# Section 1059 Extraordinary Dividends
> **IRS** · Final regulations. · Published 1997-07-16 · Effective 1997-07-16 · 62 FR 38027
## Document
- **Document number:** 97-18750
- **Category:** tax-irs
- **Sub-agency:** IRS
- **Federal Register citation:** 62 FR 38027
- **CFR reference:** 26 CFR 1
- **Publication date:** 1997-07-16
- **Effective date:** 1997-07-16
- **Treasury docket:** TD 8724
## Abstract

This document contains final regulations under section 1059(e) of the Internal Revenue Code. The final regulations clarify that certain distributions in redemption of stock held by a corporate shareholder are treated as extraordinary dividends notwithstanding provisions that otherwise might exempt the distributions from extraordinary dividend treatment. Corporations that receive a distribution in redemption of stock may be affected if the redemption is either part of a partial liquidation of the redeeming corporation or is not pro rata as to all shareholders. The final regulations also provide that section 1059(e)(1) applies to certain exchanges described in section 356.

## Source
- [Federal Register document](https://www.federalregister.gov/documents/1997/07/16/97-18750/section-1059-extraordinary-dividends)
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