Bulletin No. 2003-37 September 15, 2003

REG–121122–03, page 550. Proposed regulations under section 1042 of the Code provide guidance concerning the notarized statement of purchase requirements for taxpayers electing to defer gain from the sale of certain stock to an employee stock ownership plan.

REG–130262–03, page 553. Proposed regulations under section 1502 of the Code revise the rules for determining the basis of the stock of the former common parent of a consolidated group after a group structure change. Under the current regulations, the acquiring corporationÊs basis in the stock of the former common parent is generally redetermined to reflect the former parentÊs net asset basis. These proposed modifications permit the basis of stock acquired in a fully taxable transaction to reflect the cost of the acquired stock.