INCOME TAX

REG–251698–96, page 14. Proposed regulations under sections 1361 and 1362 of the Code interpret the rules permitting an S corporation to own 80 percent or more of the stock of a C corporation, and to elect to treat a wholly owned subsidiary as a qualified subchapter S subsidiary (QSSS).

Announcement 98–39, page 24. This announcement contains corrections to final regulations T.D. 8765 (1998–16 I.R.B. 11) relating to adjustments required when a qualified business unit (QBU) that used the profit and loss method of accounting (P&L) in a post-1986 year begins to use the dollar approximate separate transaction method of accounting (DASTM) and adjustments required when a QBU that used DASTM begins using P&L.