26 USC § 997 - Special subchapter C rules

---
identifier: "/us/usc/t26/s997"
source: "usc"
legal_status: "official_prima_facie"
title: "26 USC § 997 - Special subchapter C rules"
title_number: 26
title_name: "INTERNAL REVENUE CODE"
section_number: "997"
section_name: "Special subchapter C rules"
chapter_number: 1
chapter_name: "NORMAL TAXES AND SURTAXES"
subchapter_number: "N"
subchapter_name: "Tax Based on Income From Sources Within or Without the United States"
part_number: "IV"
part_name: "DOMESTIC INTERNATIONAL SALES CORPORATIONS"
positive_law: false
currency: "119-84"
last_updated: "2026-04-17"
format_version: "1.1.0"
generator: "[email protected]"
source_credit: "(Added Pub. L. 92–178, title V, § 501, Dec. 10, 1971, 85 Stat. 549.)"
---


# § 997. Special subchapter C rules

For purposes of applying the provisions of subchapter C of chapter 1, any distribution in property to a corporation by a DISC or former DISC which is made out of previously taxed income or accumulated DISC income shall—

**(1)** be treated as a distribution in the same amount as if such distribution of property were made to an individual, and

**(2)** have a basis, in the hands of the recipient corporation, equal to the amount determined under paragraph (1).

---

**Source Credit**: (Added Pub. L. 92–178, title V, § 501, Dec. 10, 1971, 85 Stat. 549.)