# Pub. L. 97-34: changes to the Internal Revenue Code 1981-08-13, 95 Stat. 176. Source: . ## Legislative history - Bill: [H.R. 4242](https://www.congress.gov/bill/97th-congress/house-bill/4242) - Bluebook: [JCS-71-81 (1981)](https://www.jct.gov/publications/1981/jcs-71-81/) ## § 1: Tax imposed - § 1(a), § 1(b), § 1(c), § 1(d), § 1(e): Pub. L. 97–34, § 101(a), generally revised tax tables downward providing for cumulative across-the-board reductions of 23 percent on a three phase schedule under which different new rates were set for taxable years beginning in 1982, for taxable years beginning in 1983, and for taxable years beginning after 1983. - § 1(f): Pub. L. 97–34, § 104(a), added subsec. (f). ## § 3: Tax tables for individuals - § 3(a)(1): Pub. L. 97–34, § 101(b)(2)(B), inserted “and which shall be in such form as he determines appropriate” after “Secretary”. - § 3(a): Pub. L. 97–34, § 121(c)(3), substituted “reduced by the sum of (i) the excess itemized deductions, and (ii) the direct charitable deduction” for “reduced by the excess itemized deductions”. - § 3(a): Pub. L. 97–34, § 101(b)(2)(C), added par. (5). - § 3(b)(1): Pub. L. 97–34, § 101(c)(2)(A), substituted “an individual to whom section 1301 (relating to income averaging) applies for the taxable year” for “an individual to whom (A) section 1301 (relating to income averaging), or (B) section 1348 (relating to maximum rate on personal service income), applies for the taxable year”. ## § 11: Tax imposed - § 11(b): Pub. L. 97–34, § 231(a)(1), substituted “15 percent (16 percent for taxable years beginning in 1982)” for “17 percent”. - § 11(b): Pub. L. 97–34, § 231(a)(2), substituted “18 percent (19 percent for taxable years beginning in 1982)” for “20 percent”. ## § 15: Effect of changes - § 15(d): Pub. L. 97–34 substituted provisions that this section shall not apply to any change in rates under section 1 attributable to the amendments made by section 101 of the Economic Recovery Tax Act of 1981 or subsec. (f) of section 1 for provisions that had related to the changes made by section 303(b) of the Tax Reduction Act of 1975 in the surtax exemption. - § 15(e), § 15(f): Pub. L. 97–34 struck out subsecs. (e) and (f) which had related, respectively, to changes made by the Tax Reduction and Simplification Act of 1977 and to changes made by Revenue Act of 1978. ## § 21: Expenses for household and dependent care services necessary for gainful employment - § 21(a): Pub. L. 97–34, § 124(a), designated existing provisions as par. (1), substituted “the applicable percentage” for “20 percent” in par. (1) as so designated, and added par. (2). - § 21(c)(2): Pub. L. 97–34, § 124(c), designated existing provisions as cl. (i) and added cl. (ii). - § 21(c)(2): Pub. L. 97–34, § 124(d), added subpars. (C) and (D). - § 21(d)(1): Pub. L. 97–34, § 124(b)(1)(A), substituted “$2,400” for “$2,000”. - § 21(d)(2): Pub. L. 97–34, § 124(b)(1)(B), substituted “$4,800” for “$4,000”. - § 21(e)(2): Pub. L. 97–34, § 124(b)(2)(A), substituted “$200” for “$166”. - § 21(e)(2): Pub. L. 97–34, § 124(b)(2)(B), substituted “$400” for “$333”. ## § 22: Credit for the elderly and the permanently and totally disabled - § 22(e): Pub. L. 97–34 substituted “section 911(d)(2)” for “section 911(b)”. ## § 32: Earned income - § 32(c)(1)(C): Pub. L. 97–34 struck out reference to section 913 in heading, substituted “relating to citizens or residents of the United States living abroad” for “relating to income earned by individuals in certain camps outside the United States” in cl. (i), struck out cl. (ii) which made reference to section 913, and redesignated cl. (iii) as (ii). ## § 40: Alcohol, etc., used as fuel - § 40(e)(2): Pub. L. 97–34 substituted “15” for “7” in two places, and “14” for “6” in one place. ## § 41: Credit for increasing research activities - Enacted 26 U.S.C. § 41. ## § 45K: Credit for producing fuel from a nonconventional source - § 45K(e): Pub. L. 97–34 substituted provisions respecting application with the Natural Gas Policy Act of 1978 for prior provision reading “If the taxpayer makes an election under section 107(d) of the Natural Gas Policy Act of 1978 to have subsections (a) and (b) of section 107 of that Act, and subtitle B of title I of that Act, apply with respect to gas described in subsection (c)(1)(B)(i) produced from any well on a property, then the credit allowable by subsection (a) shall not be allowed with respect to any gas produced on that property.” ## § 46: Amount of credit - § 46: Pub. L. 97–34, § 212(a)(1), added cl. (iv). - § 46: Pub. L. 97–34, § 332(a), substituted “December 31, 1982” for “December 31, 1983” in cls. (i) and (ii) and added cl. (iii). - § 46: Pub. L. 97–34, § 212(a)(2), added subpar. (F). - § 46: Pub. L. 97–34, § 207(c)(1), inserted provision after subpar. (D) directing that, in the case of an unused credit for an unused credit year ending after Dec. 31, 1973, this paragraph be applied by substituting “15” for “7” in subpar. (B) and by substituting “18” for “10” and “17” for “9” in second sentence. - § 46: Pub. L. 97–34, § 211(e)(1), inserted references in provisions preceding table to exceptions provided in paragraphs (3), (6), and (7). - § 46: Pub. L. 97–34, § 211(e)(2), substituted “Notwithstanding paragraph (2) or (3)” for “Notwithstanding paragraph (2)” and inserted “or which is recovery property (within the meaning of section 168),” after “3 years or more,”. - § 46: Pub. L. 97–34, § 211(a)(1), added par. (7). - § 46: Pub. L. 97–34, § 211(f)(1), added par. (8). - § 46: Pub. L. 97–34, § 302(c)(3), (d)(1), provided that, applicable to taxable years beginning after Dec. 31, 1984, subsection (c)(8)(D)(i)(I) of this section (relating to limitation to amount at risk) is amended by striking out “clause (i), (ii), or (iii) of subparagraph (A) or subparagraph (B) of section 128(c)(2)” and inserting in lieu thereof “subparagraph (A) or (B) of section 128(c)(1)”. Section 16(a) of Pub. L. 98–369, repealed section 302(c) of Pub. L. 97–34, and provided that this title shall be applied and administered as if section 302(c), and the amendments made by section 302(c), had not been enacted. - § 46: Pub. L. 97–34, § 211(f)(1), added par. (9). - § 46: Pub. L. 97–34, § 211(b)(1), designated existing provisions as subpar. (A), substituted “an amount equal to the aggregate of the applicable percentage of each qualified progress expenditure for the taxable year” for “an amount equal to his aggregate qualified progress expenditures for the taxable year” in subpar. (A) as so designated, and added subpar. (B). - § 46: Pub. L. 97–34, § 211(b)(2), struck out “having a useful life of 7 years or more” after “it is reasonable to believe will be new section 38 property”. - § 46: Pub. L. 97–34, § 211(d), in provisions following subpar. (B), inserted provision that, for purposes of subpar. (B), in the case of any recovery property (within the meaning of section 168), the useful life be the present class life for such property (as defined in section 168(g)(2)). ## § 47: Rehabilitation credit - § 47(a): Pub. L. 97–34, § 211(g)(2)(A), inserted provisions relating to disposition, cessation, or change in expected use described in paragraph (5). - § 47(a): Pub. L. 97–34, § 211(g)(1), (2)(B), added par. (5), redesignated former par. (5) as (6) and substituted “paragraph (1), (3), or (5)” for “paragraph (1) or (3)”. Former par. (6) redesignated (7). - § 47(a): Pub. L. 97–34, § 211(g)(1), (2)(C), redesignated former par. (6) as (7), substituted “paragraph (6)” for “paragraph (5)”, and redesignated former par. (7) as (8). - § 47(d): Pub. L. 97–34, § 211(f)(2), added subsec. (d). ## § 48: Energy credit - § 48(a)(1): Pub. L. 97–34, § 211(e)(4), in provisions following subpar. (G), substituted “Such term includes only recovery property (within the meaning of section 168 without regard to any useful life) and any other property” for “Such term includes only property”. - § 48(a)(1): Pub. L. 97–34, § 211(c), added subpar. (G). - § 48(a)(2)(B): Pub. L. 97–34, § 211(h), designated existing provisions as subcl. (I) and added subcl. (II). - § 48(a)(3)(D): Pub. L. 97–34, § 212(c), added subpar. (D). - § 48(a)(4): Pub. L. 97–34, § 214(a), inserted provision that, if any qualified rehabilitated building is used by the tax-exempt organization pursuant to a lease, this paragraph shall not apply to that portion of the basis of such building which is attributable to qualified rehabilitation expenditures. - § 48(a)(5): Pub. L. 97–34, § 214(b), inserted provision that, if any qualified rehabilitated building is used by the governmental unit pursuant to a lease, this paragraph shall not apply to that portion of the basis of such building which is attributable to qualified rehabilitation expenditures. - § 48(a)(8): Pub. L. 97–34, § 212(d)(2)(A), substituted “or 188” for “188, or 191”. - § 48(a)(9): Pub. L. 97–34, § 211(a)(2), struck out par. (9) which set out a special rule for the depreciation of railroad track. - § 48(c)(2)(A), § 48(c)(2)(B), § 48(c)(2)(C): Pub. L. 97–34, § 213(a), amended subpars. (A) to (C) generally raising in subpar. (A) the existing $100,000 dollar limitation to $125,000 in 1981 and to $150,000 in 1985 and in subpar. (B) the existing $50,000 dollar limitation to $62,500 in 1981 and to $75,000 in 1985. - § 48: Pub. L. 97–34, § 212(b), in amending subsec. (c) generally incorporated the concept of “substantial rehabilitation” into par. (1)(A), substituted “30 years” for “20 years” as the requisite period in par. (1)(B), substituted a definition of “substantially rehabilitated” for former provisions that a major portion could be treated as a separate building in certain cases in par. (1)(C), reenacted par. (1)(D) without change, substituted “December 31, 1981” for “October 31, 1978” in provisions of par. (2)(A) preceding cl. (i), substituted provisions for a recovery period of 15 years for provisions that had provided for a useful life of 5 years or more in cl. (i) of par. (2)(A), reenacted cl. (ii) without change, substituted provisions that accelerated methods of depreciation may not be used for provisions relating to property otherwise section 38 property in cl. (i) of par. (2)(B), reenacted cls. (ii) and (iii) without change, revised the provisions of cl. (iv) relating to certified historic structures, and added cl. (v) relating to expenditures of lessees, added par. (3), redesignated former par. (3) as (4), and added par. (5). - § 48: Pub. L. 97–34, § 211(e)(3), inserted “or which is recovery property (within the meaning of section 168)” after “3 years or more”. - § 48: Pub. L. 97–34, § 332(b), substituted “which does not exceed” for “equal to”. - § 48: Pub. L. 97–34, § 212(a)(3), added par. (8). ## § 51: Amount of credit - § 51(c)(3), § 51(c)(4): Pub. L. 97–34, § 261(b)(2)(B)(ii), redesignated par. (4) as (3). Former par. (3), which excluded from term “wages” any amount paid or incurred by the employer to an individual with respect to whom the employer claims credit under section 40 of this title, was struck out. - § 51(c)(3), § 51(c)(4): Pub. L. 97–34, § 261(a), extended termination date to Dec. 31, 1982, from Dec. 31, 1981, and inserted “to an individual who begins work for the employer” after “paid or incurred”. - § 51(d)(1)(H), § 51(d)(1)(I): Pub. L. 97–34, § 261(b)(1), added subpars. (H) and (I). - § 51(d)(3)(A)(ii): Pub. L. 97–34, § 261(b)(2)(B)(iii), substituted “paragraph (11)” for “paragraph (9)”. - § 51(d)(4): Pub. L. 97–34, § 261(b)(2)(B)(iii), (3), in subpar. (B) inserted “and” after “States,” in subpar. (C) substituted “paragraph (11)” for “paragraph (9)”, and struck out “(D) not having attained the age of 35 on the hiring date.” - § 51(d)(7)(B): Pub. L. 97–34, § 261(b)(2)(B)(iii), substituted “paragraph (11)” for “paragraph (9)”. - § 51(d)(9), § 51(d)(10): Pub. L. 97–34, § 261(b)(2)(A), added pars. (9) and (10) and redesignated former pars. (9) and (10) as (11) and (12), respectively. - § 51(d)(11): Pub. L. 97–34, § 261(b)(2)(A), (c)(2), redesignated former par. (9) as (11), substituted “70 percent or less” for “less than 70 percent”, and provided for validity of any determination for 45-day period beginning on the date the determination is made. Former par. (11) redesignated (13). - § 51(d)(12), § 51(d)(13): Pub. L. 97–34, § 261(b)(2)(A), redesignated former pars. (10) and (11) as pars. (12) and (13), respectively. Former par. (12) redesignated (14). - § 51(d)(14): Pub. L. 97–34, § 261(f)(1)(A), substituted as definition for term “ ‘designated local agency’ means a State employment security agency established in accordance with the Act of June 6, 1933, as amended (29 U.S.C. 49–49n)” for “ ‘designated local agency’ means the agency for any locality designated jointly by the Secretary and the Secretary of Labor to perform certification of employees for employers in that locality”. - § 51(d)(14): Pub. L. 97–34, § 261(b)(2)(A), redesignated former par. (12) as (14). - § 51(d)(15): Pub. L. 97–34, § 261(c)(1), added par. (15). - § 51(e): Pub. L. 97–34, § 261(e)(1), struck out subsec. (e) which set forth limitation that qualified first-year wages could not exceed 30 percent of FUTA wages for all employees. - § 51(f): Pub. L. 97–34, § 261(e)(2), substituted “any taxable year” for “any year” in pars. (1) and (2) and struck out par. (3), defining “year” which is covered in pars. (1) and (2). - § 51(g): Pub. L. 97–34, § 261(f)(1)(B), substituted “United States Employment Service” for “Secretary of Labor” in heading and text. - § 51(i): Pub. L. 97–34, § 261(d), added subsec. (i). ## § 62: Adjusted gross income defined - § 62: Pub. L. 97–34, § 311(h)(1), struck out “and the deduction allowed by section 220 (relating to retirement savings for certain married individuals)” after “retirement savings”. - § 62: Pub. L. 97–34, § 112(b)(2), redesignated par. (15) as (14). Former par. (14), relating to deduction for certain expenses of living abroad, was struck out. - § 62: Pub. L. 97–34, § 112(b)(2), redesignated par. (16) as (15). Former par. (15) redesignated (14). - § 62: Pub. L. 97–34, §§ 103(b), 112(b)(2), added par. (16). Former par. (16) redesignated (15). ## § 63: Taxable income defined - § 63(b)(1): Pub. L. 97–34, § 121(b)(1), added subpar. (C). - § 63(d): Pub. L. 97–34, § 104(b), substituted a blanket reference to individuals to whom subsection (a), (b), (c), or (d) of section 1 applies and the maximum amount of taxable income on which no tax is imposed by the applicable subsection of section 1 for provisions specifically referring to amounts of $3,400 in the case of (A) a joint return under section 6013, or (B) a surviving spouse (as defined in section 2(a)), $2,300 in the case of an individual who is not married and who is not a surviving spouse (as so defined), and $1,700 in the case of a married individual filing a separate return. - § 63(e)(2): Pub. L. 97–34, § 111(b)(4), substituted “section 911(d)(2)” for “section 911(b)” in provisions following subpar. (B). - § 63(f)(3): Pub. L. 97–34, § 121(c)(2), added par. (3). - § 63: Pub. L. 97–34, § 121(b)(2), added subsec. (i). ## § 72: Annuities; certain proceeds of endowment and life insurance contracts - § 72(m)(6): Pub. L. 97–34, § 312(d)(1), expanded definition of “owner-employee” to include an employee within the meaning of section 401(c)(1) except in applying paragraph (5). - § 72(m)(8): Pub. L. 97–34, § 312(d)(2), added par. (8). - § 72(m)(9): Pub. L. 97–34, § 312(e)(1), added par. (9). - § 72(o), § 72(p): Pub. L. 97–34, § 311(b)(1), added subsec. (o) and redesignated former subsec. (o) as (p). ## § 83: Property transferred in connection with performance of services - § 83(c)(3): Pub. L. 97–34 added par. (3). ## § 85: Unemployment compensation - § 85(a): Pub. L. 97–34 substituted “this section, section 105(d), and section 221” for “this section and without regard to section 105(d)” in parenthetical provision preceding par. (1). ## § 103: Interest on State and local bonds - § 103(b): Pub. L. 97–34, § 811(a), added subpar. (I). - § 103(b): Pub. L. 97–34, § 811(b), added par. (9) and redesignated former par. (9) as (10). - § 103: Pub. L. 97–34, § 812(a), added subsec. (i) and redesignated former subsec. (i) as (j). ## § 105: Amounts received under accident and health plans - § 105(d): Pub. L. 97–34, § 103(c)(2), substituted “this subsection and section 221” for “this subsection” in parenthetical provision. - § 105(h)(3)(B)(v): Pub. L. 97–34, § 111(b)(4), substituted “section 911(d)(2)” for “section 911(b)”. ## § 119: Meals or lodging furnished for the convenience of the employer - § 119(c): Pub. L. 97–34 added subsec. (c). ## § 121: Exclusion of gain from sale of principal residence - § 121(b)(1): Pub. L. 97–34 substituted “$125,000 ($62,500” for “$100,000 ($50,000”. ## § 129: Dependent care assistance programs - Enacted 26 U.S.C. § 129. ## § 140: Cross references to other Acts - § 140: Pub. L. 97–34 successively renumbered sections 128 and 129 of this title as this section. ## § 151: Allowance of deductions for personal exemptions - § 151(b), § 151(c), § 151(d)(1), § 151(d)(2), § 151(e): Pub. L. 97–34, § 104(c)(1), substituted “the exemption amount” for “$1,000” wherever appearing. - § 151: Pub. L. 97–34, § 104(c)(2), added subsec. (f). ## § 162: Trade or business expenses - § 162(h): Pub. L. 97–34 added subsec. (h) relating to State legislators’ travel expenses away from home. Former subsec. (h), relating to cross references, redesignated (i). See 1982 Amendment note above. - § 162(i): Pub. L. 97–34 redesignated former subsec. (h), relating to cross references, as (i). See 1982 Amendment note above. ## § 167: Depreciation - § 167(a): Pub. L. 97–34, § 203(a), inserted provision that, in the case of recovery property (within the meaning of section 168), the deduction allowable under section 168 shall be deemed to constitute the reasonable allowance provided by this section, except with respect to that portion of the basis of such property to which subsection (k) applies. - § 167(d): Pub. L. 97–34, § 203(d), provided that subsec. (d) did not apply with respect to recovery property defined in section 168. - § 167: Pub. L. 97–34, § 264(a), substituted “Except as provided in subparagraph (B), the aggregate amount” for “The aggregate amount” in subpar. (A), added subpar. (B), and redesignated former subpar. (B) as (C). - § 167: Pub. L. 97–34, § 209(d)(3), inserted “and which is placed in service before January 1, 1981” after “pre-1970 public utility property”. - § 167: Pub. L. 97–34, § 203(b), added par. (4). - § 167: Pub. L. 97–34, § 212(d)(1), struck out subsec. (n) which dealt with the use of the straight line method of depreciation in certain cases, and subsec. (o) which dealt with the method of depreciation to be used in the case of substantially rehabilitated historic property. - § 167: Pub. L. 97–34, § 203(c)(1), redesignated subsec. (s) as (r). Former subsec. (r), relating to the retirement-replacement-betterment method of calculating depreciation, was struck out. - § 167: Pub. L. 97–34, § 203(c)(1), redesignated subsec. (s) as (r). ## § 168: Accelerated cost recovery system - Enacted 26 U.S.C. § 168. ## § 170: Charitable, etc., contributions and gifts - § 170(b)(2): Pub. L. 97–34, § 263(a), increased to 10 from 5 percent deduction allowable to a corporation in any taxable year for charitable contributions. - § 170(e)(4): Pub. L. 97–34, § 222(a), added par. (4). - § 170(i): Pub. L. 97–34, § 121(a), added subsec. (i). Former subsec. (i) redesignated (j). - § 170(j), § 170(k): Pub. L. 97–34, § 121(a), redesignated former subsecs. (i) and (j) as (j) and (k), respectively. ## § 172: Net operating loss deduction - § 172(b)(1)(B): Pub. L. 97–34, § 207(a)(1), substituted “15 taxable years” for “7 taxable years”. - § 172(b)(1)(C): Pub. L. 97–34, § 207(a)(2)(A), substituted “ending after December 31, 1955, and before January 1, 1976, shall” for “ending after December 31, 1955, shall” and struck out provision that, for any taxable year ending after Dec. 31, 1975, the preceding sentence was to be applied by substituting “9 taxable years” for “7 taxable years”. - § 172(b)(1): Pub. L. 97–34, § 207(a)(2)(B)(i), substituted “15” for “8”. - § 172(b)(1): Pub. L. 97–34, § 207(a)(2)(B)(ii), struck out designation subclause “(I)” for provisions prohibiting a loss carryback to any taxable year which is a REIT year and struck out provision formerly designated as subclause (II) directing that the number of taxable years to which a loss could be a net operating loss carryover under subparagraph (B) be increased (to a number not greater than 8) by the number of taxable years to which such loss could not be a net operating loss carryback by reason of subclause (I). - § 172(g): Pub. L. 97–34, § 207(a)(2)(C), struck out subpar. (C) which provided that, in the case of a net operating loss carryover from a