In a Revenue Ruling, the U.S. Internal Revenue Service (IRS) has suspended two 1957 Revenue Rulings pending completion of a study on the active conduct of a trade or business (ATB) requirement under Code Sec. 355(a)(1)(C) and Code Sec. 355(b). Code Sec. 355(a)(1) provides that, if certain requirements are met, a corporation may distribute stock and securities of a controlled corporation to its shareholders and security holders without recognition of gain or loss of income to the recipient shareholders or security holders. Among those requirements, both the distributing corporation and the controlled corporation must be engaged in the active conduct of a trade or business immediately after the distribution. Each trade or business must have been actively conducted throughout the five-year period ending on the date of the distribution. Read more at CPA Practice Advisor.