Taxable Years mined under regulations prescribed by the Commissioner with the approval of the Secretary. Sec. 372 (a) I. R. C., supra, amended by Sec. 171 (c), R. A. of 1942, to read as above. Sec. 101 of said Act makes amendment applicable to taxable years beginning after Dec. 31, 1941. For Sec. 372 (a), I. R. C., before amendment, see 1942 column. Taxable Years mined under regulations prescribed Sec. 372 (a), I. R. C., supra, Taxable Years Sec. 372. (b) Transfers to cor- Sec. 372. (b) Transfers to cor- Sec. 372. (b) Transfers to corporations. If, in connection with porations.-If, in connection with porations.-If, in connection with a transfer subject to the provisions a transfer subject to the provisions a transfer subject to the provisions of section 371 (a), (b), or (e), the of section 371 (a), (b), or (e), the of section 371 (a), (b), or (e), the property was acquired by a cor- property was acquired by a cor- property was acquired by a corporation, either as paid-in surplus poration, either as paid-in surplus poration, either as paid-in surplus or as a contribution to capital, or or as a contribution to capital, or or as a contribution to capital, or in consideration for stock or secu- in consideration for stock or secu- in consideration for stock or securities issued by the corporation re- rities issued by the corporation re- rities issued by the corporation receiving the property (including ceiving the property (including ceiving the property (including cases where part of the considera- cases where part of the considera- cases where part of the consideration for the transfer of such prop- tion for the transfer of such prop- tion for the transfer of such property to the corporation consisted erty to the corporation consisted erty to the corporation consisted of property or money in addition of property or money in addition of property or money in addition to such stock or securities), then to such stock or securities), then to such stock or securities), then the basis shall be the same as it the basis shall be the same as it the basis shall be the same as it would be in the hands of the trans- would be in the hands of the trans- would be in the hands of the transferor, increased in the amount of feror, increased in the amount of feror, increased in the amount of gain or decreased in the amount of gain or decreased in the amount of gain or decreased in the amount of loss recognized to the transferor loss recognized to the transferor loss recognized to the transferor upon such transfer under the law upon such transfer under the law upon such transfer under the law applicable to the year in which the applicable to the year in which the applicable to the year in which the transfer was made. transfer was made. transfer was made. Sec. 372. (c) Distributions of Sec. 372. (c) Distributions of Sec. 372. (c) Distributions of stock or securities. If the stock stock or securities.-If the stock stock or securities.-If the stock or securities were received in a or securities were received in a or securities were received in a distribution subject to the provi- distribution subject to the provi- distribution subject to the provisions of section 371 (c), then the sions of section 371 (c), then the sions of section 371 (c), then the basis in the case of the stock in basis in the case of the stock in basis in the case of the stock in respect of which the distribution respect of which the distribution respect of which the distribution was made shall be apportioned, un- was made shall be apportioned, un- was made shall be apportioned, under rules and regulations preder rules and regulations pre- der rules and regulations prescribed by the Commissioner with scribed by the Commissioner with scribed by the Commissioner with the approval of the Secretary, be- the approval of the Secretary, be- the approval of the Secretary, between such stock and the stock or tween such stock and the stock or tween such stock and the stock or securities distributed. securities distributed. securities distributed. Sec. 372. (d) Transfers within Sec. 372. (d) Transfers within Sec. 372. (d) Transfers within system group.-If the property was system group.-If the property was system group.-If the property was acquired by a corporation which is acquired by a corporation which is acquired by a corporation which is a member of a system group upon a member of a system group upon a member of a system group upon a transfer or distribution described a transfer or distribution described a transfer or distribution described in section 371 (d) (1), then the in section 371 (d) (1), then the in section 371 (d) (1), then the basis shall be the same as it would basis shall be the same as it would basis shall be the same as it would be in the hands of the transferor; be in the hands of the transferor; be in the hands of the transferor; except that if such property is except that if such property is except that if such property is stock or securities issued by the stock or securities issued by the stock or securities issued by the corporation from which such stock corporation from which such stock corporation from which such stock or securities were received and or securities were received and or securities were received and they were issued (1) as the sole they were issued (1) as the sole they were issued (1) as the sole Taxable Years Taxable Years Taxable Years Sec. 372. (b) Transfers to cor- Sec. 372. (b) Transfers to corporations. If, in connection with porations.