# 2025-00321: Guidance Regarding Certain Matters Relating to Nonrecognition of Gain or Loss in Corporate Separations, Incorporations, and Reorganizations 2025-00321, Guidance Regarding Certain Matters Relating to Nonrecognition of Gain or Loss in Corporate Separations, Incorporations, and Reorganizations, is a Federal Register proposed rule from an unnamed agency published 2025-01-16, effective Proposed rule published January 16, 2025; written or electronic comments and requests for a public hearing must be received by March 17, 2025. (as of 2026-06-11). - Canonical: https://policyrisk.com/federal-register/2025-00321 - As of: 2026-06-11 - Plain-text twin of the page above; the HTML and this file carry the same facts. ## Facts - Document number: 2025-00321 - Title: Guidance Regarding Certain Matters Relating to Nonrecognition of Gain or Loss in Corporate Separations, Incorporations, and Reorganizations - Type: Proposed Rule - Agencies: unknown - Citation: unknown - Published: 2025-01-16 - Effective: Proposed rule published January 16, 2025; written or electronic comments and requests for a public hearing must be received by March 17, 2025. - Comments close: not stated - Significant: no - Touches household money: no - Regulation identifier numbers: none - Last updated: 2026-06-11 ## Summary The IRS is proposing new rules to clarify when companies don’t have to pay taxes on gains or losses during big changes like splits, mergers, or reorganizations. These rules affect corporations, their shareholders, and creditors by explaining how stock, debts, and property exchanges are handled tax-wise. Comments on these changes are open until March 17, 2025, so businesses should pay attention to avoid surprises and plan their moves smartly. ## Abstract This document contains proposed regulations regarding certain matters relating to corporate separations, incorporations, and reorganizations qualifying, in whole or in part, for nonrecognition of gain or loss. These matters include distributions and retentions of controlled corporation stock, assumptions of liabilities by controlled corporations, exchanges of property between distributing corporations and controlled corporations, and distributions and transfers of consideration to distributing corporation shareholders and creditors. The proposed regulations would affect corporations and their shareholders and security holders. Proposed regulations modifying the reporting requirements for corporate separations are published elsewhere in the Proposed Rules section of this issue of the Federal Register. ## Effects PRIA read - IRS Clarifies Tax Rules for Corporate Splits: mixed, medium. The IRS published proposed regulations clarifying when corporations do or do not recognize gain or loss in corporate separations, incorporations, and reorganizations under sections 355, 357, 361, and 368 of the Internal Revenue Code. The proposed rules cover distributions and retentions of controll… - Rules on Retaining Subsidiary Stock: mixed, medium. The proposed regulations address the section 355 requirement that the distributing corporation must either distribute all stock it holds in the controlled corporation or distribute an amount that constitutes 'control' under section 368(c). For this purpose, 'control' is defined as ownership of at l… - When Liability Assumptions Trigger Tax: mixed, medium. The proposed rules address when a transferee corporation's assumption of liabilities will be treated as part of a tax-free reorganization under section 357 and when an assumption is treated as money received because the principal purpose was tax avoidance under section 357(b). They also restate tha… - Guidance on Property Exchanges and Distributions: mixed, medium. The proposed regulations clarify section 361 treatment for a corporation that exchanges property pursuant to a plan of reorganization: generally no gain or loss is recognized if the exchange is solely for stock and securities of a party to the reorganization. They also clarify that money or other p… ## Related documents - [2026-20735](https://policyrisk.com/federal-register/2026-20735): Extensions of Credit to Insiders, 2026-10-09 - [2026-20790](https://policyrisk.com/federal-register/2026-20790): Application of the Personal Responsibility and Work Opportunity Reconciliation Act of 1996 to the Refunded Portion of Certain Federal Refun…, 2026-10-09 - [2026-20721](https://policyrisk.com/federal-register/2026-20721): Requirements for Additional Traceability Records for Certain Foods: Enforcement Policy for Certain Retail Food Establishments and Restauran…, 2026-10-09 - [2026-20650](https://policyrisk.com/federal-register/2026-20650): Low-Value Shipments, 2026-10-08 - [2026-20660](https://policyrisk.com/federal-register/2026-20660): Optional Practical Training Fees, 2026-10-08 - [2026-20677](https://policyrisk.com/federal-register/2026-20677): Airworthiness Directives; Various Helicopters, 2026-10-08 ## Sources - [2025-00321 on federalregister.gov](https://www.federalregister.gov/documents/2025/01/16/2025-00321/guidance-regarding-certain-matters-relating-to-nonrecognition-of-gain-or-loss-in-corporate) - [2025-00321 as published (PDF)](https://www.govinfo.gov/content/pkg/FR-2025-01-16/pdf/2025-00321.pdf) ## Related - [Previous: 2025-00312, Multi-Year Reporting Requirements for Corporate Separations and Related Transac…](https://policyrisk.com/federal-register/2025-00312) - [Next: 2025-00397, Tobacco Product Standard for Nicotine Yield of Cigarettes and Certain Other Com…](https://policyrisk.com/federal-register/2025-00397) - [All Federal Register documents](https://policyrisk.com/federal-register) Source: PRIA, https://policyrisk.com/federal-register/2025-00321 (as of 2026-06-11).