loss year ending after Dec. 31, 1975, subpars. (A) and (B) were to be applied by substituting “8th taxable year” for “6th taxable year” and “9th taxable year” for “7th taxable year”. ## § 179: Election to expense certain depreciable business assets - § 179: Pub. L. 97–34 amended section generally, changing its content from provisions that formerly made available an additional first-year depreciation allowance for small businesses to provisions allowing a taxpayer to elect to treat the cost of section 179 property as an expense which is not chargeable to capital account, with any cost so treated to be allowed as a deduction for the taxable year in which the section 179 property is placed in service. ## § 219: Retirement savings - § 219(a): Pub. L. 97–34, § 311(a), amended subsec. (a) generally, substituting in heading “Allowance of deduction” for “Deduction allowed” and in text “shall be allowed” for “is allowed”, allowed as a deduction an amount equal to the qualified retirement contributions of the individual for the taxable year, eliminated part of first sentence for allowance as a deduction amounts paid in cash for the taxable year by or on behalf of the individual for his benefit—(1) to an individual retirement annuity described in section 408(a), (2) for an individual retirement annuity described in section 408(b), or (3) for a retirement bond described in section 409 (but only if the bond is not redeemed within 12 months of the date of its issuance), covered in subsec. (e)(1) and (5) of this section, and eliminated second sentence respecting employer payments, covered in subsec. (f)(5) of this section. - § 219(b): Pub. L. 97–34, § 311(a), in heading substituted “Maximum amount of deduction” for “Limitations and restrictions”. - § 219(b)(1): Pub. L. 97–34, § 311(a), amended par. (1) generally, substituting “In general” for “Maximum deduction” in heading and in text provision for allowance of a deduction not to exceed the lesser of (A) $2,000, or (B) an amount equal to the compensation includible in the individual’s gross income for such taxable year, for provision for an amount not to exceed amount equal to 15 percent of the compensation includible in gross income for the taxable year, or $1,500, whichever is less. - § 219(b)(2): Pub. L. 97–34, § 312(c)(1), substituted “$15,000” for “$7,500”. - § 219(b)(2): Pub. L. 97–34, § 311(a), redesignated par. (7) as (2), substituted in heading “rules for employer contributions under” for “rules in case of”, substituted in subpar. (A) introductory text “an employee shall be allowed as a deduction under subsection (a) (in addition to the amount allowable under paragraph (1) an amount equal to the lesser of” for “the limitation under paragraph (1) shall be the lesser of”, inserted in subpar. (A)(i) “from such employer” before “includible” and substituted therein “without regard” for “with regard”, substituted in subpar. (A)(ii) “the amount contributed by such employer to the simplified employee pension and included in gross income (but not in excess of $7,500” for “the sum of—(I) the amount contributed by the employer to the simplified employee pension and included in gross income (but not in excess of $7,500), and (II) $1,500, reduced (but not below zero) by the amount described in subclause (I)”, and substituted in subpar. (B) “Paragraph (1) of this subsection and paragraph (1) of subsection (d)” for “Paragraphs (2) and (3)”. Former subsec. (b)(2) provisions which disallowed any deduction under subsec. (a) for an individual for the taxable year if for any part of such year (A) he was an active participant in (i) a plan described in section 401(a), (ii) an annuity plan described in section 403(a), (iii) a qualified bond purchase plan described in section 405(a), or (iv) a plan established for its employees by the United States, by a State or political subdivision thereof, or by an agency or instrumentality of any of the foregoing, or (B) amounts were contributed by his employer for an annuity contract described in section 403(b), are now covered by subsec. (e)(3) and (4) of this section. - § 219(b)(3), § 219(b)(4), § 219(b)(5): Pub. L. 97–34, § 311(a), added pars. (3) and (4). Former pars. (3) to (5) redesignated subsec. (d)(1) to (3). - § 219(b): Pub. L. 97–34, § 311(a), struck out par. (6) which set forth alternative deduction provisions which disallowed a deduction for the taxable year if the individual claimed the deduction allowed by section 220 for the taxable year. - § 219(b): Pub. L. 97–34, § 311(a), redesignated par. (7) as (2). - § 219(c): Pub. L. 97–34, § 311(a), added subsec. (c). Former subsec. (c)(1) to (3) and (5) redesignated subsec. (f)(1), (2), (3)(A), and (6). Former subsec. (c)(4), which provided for participation in governmental plans by certain individuals, with subpars. (A) and (B) covering members of reserve components and volunteer firefighters, was struck out. - § 219(d): Pub. L. 97–34, § 311(a), in heading redesignated former subsec. (b) heading as subsec. (d) heading and inserted “Other” before “limitations”. - § 219(d)(1): Pub. L. 97–34, § 311(a), redesignated former subsec. (b)(3) as par. (1), substituted as heading “Individuals who have attained age 70½” for “Contributions after age 70½” and in text “shall be allowed under this section” for “is allowed under subsection (a)”, “qualified retirement contribution” for “payment described in subsection (a)”, and “made for a taxable year of an individual if such individual has attained” for “made during the taxable year of an individual who has attained”. - § 219(d)(2): Pub. L. 97–34, § 313(b)(2), inserted reference to section 405(d)(3). - § 219(d)(2): Pub. L. 97–34, § 311(a), redesignated former subsec. (b)(4) as par. (2) and substituted “shall be allowed” for “is allowed”. - § 219(d)(3): Pub. L. 97–34, § 311(a), redesignated former subsec. (b)(5) as par. (3) and, as so redesignated, substituted “shall be allowed under this section” for “is allowed under subsection (a)” and “year which is properly allocable” for “year properly allocable”. - § 219(e): Pub. L. 97–34, § 311(a), added subsec. (e) incorporating former provisions of subsecs. (a) and (b)(2) as pars. (1), and (3) and (4) and, among other changes, inserted provisions relating to a qualified employee pension. - § 219(f)(1): Pub. L. 97–34, § 311(a), redesignated former subsec. (c)(1) as par. (1). - § 219(f)(2): Pub. L. 97–34, § 311(a), redesignated former subsec. (c)(2) as par. (2) and, as so redesignated, substituted “deduction under subsections (b) and (c)” for “deduction under subsection (b)(1)”, and struck out provision that for purposes of this section, the determination of whether an individual is married shall be made in accordance with the provisions of section 143(a). - § 219(f)(3): Pub. L. 97–34, § 311(a), redesignated former subsec. (c)(3) as subpar. (A) and, as so redesignated, added subpar. (A) heading “Individual retirement plans”, and “to an individual retirement plan” before “on the last day” in text, and added subpar. (B). - § 219(f)(4): Pub. L. 97–34, § 311(a), added par. (4). - § 219(f)(5): Pub. L. 97–34, § 311(a), redesignated former provisions of subsec. (a) as par. (5), added par. (5) heading “Employer payments”, substituted “to an individual retirement plan shall be treated as payment of compensation to the employee” for “to such a retirement account, or for such a retirement annuity or retirement bond constitutes payment of compensation to the employee”, and “in the taxable year for which the amount was contributed” after “gross income”, and struck out “after the application of subsection (b)” after “under this section to the employee”. - § 219(f)(6): Pub. L. 97–34, § 311(a), redesignated former subsec. (c)(5) as par. (6), inserted “for contributions to an individual retirement plan” after “under this section” in subpar. (A), and struck out in subpar. (C) “or section 220” after “under this section”. - § 219(g): Pub. L. 97–34, § 311(a), added subsec. (g). ## § 226: Cross reference - § 226: Pub. L. 97–34 successively renumbered sections 221 and 222 of this title as this section. ## § 243: Dividends received by corporations - § 243(b)(3)(C): Pub. L. 97–34 struck out “$150,000” before “minimum accumulated earnings credit”. ## § 263: Capital expenditures - § 263(a)(1)(H): Pub. L. 97–34, § 202(d)(1), added subpar. (H). - § 263(e): Pub. L. 97–34, § 201(c), struck out subsec. (e) which related to the allowance of repair expenses or specified repair, rehabilitation, or improvement expenditures. - § 263(g): Pub. L. 97–34, § 502, added subsec. (g). ## § 265: Expenses and interest relating to tax-exempt income - § 265: Pub. L. 97–34, § 302(c)(2), (d)(1), provided that, applicable to taxable years beginning after Dec. 31, 1984, par. (2) is amended by striking out “or to purchase or carry any certificate to the extent the interest on such certificate is excludable under section 128” and inserting in lieu thereof “or to purchase or carry obligations or shares, or to make other deposits or investments, the interest on which is described in section 128(c)(1) to the extent such interest is excludable from gross income under section 128”. Section 16(a) of Pub. L. 98–369, repealed section 302(c) of Pub. L. 97–34, and provided that this title shall be applied and administered as if section 302(c), and the amendments made by such section 302(c), had not been enacted. - § 265: Pub. L. 97–34, § 301(b)(2), inserted “, or to purchase or carry any certificate to the extent the interest on such certificate is excludable under section 128” after “116”. ## § 274: Disallowance of certain entertainment, etc., expenses - § 274(b)(1): Pub. L. 97–34, § 265(a), excluded from term “gift” an award for productivity, designated existing provisions as cl. (i), and as so designated, increased the limitation to $400 from $100, and added cl. (ii). - § 274(b): Pub. L. 97–34, § 265(b), added par. (3). ## § 280B: Demolition of structures - § 280B: Pub. L. 97–34, § 212(d)(2)(C)(i), substituted “48(g)(3)(A)” for “section 191(d)(1)” in provisions preceding par. (1). - § 280B: Pub. L. 97–34, § 212(d)(2)(C)(ii), substituted “section 48(g)(3)(B)” for “section 191(d)(2)”. ## § 303: Distributions in redemption of stock to pay death taxes - § 303(b)(1)(C): Pub. L. 97–34, § 422(e)(1), struck out “or 6166A” after “section 6166” in two places. - § 303(b)(2)(A): Pub. L. 97–34, § 422(b)(1), substituted “35” for “50” before percent. - § 303(b)(2)(B): Pub. L. 97–34, § 422(b)(2), in heading, substituted “stock in 2” for “stock of two”, in first sentence, struck out “the 50 percent requirement” before “of subparagraph (A)” and substituted “2” for “two” and “20 percent or more in value” for “more than 75 percent in value”, and, in last sentence, substituted “For purposes of the 20-percent requirement” for “For the purpose of the 75 percent requirement” and, in determining value of decedent’s gross estate, treated the estate as including stock which at decedent’s death represented surviving spouse’s interest in property held by the decedent and surviving spouse either as joint tenants, tenants by the entirety, or tenants in common. ## § 305: Distributions of stock and stock rights - § 305(d)(1): Pub. L. 97–34, § 321(b), inserted “(other than subsection (e))” after “this section”. - § 305(e), § 305(f): Pub. L. 97–34, § 321(a), added subsec. (e) and redesignated former subsec. (e) as (f). ## § 312: Effect on earnings and profits - § 312(k)(3), § 312(k)(4): Pub. L. 97–34 added par. (3), redesignated former par. (3) as (4) substituted “The provisions of paragraphs (1) and (3)” for “The provisions of paragraph (1)”, and inserted provision that the rules of section 168(f)(2) shall apply in determining the earnings and profits of the corporation in the case of recovery property (within the meaning of section 168). ## § 368: Definitions relating to corporate reorganizations - § 368(a)(3)(D): Pub. L. 97–34 substituted “Agency proceedings” for “Agency receivership proceedings” in heading, incorporated existing provisions in text designated cl. (i), inserted in cl. (i)(II) definition for term “title 11 or similar case”, and added cls. (ii) and (iii). ## § 381: Carryovers in certain corporate acquisitions - § 381(c): Pub. L. 97–34, § 208, added par. (28) relating to recovery allowance for recovery property. - § 381(c): Pub. L. 97–34, § 221(b)(1)(B), added par. (28) relating to credit under section 44F. - § 381(c): Pub. L. 97–34, § 331(d)(1)(B), added par. (29). ## § 382: Limitation on net operating loss carryforwards and certain built-in losses following ownership change - § 382(b): Pub. L. 97–34 designated existing provisions as subpar. (A) and added subpar. (B). ## § 383: Special limitations on certain excess credits, etc. - § 383: Pub. L. 97–34, § 331(d)(1)(C)(ii), (D)(ii), in catchlines of sections 383, as related to section 382(a) of this title, before and after amendment by Pub. L. 94–455, § 806(f)(2), inserted reference to employee stock ownership credits. - § 383: Pub. L. 97–34, § 331(d)(1)(D)(i), in section 383, as in effect prior to amendment by Pub. L. 94–455, § 806(f)(2), as related to section 382(a) of this title, inserted “to any unused credit of the corporation which could otherwise be carried forward under section 44G(b)(2),”. - § 383: Pub. L. 97–34, § 331(d)(1)(C)(i), in section 383, as amended by Pub. L. 94–455, § 806(f)(2), as related to section 382(a) of this title, inserted “to any unused credit of the corporation under section 44G(b)(2),”. - § 383: Pub. L. 97–34, § 221(b)(1)(C)(ii), (D)(ii), in catchlines of sections 383, as related to section 382(a) of this title, before and after amendment by Pub. L. 94–455, § 806(f)(2), inserted reference to research credits. - § 383: Pub. L. 97–34, § 221(b)(1)(D)(i), in section 383, as in effect prior to amendment by Pub. L. 94–455, § 806(f)(2), as related to section 382(a) of this title, inserted “to any unused credit of the corporation which could otherwise be carried forward under section 44F(g)(2),” after “section 44E(e)(2),”. - § 383: Pub. L. 97–34, § 221(b)(1)(C)(i), in section 383, as amended by Pub. L. 94–455, § 806(f)(2), as related to section 382(a) of this title, inserted “to any unused credit of the corporation under section 44F(g)(2),” after “section 44E(e)(2),”. ## § 401: Qualified pension, profit-sharing, and stock bonus plans - § 401(a)(17): Pub. L. 97–34, § 312(b)(1), designated provision relating to the annual compensation of each employee as subpar. (A), and in subpar. (A) as so designated, substituted “$200,000” for “$100,000”, and added subpar. (B). - § 401(a)(22): Pub. L. 97–34, § 338(a), inserted “(other than a profit-sharing plan)” and substituted “if” for “If” and “such plan” for “said plan”. - § 401(a)(23): Pub. L. 97–34, § 335, substituted “409A(h), except that in applying section 409A(h) for purposes of this paragraph, the term ‘employer securities’ shall include any securities of the employer held by the plan” for “409A(h)(2)”. - § 401(d): Pub. L. 97–34, § 312(e)(2), inserted provision making subpar. (B) inapplicable to any distribution to which section 72(m)(9) applies. - § 401(d): Pub. L. 97–34, § 314(a)(1), inserted provision making subpar. (C) inapplicable to a distribution on account of the termination of the plan. - § 401(e): Pub. L. 97–34, § 312(c)(2), substituted “for such taxable year exceeds $15,000” for “for all such years exceeds $7,500”. - § 401(j): Pub. L. 97–34, § 312(c)(3), (4), substituted in par. (2)(A) “$100,000” for “$50,000” and in par. (3) inserted provision that for purposes of this paragraph, a change in the annual compensation taken into account under subpar. (A) of subsec. (j)(2) be treated as beginning a new period of plan participation. ## § 402: Taxability of beneficiary of employees’ trust - § 402(a): Pub. L. 97–34, § 311(c)(1), inserted “(other than deductible employee contributions within the meaning of section 72(o)(5))”. - § 402(a): Pub. L. 97–34, § 314(c)(1), struck out “or made available” after “distributed” in three places. - § 402(a): Pub. L. 97–34, § 311(b)(3)(A), inserted “(other than accumulated deductible employee contributions within the meaning of section 72(o)(5))” after “contributions” in subpar. (B) and added subcl. (III) in subpar. (D). - § 402(e)(4): Pub. L. 97–34, § 311(b)(2), (c)(2), added to subpar. (A) provision that for purposes of sections 402 and 403, the balance to the credit of the employee does not include the accumulated deductible employee contributions under the plan (within the meaning of section 72(o)(5)), and added subpar. (J) provision making subpar. (J) inapplicable to distributions of accumulated deductible employee contributions (within the meaning of section 77(o)(5)). See 1983 Amendment note above. ## § 403: Taxation of employee annuities - § 403(b)(8)(B): Pub. L. 97–34 inserted “, or 1 or more distributions of accumulated deductible employee contributions (within the meaning of section 72(o)(5))” after “subsection (a)”. ## § 404: Deduction for contributions of an employer to an employees’ trust or annuity plan and compensation under a deferred-payment plan - § 404(a)(10): Pub. L. 97–34, § 333(a), added par. (10). - § 404(e): Pub. L. 97–34, § 312(a), substituted in pars. (1) and (2)(A) “$15,000” for “$7,500”. - § 404(i): Pub. L. 97–34, § 331(b), added subsec. (i). ## § 408: Individual retirement accounts - § 408(a)(1): Pub. L. 97–34, § 313(b)(2), inserted reference to section 405(d)(3). - § 408(a)(1): Pub. L. 97–34, § 311(g)(1)(A), substituted “$2,000” for “$1,500”. - § 408(b): Pub. L. 97–34, § 311(g)(1)(B), substituted in par. (2)(B) and provision following par. (5) “$2,000” for “$1,500”. - § 408(d)(4): Pub. L. 97–34, § 311(h)(2), substituted section “219” for “219 or 220” in provision preceding subpar. (A) and in subpar. (B). - § 408(d)(5)(A): Pub. L. 97–34, § 312(c)(5), substituted “$15,000” for “$7,500”. - § 408(d)(5)(A): Pub. L. 97–34, § 311(g)(2), (h)(2), substituted “$2,250” for “$1,750” and “219” for “219 or 220” in two places. - § 408(j): Pub. L. 97–34, § 312(c)(5), substituted “$15,000” for “$7,500”. - § 408(j): Pub. L. 97–34, § 311(g)(1)(C), substituted “$2,000” for “$1,500”. - § 408(k)(3)(C): Pub. L. 97–34, § 312(b)(2), designated provision relating to compensation bearing a uniform relationship to total compensation as cl. (i), and in cl. (i) as so designated, substituted “$200,000” for “$100,000”, and added cl. (ii). - § 408(m), § 408(n): Pub. L. 97–34, § 314(b)(1), as amended by Pub. L. 97–448, § 103(e)(1), added subsec. (m) and redesignated former subsec. (m) as (n). ## § 409: Qualifications for tax credit employee stock ownership plans - § 409(b): Pub. L. 97–34, § 331(c)(1)(A), (B), inserted in par. (1)(A) reference to section 44G(c)(1)(B), and inserted in par. (4) “or the credit allowed under section 44G (relating to the employee stock ownership credit)” after “basic employee plan credit”. - § 409(d): Pub. L. 97–34, § 337, designated provision relating to death, disability, or separation from service as par. (1) and added pars. (2) and (3). - § 409(g): Pub. L. 97–34, § 331(c)(1)(C), (D), inserted reference to section 44G(c)(1)(B) and inserted “or the credit allowed under section 44G (relating to employee stock ownership credit)” after “employee plan credit”. - § 409(h)(2): Pub. L. 97–34, § 334, substituted “this subsection” for “this section” and inserted provision respecting receipt of distributions in cash where employer’s charter or bylaws restrict ownership of substantially all outstanding employer securities to employees or to a section 401(a) trust where a participant is not permitted to exercise the right described in par. (1)(A). - § 409(h)(3), § 409(h)(4): Pub. L. 97–34, § 336, added pars. (3) and (4). - § 409(i)(1)(A): Pub. L. 97–34, § 331(c)(1)(E), inserted reference to section 44G(c)(1)(B). - § 409(m): Pub. L. 97–34, § 331(c)(1)(F), inserted reference to section 44G(c)(1)(B). - § 409(n)(2), § 409(n)(3): Pub. L. 97–34, § 331(c)(1)(G), (H), inserted “or employee stock ownership credit” after “employee plan credit” in par. (2) and added par. (3). ## § 410: Minimum participation standards - § 410(b)(3)(C): Pub. L. 97–34 substituted “section 911(d)(2)” for “section 911(b)”. ## § 415: Limitations on benefits and contribution under qualified plans - § 415(a)(2): Pub. L. 97–34, § 311(g)(4)(A), struck out in provision preceding subpar. (A) “Except as provided in paragraph (3)”, redesignated former subpar. (E) as (C), and in subpar. (C) as so designated, inserted “described in section 408(k), or”, redesignated former subpar. (F) as (D), struck out former subpars. (C), relating to an individual retirement account described under section 408(a), (D), relating to an individual retirement annuity described in section 408(b), and (G), relating to a retirement bond described in section 