-If, in connection with a transfer subject to the provisions a transfer subject to the provisions of section 371 (a), (b), or (e), the of section 371 (a), (b), or (e), the property was acquired by a cor- property was acquired by a corporation, either as paid-in surplus poration, either as paid-in surplus or as a contribution to capital, or or as a contribution to capital, or in consideration for stock or secu- in consideration for stock or securities issued by the corporation re- rities issued by the corporation receiving the property (including ceiving the property (including cases where part of the considera- cases where part of the consideration for the transfer of such prop- tion for the transfer of such property to the corporation consisted erty to the corporation consisted of property or money in addition of property or money in addition to such stock or securities), then to such stock or securities), then the basis shall be the same as it the basis shall be the same as it would be in the hands of the trans- would be in the hands of the transferor, increased in the amount of feror, increased in the amount of gain or decreased in the amount of gain or decreased in the amount of loss recognized to the transferor loss recognized to the transferor upon such transfer under the law upon such transfer under the law applicable to the year in which the applicable to the year in which the transfer was made. transfer was made. Sec. 372. (c) Distributions of Sec. 372. (c) Distributions of stock or securities.-If the stock stock or securities.-If the stock or securities were received in a or securities were received in a distribution subject to the provi- distribution subject to the provisions of section 371 (c), then the sions of section 371 (c), then the basis in the case of the stock in basis in the case of the stock in respect of which the distribution respect of which the distribution was made shall be apportioned, un- was made shall be apportioned, under rules and regulations pre- der rules and regulations prescribed by the Commissioner with scribed by the Commissioner with the approval of the Secretary, be- the approval of the Secretary, between such stock and the stock or tween such stock and the stock or securities distributed. securities distributed. Sec. 372. (d) Transfers within Sec. 372. (d) Transfers within system group. If the property was system group.-If the property was acquired by a corporation which is acquired by a corporation which is a member of a system group upon a member of a system group upon a transfer or distribution described a transfer or distribution described in section 371 (d) (1), then the in section 371 (d) (1), then the basis shall be the same as it would basis shall be the same as it would be in the hands of the transferor; be in the hands of the transferor; except that if such property is except that if such property is stock or securities issued by the stock or securities issued by the corporation from which such stock corporation from which such stock securities were received and or securities were received and they were issued (1) as the sole they were issued (1) as the sole or Sec. 372. (b) Transfers to corporations. See p. 422, Eighth Edition. Sec. 372. (c) Distributions of stock or securities. See p. 422, Eighth Edition. Sec. 372. (d) Transfers within system group. See p. 422, Eighth Edition. Taxable Years Taxable Years Taxable Years consideration for the property consideration for the property consideration for the property transferred to such corporation, transferred to such corporation, transferred to such corporation, then the basis of such stock or then the basis of such stock or then the basis of such stock or securities shall be either (A) the securities shall be either (A) the securities shall be either (A) the same as in the case of the property transferred therefor, or (B) the fair market value of such stock or securities at the time of their receipt, whichever is the lower; or (2) as part consideration for the property transferred to such corporation, then the basis of such stock or securities shall be either (A) an amount which bears the same ratio to the basis of the property transferred as the fair market value of such stock or securities at the time of their receipt bears to the total fair market value of the entire consideration received, or (B) the fair market value of such stock or securities at the time of their receipt, whichever is the lower. Sec. 373. Definitions. As used in this supplement same as in the case of the property same as in the case of the property Sec. 373. Definitions. Sec. 373. (a) The term "order of Sec. 373. (a) The term "order of the