{"data":{"id":"us/26-cfr-1.356-6","jurisdiction":"us","citation":"26 CFR 1.356-6","heading":"-6 Rules for treatment of nonqualified preferred stock as other property.","body":"(a) In general. For purposes of §§ 1.354-1(e), 1.355-1(c), and 1.356-3(b), the terms stock and securities do not include—\n(1) Nonqualified preferred stock, as defined in section 351(g)(2), received in exchange for (or in a distribution with respect to) stock, or a right to acquire stock, other than nonqualified preferred stock; or\n(2) A right to acquire such nonqualified preferred stock, received in exchange for (or in a distribution with respect to) stock, or a right to acquire stock, other than nonqualified preferred stock.\n(b) Exceptions. The following exceptions apply:\n(1) Certain recapitalizations. Paragraph (a) of this section does not apply in the case of a recapitalization under section 368(a)(1)(E) of a family-owned corporation as described in section 354(a)(2)(C)(ii)(II).\n(2) Transition rule. Paragraph (a) of this section does not apply to a transaction described in section 1014(f)(2) of the Taxpayer Relief Act of 1997 (111 Stat. 921).\n(c) Effective date. This section applies to nonqualified preferred stock, or a right to acquire such stock, received in connection with a transaction occurring on or after March 9, 1998.","path":["Title 26—Internal Revenue","CHAPTER I—INTERNAL REVENUE SERVICE, DEPARTMENT OF THE TREASURY","SUBCHAPTER A—INCOME TAX","PART 1—INCOME TAXES"],"source_url":"https://www.ecfr.gov/api/versioner/v1/full/2026-08-25/title-26.xml","current_through":"2026-08-25","vintage":"","retrieved_at":"2026-08-27T02:25:11Z","sha256":"cf6e557e48831098607da0ef0dbe88a741f296529bb90d12e7bc0a5e3780507b","source_id":"us-cfr","stale":true,"prev":"us/26-cfr-1.356-5","next":"us/26-cfr-1.356-7"},"notice":"GroundRules: Original legal text. Not legal advice."}