409, and in provision following subpar. (D), substituted “such a contract, plan, or pension,” for “such contract, annuity plan, account, annuity, plan, or bond” and “408(k)” for “408(a), 408(b), or 409”. - § 415(a): Pub. L. 97–34, § 311(h)(3), struck out par. (3) which provided that par. (2) not apply to an account, annuity, or bond described in section 408(a), 408(b), or 409, established for the benefit of the spouse of the individual contributing to such account, or for such annuity or bond, if a deduction is allowed under section 220 to such individual with respect to such contribution for such year. - § 415(c)(2): Pub. L. 97–34, § 311(g)(4)(B), included in provision following subpar. (C) references to sections 403(b)(8) and 405(d)(3) and inserted “without regard to employee contributions to a simplified employee pension allowable as a deduction under section 219(a), and without regard to deductible employee contributions within the meaning of section 72(o)(5)”. - § 415(c)(6): Pub. L. 97–34, § 333(b)(1), added subpar. (C). - § 415(e): Pub. L. 97–34, § 311(g)(4)(C), struck out “, any individual retirement account described in section 408(a), any individual retirement annuity described in section 408(b), and any retirement bond described in section 409,” before “for the benefit”. ## § 421: General rules - § 421(a), § 421(b), § 421(c)(1)(A): Pub. L. 97–34 inserted references to section 422A(a) in subsecs. (a), (b), and (c)(1)(A) and to section 422A(a)(1) in subsec. (b). ## § 422: Incentive stock options - Enacted 26 U.S.C. § 422. ## § 424: Definitions and special rules - § 424(d): Pub. L. 97–34, § 251(b)(2), inserted reference to section 422A(b)(6). - § 424(g): Pub. L. 97–34, § 251(b)(3), inserted reference to section 422A(a)(2). - § 424(h)(3)(B): Pub. L. 97–34, § 251(b)(4), inserted reference to section 422A(b)(5). ## § 453: Installment method - § 453(i), § 453(j): Pub. L. 97–34 added subsec. (i) and redesignated former subsec. (i) as (j). ## § 472: Last-in, first-out inventories - § 472(d): Pub. L. 97–34, § 236(a), substituted “3-year averaging for increases in inventory value” for “Preceding closing inventory” in heading, substituted first sentence reading “The beginning inventory for the first taxable year for which the method described in subsection (b) is used shall be valued at cost.” for “In determining income for the taxable year preceding the taxable year for which the method described in subsection (b) is first used, the closing inventory of such preceding year of the goods specified in the application referred to in subsection (a) shall be at cost.” and inserted “Any change in the inventory amount resulting from the application of the preceding sentence shall be taken into account ratably in each of the 3 taxable years beginning with the first taxable year for which the method described in subsection (b) is first used.” - § 472(f): Pub. L. 97–34, § 235, added subsec. (f). ## § 474: Simplified dollar-value LIFO method for certain small businesses - Enacted 26 U.S.C. § 474. ## § 483: Interest on certain deferred payments - § 483(g): Pub. L. 97–34 added subsec. (g). ## § 527: Political organizations - § 527(h): Pub. L. 97–34 added subsec. (h). ## § 535: Accumulated taxable income - § 535(c)(2): Pub. L. 97–34, § 232(a), designated existing provisions as subpar. (A), substituted “$250,000” for “$150,000”, and added subpar. (B). - § 535(c)(3): Pub. L. 97–34, § 232(b)(1), substituted “$250,000” for “$150,000”. ## § 541: Imposition of personal holding company tax - § 541: Pub. L. 97–34 substituted “50 percent” for “70 percent”. ## § 584: Common trust funds - § 584(c)(2): Pub. L. 97–34, § 301(b)(6)(A), inserted reference to “interest” in heading and text, which continued the amendment made by Pub. L. 96–223. - § 584(c)(2): Pub. L. 97–34, § 301(b)(3), inserted “or 128” after “section 116”. ## § 585: Reserves for losses on loans of banks - § 585(b)(2): Pub. L. 97–34 defined “allowable percentage” to mean 1.0 percent for taxable years beginning in 1982 and 0.6 percent for taxable years beginning after 1982, previously so applicable for taxable years beginning after 1981 and redefined “base year” by substituting the last taxable year beginning before 1976 for taxable years beginning after 1975 but before 1983, for the last taxable year beginning before 1976 for taxable years after 1975 but before 1982; and the last taxable year beginning before 1983 for taxable years beginning after 1982, for the last taxable year beginning before 1982 for taxable years beginning after 1981. ## § 591: Deduction for dividends paid on deposits - § 591: Pub. L. 97–34 designated existing provisions as subsec. (a), inserted heading “In general”, and added subsec. (b). ## § 593: Reserves for losses on loans - § 593(a): Pub. L. 97–34, § 245(c)(1), struck out “not having capital stock represented by shares” after “mutual savings bank”. - § 593(b)(2)(B): Pub. L. 97–34, § 245(b)(1), inserted “which is not described in section 591(b)” after “mutual savings bank” in cls. (i) and (ii) and in last sentence. - § 593(b)(2)(C): Pub. L. 97–34, § 245(b)(2), inserted “which are not described in section 591(b)” after “mutual savings banks” in cl. (i). - § 593(e)(1): Pub. L. 97–34, § 245(c)(2), inserted “or an institution that is treated as a mutual savings bank under section 591(b)” after “domestic building and loan association” and “liquidation of the association”. - § 593(e)(1): Pub. L. 97–34, § 243, inserted provisions making par. (1) inapplicable to any distribution to the Federal Savings and Loan Insurance Corporation in redemption of an interest in an association, if such interest was originally received by the Corporation in exchange for financial assistance pursuant to section 1729(f) of title 12. ## § 597: Treatment of transactions in which Federal financial assistance provided - Enacted 26 U.S.C. § 597. ## § 642: Special rules for credits and deductions - § 642(f): Pub. L. 97–34 substituted “and 188” for “188, and 191”. ## § 643: Definitions applicable to subparts A, B, C, and D - § 643(a)(7): Pub. L. 97–34, § 301(b)(6)(A), inserted reference to “interest” in heading and text, which continued the amendment made by Pub. L. 96–223. - § 643(a)(7): Pub. L. 97–34, § 301(b)(4), inserted “or section 128 (relating to interest on certain savings certificates)” after “received)”. ## § 691: Recipients of income in respect of decedents - § 691(c)(3): Pub. L. 97–34 substituted “section 2602(c)(5)(B)” for “section 2602(c)(5)(C)”. ## § 702: Income and credits of partner - § 702(a)(5): Pub. L. 97–34, § 301(b)(6)(C), inserted reference to “interest” in heading and text which continued the amendment made by Pub. L. 96–223. - § 702(a)(5): Pub. L. 97–34, § 301(b)(5), inserted “or 128” after “section 116”. ## § 854: Limitations applicable to dividends received from regulated investment company - § 854(b): Pub. L. 97–34, § 302(c)(4), (d)(1), provided for general amendment of subsec. (b) so as to include provisions relating to taxable interest described in section 128 of this title, applicable to taxable years beginning after Dec. 31, 1984. Section 16(a) of Pub. L. 98–369, repealed section 302(c) of Pub. L. 97–34, and provided that this title shall be applied and administered as if section 302(c), and the amendments made by section 302(c), had not been enacted. ## § 857: Taxation of real estate investment trusts and their beneficiaries - § 857(c): Pub. L. 97–34, § 302(c)(5), (d)(1), provided for general amendment of subsec. (c) so as to include provisions relating to treatment for section 128 of this title, adjustments to gross income and aggregate interest received, and notice to shareholders, applicable to taxable years beginning after Dec. 31, 1984. Section 16(a) of Pub. L. 98–369, repealed section 302(c) of Pub. L. 97–34, and provided that this title shall be applied and administered as if section 302(c), and the amendments made by section 302(c), had not been enacted. ## § 862: Income from sources without the United States - § 862(a)(8): Pub. L. 97–34 added par. (8). ## § 871: Tax on nonresident alien individuals - § 871(g): Pub. L. 97–34 substituted “6015(j)” for “6015(i)”. ## § 879: Tax treatment of certain community income in the case of nonresident alien individuals - § 879(a)(1): Pub. L. 97–34 substituted “section 911(d)(2)” for “section 911(b)”. ## § 897: Disposition of investment in United States real property - § 897(c)(1)(A)(i): Pub. L. 97–34, § 831(a)(1), defined “United States real property interest” to also mean an interest in real property located in the Virgin Islands. - § 897(c)(4)(B): Pub. L. 97–34, § 831(b), substituted “Assets” for “Interests” in heading and in first sentence “Under regulations prescribed by the Secretary, assets held by a partnership, trust or estate shall be treated as held” for “United States real property interests held by a partnership, trust, or estate shall be treated as owned” before “proportionately by its partners or beneficiaries”, and inserted provisions respecting treatment of an asset as used or held for use in a trade or business by a partner or beneficiary when used or held by the partnership, trust, or estate in a trade or business and attributing chain treatment of such trade or business to partnership, trust, or estate which are above the first such entity. - § 897(d)(1): Pub. L. 97–34, § 831(c), substituted “Exceptions” for “Exception where there is a carryover basis” in heading, inserted introductory text “Gain shall not be recognized under subparagraph (A)”, inserted cls. (i)(I) and (ii), and substituted cl. (i)(II) the basis of the distributed property in the hands of the distributee is no greater than the adjusted basis of such property before the distribution, increased by the amount of gain (if any) recognized by the distributing corporation” for subpar. (B) provision “Subparagraph (A) shall not apply if the basis of the distributed property in the hands of the distributee is the same as the adjusted basis of such property before the distribution increased by the amount of any gain recognized by the distributing corporation.” - § 897(i): Pub. L. 97–34, § 831(d), in par. (1)(A) substituted “holds a United States real property interest” for “has a permanent establishment in the United States”, in par. (1)(B) substituted “treaty obligation of the United States the foreign corporation is entitled to nondiscriminatory treatment