1680
7 4TH CONGRESS . SESS . II. CH. 690. J UNE 22, 1936 . distribution under the plan shall be considered a distribution in complete liquidation . Bond to in sure in- If such transfer of all the property does not occur within the tax- able year the Commissioner may require of the taxpayer such bond, or waiver of the s tatute of limitations on assessment and collection, or both, as he may deem necessary to insure, if the transfer of the property is not completed within such three-year period, or if the taxpayer does not continue qualified under subparagraph (A) until the completion of such transfer, the assessment and collection of all income, war-profits, and excess-profits taxes then imposed by law for such taxable year or subsequent taxable years, to the extent D istributio n in corn - attributable to property so received . A distribution otherwise con- plete liquidation but not within meaning of stituting a distribution in complete liquidation within the meaning corp orate law . of this paragraph shall not be considered as not constituting such a distribution merely because it does not constitute a distribution or liquidation within the meaning of the corporate law under which the distribution is made ; and for the purposes of this para- graph a transfer of property of such other corporation to the tax- pa yer s hall not be cons idere d as n ot co nstit uting a dis tribu tion (or one of a series of distributions) in complete cancellation or redemption of all the stock of such other corporation, merely because the carrying out of the plan involves (i) the transfer under the plan to the taxpayer by such other corporation of property, not attributable to shares owned by the taxpayer, upon an exchange descr ibed in paragraph (4) of this sub section, and (ii) the com- plete cancellation or redemption under the plan, as a result of ex chan ges desc ribed in para graph (3) of this subs ecti on, of th e sh ares not own ed by the tax payer . not solely Gain from exchanges (c) GAIN FROM EXCHANGES NOT SOLELY IN KIND .- ol ely in kind. Recognitionof . (1) If an exchange would be within the provisions of subsection (b) (1), (2), (3), or (5) of this section if it were not for the fact that the property receive d in exchange con sists not only of property permitted by such paragraph to be received without the recognition of gain, but also of other property or money, then the gain, if a ny, t o the recip ient shall be re cogni zed, but in an a mount not in excess of the sum of su ch money and the fair market value of such other property . Reorganization dis-
(2) If a distribution made in pursuance of a plan of reorganiza- tribution construed as ta xa ble dioidend . tion is within the provisions of paragraph (1) of this subsection but has the effect of the distribution of a taxable dividend, then there shall be taxed as a dividend to each distributee such an Acc umu lat ion s after amount of the gain recognized under paragraph
asisnotin February 1918 .
h
(1) excess of his rata ble share of the undistributed earnings and profits Tax on gain from of the corporation accumulated after February 28, 1913 . The property exchange .
remainder, if any, of the gain recognized under paragraph (1) shall be taxed as a gain from the exchange of property . Gain of corporatio n .
(d) SAME-GAIN OF CORPORATION.-If an exchange would be within the provisions of subsection (b) ~4) of this section if it were not for the fact that the property received in exchange consists not only of stock or securities permitted by such paragraph to be received without the recognition of gain, but also of other property or mon ey, then - organization . distributed on re-
(1) If the corp oration receiving such other prop erty or money distributes it in pursuance of the plan of reorganization, no gain to the corporation shall be recognized from the exchange, but If not distributed . (2) If the corp oration receiving such other prop erty or money does not distribute it in pursuance of the plan of reorganization, the gain, if any, to the corporation shall be recognized, but in an
