26 CFR § 1.1502-34 - Special aggregate stock ownership rules.

---
identifier: "/us/cfr/t26/s1.1502-34"
source: "ecfr"
legal_status: "authoritative_unofficial"
title: "26 CFR § 1.1502-34 - Special aggregate stock ownership rules."
title_number: 26
title_name: "Internal Revenue"
section_number: "1.1502-34"
section_name: "Special aggregate stock ownership rules."
chapter_name: "INTERNAL REVENUE SERVICE, DEPARTMENT OF THE TREASURY"
subchapter_number: "A"
subchapter_name: "INCOME TAX"
part_number: "1"
part_name: "INCOME TAXES"
positive_law: false
currency: "2026-04-05"
last_updated: "2026-04-05"
format_version: "1.1.0"
generator: "[email protected]"
authority: "26 U.S.C. 7805, unless otherwise noted."
regulatory_source: "T.D. 6500, 25 FR 11402, Nov. 26, 1960; 25 FR 14021, Dec. 21, 1960; T.D. 9989, 89 FR 17606, Mar. 11, 2024, unless otherwise noted."
cfr_part: "1"
---


# 1.1502-34 Special aggregate stock ownership rules.

(a) *Determination of stock ownership.* For purposes of the consolidated return regulations, in determining the stock ownership of a member of a group in another corporation (issuing corporation) for purposes of determining the application of section 165(g)(3)(A), 332(b)(1), 351(a), 732(f), or 904(f) in a consolidated return year, stock in the issuing corporation owned by all other members of the group is included. For the determination of whether a member of the group is an 80-percent distributee, *see* section 337(c) (providing that, for purposes of section 337, the determination of whether any corporation is an 80-percent distributee is made without regard to any consolidated return regulation).

(b) *Example regarding liquidation of member.* The following example illustrates the stock ownership aggregation rule set forth in paragraph (a) of this section.

(1) *Facts.* P wholly owns A, B, and C, each of which is a member of the P group. A, B, and C each owns 33
1/3 percent of the stock of D. D liquidates in a transaction purported to qualify under section 332.

(2) *Analysis.* For purposes of determining satisfaction of the 80-percent stock ownership requirement under section 332(b)(1), under the stock ownership aggregation rule set forth in paragraph (a) of this section: A is treated as owning all of the D stock owned by B and C; B is treated as owning all of the D stock owned by A and C; and C is treated as owning all of the D stock owned by A and B. Therefore, each of A, B, and C is treated as owning 100 percent of the stock of D and thus meeting the 80-percent stock ownership requirement for purposes of section 332. However, none of A, B, or C is treated as an 80-percent distributee for purposes of section 337. *See* section 337(c). Therefore, section 337(a) does not apply.

[T.D. 10018, 89 FR 106871, Dec. 30, 2024]