with respect to that interest” for “treaty, such permanent establishment may not be treated less favorably than domestic corporations carrying on the same activities”, in par. (3) inserted subpar. (A), designated existing provisions as subpar. (B), in subpar. (B) substituted “such other conditions as the Secretary may prescribe by regulations with respect to the corporation or its shareholders” for “such conditions as may be prescribed by the Secretary”, and prescribed percentage interest required for making the requisite election and application of constructive ownership rules in determining existence of the required percentage of a class of interest. - § 897(j), § 897(k), § 897(l): Pub. L. 97–34, § 831(f), (g), added subsecs. (j) to (l). ## § 911: Citizens or residents of the United States living abroad - § 911: Pub. L. 97–34 amended section generally, modifying the eligibility standards of existing law, replacing the existing system of deduction for excess living costs with an exclusion of a portion of foreign earned income, and providing for an individual’s election to exclude a portion of his income or to deduct an amount for housing, based on his housing expenses. ## § 964: Miscellaneous provisions - § 964(a): Pub. L. 97–34 substituted “section 312(k)(4)” for “section 312(k)(3)”. ## § 1014: Basis of property acquired from a decedent - § 1014(e): Pub. L. 97–34 added subsec. (e). ## § 1015: Basis of property acquired by gifts and transfers in trust - § 1015(d)(2): Pub. L. 97–34 substituted “calendar year (or preceding calendar period)” for “calendar quarter (or calendar year if the gift was made before January 1, 1971)” and “calendar year or period” for “calendar quarter or year” in two places. ## § 1016: Adjustments to basis - § 1016(a)(24): Pub. L. 97–34, § 212(d)(2)(G), added par. (24). - § 1016(c): Pub. L. 97–34, § 421(g), substituted provisions respecting increase in basis of property on which additional estate tax is imposed for provisions for increase in basis in the case of certain involuntary conversions, if such compulsory or involuntary conversions are within the meaning of section 1033, and an additional estate tax is imposed under section 2032A, and provisions respecting time adjustment made. ## § 1033: Involuntary conversions - § 1033(g)(3)(A): Pub. L. 97–34 substituted “(relating to election to expense certain depreciable business assets)” for “(relating to additional first-year depreciation allowance for small business)”. ## § 1040: Transfer of certain farm, etc., real property - § 1040: Pub. L. 97–34 substituted “Transfer of certain farm, etc., real property” for “Use of farm, etc., real property to satisfy pecuniary bequest” in section catchline. - § 1040(a): Pub. L. 97–34 revised subsec. (a) generally, substituting “transfers to a qualified heir (within the meaning of section 2032A(e)(1)) any property” for “satisfies the right of a qualified heir (within the meaning of section 2032A(e)(1)) to receive a pecuniary bequest with property” and “such transfer” for “such exchange” before “shall be recognized”. - § 1040(b): Pub. L. 97–34 substituted “shall apply where the trustee of a trust (any portion of which is included in the gross estate of the decedent) transfers property with respect to which an election was made under section 2032A” for “shall apply where— ## § 1092: Straddles - Enacted 26 U.S.C. § 1092. ## § 1212: Capital loss carrybacks and carryovers - § 1212(c): Pub. L. 97–34 added subsec. (c). ## § 1221: Capital asset defined - § 1221: Pub. L. 97–34 redesignated par. (6) as (5) and struck out former par. (5), which excluded from definition of “capital asset” an obligation of the United States or any of its possessions, or of a State or any political subdivision thereof, or of the District of Columbia, issued on or after March 1, 1941, on a discount basis and payable without interest at a fixed maturity date not exceeding one year from the date of issue, and is covered by section 1232(a)(4)(B) of this title. ## § 1231: Property used in the trade or business and involuntary conversions - § 1231(b)(1)(D): Pub. L. 97–34 substituted “paragraph (5)” for “paragraph (6)”. ## § 1233: Gains and losses from short sales - § 1233(e)(2)(A): Pub. L. 97–34 inserted “, but does not include any position to which section 1092(b) applies” after “taxpayer”. ## § 1234A: Gains or losses from certain terminations - Enacted 26 U.S.C. § 1234A. ## § 1236: Dealers in securities - § 1236(a): Pub. L. 97–34, § 506(a), substituted “before the close of the day on which it was acquired (before the close of the following day in the case of an acquisition before January 1, 1982)” for “before the expiration of the 30th day after the date of its acquisition” in par. (1) and “close of such day” for “expiration of such 30th day” in par. (2). - § 1236(d): Pub. L. 97–34, § 506(b), added subsec. (d). ## § 1245: Gain from dispositions of certain depreciable property - § 1245(a)(1): Pub. L. 97–34, § 204(a), inserted reference to section 1245 recovery property disposed of after Dec. 31, 1980, in introductory provisions. - § 1245(a)(2): Pub. L. 97–34, §§ 202(b)(1)–(3), 204(b), inserted reference to section 179 in subpar. (D), added subpar. (E), and, in provisions following subpar. (E), and inserted references to section 179 in three places. Pub. L. 97–34, § 212(d)(2)(F), in provisions following subpar. (E), substituted “191 (as in effect before its repeal by the Economic Recovery Tax Act of 1981)” for “191” in two places. - § 1245(a)(3)(D): Pub. L. 97–34, § 202(b)(3), inserted reference to section 179. - § 1245(a)(3)(E), § 1245(a)(3)(F): Pub. L. 97–34, § 201(b), added subpars. (E) and (F). - § 1245(a): Pub. L. 97–34, § 204(c), added par. (5). - § 1245(a): Pub. L. 97–34, § 204(d), added par. (6). ## § 1250: Gain from dispositions of certain depreciable realty - § 1250(b)(4): Pub. L. 97–34, § 212(d)(2)(F), inserted “(as in effect before its repeal by the Economic Recovery Tax Act of 1981)” after “section 167(k) or 191” in two places. - § 1250(d): Pub. L. 97–34, § 204(e), added par. (11). ## § 1256: Section 1256 contracts marked to market - Enacted 26 U.S.C. § 1256. ## § 1402: Definitions - § 1402(a)(8): Pub. L. 97–34, § 111(b)(3), substituted “relating to citizens or residents of the United States living abroad” for “relating to income earned by employees in certain camps”. - § 1402(a)(11): Pub. L. 97–34, § 111(b)(5), substituted “in the case of an individual described in section 911(d)(1)(B), the exclusion from gross income provided by section 911(a)(1) shall not apply” for “in the case of an individual who has been a resident of the United States during the entire taxable year, the exclusion from gross income provided by section 911(a)(2) shall not apply”. ## § 1561: Limitation on accumulated earnings credit in the case of certain controlled corporations - § 1561(a): Pub. L. 97–34 substituted “$250,000 ($150,000 if any component member is a corporation described in section 535(c)(2)(B))” for “$150,000”. ## § 2001: Imposition and rate of tax - § 2001(b)(2): Pub. L. 97–34, § 402(c), inserted “which would have been” before “payable” and “, if the rate schedule set forth in subsection (c) (as in effect at the decedent’s death) had been applicable at the time of such gifts” after “December 31, 1976,”. - § 2001(c): Pub. L. 97–34, § 402(a), (b)(1), designated existing provision as par. (1), inserted heading “In general” and substituted in table provision that if the amount computed is over $2,500,000 then the tentative tax is $1,025,800 plus 50% of the excess over $2,500,000 for provisions that if the amount computed is over $2,500,000 but not over $3,000,000, then the tentative tax is $1,025,800 plus 53% of the excess over $2,500,000, over $3,000,000 but not over $3,500,000 then the tentative tax is $1,290,000 plus 57% of the excess over $3,000,000, over $3,500,000 but not over $4,000,000 then the tentative tax is $1,575,800 plus 61% of the excess over $3,500,000, over $4,000,000 but not over $4,500,000 then the tentative tax is $1,880,800 plus 65% of the excess over $4,000,000, over $4,500,000 but not over $5,000,000 then the tentative tax is $2,205,800 plus 69% of the excess over $4,500,000, over $5,000,000 then the tentative tax is $2,550,800 plus 70% of the excess over $5,000,000, and added par. (2). ## § 2010: Unified credit against estate tax - § 2010(a): Pub. L. 97–34, § 401(a)(1), substituted “$192,800” for “$47,000”. - § 2010(b): Pub. L. 97–34, § 401(a)(2)(A), struck out “$47,000” before “credit” from heading and in text substituted in subsec. (a) substitutions for “$192,800” amounts of “$62,800”, “$79,300”, “$96,300”, “$121,800”, and “$155,800” in the case of decedents dying in 1982, 1983, 1984, 1985, and 1986, respectively, for subsec. (a) substitutions for “$47,000” amounts of “$30,000”, “$34,000”, “$38,000”, and “$42,500” in the case of decedents dying in 1977, 1978, 1979, and 1980, respectively. ## § 2012: Credit for gift tax - § 2012(b)(2): Pub. L. 97–34 substituted “the amount of such value, reduced as provided in paragraph (1)” for “an amount which bears the same ratio to such value (reduced as provided in paragraph (1) of this subsection) as the aggregate amount of the marital deductions allowed under section 2056(a) bears to the aggregate amount of such marital deductions computed without regard to subsection (c) thereof”. ## § 2032A: Valuation of certain farm, etc., real property - § 2032A(a)(2): Pub. L. 97–34, § 421(a), substituted “Limit on aggregate reduction in fair market value” for “Limitation” in heading “shall not exceed the applicable limit set forth in the following table:” for “shall not exceed $500,000” in text, and inserted table. - § 2032A(b)(1): Pub. L. 97–34, § 421(b)(1), substituted “qualified use by the decedent or a member of the decedent’s family” for “qualified use” in provision preceding subpar. (A), and in subpars. (A)(i) and (C)(i). - § 2032A(b)(4), § 2032A(b)(5): Pub. L. 97–34, § 421(b)(2), added pars. (4) and (5). - § 2032A(c)(1): Pub. L. 97–34, § 421(c)(1)(A), substituted “10 years” for “15 years”. - § 2032A(c)(2)(E): Pub. L. 97–34, § 421(h)(2), added subpar. (E). - § 2032A(c)(3): Pub. L. 97–34, § 421(c)(1)(B)(i), redesignated par. (4) as (3) and struck out former par. (3), which provided for a phaseout of additional tax between the 10th and 15th years. - § 2032A(c)(4), § 2032A(c)(5): Pub. L. 97–34, § 