25) The change in the control test generally applies to transfers after August 5, 1997.
Finally, the 1997 Act clarified that section 355(f) applies with respect to an intragroup distribution only if section 355(e) in its entirety applies.
Section 355(e) applies if there is a section 355 distribution that is part of a plan pursuant to which a person or persons acquires, directly or indirectly, stock representing at least a 50-percent interest in the distributing corporation or any controlled corporation.
Thus, there is an acquisition to which section 355(e) applies if a person or persons acquires 50 percent or more of the vote or value of the stock of the controlled or distributing corporation.
If the IRS applies the attribution rules to look through to the ultimate owners, the phrase "directly or indirectly" seems unnecessary.
Section 355(e) applies to distributions that are part of a plan pursuant to which one or more persons acquire stock representing a 50-percent or greater interest in "the distributing corporation or any controlled corporation.
Under section 355(e)(1), if there is a distribution to which 355(e)(2)(A) applies, any stock "in the controlled corporation" is treated as non-qualified property.
Therefore, section 355(e) seemingly applies to this example.
Section 355(e) applies to the acquisition of a 50-percent or greater interest in "any controlled corporation.