- 20 -
Section 301 provides in relevant part:
SEC. 301. DISTRIBUTIONS OF PROPERTY.
(a) In General.--Except as otherwise provided in
this chapter, a distribution of property (as defined in
section 317(a)) made by a corporation to a shareholder
with respect to its stock shall be treated in the
manner provided in subsection (c).
(b) Amount Distributed.--
(1) General rule.--For purposes of this
section, the amount of any distribution shall be
the amount of money received, plus the fair market
value of the other property received.
* * * * * * *
(c) Amount Taxable.--In the case of a distribution
to which subsection (a) applies--
(1) Amount constituting dividend.--That
portion of the distribution which is a dividend
(as defined in section 316) shall be included in
gross income.
(2) Amount applied against basis.--That
portion of the distribution which is not a
dividend shall be applied against and reduce the
adjusted basis of the stock.
(3) Amount in excess of basis.--
(A) In general.--Except as provided in
subparagraph (B), that portion of the
distribution which is not a dividend, to the
extent that it exceeds the adjusted basis of
the stock, shall be treated as gain from the
sale or exchange of property. * * *
Page: Previous 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 NextLast modified: May 25, 2011