[Code of Federal Regulations]
[Title 26, Volume 11]
[Revised as of April 1, 2004]
From the U.S. Government Printing Office via GPO Access
[CITE: 26CFR1.1366-0]

[Page 737]
 
                       TITLE 26--INTERNAL REVENUE
 
    CHAPTER I--INTERNAL REVENUE SERVICE, DEPARTMENT OF THE TREASURY 
                               (CONTINUED)
 
PART 1_INCOME TAXES--Table of Contents
 
Sec. 1.1366-0  Table of contents.

    The following table of contents is provided to facilitate the use of 
Sec. Sec. 1.1366-1 through 1.1366-5:

    Sec. 1.1366-1 Shareholder's share of items of an S corporation.

    (a) Determination of shareholder's tax liability.
    (1) In general.
    (2) Separately stated items of income, loss, deduction, or credit.
    (3) Nonseparately computed income or loss.
    (4) Separate activities requirement.
    (5) Aggregation of deductions or exclusions for purposes of 
limitations.
    (b) Character of items constituting pro rata share.
    (1) In general.
    (2) Exception for contribution of noncapital gain property.
    (3) Exception for contribution of capital loss property.
    (c) Gross income of a shareholder.
    (1) In general.
    (2) Gross income for substantial omission of items.
    (d) Shareholders holding stock subject to community property laws.
    (e) Net operating loss deduction of shareholder of S corporation.
    (f) Cross-reference.

  Sec. 1.1366-2 Limitations on deduction of passthrough items of an S 
                    corporation to its shareholders.

    (a) In general.
    (1) Limitation on losses and deductions.
    (2) Carryover of disallowance.
    (3) Basis limitation amount.
    (i) Stock portion.
    (ii) Indebtedness portion.
    (4) Limitation on losses and deductions allocated to each item.
    (5) Nontransferability of losses and deductions.
    (6) Basis of stock acquired by gift.
    (b) Special rules for carryover of disallowed losses and deductions 
to post-termination transition period described in section 1377(b).
    (1) In general.
    (2) Limitation on losses and deductions.
    (3) Limitation on losses and deductions allocated to each item.
    (4) Adjustment to the basis of stock.
    (c) Carryover of disallowed losses and deductions in the case of 
liquidations, reorganizations, and divisions.
    (1) Liquidations and reorganizations.
    (2) Corporate separations to which section 368(a)(1)(D) applies.

               Sec. 1.1366-3 Treatment of family groups.

    (a) In general.
    (b) Examples.

 Sec. 1.1366-4 Special rules limiting the passthrough of certain items 
                of an S corporation to its shareholders.

    (a) Passthrough inapplicable to section 34 credit.
    (b) Reduction in passthrough for tax imposed on built-in gains.
    (c) Reduction in passthrough for tax imposed on excess net passive 
income.

                     Sec. 1.1366-5 Effective date.

[T.D. 8852, 64 FR 71644, Dec. 22, 1999]