421(c)(1)(B)(i), redesignated pars. (5) and (6) as (4) and (5), respectively. Former par. (4) redesignated (3). - § 2032A(c)(6): Pub. L. 97–34, § 421(c)(2)(B)(ii), in subpar. (B) substituted “more than 3 years” for “3 years or more”. - § 2032A(c)(6): Pub. L. 97–34, § 421(c)(1)(B)(i), redesignated par. (7) as (6). Former par. (6) redesignated (5). - § 2032A(c)(7): Pub. L. 97–34, § 421(c)(1)(B)(i), (2)(A), added par. (7). Former par. (7) redesignated (6). - § 2032A(d)(1): Pub. L. 97–34, § 421(j)(3), substituted “The election under this section shall be made on the return of the tax imposed by section 2001. Such election shall be made in such manner as the Secretary shall by regulations prescribe. Such an election, once made, shall be irrevocable.” for “The election under this section shall be made not later than the time prescribed by section 6075(a) for filing the return of tax imposed by section 2001 (including extensions thereof), and shall be made in such manner as the Secretary shall by regulations prescribe.” - § 2032A(e)(2): Pub. L. 97–34, § 421(i), substituted provisions designated subpars. (A) through (D) for “such individual’s ancestor or lineal descendant, a lineal descendant of a grandparent of such individual, the spouse of such individual, or the spouse of any such descendant”. - § 2032A(e)(7): Pub. L. 97–34, § 421(f), added subpar. (B), redesignated former subpar. (B) as (C), and inserted “and that there is no comparable land from which the average net share rental may be determined” after “determined” in subpar. (C), without specifying whether the language was to be inserted in cl. (i) or (ii) of subpar. (C). In view of H. Rept. No. 97–201, 97th Cong., July 14, 1981, p. 492, the language was inserted in cl. (ii) as the probable intent of Congress. - § 2032A(e)(9): Pub. L. 97–34, § 421(j)(2)(A), struck out from subpar. (B) “in satisfaction of the right of such person to a pecuniary bequest” after “from the estate” and in subpar. (C) substituted “(to the extent such property is includible in the gross estate of the decedent)” for “in satisfaction of a right (which such person has by reason of the death of the decedent) to receive from the trust a specific dollar amount which is the equivalent of a pecuniary bequest”. - § 2032A(e)(12): Pub. L. 97–34, § 421(c)(2)(B)(i), added par. (12). - § 2032A(e)(13), § 2032A(e)(14): Pub. L. 97–34, § 421(h)(1), (j)(4), added pars. (13) and (14). - § 2032A(f)(1): Pub. L. 97–34, § 421(e)(2), substituted “to which subsection (h)” for “to which an election under subsection (h)”. - § 2032A(f)(1): Pub. L. 97–34, § 421(d)(2)(A), substituted “conversion or exchange”, “(h) or (i)”, and “replace or of the exchange of property” for “conversion”, “(h)”, and “replace”. - § 2032A(g): Pub. L. 97–34, § 421(j)(1), inserted provision that for purposes of the preceding sentence, an interest in a discretionary trust all the beneficiaries of which are qualified heirs shall be treated as a present interest. - § 2032A(h)(1)(A): Pub. L. 97–34, § 421(e)(1)(A), struck out “and the qualified heir makes an election under this subsection” after “qualified real property”. - § 2032A(h)(2)(A): Pub. L. 97–34, § 421(c)(1)(B)(ii), substituted “; except that” for “, except that” and “the 10-year period” for “the 15-year period”, deleted cl. (i) designation, and struck out cl. (ii), which provided the phaseout period under par. (3) of subsec. (c) be appropriately adjusted to take into account the extension referred to in cl. (i). - § 2032A(h)(2)(C): Pub. L. 97–34, § 421(c)(1)(B)(iii), substituted “(6)” for “(7)” in provisions preceding cl. (i). - § 2032A(h): Pub. L. 97–34, § 421(e)(1)(B), struck out par. (5) which provided for making a subsec. (h) election at such time and in such manner as the Secretary may by regulations prescribe. - § 2032A(i): Pub. L. 97–34, § 421(d)(1), added subsec. (i). ## § 2035: Adjustments for certain gifts made within 3 years of decedent’s death - § 2035(b): Pub. L. 97–34, § 403(b)(3)(B), inserted “(other than by reason of section 6019(a)(2))” after “section 6019”. - § 2035(d): Pub. L. 97–34, § 424(a), added subsec. (d). ## § 2039: Annuities - § 2039: Pub. L. 97–34, § 311(d)(1), provided that for purposes of subsec. (c), any deductible employee contributions, within the meaning of par. (5) of section 72(o), shall be considered as made by a person other than the decedent. - § 2039: Pub. L. 97–34, § 313(b)(3), inserted reference to rollover contribution described in section 405(d)(3). - § 2039: Pub. L. 97–34, § 311(h)(4), substituted “section 219” for “section 219 or 220”. ## § 2040: Joint interests - § 2040(a): Pub. L. 97–34, § 403(c)(2), substituted “joint tenants with right of survivorship” for “joint tenants” in three places. - § 2040(b)(2): Pub. L. 97–34, § 403(c)(1), in redefining “qualified joint interest” substituted provision defining term as meaning any interest in property held by the decedent and the decedent’s spouse as tenants by the entirety, or joint tenants with right of survivorship, but only if the decedent and the spouse of the decedent are the only joint tenants for provision defining the term as meaning any interest in property held by the decedent and the decedent’s spouse as joint tenants or as tenants by the entirety, but only if such joint interest was created by the decedent, the decedent’s spouse, or both, in the case of personal property, the creation of such joint interest constituted in whole or in part a gift for purposes of chapter 12, or in the case of real property, an election under section 2515 applies with respect to the creation of such joint interest, and in the case of a joint tenancy, only the decedent and the decedent’s spouse are joint tenants. - § 2040: Pub. L. 97–34, § 403(c)(3)(A), repealed subsec. (c) respecting value where spouse of decedent materially participated in farm or other business, subsec. (d) relating to joint interests of husband and wife created before 1977, and subsec. (e) covering treatment of certain post-1976 terminations. ## § 2044: Certain property for which marital deduction was previously allowed - Enacted 26 U.S.C. § 2044. ## § 2045: Prior interests ## § 2046: Disclaimers ## § 2055: Transfers for public, charitable, and religious uses - § 2055(e)(4): Pub. L. 97–34 added par. (4). ## § 2056: Bequests, etc., to surviving spouse - § 2056(a): Pub. L. 97–34, § 403(a)(1)(B), substituted “subsection (b)” for “subsections (b) and (c)”. - § 2056(b)(7), § 2056(b)(8): Pub. L. 97–34, § 403(d)(1), added pars. (7) and (8). - § 2056(c), § 2056(d): Pub. L. 97–34, § 403(a)(1)(A), redesignated subsec. (d) as (c) and struck out former subsec. (c) relating to limitation on aggregate of deductions. ## § 2204: Discharge of fiduciary from personal liability - § 2204(a), § 2204(b), § 2204(c): Pub. L. 97–34, § 422(e)(1), (3), struck out reference to section 6166A in subsecs. (a) and (b), and two such references in subsec. (c). ## § 2207A: Right of recovery in the case of certain marital deduction property - Enacted 26 U.S.C. § 2207A. ## § 2501: Imposition of tax - § 2501(a)(1), § 2501(a)(4): Pub. L. 97–34 substituted “calendar year” for “calendar quarter” wherever appearing. ## § 2502: Rate of tax - § 2502(a): Pub. L. 97–34 substituted in introductory text and par. (1) “calendar year” for “calendar quarter” and in pars. (1) and (2) “calendar periods” for “calendar years and calendar quarters”. - § 2502(b): Pub. L. 97–34 substituted definition of “preceding calendar period” for “calendar quarter”, the latter including only the first calendar quarter of the calendar year 1971 and succeeding calendar quarters (covered in par. (2)), the former incorporating former subsec. (c)(1) definition of “preceding calendar years” as meaning calendar years 1932 and 1970 and all calendar years intervening between calendar year 1932 and calendar year 1970 and “calendar year 1932” as including only the portion of such year after June 6, 1932, and former subsec. (c)(2) definition of “preceding calendar quarters” as meaning the first calendar quarter of calendar year 1971 and all calendar quarters intervening between such calendar quarter and the calendar quarter for which the tax is being computed. - § 2502(c), § 2502: Pub. L. 97–34 redesignated subsec. (d) as (c). Former subsec. (c), defining “preceding calendar years” and “preceding calendar quarters”, was incorporated in subsec. (b). ## § 2503: Taxable gifts - § 2503(a): Pub. L. 97–34, § 442(a)(3)(A), substituted “the total amount of gifts made during the calendar year, less the deductions provided in subchapter C (section 2522 and following)” for “, in the case of gifts made after December 31, 1970, the total amount of gifts made during calendar quarter, less the deductions provided in subchapter C (sec. 2521 and following” and struck out provision that in the case of gifts made before Jan. 1, 1971, “taxable gifts” means the total amount of gifts made during the calendar year, less the deductions provided in subchapter C. - § 2503(b): Pub. L. 97–34, § 442(a)(3)(B), substituted provision that in the case of gifts, other than gifts of future interests in property, made to any person by the donor during the calendar year, the first $10,000 of such gifts to such person shall not, for purposes of subsec. (a), be included in the total amount of gifts made during such year for provision that in computing taxable gifts for the calendar quarter, in the case of gifts, other than gifts of future interests in property, made to any person by the donor during the calendar year 1971 and subsequent calendar years, $10,000 of such gifts to such person less the aggregate of the amounts of such gifts to such person during all preceding calendar quarters of the calendar year shall not, for purposes of subsec. (a), be included in the total amount of gifts made during such quarter. - § 2503(b): Pub. L. 97–34, § 441(a), substituted “$10,000” for “$3,000”. - § 2503(d): Pub. L. 97–34, § 311(h)(5), repealed subsec. (d) which related to individual retirement accounts, etc., for spouse. - § 2503(e): Pub. L. 97–34, § 441(b), added subsec. (e). ## § 2504: Taxable gifts for preceding calendar periods - § 2504: Pub. L. 97–34, § 442(a)(4)(D), substituted “calendar periods” for “years and quarters” in section catchline. - § 2504(a): Pub. L. 97–34, § 442(a)(4)(A), substituted in introductory text “preceding calendar periods” and “calendar year” for “preceding calendar years