CHAPTER 280

An Act to umend the Code of Virginia by adding a new section numbered
58-86.1:2, relating to the complete liquidation of a subsidiary corpora-
tion, so as to provide for the non-recognition of gain or loss for
income tax purposes in certain circumstances. a

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Approved March 31, 1964

Be it enacted by the General Assembly of Virginia:
1. That the Code of Virginia be amended by adding a new section num-
bered 58-86.1:2, as follows:

§ 58-86.1 2, Complete liquidation of a subsidiary corporation.—
No gain or loss shall be recognized on the receipt by a corporation of
property (including money) distributed in complete liquidation of another
corporation after December 31, 1963, and in complete cancellation or
redemption of all its stock, if the corporation receiving such property was,
on the date of the adoption of the plan of liquidation, and has continued
to be at all times until the receipt of all property so distributed, the owner
of stock (in such other corporation) possessing at least 80 percent of the
total combined voting power of all classes of stock entitled to vote, and the
owner of at least 80 percent of the total number of shares of all other
classes of stock (except non-voting stock which is limited and preferred
as to dividends). The basis of property received by a corporation without
recognition of gain or loss in a distribution as provided for in this section
shall be the same at it would be in the hands of the liquidating corporation,
notwithstanding § 58-85.