# Pub. L. 109-222: changes to the Internal Revenue Code 2006-05-17, 120 Stat. 364. Source: . ## Legislative history - Bill: [H.R. 4297](https://www.congress.gov/bill/109th-congress/house-bill/4297) - House report: [H. Rept. 109-304](https://www.govinfo.gov/content/pkg/CRPT-109hrpt304/html/CRPT-109hrpt304.htm) - Conference report: [H. Rept. 109-455](https://www.govinfo.gov/content/pkg/CRPT-109hrpt455/html/CRPT-109hrpt455.htm) - Bluebook: [JCT general explanation (2007)](https://www.govinfo.gov/app/details/CPRT-110JPRT31502) ## § 1: Tax imposed - § 1(g)(2)(A): Pub. L. 109–222, § 510(a), substituted “age 18” for “age 14”. - § 1(g)(2)(C): Pub. L. 109–222, § 510(c), added subpar. (C). - § 1(g)(4)(C): Pub. L. 109–222, § 510(b), added subpar. (C). ## § 26: Limitation based on tax liability; definition of tax liability - § 26(a)(2): Pub. L. 109–222 substituted “2006” for “2005” in heading and “2005, or 2006” for “or 2005” in introductory provisions. ## § 55: Alternative minimum tax imposed - § 55(d)(1)(A): Pub. L. 109–222, § 301(a)(1), substituted “$62,550 in the case of taxable years beginning in 2006” for “$58,000 in the case of taxable years beginning in 2003, 2004, and 2005”. - § 55(d)(1)(B): Pub. L. 109–222, § 301(a)(2), substituted “$42,500 in the case of taxable years beginning in 2006” for “$40,250 in the case of taxable years beginning in 2003, 2004, and 2005”. ## § 142: Exempt facility bond - § 142(d)(2)(B): Pub. L. 109–222 substituted “Subsections (g) and (h) of section 7872” for “Section 7872(g)”. ## § 143: Mortgage revenue bonds: qualified mortgage bond and qualified veterans’ mortgage bond - § 143(l)(3)(B): Pub. L. 109–222, § 203(b)(1), reenacted heading without change, substituted introductory provisions of cl. (i) for “A State veterans limit for any calendar year is the amount equal to—” and inserted heading, redesignated former cls. (i) and (ii) as subcls. (I) and (II), respectively, of cl. (i) and adjusted margins, and added cls. (ii) to (iv). - § 143(l)(4): Pub. L. 109–222, § 203(a)(1), amended par. (4) generally. Prior to amendment, par. (4) defined the term “qualified veteran”. ## § 144: Qualified small issue bond; qualified student loan bond; qualified redevelopment bond - § 144(a)(4)(F), § 144(a)(4)(G): Pub. L. 109–222 substituted “December 31, 2006” for “September 30, 2009”. ## § 148: Arbitrage - § 148(f)(4)(D)(ii)(II), § 148(f)(4)(D)(ii)(III), § 148(f)(4)(D)(ii): Pub. L. 109–222 redesignated subcls. (III) and (IV) as (II) and (III), respectively, and struck out former subcl. (II) which read as follows: “all bonds issued by a governmental unit to make loans to other governmental units with general taxing powers not subordinate to such unit shall, for purposes of applying such subclause to such unit, be treated as not issued by such unit.” ## § 149: Bonds must be registered to be tax exempt; other requirements - § 149(f)(1): Pub. L. 109–222, § 508(d)(1), substituted “paragraphs (2), (3), (4), and (5)” for “paragraphs (2) and (3)”. - § 149(f)(2)(A): Pub. L. 109–222, § 508(a), amended subpar. (A) generally. Prior to amendment, text read as follows: “The requirements of this paragraph are met with respect to an issue if the issuer reasonably expects that as of the close of the 3-year period beginning on the date of issuance of the issue, at least 95 percent of the net proceeds of the issue (as of the close of such period) will have been used directly or indirectly to make or finance loans to ultimate borrowers.” - § 149(f)(4), § 149(f)(5), § 149(f)(6): Pub. L. 109–222, § 508(b), added pars. (4) and (5) and redesignated former par. (4) as (6). Former par. (5) redesignated (7). - § 149(f)(7): Pub. L. 109–222, § 508(b), redesignated par. (5) as (7). - § 149(f)(7)(B): Pub. L. 109–222, § 508(d)(2), substituted “paragraph (6)(A)” for “paragraph (4)(A)”. ## § 163: Interest - § 163(j)(8): Pub. L. 109–222, § 501(a), added par. (8). Former par. (8) redesignated (9). - § 163(j)(9): Pub. L. 109–222 redesignated par. (8) as (9) and added subpar. (D). ## § 167: Depreciation - § 167(g)(8): Pub. L. 109–222, § 207(a), added par. (8). - § 167(h)(5): Pub. L. 109–222, § 503(a), added par. (5). ## § 170: Charitable, etc., contributions and gifts - § 170(e)(1)(A): Pub. L. 109–222 inserted “(determined without regard to section 1221(b)(3))” after “long-term capital gain”. ## § 179: Election to expense certain depreciable business assets - § 179(b)(1), § 179(b)(2), § 179(b)(5)(A), § 179(c)(2), § 179(d)(1)(A)(ii): Pub. L. 109–222 substituted “2010” for “2008”. ## § 355: Distribution of stock and securities of a controlled corporation - § 355(b)(3): Pub. L. 109–222, § 