CHAPTER 1— NORMAL TAXES AND SURTAXES›Subchapter C— Corporate Distributions and Adjustments›PART II— CORPORATE LIQUIDATIONS›Subpart A— Effects on Recipients
§ 331. Gain or loss to shareholder in corporate liquidations
26 U.S.C. Subtitle A — Income Taxes (Internal Revenue Code) · 2026 edition · updated 2026-10-03 · United States
(a) Distributions in complete liquidation treated as exchanges
Amounts received by a shareholder in a distribution in complete liquidation of a corporation shall be treated as in full payment in exchange for the stock.
(b) Nonapplication of section 301
Section 301 (relating to effects on shareholder of distributions of property) shall not apply to any distribution of property (other than a distribution referred to in paragraph (2)(B) of section 316(b)) in complete liquidation.
(c) Cross reference
For general rule for determination of the amount of gain or loss recognized, see section 1001.
(Aug. 16, 1954, ch. 736, 68A Stat. 101; Pub. L. 88–272, title II, § 225(f)(2), Feb. 26, 1964, 78 Stat. 88; Pub. L. 94–455, title XIX, § 1901(b)(28)(A), Oct. 4, 1976, 90 Stat. 1799; Pub. L. 97–248, title II, § 222(a), (e)(1)(B), Sept. 3, 1982, 96 Stat. 478, 480; Pub. L. 115–141, div. U, title IV, § 401(a)(63), Mar. 23, 2018, 132 Stat. 1187.)
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