Securities and Exchange Com- the Securities and Exchange Commission" means an order issued af- mission" means an order issued after May 28, 1938, by the Securities ter May 28, 1938, by the Securities and Exchange Commission which re- and Exchange Commission which requires, authorizes, permits, or ap-quires, authorizes, permits, or approves transactions described in proves transactions described in such order to effectuate the provi- such order to effectuate the provisions of section 11 (b) of the Pub- sions of section 11 (b) of the Public Utility Holding Company Act of lic Utility Holding Company Act of 1935, 49 Stat. 820 (U. S. C., title 1935, 49 Stat. 820 (U. S. C., title 15, sec. 79k (b)), which has be- 15, sec. 79k (b)), which has become or becomes final in accordance come or becomes final in accordance with law. with law. Sec. 373. Definitions. Sec. 373. (a) The term "order of the Securities and Exchange Commission" means an order (1) issued after May 28, 1938, and prior to January 1, 1943, by the Securities and Exchange Commission to effectuate the provisions of section 11 (b) of the Public Utility Holding Company Act of 1935 (49 Stat. 820 (U. S. C., Supp. V, title 15, section 79k (b)), or (2) issued by the Commission subsequent to December 31, 1942, in which it is expressly stated that an order of the character specified in clause (1) is amended or supplemented, and (3) which has become final in accordance with law. Sec. 373 (a), I. R. C., supra, amended by Sec. 117 (a), R. A. of 1941, to read as above. Sec. 117 (b) of said Act makes amendment applicable to taxable years beginning after Dec. 31, 1939. For Sec. 373 (a), I. R. C., supra, before amendment, see Sec. 373 (a), I. R. C., in 1939 and 1940 columns. Sec. 373. (b) The terms "regis- Sec. 373. (b) The terms "regis- Sec. 373. (b) The terms "registered holding company", "holding tered holding company", "holding- tered holding company", "holdingcompany system", and "associate company system", and "associate company system", and "associate company" shall have the meanings company" shall have the meanings company" shall have the meanings assigned to them by section 2 of assigned to them by section 2 of assigned to them by section 2 of the Public Utility Holding Com- the Public Utility Holding Com- the Public Utility Holding Com consideration for the property consideration for the property Sec. 373. Definitions. As used in this supplement- at the time of their receipt, which- Sec. 373. Definitions. Sec. 373. (a) The term "order Sec. 373. (a) The term "order of the Securities and Exchange of the Securities and Exchange Commission" means an order (1) Commission" means an order (1) issued after May 28, 1938, and issued after May 28, 1938, and prior to January 1, 1941 1943, by prior to January 1, 1940-1941, by the Securities and Exchange Com- the Securities and Exchange Commission to effectuate the provi- mission to effectuate the provisions of section 11 (b) of the Pub- sions of section 11 (b) of the Public Utility Holding Company Act lic Utility Holding Company Act of 1935, 49 Stat. 820 (U. S. of 1935, 49 Stat. 820 (U. S. C., Supp. III, Title 15, §79 (b)) (49 Supp. III, Title 15, § 79 (b)), or Stat. 820; U. S. C., Supp. V, title (2) issued by the Commission sub15, section 79k (b)), or (2) issued sequent to December 31, 1939-1940, by the Commission subsequent to in which it is expressly stated that December 31, 1940 1942, in which an order of the character specified it is expressly stated that an order in clause (1) is amended or supof the character specified in clause plemented, and (3) which has be(1) is amended or supplemented, come final in accordance with law. and (3) which has become final in accordance with law. Sec. 373 (a), I. R. C., supra, amended by Sec. 117 (a), R. A. of 1941, by omitting language in stricken through type and adding language in italics. Sec. 117 (b) of said Act makes amendment applicable to taxable years beginning after Dec. 31, 1939. For Sec. 373 (a), I. R. C., supra, before amendment, see Sec. 373 (a), I. R. C., in 1939 column. Sec. 373 (a), I. R. C., supra, amended by Sec. 221 (a), R. A. of 1939, by inserting "1941" and "1940" in lieu of "1940" and "1939," respectively. Sec. 221 (b) of said Act makes amendment applicable to taxable years beginning after Dec. 31, 1938. Sec. 373. (b) The terms "regis- Sec. 373. (b) The terms "registered holding company", "holding- tered holding company", "holdingcompany system", and "associate company system", and "associate company" shall have the meanings company" shall have the meanings assigned to them by section 2 of assigned to them by section 2 of the Public Utility Holding Com- the Public Utility Holding Com Taxable Years Beginning before 1939 Sec. 373. Definitions. See p. 422, Eighth Edition. Taxable Years Taxable Years Taxable Years pany Act of 1935, 49 Stat. 804 (U. S. C., Supp. III, Title 15, § 79 (b), (c)). pany Act of 1935, 49 Stat. 804 pany Act of 1935, 49 Stat. 804 (U. S. C., Supp. III, Title 15, § 79 (U. S. C., Supp. III, Title 15, § 79 (b), (c)). (b), (c)). Sec. 373. (c) The term "ma- Sec. 