202, added par. (3). - § 355(g): Pub. L. 109–222, § 507(a), added subsec. (g). ## § 408A: Roth IRAs - § 408A(c)(3)(B): Pub. L. 109–222, § 512(a)(1), redesignated subpar. (C) as (B) and struck out former subpar. (B). Prior to amendment, text read as follows: “A taxpayer shall not be allowed to make a qualified rollover contribution to a Roth IRA from an individual retirement plan other than a Roth IRA during any taxable year if, for the taxable year of the distribution to which such contribution relates— - § 408A(c)(3)(B)(i): Pub. L. 109–222, § 512(a)(2), substituted “except that any amount included in gross income under subsection (d)(3) shall not be taken into account, and” for “except that— - § 408A(c)(3)(C): Pub. L. 109–222, § 512(a)(1), redesignated subpar. (D), relating to marital status, as (C). Former subpar. (C) redesignated (B). See Effective Date of 2006 Amendment note below. - § 408A(d)(3)(A)(iii): Pub. L. 109–222, § 512(b)(1), amended cl. (iii) generally. Prior to amendment, cl. (iii) read as follows: “unless the taxpayer elects not to have this clause apply for any taxable year, any amount required to be included in gross income for such taxable year by reason of this paragraph for any distribution before January 1, 1999, shall be so included ratably over the 4-taxable year period beginning with such taxable year.” - § 408A(d)(3)(E): Pub. L. 109–222, § 512(b)(2)(B), substituted “2-year” for “4-year” in heading. - § 408A(d)(3)(E)(i): Pub. L. 109–222, § 512(b)(2)(A), amended cl. (i) generally. Prior to amendment, text read as follows: ## § 468B: Special rules for designated settlement funds - § 468B(g): Pub. L. 109–222 reenacted heading without change and amended text of subsec. (g) generally. Prior to amendment, text read as follows: “Nothing in any provision of law shall be construed as providing that an escrow account, settlement fund, or similar fund is not subject to current income tax. The Secretary shall prescribe regulations providing for the taxation of any such account or fund whether as a grantor trust or otherwise.” ## § 852: Taxation of regulated investment companies and their shareholders - § 852(b)(3)(E): Pub. L. 109–222 added subpar. (E). ## § 871: Tax on nonresident alien individuals - § 871(k)(2)(E): Pub. L. 109–222 added subpar. (E). ## § 897: Disposition of investment in United States real property - § 897(h)(1): Pub. L. 109–222, § 505(a)(1), in first sentence, substituted “a nonresident alien individual, a foreign corporation, or other qualified investment entity” for “a nonresident alien individual or a foreign corporation” and “such nonresident alien individual, foreign corporation, or other qualified investment entity” for “such nonresident alien individual or foreign corporation” and inserted second sentence and struck out former second sentence which read as follows: “Notwithstanding the preceding sentence, any distribution by a real estate investment trust with respect to any class of stock which is regularly traded on an established securities market located in the United States shall not be treated as gain recognized from the sale or exchange of a United States real property interest if the shareholder did not own more than 5 percent of such class of stock at any time during the 1-year period ending on the date of the distribution.” - § 897(h)(4)(A)(i): Pub. L. 109–222, § 504(a), inserted “which is a United States real property holding corporation or which would be a United States real property holding corporation if the exceptions provided in subsections (c)(3) and (h)(2) did not apply to interests in any real estate investment trust or regulated investment company” after “any regulated investment company”. - § 897(h)(4)(A)(ii): Pub. L. 109–222, § 505(a)(2), inserted at end “Notwithstanding the preceding sentence, an entity described in clause (i)(II) shall be treated as a qualified investment entity for purposes of applying paragraphs (1) and (5) and section 1445 with respect to any distribution by the entity to a nonresident alien individual or a foreign corporation which is attributable directly or indirectly to a distribution to the entity from a real estate investment trust.” - § 897(h)(5): Pub. L. 109–222, § 506(a), added par. (5). ## § 911: Citizens or residents of the United States living abroad - § 911(b)(2)(D)(ii): Pub. L. 109–222, § 515(a)(1), substituted “2005” for “2007” in introductory provisions. - § 911(b)(2)(D)(ii)(II): Pub. L. 109–222, § 515(a)(2), substituted “2004” for “2006”. - § 911(c)(1)(A): Pub. L. 109–222, § 515(b)(2)(A), inserted “to the extent such expenses do not exceed the amount determined under