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TITLE 26-INTERNAL REVENUE CODE Such term includes supplemental transac- tions under section 305 of such Act. (D) Subsidiary The term "subsidiary" means any corpo- ration 100 percent of whose total combined voting shares are, directly or indirectly, owned or controlled by the Consolidated Rail Corporation. (d) Assumption of liabilities In the case of a transaction involving an as- sumption of a liability or the acquisition of property subject to a liability, the rules pro- vided in section 357 shall apply. (e) Use of expired net operating loss carryovers to offset income arising from certain railroad reor- ganization proceedings (1) In general If- (A) any corporation receives or accrues any amount pursuant to- (I) an award in (or settlement of) a pro- ceeding under section 77 of the Bankrupt- cy Act, (ii) an award in (or settlement of) a pro- ceeding before the special court to carry out section 303(c), 305, or 306 of the Re- gional Rail Reorganization Act of 1973, (Iii) an award in (or settlement of) a pro- ceeding in the Court of Claims under sec- tion 1491 of title 28 of the United States Code, to the extent such proceeding in- volves a claim arising under the Regional Rail Reorganization Act of 1973, or (iv) a redemption of a certificate of value of the United States Railway Asso- ciation issued to such corporation under section 306 of such Act, (B) any portion of such amount is includi- ble In the gross income of such corporation for the taxable year in which such portion is received or accrued, and such taxable year begins not more than 5 years after the date of such award, settlement, or redemp- tion, and (C) the net operating loss of such corpora- tion for any taxable year- (i) was a net operating loss carryover to, or arose In, the first taxable year of such corporation ending after March 31, 1976 (or, in the case of a proceeding referred to in subparagraph (A)(i) which began after March 31, 1976, ending after the begin- ning of such proceeding), but (it) solely by reason of the lapse of time, is not a net operating loss carryover to the taxable year referred to in subparagraph (B), then such net operating loss shall be a net operating loss carryover to the taxable year described in subparagraph (B) but only for use (to the extent not theretofore used under this subsection to offset other amounts) to offset the portion referred to in subparagraph (B). (2) Special rule For purposes of paragraph (1)(C)(i), a cor- poration which was a regulated transporta- tion corporation (within the meaning of sec- tion 172(g)) for its last taxable year ending on or before March 31, 1976, shall be treated as such a regulated transportation corporation for its first taxable year ending after such date. (Added June 29, 1956, ch. 463, § 1, 70 Stat. 402, and amended Mar. 31, 1976, Pub. L. 94-253, § l(a), (d), 90 Stat. 295, 296; Oct. 4, 1976, Pub. L, 94-455, title XIX, § 1001(a)(53), (b)(10)(A), (14)(B), (C), 90 Stat. 1773, 1795, 1796.) REFERENCES IN TEXT Section 77 of the Bankruptcy Act, referred to in subsec. (b)(2), is classified to section 205 (rather than section 501 et seq.) of Title 11, Bankruptcy. The refer- ence possibly should have been to section "77B" of the Bankruptcy Act, because that citation appeared in the predecessor provisions (2e U.S.C. 373(b)(2)) prior to the amendment made by Pub. L. 94-'55, § 1901(b)(14)(B), 90 Stat. 1796. Section 77B of the Bankruptcy Act was amended generally as chapters X to XIV of the Bankruptcy Act by act June 22, 1938, popularly known as the Chandler Act. Chapter X of the Bankruptcy Act is classified to section 501 et seq. of Title 11. The Regional Rail Reorganization Act of 1973, re- ferred to in subsecs. (c)(1), (5)(A) to (C), (e)(1)(A)(ii) to (iv), is Pub. L. 93-236, Jan. 2, 1974, 87 Stat. 985, as amended, which is classified principally to chapter 16 (§701 et seq.) of Title 45, Railroads. Sections 102, 303, 305, and 306 of the Regional Rail Reorganization Act of 1973 are classified to sections 702, 743, 745, and 746, respectively, of title 45. For complete classification of this Act to the Code, see Short Title note set out under section 701 of Title 45 and Tables volume. Sections 102, 305, and 306 of such Act, referred to in subsecs. (c)(5)(C) and (e)(1)(A)(iv), probably mean sec- tions 102, 305, and 306 of the Regional Rail Reorgani- zation Act of 1973. See note hereinabove. AMENDMENT 1976-Subsec. (a)(1). Pub. L. 94-455, § 1901(a)(53), struck out "49 Stat. 922;" before "11 U.S.C. 205)". Subsec. (b). Pub. L. 94-455, § 1901(b)(14)(B), desig- nated existing provisions as par. (1), and in par. (1) as so designated, substituted "December 31, 1938" for "July 31, 1955" and added par. (2). Subsec. (c). Pub. L. 94-253, § l(a), added subsec. (c). Former subsec. (c) was redesignated as (d). Subsec. (c)(3). Pub. L. 94-455, § 1901(b)(14)(C), sub- stituted "subsection (b)(1)" for "subsection (b)". Subsec. (d). Pub. L. 94-253, § l(a), redesignated former subsec. (c) as subsec. (d). Subsec. (e). Pub. L. 94-253, § l(d), added subsec. (e). Subsec. (e)(2). Pub. L. 94-455, § 1901(b)(10)(A), sub- stituted "172(g)" for "172(j)". EFFECTIVE DATE OF 1976 AMENDMENT Amendment of subsecs. (a)(1), (b), and (c)(3) by sec- tion 1901(a)(53), (b)(14)(B), (b)(14)(C) of Pub. L. 94- 455 effective for taxable years beginning after Dec. 31, 1976, see section 1901(d) of Pub. L. 94-455, set out as an Effective Date of 1976 Amendment note under sec- tion 2 of this title. Amendment of subsec. (e)(2) by section 1901(b)(10)(A) of Pub. L. 94-455 effective for taxable years ending after Oct. 4, 1976, see section 1901(d) of Pub. L. 94-455, set out as an Effective Date of 1976 Amendment note under section 2 of this title. Section 2 of Pub. L. 94-253 provided that: "The amendments made by section 1 [amending sections 354, 356, 358, and 374(c) to (e) of this title] shall apply to taxable years ending after March 31, 1976." SECTION REFERRED TO IN OTHER SECTIONS This section is referred to in sections 48, 49, 250, 341, 354, 357, 358, 372, 617, 1232, 1245, 1250, 1251 of this title. Page 273 § 374