26 U.S.C. § 311
§ 311. Taxability of corporation on distribution
No plain-English explainer yet. Below is the official text. Explainers are being added section by section.
History
Part of the code since 1954. Last changed November 10, 1988 by the Technical and Miscellaneous Revenue Act of 1988.
Every change, newest first (10)
- November 10, 1988Technical and Miscellaneous Revenue Act of 1988
- October 22, 1986Tax Reform Act of 1986
- July 18, 1984Deficit Reduction Act of 1984
- September 3, 1982Tax Equity and Fiscal Responsibility Act of 1982
- October 19, 1980Public Law 96-471
- November 6, 1978Revenue Act of 1978
- October 4, 1976Tax Reform Act of 1976
- October 2, 1976Public Law 94-452
- December 30, 1969Tax Reform Act of 1969
- August 16, 1954Internal Revenue Code of 1954 (original text)
The law as written
Current through Public Law 119-102. Amendment notes omitted.
Except as provided in subsection (b), no gain or loss shall be recognized to a corporation on the distribution (not in complete liquidation) with respect to its stock of—
its stock (or rights to acquire its stock), or
property.
If—
a corporation distributes property (other than an obligation of such corporation) to a shareholder in a distribution to which subpart A applies, and
the fair market value of such property exceeds its adjusted basis (in the hands of the distributing corporation),
then gain shall be recognized to the distributing corporation as if such property were sold to the distributee at its fair market value.
Rules similar to the rules of section 336(b) shall apply for purposes of this subsection.
If the property distributed consists of an interest in a partnership or trust, the Secretary may by regulations provide that the amount of the gain recognized under paragraph (1) shall be computed without regard to any loss attributable to property contributed to the partnership or trust for the principal purpose of recognizing such loss on the distribution.