paragraph (2)” after “the taxable year”. - § 911(c)(1)(B)(i): Pub. L. 109–222, § 515(b)(1), amended cl. (i) generally. Prior to amendment, cl. (i) read as follows: “16 percent of the salary (computed on a daily basis) of an employee of the United States who is compensated at a rate equal to the annual rate paid for step 1 of grade GS–14, multiplied by”. - § 911(c)(2), § 911(c)(3), § 911(c)(4): Pub. L. 109–222, § 515(b)(2)(B), added par. (2) and redesignated former pars. (2) and (3) as (3) and (4), respectively. - § 911(d)(4): Pub. L. 109–222, § 515(b)(2)(C)(i), substituted “, (c)(1)(B)(ii), and (c)(2)(A)(ii)” for “and (c)(1)(B)(ii)” in concluding provisions. - § 911(d)(7): Pub. L. 109–222, § 515(b)(2)(C)(ii), which directed substitution of “subsection (c)(4)” for “subsection (c)(3)”, was executed by substituting “subsection (c)(4)(A)” for “subsection (c)(3)(A)” to reflect the probable intent of Congress. - § 911(f), § 911(g): Pub. L. 109–222, § 515(c), added subsec. (f) and redesignated former subsec. (f) as (g). ## § 953: Insurance income - § 953(e)(10): Pub. L. 109–222 substituted “January 1, 2009” for “January 1, 2007” and “December 31, 2008” for “December 31, 2006”. ## § 954: Foreign base company income - § 954(c)(6): Pub. L. 109–222, § 103(b)(1), added par.(6). - § 954(h): Pub. L. 109–222, § 103(a)(2), substituted “January 1, 2009” for “January 1, 2007”. ## § 1221: Capital asset defined - § 1221(b)(3): Pub. L. 109–222 added par. (3). Former par. (3) redesignated (4). - § 1221(b)(4): Pub. L. 109–222 redesignated par. (3) as (4). ## § 1355: Definitions and special rules - § 1355(a)(4): Pub. L. 109–222 inserted “(6,000, in the case of taxable years beginning after December 31, 2005, and ending before January 1, 2011)” after “10,000”. ## § 1445: Withholding of tax on dispositions of United States real property interests - § 1445(b)(8): Pub. L. 109–222, § 506(b), added par. (8). - § 1445(e)(6), § 1445(e)(7): Pub. L. 109–222, § 505(b), added par. (6) and redesignated former par. (6) as (7). ## § 3402: Income tax collected at source - § 3402(t): Pub. L. 109–222 added subsec. (t). ## § 4965: Excise tax on certain tax-exempt entities entering into prohibited tax shelter transactions - Enacted 26 U.S.C. § 4965. ## § 6011: General requirement of return, statement, or list - § 6011(g), § 6011(h): Pub. L. 109–222 added subsec. (g) and redesignated former subsec. (g) as (h). ## § 6033: Returns by exempt organizations - § 6033(a)(1): Pub. L. 109–222, § 516(b)(1)(B), substituted “paragraph (3)” for “paragraph (2)”. - § 6033(a)(2): Pub. L. 109–222, § 516(b)(1)(A), added par. (2). Former par. (2) redesignated (3). - § 6033(a)(3): Pub. L. 109–222, § 516(b)(1)(A), redesignated par. (2) as (3). ## § 6049: Returns regarding payments of interest - § 6049(b)(2)(B): Pub. L. 109–222, § 502(a), redesignated subpar. (C) as (B) and struck out former subpar. (B) which read as follows: “interest on any obligation if such interest is exempt from tax under section 103(a) or if such interest is exempt from tax (without regard to the identity of the holder) under any other provision of this title,”. - § 6049(b)(2)(C): Pub. L. 109–222 redesignated subpar. (D) as (C) and substituted “subparagraph (B)” for “subparagraph (C)”. - § 6049(b)(2): Pub. L. 109–222, § 502(a), redesignated subpar. (D) as (C). ## § 6159: Agreements for payment of tax liability in installments - § 6159(f): Pub. L. 109–222 substituted “section 7122(e)” for “section 7122(d)”. ## § 6652: Failure to file certain information returns, registration statements, etc. - § 6652(c)(1): Pub. L. 109–222, § 516(c)(2), substituted “6033(a)(1)” for “6033” wherever appearing in heading and text. - § 6652(c)(3), § 6652(c)(4), § 6652(c)(5): Pub. L. 109–222, § 516(c)(1), added par. (3) and redesignated former pars. (3) and (4) as (4) and (5), respectively. ## § 7122: Compromises - § 7122(c): Pub. L. 109–222, § 509(a), added subsec. (c). Former subsec. (c) redesignated (d). - § 7122(d): Pub. L. 109–222, § 509(a), redesignated subsec. (c) as (d). Former subsec. (d) redesignated (e). - § 7122(d)(3)(C): Pub. L. 109–222, § 509(b)(1), added subpar. (C). - § 7122(e): Pub. L. 109–222, § 509(a), redesignated subsec. (d) as (e). - § 7122(f): Pub. L. 109–222, § 509(b)(2), added subsec. (f) relating to deemed acceptance of offer not rejected within certain period. ## § 7872: Treatment of loans with below-market interest rates - § 7872(g)(6): Pub. L. 109–222, § 209(b)(1), added par. (6). - § 7872(h): Pub. L. 109–222, § 209(a), added subsec. (h). Former subsec. (h) redesignated (i). - § 7872(i): Pub. L. 109–222, § 209(a), redesignated subsec. (h) as (i).