SECTION 63 OF THE ACT.—

(1) IN GENERAL.—Section 361 (relating to nonrecognition of gain or loss to corporations) is amended to read as follows: "SEC. 361. NONRECOGNITION OF GAIN OR LOSS TO TRANSFEROR CORPORATION; OTHER TREATMENT OF TRANSFEROR CORPORATION; ETC. "(a) GENERAL RULE.—No gain or loss shall be recognized to a transferor corporation which is a party to a reorganization on any exchange of property pursuant to the plan of reorganization. "Ob) OTHER TREATMENT OF TRANSFEROR CORPORATION.—In the case of a transferor corporation which is a party to a reorganization— "(1) sections 336 and 337 shall not apply with respect to any liquidation of such corporation pursuant to the plan of reorganization, "(2) the basis of the property (other than stock and securities described in paragraph (3)) received by the corporation pursuant to such plan of reorganization shall be the same as it would be in the hands of the transferor of such property, adjusted by the amount of gain or loss recognized to such transferor on such transfer, and

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