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TITLE 26-INTERNAL REVENUE CODE "(2) the acquiring corporation (or a corporation in control of the acquiring corporation) acquires bene- ficial interests in shares described in section 2(g)(2) of the Bank Holding Company Act [section 1841(g)(2) of this title 12, Banks and Banking] (as defined in section 1103(a)(2) of the Internal Rev- enue Code of 1954 (section 1103(a)(2) of this title]) in a transaction to which section 351 [section 351 of this title] applies, then, the acquiring corporation (or a corporation which is in control (within the meaning of section 2(a)(2) of such Act) [section 1841(a)(2) of title 12]) of the acquiring corporation or a subsidiary (within the meaning of section 2(d) of such Act (section 1841(d), of title 12]) of the corporation so in control) shall be treated as a qualified bank holding corporation for purposes of section 1103(b) and 6158 of the Internal Revenue Code of 1954 (section 1103(b) and 6158 of this title] and the shares described in such section 2(g)(2) [section 1841(g)(2) of title 12] shall be consid- ered property which is acquired by such corporation, for purposes of section 1101(c)(1)(A)(iii) of the Inter- nal Revenue Code of 1954 (subsec. (c)(1)(A)(iii) of this section], after July 7, 1970." SAVINGS CLAUSE See section 11 of act May 9, 1956, set out as a Sav- ings Clause note under section 1841 of Title 12, Banks and Banking. SECTION REFERRED TO IN OTMa SECTIONS This section is referred to in sections 311, 1102, 1103, 6158 of this title. § 1102. Special rules (a) Basis of property acquired in distributions If, by reason of section 1101, gain is not recog- nized with respect to the receipt of any proper- ty, then, under regulations prescribed by the Secretary- (1) if the property is received by a share- holder with respect to stock, without the sur- render by such shareholder of stock, the basis of the property received and of the stock with respect to which it is distributed shall, in the distributee's hands, be determined by allocat- ing between such property and such stock and the adjusted basis of such stock; or (2) if the property is received by a share- holder in exchange for stock or by a security holder in exchange for securities, the basis of the property received shall, in the distribu- tee's hands, be the same as the adjusted basis of the stock or securities exchanged, in- creased by- (A) the amount of the property received which was treated as a dividend, and (B) the amount of gain to the taxpayer recognized on the property received (not in- cluding any portion of such gain which was treated as a dividend). (b) Periods of limitation The periods of limitation provided in section 6501 (relating to limitations on assessment and collection) shall not expire, with respect to any deficiency (including interest and additions to the tax) resulting solely from the receipt of property by shareholders in a distribution which is certified by the Board under subsec- tion (a), (b), or (c) of section 1101, until five years after the distributing corporation notifies the Secretary (in such manner and with such accompanying information as the Secretary may by regulations prescribe) that the period (including extensions thereof) prescribed in sec- tion 4(a) of the Bank Holding Company Act of 1956, or section 1101(e)(2)(B), whichever is ap- plicable, has expired; and such assessment may be made notwithstanding any provision of law or rule of law which would otherwise prevent such assessment. (c) Allocation of earnings and profits (1) Distribution of stock in a controlled corpora- tion In the case of a distribution by a qualified bank holding corporation under section 1101(a)(1) or (b)(1) of stock in a controlled corporation, proper allocation with respect to the earnings and profits of the distributing corporation and the controlled corporation shall be made under regulations prescribed by the Secretary. (2) Exchanges described in section 1101(c)(2), or (3) In the case of any exchange described in section 1101(c)(2) or (3), proper allocation with respect to the earnings and profits of the corporation transferring the property and the corporation receiving such property shall be made under regulations prescribed by the Secretary. (3) Definition of controlled corporation For purposes of paragraph (1), the term "controlled corporation" means a corporation with respect to which at least 80 percent of the total combined voting power of all classes of stock entitled to vote and at least 80 per- cent of the total number of shares of all other classes of stock is owned by the distrib- uting qualified bank holding corporation. (d) Itemization of property In any certification under this part, the Board shall make such specification and item- ization of property as may be necessary to carry out the provisions of this part. (e) Certain bank holding companies This part shall apply in respect of any compa- ny which becomes a bank holding company as a result of the enactment of the Act entitled "An Act to amend the Bank Holding Company Act of 1956", approved July 1, 1966 (Public Law 89- 485), with the following modifications: (1) Subsections (a)(3) and (b)(3) of section 1101 shall not apply. (2) Subsections (a)(1) and (2) and (b)(1) and (2) of section 1101 shall apply in respect of distributions to shareholders of the distribut- ing bank holding corporation only if all distri- butions to each class of shareholders which are made- (A) after April 12, 1965, and (B) on or before the date on which the Board of Governors of the Federal Reserve System makes its final certification under section 1101(e), are pro rata. For purposes of the preceding sentence, any redemption of stock made in whole or in part with property other than money shall be treated as a distribution. (3) In applying subsections (c) and (d) of section 1101 and subsection (b) of section 1103, the date "April 12, 1965" shall be substi- tuted for the date "May 15, 1955". § 1102 Page 670