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issuing corporation to the acquiring corporation for property,
and then (3) still control the acquiring corporation thereafter.
We also listen to section 304(c)(3) and section 1.304-5(a), In-
come Tax Regs., which tell us to look at section 318’s attribu-
tion rules to determine who controls what under section 304. See
Gunther v. Commissioner, 92 T.C. 39, 49 n.12 (1989), affd. 909
F.2d 291 (7th Cir. 1990).
In this case, RHI was the “issuing corporation” and HMI was
the “acquiring corporation.” Before the sale, RHI was owned
entirely by Richard and Mary Ann Hurst. Under section
318(a)(1)(A)(i), a taxpayer is considered to own shares of stock
held by his spouse. Thus, we treat HMI and RHI as being under
common control, in that HMI was actually owned by Mr. Hurst and
RHI was constructively owned by Mr. Hurst (since he actually
owned 50 percent and the 50 percent his wife owned is construc-
tively owned by him as well). Moreover, Mrs. Hurst also con-
structively controlled both corporations, in that her husband’s
50-percent interest in RHI was attributed to her (thus putting
her at 100-percent ownership) as was his 100-percent interest in
HMI. Section 304(a)(1)(A) is met.
HMI also acquired the RHI stock in exchange for property,
as the Code makes painfully clear by defining “property” to
include “money”. Sec. 317(a). The accompanying regulation
helpfully clarifies that definition by including as “property” a
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