# Definition of terms.
**AGENCY:**
Internal Revenue Service (IRS), Treasury.
**ACTION:**
Correcting amendment.
**SUMMARY:**
This document contains corrections to final regulations (TD 9739) that provide guidance regarding the qualification of a transaction as a corporate reorganization under section 368(a)(1)(F), and which were published in the *Federal Register* on Monday, September 21, 2015 (80 FR 56904).
**DATES:**
This correction is effective December 8, 2015 and applicable September 21, 2015.
**FOR FURTHER INFORMATION CONTACT:**
Douglas C. Bates at (202) 317-6065 (not a toll-free number).
**SUPPLEMENTARY INFORMATION:**
**Background**
The final regulations (TD 9739) that are the subject of this correction are under section 367 and 368 of the Internal Revenue Code.
**Need for Correction**
As published, the final regulation (TD 9739) contains errors that may prove to be misleading and are in need of clarification.
**List of Subjects in 26 CFR Part 1**
Income taxes, Reporting and recordkeeping requirements.
**Correction of Publication**
Accordingly, 26 CFR part 1 is amended by making the following correcting amendments:
**26 CFR Part 1**
**PART 1—INCOME TAXES**
*Paragraph 1.* The authority citation for part 1 continues to read in part as follows:
**Authority:**
26 U.S.C. 7805 * * *
**26 CFR Part 1**
*Par. 2.* Section 1.368-2 is amended by revising the last sentence of paragraph (m)(4) *Example 5.* and revising the third sentence of *Example 7.* to read as follows:
§ 1.368-2
(m) * * *
(4) * * *
**Example 5.**
* * * The result would be the same with respect to qualification under section 368(a)(1)(F) if, instead of merging into S2, S1 completely liquidates or is deemed to liquidate by reason of a conversion in an entity disregarded as separate from its owner under § 301.7701-3 of this chapter.
**Example 7.**
* * * Each of T, P, and S is a State A corporation engaged in a manufacturing business.
Martin V. Franks,
Chief, Publications and Regulations Branch, Legal Processing Division, Associate Chief Counsel (Procedure and Administration).