26 U.S.C. § 331
Amounts received by a shareholder in a distribution in complete liquidation of a corporation shall be treated as in full payment in exchange for the stock.
Section 301 (relating to effects on shareholder of distributions of property) shall not apply to any distribution of property (other than a distribution referred to in paragraph (2)(B) of section 316(b)) in complete liquidation.
For general rule for determination of the amount of gain or loss recognized, see section 1001.
26 U.S.C. § 331
EDITORIAL NOTES
AMENDMENTS2018- Pub. L. 115-141 substituted "shareholder" for "shareholders" in section catchline. 1982-Subsec. (a). Pub. L. 97-248, §222(a), substituted provisions that amounts received by a shareholder in a distribution in complete liquidation of a corporation shall be treated as in full payment in exchange for the stock for provisions that, in complete liquidations, amounts distributed shall be treated as in full payment in exchange for the stock, while amounts distributed in partial liquidation shall be treated as in part or full payment in exchange for the stock. Subsec. (b). Pub. L. 97-248, §222(e)(1)(B), struck out "partial or" before "complete liquidation".1976-Subsec. (c). Pub. L. 94-455 substituted "reference" for "references" in heading and struck out cross reference relating to general rule for determination of the amount of gain or loss to the distributee and substituted "section 1001" for "section 1002".1964-Subsec. (b). Pub. L. 88-272 inserted "(other than a distribution referred to in paragraph (2)(B) of section 316(b))".
STATUTORY NOTES AND RELATED SUBSIDIARIES
EFFECTIVE DATE OF 1982 AMENDMENT Amendment by Pub. L. 97-248 applicable to distributions after Aug. 31, 1982, with exceptions for certain partial liquidations, see section 222(f) of Pub. L. 97-248 set out as a note under section 302 of this title.
EFFECTIVE DATE OF 1976 AMENDMENT Amendment by Pub. L. 94-455 effective for taxable years beginning after Dec. 31, 1976, see section 1901(d) of Pub. L. 94-455 set out as a note under section 2 of this title.
EFFECTIVE DATE OF 1964 AMENDMENT Amendment by Pub. L. 88-272 applicable to distribution made in any taxable year of the distributing corporation beginning after Dec. 31, 1963, see section 225(l) of Pub. L. 88-272 set out as a note under section 316 of this title.
LIQUIDATIONS BEFORE JANUARY 1, 1966 Pub. L. 88-272, title II, §225(h), Feb. 26, 1964, 78 Stat. 90, provided that in the case of corporations referred to in former subsec. (g)(3) of this section the amendments made by section 225 of Pub. L. 88-272 do not apply if there is a complete liquidation of such corporation and if the distribution of all the property under such liquidation occurs before Jan. 1, 1966, except for certain liquidations to which section 332 of this title applies.
- corporation
- The term "corporation" includes associations, joint-stock companies, and insurance companies.
- shareholder
- The term "shareholder" includes a member in an association, joint-stock company, or insurance company.
- stock
- The term "stock" includes shares in an association, joint-stock company, or insurance company.
- taxable year
- The term "taxable year" means the calendar year, or the fiscal year ending during such calendar year, upon the basis of which the taxable income is computed under subtitle A. "Taxable year" means, in the case of a return made for a fractional part of a year under the provisions of subtitle A or under regulations prescribed by the Secretary, the period for which such return is made.