Utah Code » Title 59, Chapter 7 — Corporate Franchise and Income Taxes; part 59-7-1 — Corporate Tax Generally
Utah Code

Utah Code § 59-7-108 (2026)

Distributions by corporations

✓ current as of May 2026
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For purposes of this chapter, a distribution is made out of earnings or profits to the extent of the earnings or profits, and from the most recently accumulated earnings or profits.
Subject to Subsection (1)(b)(ii), any earnings or profits accumulated or increase in value of property accrued before January 1, 1931, may be excluded from taxable income after the earnings and profits accumulated after December 31, 1930 have been distributed.
A distribution described in Subsection (1)(b)(i) shall be applied against and reduce the basis of the stock.
Subject to Subsection (2)(b), if any distribution that is not in partial or complete liquidation is made by a corporation to its shareholders, is not out of increase in value of property accrued before January 1, 1931, and is not out of earnings or profits, the amount of the distribution shall be applied against and reduce the basis of the stock.
If a distribution described in Subsection (2)(a) is in excess of the basis of the stock, the excess shall be treated as a gain from the sale or exchange of property.
Notes of Decisions
Cited in 2 cases, 1991–1999 · leading case: Savage Indus., Inc. v. Utah State Tax Comm'n, 811 P.2d 664 (Utah 1991).
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Savage Indus., Inc. v. Utah State Tax Comm'n, 811 P.2d 664 (Utah 1991). · cites it 18× “The Commission’s decision to deny Savage’s petition for rede-termination was based on its interpretation of Utah Code Ann. § 59-7-108 . In its conclusions of law, the Commission stated that Savage’s interpretation of this section was incorrect and that the plain language of the…”
Steiner Corp. v. Auditing Div. of the Utah State Tax Comm'n, 1999 UT 53 (Utah 1999). “§§ 59-7-108(5), - 306, -308. ¶ 3 It is undisputed that a corporation’s gain or loss from the sale of stock of a subsidiary is treated as a business income gain or loss if the corporation and the subsidiary are a “unitary business.”
— Utah Code § 59-7-108(14)(f) — 1 case
Savage Indus., Inc. v. Utah State Tax Comm'n, 811 P.2d 664 (Utah 1991). “The Commission’s decision to deny Savage’s petition for rede-termination was based on its interpretation of Utah Code Ann. § 59-7-108 . In its conclusions of law, the Commission stated that Savage’s interpretation of this section was incorrect and that the plain language of the…”
— Utah Code § 59-7-108(5) — 1 case
Steiner Corp. v. Auditing Div. of the Utah State Tax Comm'n, 1999 UT 53 (Utah 1999). “§§ 59-7-108(5), - 306, -308. ¶ 3 It is undisputed that a corporation’s gain or loss from the sale of stock of a subsidiary is treated as a business income gain or loss if the corporation and the subsidiary are a “unitary business.”
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