§ 1059(e)(1)(A)

dividend treated as extraordinary dividend

UNDECIDED

0 of 2 settled

  1. 1

    § 1059(e)(1)(A)

    ANY OF

    In the case of any redemption of stock—

    NOT“Except as otherwise provided in regulations—” Enclosing § 1059(e)(1)

    “Except as otherwise provided in regulations” leaves this to Treasury. Cited by Reg. § 1.1059(e)-1(a), Reg. § 1.1059(e)-1(b)

    “In the case of any redemption of stock—” Opening words
    “which is part of a partial liquidation (within the meaning of section 302(e)) of the redeeming corporation,” § 1059(e)(1)(A)(i) needs Step 2 treated as in partial liquidation UNDECIDED
    “which is not pro rata as to all shareholders, or” § 1059(e)(1)(A)(ii)
    “which would not have been treated (in whole or in part) as a dividend if— any options had not been taken into account under section 318(a)(4), or section 304(a) had not applied,” § 1059(e)(1)(A)(iii)

    any amount treated as a dividend with respect to such redemption shall be treated as an extraordinary dividend to which paragraphs (1) and (2) of subsection (a) apply without regard to the period the taxpayer held such stock. In the case of a redemption described in clause (iii), only the basis in the stock redeemed shall be taken into account under subsection (a).

  2. 2

    § 302(e)

    treated as in partial liquidation

    ALL OF
    “the distribution is not essentially equivalent to a dividend (determined at the corporate level rather than at the shareholder level)”
    “the distribution is pursuant to a plan and occurs within the taxable year in which the plan is adopted or within the succeeding taxable year.”