Bill 29

                    Current Status

Introducing Body:               Senate
Bill Number:                    29
Primary Sponsor:                Passailaigue
Committee Number:               06
Type of Legislation:            GB
Subject:                        Income tax laws, liquidation of
                                corporation
Residing Body:                  Senate
Current Committee:              Finance
Computer Document Number:       29
Introduced Date:                Jan 08, 1991
Last History Body:              Senate
Last History Date:              Jan 08, 1991
Last History Type:              Introduced and read first time,
                                referred to Committee
Scope of Legislation:           Statewide
All Sponsors:                   Passailaigue
Type of Legislation:            General Bill

 Bill  Body    Date          Action Description              CMN
 ----  ------  ------------  ------------------------------  ---
 29    Senate  Jan 08, 1991  Introduced and read first       06
                             time, referred to Committee
 29    Senate  Sep 10, 1990  Prefiled, referred to           06
                             Committee

A BILL

TO AMEND SECTION 12-7-435, AS AMENDED, CODE OF LAWS OF SOUTH CAROLINA, 1976, RELATING TO DEDUCTIONS FROM SOUTH CAROLINA TAXABLE INCOME FOR PURPOSES OF THE STATE INCOME TAX, SO AS TO ALLOW CERTAIN SHAREHOLDERS TO DEDUCT UNUSED NET OPERATING LOSSES ON THE COMPLETE LIQUIDATION OF A CORPORATION WHICH FOR FEDERAL INCOME TAX PURPOSES ONLY WAS A SUBCHAPTER "S" CORPORATION AND TO ALLOW CERTAIN SHAREHOLDERS OF A CORPORATION ELECTING SUBCHAPTER "S" STATUS TO DEDUCT UNUSED NET OPERATING LOSSES.

Be it enacted by the General Assembly of the State of South Carolina:

SECTION 1. Section 12-7-435 of the 1976 Code is amended by adding an appropriately lettered item to read:

"( ) the applicable proportionate share of unused net operating losses on complete liquidation of a corporation which is a subchapter 'S' corporation for federal income tax purposes only of:

(1) individuals who were shareholders when the net operating losses were incurred and remain shareholders up to the time of liquidation, and

(2) individuals who are shareholders at the time of liquidation but who acquired the shares by gift, bequest, or as an heir at law, from an individual who owned the shares when the net operating losses were incurred."

SECTION 2. Upon approval by the Governor, this act is effective for complete liquidations occurring after December 31, 1989.