5
Effective date. 26 USC 312.
PUBLIC LAW 87-403-FEB. 2, 1962
[76 STAT.
(b) The amendments made by this section shall apply only with respect to distributions made after the date of the enactment of this Act. SEC. 3. (a) Section 312 of the Internal Revenue Code of 1954 (relating to the effect on earnings and profits) is amended by adding at the end thereof the following new subsection: " (k) SPECIAL ADJUSTMENT ON DISPOSITION OF ANTITRUST STOCK RECEIVED AS A DIVIDEND.—If a corporation received antitrust stock (as
26'u's8' ^' ^°^'
26 USC 535.
i4nte, p. 4.
defined in section 301(f)) in a distribution to which section 301 applied, and the amount of the distribution determined under section 301(f)(2) exceeded the basis of the stock determined under section 301(f)(3), then proper adjustment shall be made, under regulations prescribed by the Secretary or his delegate, to the earnings and profits of such corporation at the time such stock (or other property the basis of which is determined by reference to the basis of such stock) is disposed of by such corporation." (b) Subsection (b) of section 535 of the Internal Revenue Code of 1954 (relating to accumulated taxable income) is amended by adding at the end thereof the following new paragraphs: " (9) DISTRIBUTIONS OF DIVESTED STOCK.—There shall be allowed as a deduction the amount of any dividend distribution received of divcsted stock (as defined in subsection (e) of section 1111), minus the taxes imposed by this subtitle attributable to such receipt, but only if the stock with respect to which the distribution is made was owned by the distributee on September 6, 1961, or was owned by the distributee for a t least 2 years prior to the date on which the antitrust order (as defined in subsection (d) of section 1111) was entered. "(10)
S P E C I A L ADJUSTMENT ON D I S P O S I T I O N OF ANTITRUST STOCK
RECEIVED AS A DIVIDEND.
74 Stat 77. 26 USC 543.
Ante, p. 4.
If
" (A) a corporation received antitrust stock (as defined in section 301(f)) in a distribution to which section 301 applied, " (B) the amount of the distribution determined under section 301(f)(2) exceeded the basis of the stock determined ' under section 301(f)(3), and " (C) paragraph (9) did not apply in respect of such distribution, then proper adjustment shall be made, under regulations prescribed by the Secretary or his delegate, if such stock (or other property the basis of which is determined by reference to the basis of such stock) is sold or exchanged." (c) Section 543 of the Internal Revenue Code of 1954 (relating to personal holding company income) is amended (1) by adding at the end of paragraph (1) of subsection (a) the following new sentence: "This paragraph shall not apply to a dividend distribution of divested stock (as defined in subsection (e) of section 1111) b u t only if the stock with respect to which the distribution is made was owned by the distributee on September 6, 1961, or was owned by the distributee for at least 2 years prior to the date on which the antitrust order (as defined in subsection (d) of section 1111) was entered."; and (2) by adding at the end thereof the following new subsection: " (d) SPECIAL ADJUSTMENT ON DISPOSITION OF ANTITRUST STOCK RECEIVED AS A DIVIDEND.—If—
"(1) a corporation received antitrust stock (as defined in section 301(f)) in a distribution to which section 301 applied, "(2) the amount of the distribution determined under section 301(f)(2) exceeded the basis of the stock determined under section 301(f)(3), and
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