S is the parent of T, and S and T do not file a consolidated return. At the end of the day on June 30 of Year 1, P makes a qualified stock purchase of T from S. P makes a section 338 election for T, and T’s deemed asset sale occurs as of the end of T’s acquisition date (June 30).
T must file a separate return for its taxable year ending on June 30 of Year 1.
That short-year return includes the deemed asset sale resulting from the section 338 election.
S is the parent of T, but S and T do not file a consolidated return together.
At the end of June 30, P makes a qualified stock purchase of T from S and makes a section 338 election for T.
T must file a separate return for its taxable year ending on June 30, the date of the deemed asset sale.
T’s short-year return includes the deemed asset sale resulting from the section 338 election.
