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California Laws | Revenue and Taxation Code
DIVISION 2. OTHER TAXES
PART 11. CORPORATION TAX LAW

24966. (a) The basis in stock purchased shall be reduced by the nontaxed portion of any extraordinary dividend received as provided in Section 1059 of the Internal Revenue Code, except as otherwise provided in this section. (22945)

(b) The reduction described in Section 1059(b)(2)(B) of the Internal Revenue Code shall be the amount determined under Section 24402. (22946)

(c) Reference to Section 301 of the Internal Revenue Code shall be reference to Sections 24451 to 24454, inclusive. (22947)

(d) Reference to Section 301(b)(2) of the Internal Revenue Code shall be reference to subdivision (b) of Section 24452. (22948)

(e) Reference to Section 301(c)(2) of the Internal Revenue Code shall be reference to subdivision (b) of Section 24453. (22949)

24966.1. Section 1059A of the Internal Revenue Code, relating to limitation on taxpayer's basis or inventory cost in property imported from related persons, shall apply, except as otherwise provided. (22950)

24966.2. Section 1060 of the Internal Revenue Code, relating to special allocation rules for certain asset acquisitions, shall apply, except as otherwise provided. (22951)

24989. Section 1056 of the Internal Revenue Code, relating to basis limitation for player contracts transferred in connection with the sale of a franchise, shall apply, except as otherwise provided. (22952)

Article 4.5. Capital Gains and Losses (24990-24995) (22953)(Text)

24990. Subchapter P of Chapter 1 of Subtitle A of the Internal Revenue Code, relating to capital gains and losses, shall apply, except as otherwise provided. (22954)

24990.2. Section 301 of Title III of Division A of the Emergency Economic Stabilization Act of 2008 (Public Law 110-343), relating to gain or loss from sale of certain preferred stock, shall not apply. (22955)

24990.4. For taxable years beginning on or after January 1, 1997: (22956)

(a) Section 1237(a) of the Internal Revenue Code, relating to real property subdivided for sale, is modified to provide that the term "other than a corporation" in the material preceding Section 1237(a) (1) of the Internal Revenue Code shall instead mean "other than a C corporation." (22957)

(b) Section 1237(a)(2)(A) of the Internal Revenue Code, relating to real property subdivided for sale, is modified to provide that an improvement shall be deemed to be made by the taxpayer if that improvement was made by an "S corporation" that included the taxpayer as a shareholder. (22958)

24990.5. (a) Section 1201 of the Internal Revenue Code, relating to alternative tax for corporations, shall not be applicable. (22959)

(b) The provisions of Section 1212 of the Internal Revenue Code, relating to capital loss carrybacks and carryovers, are modified as follows: (22960)

(1) Section 1212(a)(1)(A) of the Internal Revenue Code, relating to capital loss carrybacks, shall not apply. (22961)

(2) Section 1212(a)(3) of the Internal Revenue Code, relating to special rules on carrybacks, shall not apply. (22962)

(3) Sections 1212(b) and 1212(c) of the Internal Revenue Code, relating to taxpayers other than a corporation, shall not apply. (22963)

24990.6. (a) Section 1245(a)(2)(C) of the Internal Revenue Code, relating to certain deductions treated as amortization, is modified to also refer to Sections 24356.2, 24356.3, and 24356.4. (22964)

(b) Section 1245(b)(8) of the Internal Revenue Code, relating to disposition of amortizable Section 197 intangibles, shall apply to dispositions of property on or after January 1, 2010. (22965)

24990.7. The provisions of Section 1248 of the Internal Revenue Code, relating to gain from certain sales or exchanges of stock in certain foreign corporations, shall not apply to transactions occurring after August 20, 1990, in taxable years beginning on or after January 1, 1990. (22966)

24990.8. For taxable years beginning on or after January 1, 2010, specific reference to Section 1223(4) to (16), inclusive, of the Internal Revenue Code in this part shall instead be treated as a reference to Section 1223(3) to (15), inclusive, of the Internal Revenue Code, respectively. (22967)

24991. Section 1275(a)(3) of the Internal Revenue Code, relating to the definition of tax-exempt obligation, does not apply but instead the term "tax-exempt obligation" means an obligation the interest on which is exempt from tax under this part. (22968)

24993. (a) Section 7872 of the Internal Revenue Code, relating to the treatment of loans with below market interest rates, shall apply, except as otherwise provided. (22969)

(b) Section 7872(h) of the Internal Revenue Code, relating to exception for loans to qualified continuing care facilities, shall apply to calendar years beginning on or after January 1, 2010, with respect to loans made before, on, or after that date. (22970)

24995. The provisions of Part VI of Subchapter P of Chapter 1 of Subtitle A of the Internal Revenue Code, relating to treatment of certain passive foreign investment companies, shall not be applicable. (22971)

Article 5. Wash Sales of Stock or Securities (24998) (22972)(Text)

24998. The provisions of Sections 1091 and 1092 of the Internal Revenue Code, relating to loss from wash sales of stock or securities, and straddles, respectively, shall be applicable for purposes of this part. (22973)

CHAPTER 17. ALLOCATION OF INCOME (22974)(Text)

Article 1. General Provisions (25101-25108) (22975)(Text)

25101. When the income of a taxpayer subject to the tax imposed under this part is derived from or attributable to sources both within and without the state the tax shall be measured by the net income derived from or attributable to sources within this state in accordance with the provisions of Article 2 (commencing with Section 25120). However, any method of apportionment shall take into account as income derived from or attributable to sources without the state, income derived from or attributable to transportation by sea or air without the state, whether or not the transportation is located in or subject to the jurisdiction of any other state, the United States or any foreign country. (22976)

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