The US Treasury Department and the Internal Revenue Service (IRS) have issued final regulations (TD 9606) to prevent tax-avoidance in connection with stock acquisitions by related corporations under section 304 of the US Internal Revenue Code (IRC). IRC section 304 is intended to prevent the use of stock sales between brother-sister or parent-subsidiary corporations as a means to produce capital gains rather than dividend treatment. Specifically, IRC section 304(a)(1) provides that, if a corporation (acquiring corporation), in return for property, acquires stock in another corporation (issuing corporation) from a transferor in control of each of the two corporations, property received...