Page:United States Statutes at Large Volume 68A.djvu/168

 128

INTERNAL REVENUE CODE OF 1954.

acquiring corporation shall include in its income such amounts as would have been includible by the distributor or transferor corporation in accordance with section 111 (relating to the recovery of bad debts, prior taxes, and delinquency amounts). (13)

INVOLUNTARY CONVERSIONS UNDER SECTION 1033.—The ac-

quiring corporation shall be treated as the distributor or transferor corporation after the date of distribution or transfer for purposes of applying section 1033. (14)

DIVIDEND CARRYOVER TO PERSONAL HOLDING COMPANY,—

The dividend carryover (described in section 564) to taxable years ending after the date of distribution or transfer. (15)

INDEBTEDNESS OF CERTAIN PERSONAL HOLDING COMPANIES.—

The acquiring corporation shall be considered to be the distributor or transferor corporation for the purpose of determining the applicability of section 545(b)(7), relating to a deduction for payment of certain indebtedness incurred before January 1, 1934. (16)

CERTAIN

OBLIGATIONS OF DISTRIBUTOR OR TRANSFEROR

CORPORATION.—If the acquiring corporation— (A) assumes an obligation of the distributor or transferor corporation which, after the date of the distribution or transfer, gives rise to a liability, and (B) such liability, if paid or accrued by the distributor or transferor corporation, would have been deductible in computing its taxable income, the acquiring corporation shall be entitled to deduct such items when paid or accrued, as the case may be, as if such corporation were the distributor or transferor corporation. A corporation which would have been an acquiring corporation under this section if the date of distribution or transfer had occurred on or after the effective date of the provisions of this subchapter applicable to a liquidation or reorganization, as the case may be, shall be entitled, even though the date of distribution or transfer occurred before such effective date, to apply this paragraph with respect to amounts paid or accrued in taxable years beginning after December 31, 1953, on account of such obligations of the distributor or transferor corporation. This paragraph shall not apply if such obligations are reflected in the amount of stock, securities, or property transferred by the acquiring corporation to the transferor corporation for the property of the transferor corporation. (17)

DEFICIENCY DIVIDEND OF PERSONAL HOLDING COMPANY.—

If the acquiring corporation pays a deficiency dividend (as defined in section 547(d)) with respect to the distributor or transferor corporation, such distributor or transferor corporation shall, with respect to such payments, be entitled to the deficiency dividend deduction provided in section 547. (18) PERCENTAGE DEPLETION ON EXTRACTION OF ORES OR MINERALS FROM THE WASTE OR RESIDUE OF PRIOR MINING.—The acquir-

ing corporation shall be considered to be the distributor or transferor corporation for the purpose of determining the applicability of section 613(c)(3) (relating to extraction of ores or minerals from the ground). § 381(c) (12)

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