Page:United States Statutes at Large Volume 76.djvu/1091

 76 STAT.]

1043

PUBLIC LAW 87-834-OCT. 16, 1%2

to include the earnings and profits of such other foreign corporation which— " (C) are attributable (under regulations prescribed by the Secretary or his delegate) to the stock of such other foreign corporation which such person owned within the meaning of section 958(a)(2) (by reason of his ownership within the meaning of section 958(a)(1)(A) of the stock sold or exchanged) on the date of such sale or exchange; and " (D) were accumulated in taxable years of such other corporation beginning after December 31, 1962, and during the period or periods— " (i) such other corporation was a controlled foreign corporation, and " (ii) such person owned within the meaning of section 958(a)(2) the stock of such other foreign corporation. "(d)

Ante, p. lois.

EXCLUSIONS FROM EARNINGS AND PROFITS.—For purposes of

this section, the following amounts shall be excluded, with respect to any United States person, from the earnings and profits of a foreign corporation: " (1) A M O U N T S INCLUDED I N GROSS INCOME UNDER SECTION 951.—

Earnings and profits of the foreign corporation attributable to any amount previously included in.the gross income of such person under section 951, with respect to the stock sold or exchanged, but only to the extent the inclusion of such amount did not result in an exclusion of an amount from gross income under section 959.

Ante, p. looe.

"(2) G A I N REALIZED FROM THE SALE OR EXCHANGE OF PROPERTY IN PURSUANCE OF A PLAN OF COMPLETE LIQUIDATION.—If a foreign

corporation adopts a plan of complete liquidation in a taxable year of a foreign corporation beginning after December 31, 1962, and if section 337(a) would apply if such foreign corporation were a domestic corporation, earnings and profits of the foreign corporation attributable (under regulations prescribed by the Secretary or his delegate) to any net gain from the sale or exchange of property. "(3)

LESS DEVELOPED COUNTRY CORPORATIONS.—Earnings

26 USC 337.

and

profits accumulated by a foreign corporation while it was a less developed country corporation (as defined in section 902(d)), if the stock sold or exchanged was owned for a continuous period of at least 10 years, ending with the date of the sale or exchange, by the United States person who sold or exchanged such stock. In the case of stock sold or exchanged by a corporation, if United States persons who are individuals, estates, or trusts (each of whom owned within the meaning of section 958(a), or were considered as owning by applying the rules of ownership of section 958(b), 10 percent or more of the total combined voting power of all classes of stock entitled to vote of such corporation) owned, or were considered as owning, at any time during the 10-year period ending on the date of the sale or exchange more than 50 percent of the total combined voting power of all classes of stock entitled to vote of such corporation, this paragraph shall apply only if such United States persons owned, or were considered as owning, at all times during the remainder of such 10-year period more than 50 percent of the total combined voting power of all classes of stock entitled to vote of sUch corporation. For purposes of this paragraph, stock owned by a United States person who is an individual, estate, or trust which was acquired by reason of the death of the predecessor in interest of such United States

Ante, p. 1000.

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