Rev. Rul. 79-433

FACTS

Rev. Rul. 63-29, 1963-1 C.B. 77, holds that the continuity of business enterprise requirement of section 1.368-1(b) of the Income Tax Regulations was satisfied where the transferee corporation sold its assets and discontinued its business, then acquired the assets of another corporation in exchange for its voting stock, and used the sales proceeds realized on the sale of its assets to expand the business formerly conducted by the acquired corporation.

HOLDING

Rev. Rul. 63-29 is suspended and will be revised after the finalization of the regulations clarifying the continuity of business enterprise requirement that were published in proposed form in the Federal Register dated December 28, 1979. The Service will not issue rulings, in some circumstances, as to whether the continuity of business enterprise requirement is satisfied pending finalization of these regulations. See Rev. Proc. 79-68, page , this Bulletin.

PROSPECTIVE APPLICATION

Pursuant to the authority contained in section 7805(b) of the Internal Revenue Code, this revenue ruling will not be applied to transactions consummated before December 28, 1979, or to transactions consummated on or after December 28, 1979, pursuant to the terms of a binding written contract entered into before that date if such terms were in effect on that date.

Rev. Rul. 63-29 is suspended.