Continuity as the Key to Reform of Section 355

69 Am. U. L. Rev. F. 39 (2019)

10 Pages Posted: 18 Jun 2020

See all articles by Charlene D. Luke

Charlene D. Luke

University of Florida Levin College of Law

Date Written: 2019


There can be little doubt that Internal Revenue Code (Code) section 355 is overly complex; the piecemeal adjustments spanning multiple decades could serve as exemplars of the potential pitfalls of incremental reform. Revisions to section 355 have tended to be under- or over-inclusive because they are reactive to particular deals, yet they leave largely intact older structures that dealt with different deals. The result is a jumble of provisions that fail to implement a coherent, principled approach to the tax treatment of corporate divisions. In Reform of Section 355, Bret Wells urges changing Code section 355 to focus on the continuity of historic shareholders and historic assets. The proposals Wells suggests are grounded in congressional intent, specifically the rise and fall of the General Utilities doctrine and its role in the taxation of corporate divisions. This Response to Reform of Section 355 explores the continuity concept and considers the extent to which, if there were conflicting readings of congressional intent or changes to congressional intent, the use of the continuity concept to guide section 355 reform would remain a principled choice.

Suggested Citation

Luke, Charlene D., Continuity as the Key to Reform of Section 355 (2019). 69 Am. U. L. Rev. F. 39 (2019), Available at SSRN: or

Charlene D. Luke (Contact Author)

University of Florida Levin College of Law ( email )

P.O. Box 117625
Gainesville, FL 32611-7625
United States
352.273.0658 (Phone)

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