98 STAT. 578
PUBLIC LAW 98-369—JULY 18, 1984 J
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"(B)(i) the common parent owns directly stock meeting the requirements of paragraph (2) in at least 1 of the other includible corporations, and "(ii) stock meeting the requirements of paragraph (2) in each of the includible corporations (except the common parent) is owned directly by 1 or more of the other includible corporations. "(2) 80-PERCENT VOTING AND VALUE TEST.—The Ownership of stock of any corporation meets the requirements of this paragraph if it— "(A) possesses at least 80 percent of the total voting power of the stock of such corporation, and "(B) has a value equal to at least 80 percent of the total value of the stock of such corporation. "(3) 5 YEARS MUST ELAPSE BEFORE RECONSOLIDATION.— "(A) IN GENERAL.—If— "(i) a corporation is included (or required to be included) in a consolidated return filed by an affiliated group for a taxable year which includes any period after December 31, 1984, and "(ii) such corporation ceases to be a member of such group in a taxable year beginning after December 31, 1984, with respect to periods after such cessation, such corporation (and any successor of such corporation) may not be included in any consolidated return filed by the affiliated group (or by another affiliated group with the same common parent or a successor of such common parent) before the 61st month beginning after its first taxable year in which it ceased to be a member of such affiliated group. "(B)
SECRETARY MAY WAIVE APPLICATION OF SUBPARA-
GRAPH (A).—The Secretary may waive the application of subparagraph (A) to any corporation for any period subject to such conditions as the Secretary may prescribe. "(4) STOCK NOT TO INCLUDE CERTAIN PREFERRED STOCK.—For
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purposes of this subsection, the term 'stock' does not include any stock which— "(A) is not entitled to vote, "(B) is limited and preferred as to dividends and does not
participate in corporate growth to any significant extent, "(C) has redemption and liquidation rights which do not exceed the paid-in capital or par value represented by such stock (except for a reasonable redemption premium in excess of such paid-in capital or par value), and "(D) is not convertible into another class of stock. "(5) REGULATIONS.—The Secretary shall prescribe such regulations as may be necessary or appropriate to carry out the purposes of this subsection, including (but not limited to) regulations— i.)^ "(A) which treat warrants, obligations convertible into stock, and other similar interests as stock, and stock as not stock, "(B) which treat options to acquire or sell stock as having .f.A'. been exercised, "(C) which provide that the requirements of paragraph (2)(B) shall be treated as met if the affiliated group, in
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