Page:United States Statutes at Large Volume 98 Part 1.djvu/625

 PUBLIC LAW 98-369—JULY 18, 1984

98 STAT. 577

"(IV) at least 25 percent of the total indebtedness of the corporation is extinguished by transfers pursuant to such plan." 26 USC 108 note. (2) EFFECTIVE DATE.—The amendment made by paragraph (1) shall take effect as if it had been included in the amendments made by subsections (e) and (f) of section 806 of the Tax Reform 26 USC 368, 382, 383. Act of 1976. (b) EFFECTIVE DATE.—

26 USC 108 note.

(1) IN GENERAL.—Except as otherwise provided in this subsection, the amendment made by subsection (a) shall apply to transfers after the date of the enactment of this Act in taxable years ending after such date. (2) TRANSITIONAL RULE.—The amendment made by subsection (a) shall not apply to the transfer by a corporation of its stock in exchange for debt of the corporation after the date of the enactment of this Act if such transfer is— (A) pursuant to a written contract requiring such transfer which was binding on the corporation at all times on June 7, 1984, and at all times after such date but only if the transfer takes place before January 1, 1985, and only if the transferee held the debt at all times on June 7, 1984, or (B) pursuant to the exercise of an option to exchange debt for stock but only if such option was in effect at all times on June 7, 1984, and at all times after such date and only if at all times on June 7, 1984, the option and the debt were held by the same person. (3) CERTAIN TRANSFERS TO CONTROLLING SHAREHOLDER.—The

amendment made by subsection (a) shall not apply to any transfer before January 1, 1985, by a corporation of its stock in exchange for debt of such corporation if— (A) such transfer is to another corporation which at all times on June 7, 1984, owned 75 percent or more of the total value of the stock of the corporation making such transfer, and (B) immediately after such transfer, the transferee corporation owns 80 percent or more of the total value of the stock of the transferor corporation. (4)

CERTAIN

TRANSFERS PURSUANT TO DEBT RESTRUCTURE

AGREEMENT.—The amendment made by subsection (a) shall not apply to the transfer by a corporation of its stock in exchange for debt of the corporation after the date of the enactment of this Act and before January 1, 1985, if— (A) such transfer is covered by a debt restructure agreement entered into by the corporation during November 1983, and (B) such agreement was specified in a registration statement filed with the Securities and Exchange Commission by the corporation on March 7, 1984. SEC. 60. AFFILIATED GROUP DEFINED.

(a) IN GENERAL.—Subsection (a) of section 1504 (defining affiliated 26 USC 1504. group) is amended to read as follows: "(a) AFFILIATED GROUP DEFINED.—For purposes of this subtitle— "(1) IN GENERAL.—The term 'affiliated group' means— "(A) 1 or more chains of includible corporations connected through stock ownership with a common parent corporation which is an includible corporation, but only if—

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