Section 1.1366-5 - Effective/applicability date(a) Sections 1.1366-1 , 1.1366-2(a)(1) , and 1.1366-2(b) through 1.1366-4 apply to taxable years of an S corporation beginning on or after August 18, 1998.(b) Section 1.1366-2(a)(2) applies to indebtedness between an S corporation and its shareholder resulting from any transaction occurring on or after July 23, 2014. In addition, S corporations and their shareholders may rely on § 1.1366-2(a)(2) with respect to indebtedness between an S corporation and its shareholder that resulted from any transaction that occurred in a year for which the period of limitations on the assessment of tax has not expired before July 23, 2014.(c) Sections 1.1366-2(a)(3) through (7) , and this section apply on and after July 23, 2014. For rules that apply before that date, see 26 CFR part 1 (revised as of April 1, 2014).T.D. 9682, 79 FR 42678, July 23, 2014