373. (c) The term "ma- Sec. 373. (c) The term "majority-owned subsidiary com-jority-owned subsidiary com-jority-owned subsidiary company" of a registered holding pany" of a registered holding pany" of a registered holding company means a corporation, company means a corporation, company means a corporation, stock of which, representing in the stock of which, representing in the stock of which, representing in the aggregate more than 50 per centum aggregate more than 50 per centum aggregate more than 50 per centum of the total combined voting power of the total combined voting power of the total combined voting power of all classes of stock of such cor- of all classes of stock of such cor- of all classes of stock of such corporation entitled to vote (not in- poration entitled to vote (not in-poration entitled to vote (not including stock which is entitled to cluding stock which is entitled to cluding stock which is entitled to vote only upon default or nonpay- vote only upon default or nonpay- vote only upon default or nonpayment of dividends or other special ment of dividends or other special ment of dividends or other special circumstances) is owned wholly by circumstances) is owned wholly by circumstances) is owned wholly by such registered holding company, such registered holding company, such registered holding company, or partly by such registered hold- or partly by such registered hold- or partly by such registered holding company and partly by one or ing company and partly by one or ing company and partly by one or more majority-owned subsidiary more majority-owned subsidiary more majority-owned subsidiary companies thereof, or by one or companies thereof, or by one or companies thereof, or by one or more majority-owned subsidiary more majority-owned subsidiary more majority-owned subsidiary companies of such registered hold- companies of such registered hold- companies of such registered holding company. ing company. ing company. Sec. 373. (d) The term "system Sec. 373. (d) The term "system Sec. 373. (d) The term "system group" means one or more chains group" means one or more chains group" means one or more chains of corporations connected through of corporations connected through of corporations connected through stock ownership with a common stock ownership with a common stock ownership with a common parent corporation if— parent corporation if Sec. 373. (d) (1) At least 90 per Sec. 373. (d) (1) At least 90 per centum of each class of the stock centum of each class of the stock (other than stock which is pre- (other than stock which is preferred as to both dividends and ferred as to both dividends and assets) of each of the corporations assets) of each of the corporations (except the common parent corpo- (except the common parent corporation) is owned directly by one ration) is owned directly by one or more of the other corporations; or more of the other corporations; and and parent corporation if— Sec. 373. (d) (1) At least 90 per centum of each class of the stock (other than stock which is preferred as to both dividends and assets) of each of the corporations (except the common parent corporation) is owned directly by one or more of the other corporations; and Sec. 373. (d) (2) The common Sec. 373. (d) (2) The common Sec. 373. (d) (2) The common parent corporation owns directly parent corporation owns directly parent corporation owns directly at least 90 per centum of each class at least 90 per centum of each class of the stock (other than stock of the stock (other than stock which is preferred as to both dividends and assets) of at least one of the other corporations; and Sec. 373. (d) (3) Each of the corporations is either a registered holding company or a majorityowned subsidiary company. Sec. 373. (e) The term "nonexempt property" means Sec. 373. (e) (1) Any consideration in the form of evidences of indebtedness owed by the transferor or a cancellation or assumption of debts or other liabilities of the transferor (including a continuance of encumbrances subject to which the property was transferred); which is preferred as to both divi- at least 90 per centum of each class of the stock (other than stock which is preferred as to both dividends and assets) of at least one of the other corporations; and Sec. 373. (d) (3) Each of the Sec. 373. (d) (3) Each of the corporations is either a registered corporations is either a registered holding company or a majority-holding company or a majorityowned subsidiary company. owned subsidiary company. Sec. 373. (e) The term "nonexempt property" means Sec. 373. (e) (1) Any consideration in the form of evidences of indebtedness owed by the transferor or a cancellation or assumption of debts or other liabilities of the transferor (including a continuance of encumbrances subject to which the property was transferred); Sec. 373. (e) The term "nonexempt property" means Sec. 373. (e) (1) Any consideration in the form of a cancellation or assumption of debts or other liabilities (including a continuance of encumbrances subject to which the property was transferred); |