§304. Redemption through use of related corporations — Inbound Citations
26 U.S.C. § 304
Cited by 14 provisions in release 119-102.
Citations to 26 U.S.C. § 304 as a whole
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(2) section 304 (relating to redemption by related corporations);
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(5) For coordination of this section with section 304, see section 304(b)(3).
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(c) For purposes of part I (other than section 304), part II, this part, and part V, the term “control” means the ownership of stock possessing at least 80 percent of the total combined voting power of all classes of stock entitled to vote and at least 80 percent of the total number of shares of all other classes of stock of the corporation.
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(B) In the case of a distribution in redemption of stock to which section 303 (or so much of section 304 as relates to section 303) applies—(i) the redemption of such stock, and the withdrawal of money and other property distributed in such redemption, shall not be treated as a distribution or withdrawal for purposes of subparagraph (A), and(ii) for purposes of subparagraph (A), the value of the interest in the closely held business shall be considered to be such value reduced by the value of the stock redeemed.This subparagraph shall apply only if, on or before the date prescribed by subsection (a)(3) for the payment of the first installment which becomes due after the date of the distribution (or, if earlier, on or before the day which is 1 year after the date of the distribution), there is paid an amount of the tax imposed by section 2001 not less than the amount of money and other property distributed.
Citations to §304(a)
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(II) section 304(a) had not applied,
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(C) If any transaction is treated under section 304(a) as a distribution in redemption of the stock of any corporation, for purposes of subparagraphs (A) and (B), such corporation shall be treated as purchasing an amount of its stock equal to the amount treated as such a distribution under section 304(a).
Citations to §304(b)(2)
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(3) The term “section 306 stock” also includes any stock which is not common stock acquired in an exchange to which section 351 applied if receipt of money (in lieu of the stock) would have been treated as a dividend to any extent. Rules similar to the rules of section 304(b)(2) shall apply—(A) for purposes of the preceding sentence, and(B) for purposes of determining the application of this section to any subsequent disposition of stock which is section 306 stock by reason of an exchange described in the preceding sentence.
Citations to §304(b)(3)
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(5) For coordination of this section with section 304, see section 304(b)(3).
Citations to §304(c)
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(i) in the case of a transaction with respect to which the requirements of subparagraphs (A) and (B) of section 354(b)(1) are met, the term “control” has the meaning given such term by section 304(c), and
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(e) If a person controls (within the meaning of section 304(c)) a corporation—(1) participation in or cooperation with an international boycott by such corporation shall be presumed to be such participation or cooperation by such person, and(2) participation in or cooperation with such a boycott by such person shall be presumed to be such participation or cooperation by such corporation.
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(ii) For purposes of clause (i), the term “control” has the meaning given such term by section 304(c). In determining control, there shall be disregarded any qualified replacement property of the taxpayer with respect to the section 1042 sale being tested.
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(B) any taxpayer owning stock representing control (within the meaning of section 304(c)) of such corporation at the time of such disposition holds any qualified replacement property of such corporation at such time,
Citations to §304(c)(1)
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(1) control (as defined in section 304(c)(1)) of a corporation is acquired by any person (or group of persons) in a transaction (or series of related transactions), or
Citations to §304(c)(3)(B)
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(4) For purposes of paragraphs (1)(B)(ii) and (3), section 318(a) shall apply. For purposes of applying the preceding sentence to paragraph (3), the rules of section 304(c)(3)(B) shall apply.