or calendar quarters” and “calendar quarter”, incorporated existing text in provisions designated pars. (1) to (3), and substituted in par. (1) “calendar period” for “years or calendar quarters” and in par. (3) “preceding calendar periods” and “calendar year” for “calendar years or calendar quarters” and “calendar quarter”. - § 2504(b): Pub. L. 97–34, § 442(a)(4)(B), substituted in heading “calendar periods” for “years and quarters” and in text “preceding calendar periods” for “preceding calendar years and calendar quarters”, “the periods” for “the years and calendar quarters”, and “such preceding calendar periods” for “such years and calendar quarters”. - § 2504(c): Pub. L. 97–34, § 442(a)(4)(C), substituted in heading “calendar periods” for “calendar years and quarters” and in text “preceding calendar period” for “preceding calendar year or calendar quarter” in four places, “any calendar year” for “any calendar quarter”, and “section 2502(b)” for “section 2502(c)”. ## § 2505: Unified credit against gift tax - § 2505(a): Pub. L. 97–34, § 442(a)(5)(A), substituted in provision preceding par. (1) “year” for “quarter”, and “periods” for “quarters” in par. (2). - § 2505(a)(1): Pub. L. 97–34, § 401(b)(1), substituted “$192,800” for “$47,000”. - § 2505(b): Pub. L. 97–34, § 401(b)(2), struck out from heading “$47,000” before “credit”, substituted subsec. (a)(1) substitutions for “$192,800” of amounts of “$62,800”, “$79,300”, “$96,300”, “$121,800”, and “$155,800” in the case of gifts made in 1982, 1983, 1984, 1985, and 1986, respectively, for subsec. (a)(1) substitutions for “$47,000” of amounts of “$6,000”, “$30,000”, “$34,000”, “$38,000”, and “$42,500” in the case of gifts made after Dec. 31, 1976, and before July 1, 1977, after June 30, 1977, and before Jan. 1, 1978; after Dec. 31, 1977, and before Jan. 1, 1979, after Dec. 31, 1978, and before Jan. 1, 1980, and after Dec. 31, 1979, and before Jan. 1, 1981, respectively. - § 2505: Pub. L. 97–34, § 442(a)(5)(B), substituted “year” for “quarter” in two places. ## § 2512: Valuation of gifts - § 2512(b): Pub. L. 97–34 substituted “calendar year” for “calendar quarters”. ## § 2513: Gift by husband or wife to third party - § 2513(a)(1), § 2513(a)(2): Pub. L. 97–34, § 442(b)(2)(A), substituted “calendar year” for “calendar quarter”. - § 2513(b)(2): Pub. L. 97–34, § 442(b)(2)(B)–(D), in introductory text, substituted “calendar year” for “calendar quarter”, in subpar. (A), substituted “The consent” for “the consent”, “15th day of April following the close of such year” for “15th day of the second month following the close of such calendar quarter”, and “such year” for “such calendar quarter” in two other places, and in subpar. (B) substituted “The consent” and “such year” for “the consent” and “such calendar quarter”. - § 2513(c): Pub. L. 97–34, § 442(b)(2)(E), in provision preceding par. (1) substituted “calendar year” for “calendar quarter” and in par. (1) “15th day of April following the close of such year” for “15th day of the second month following the close of such quarter”. - § 2513(d): Pub. L. 97–34, § 442(b)(2)(F), substituted “any calendar year” and “such year” for “any calendar quarter” and “such calendar quarter”. ## § 2518: Disclaimers - § 2518(c)(3): Pub. L. 97–34 added par. (3). ## § 2519: Dispositions of certain life estates - Enacted 26 U.S.C. § 2519. ## § 2522: Charitable and similar gifts - § 2522(a): Pub. L. 97–34, § 442(c), substituted “year” for “quarter” in two places in provision preceding par. (1). - § 2522(b): Pub. L. 97–34, § 442(c), substituted “year” for “quarter” in provision preceding par. (1). - § 2522(c)(3): Pub. L. 97–34, § 423(b), added par. (3). ## § 2523: Gift to spouse - § 2523(a): Pub. L. 97–34, § 403(b)(1), struck out “(1) In general” designation for existing text and struck out par. (2) which declared that the aggregate of the allowed deductions for any calendar quarter should not exceed the sum of $100,000 reduced, but not below zero, by the aggregate of the allowed deductions for preceding calendar quarters beginning after Dec. 31, 1976, plus 50 percent of the lesser of the amount of the allowed deductions for such calendar quarter, determined without regard to par. (2), or the amount, if any, by which the aggregate determined under cl. (i) of par. (2) for the calendar quarter and for each preceding calendar quarter beginning after Dec. 31, 1976, exceeds $200,000. - § 2523(f): Pub. L. 97–34, § 403(b)(2), (d)(2), substituted provision relating to election with respect to life estate for donee spouse for provision relating to community property. - § 2523(g): Pub. L. 97–34, § 403(d)(2), added subsec. (g). ## § 2602: Amount of tax - § 2602: Pub. L. 97–34 redesignated subpars. (B) and (C) as (A) and (B), respectively, and struck out former subpar. (A) relating to adjustments to marital deduction and providing that if the generation-skipping transfer occurs at the same time as, or within 9 months after, the death of the deemed transferor, for purposes of section 2056, relating to bequests, etc., to surviving spouse, the value of the gross estate of the deemed transferor shall be deemed to be increased by the amount of such transfer. ## § 2621: Taxable amount in case of taxable distribution - § 2621(b): Pub. L. 97–34 substituted “Section 6166” for “Sections 6166 and 6166A” in heading and “section 6166 (relating to extension of time” for “sections 6166 and 6166A (relating to extensions of time” in text. ## § 3121: Definitions - § 3121(a)(18): Pub. L. 97–34 substituted “section 127 or 129” for “section 127”. ## § 3201: Rate of tax - § 3201(a): Pub. L. 97–34 added subsec. (a). - § 3201(b): Pub. L. 97–34 designated existing provisions as subsec. (b) and substituted “The rate of tax imposed by subsection (a) shall be increased by” for “In addition to other taxes, there is hereby imposed on the income of every employee a tax rate equal to”. ## § 3211: Rate of tax - § 3211(a): Pub. L. 97–34 substituted “11.75” for “9.5”. ## § 3221: Rate of tax - § 3221(a): Pub. L. 97–34 substituted in first sentence “11.75” for “9.5”. ## § 3231: Definitions - § 3231(e)(1): Pub. L. 97–34, § 743(a), inserted after third sentence provision that “Compensation which is paid in one calendar month but which would be payable in a prior or subsequent taxable month but for the fact that prescribed date of payment would fall on a Saturday, Sunday or legal holiday shall be deemed to have been paid in such prior or subsequent taxable month.” - § 3231(e)(1): Pub. L. 97–34, § 741(d)(2), struck out cl. (iii) exclusion from term “compensation” the voluntary payment by an employer, without deduction from the remuneration of the employee, of the tax imposed on such employee by section 3201, redesignated as cl. (iii) provisions formerly designated (iv). - § 3231(e)(2): Pub. L. 97–34, § 743(b), (c), inserted first sentence respecting presumption of a payment through the employer’s payroll as being compensation for services rendered as an employee in the period with respect to which payment is made, and in second sentence following “an employee” inserted “receiving retroactive wage payments”. ## § 3306: Definitions - § 3306(b)(13): Pub. L. 97–34, § 124(e)(2)(A), substituted “section 127 or 129” for “section 127”. - § 3306(c)(18), § 3306(c)(19): Pub. L. 97–34, § 822(a), added par. (18) and redesignated former par. (18) as (19). ## § 3401: Definitions - § 3401(a)(12)(D): Pub. L. 97–34, § 311(h)(6), substituted “section 219(a)” for “section 219(a) or 220(a)”. - § 3401(a)(18): Pub. L. 97–34, § 124(e)(2)(A), substituted “section 127 or 129” for “section 127”. - § 3401(a)(18): Pub. L. 97–34, § 112(b)(5), redesignated par. (19) as (18). Former par. (18), relating to remuneration paid to or on behalf of an employee if (and to the extent that) at the time of the payment of such remuneration it was reasonable to believe that a corresponding deduction was allowable under section 913 (relating to deduction for certain expenses of living abroad), was struck out. - § 3401(a)(19), § 3401(a)(20): Pub. L. 97–34, § 112(b)(5), redesignated par. (20) as (19). Former par. (19) redesignated (18). ## § 3402: Income tax collected at source - § 3402(a): Pub. L. 97–34, § 101(e)(1), revised subsec. (a) generally to provide for a 5-percent reduction in income tax withholding rates on Oct. 1, 1981, a further 10-percent reduction on July 1, 1982, and a final 10-percent reduction on July 1, 1983. - § 3402(b)(1): Pub. L. 97–34, § 101(e)(2)(A), redesignated par. (2) as (1). Former par. (1), which set out a table for determining amount of one withholding exemption for each of the various payroll periods, was struck out. - § 3402(b)(2): Pub. L. 97–34, § 101(e)(2)(A), redesignated par. (3) as (2). Former par. (2) redesignated (1). - § 3402(b)(3): Pub. L. 97–34, § 101(e)(2)(A), (B), redesignated par. (4) as (3) and substituted provisions relating to an employer’s computation of the tax to be deducted and withheld as if the aggregate of the wages paid to the employee during the calendar week were paid for a weekly payroll period, for provisions relating to an employer’s computation of the tax to be deducted and withheld using the excess of the aggregate of the wages paid to the employee during the calendar week over the withholding exemption allowed by this subsection for a weekly payroll period. Former par. (3) redesignated (2). - § 3402(b)(4), § 3402(b): Pub. L. 97–34, § 101(e)(2)(A), redesignated par. (5) as (4). Former par. (4) redesignated (3). - § 3402(f)(1): Pub. L. 97–34, § 101(e)(3), inserted “(or more than one exemption if so prescribed by the Secretary)” after “an amount equal to one exemption”. - § 3402(i): Pub. L. 97–34, § 101(e)(4), substituted provisions authorizing the Secretary by regulations to provide for increases or decreases in the amount of withholding otherwise required under this section in cases where the employee requests the changes, for provisions under which the Secretary was authorized to provide withholding in addition to that otherwise required under this section in cases in which the employer and the employee agreed to such additional withholding. - § 3402(m): Pub. L. 97–34, § 101(e)(5), revised provisions respecting additional withholding allowances for anticipated excess itemized deductions and tax credits claimed in accordance with Treasury regulations and Treasury statutory authority to provide additional withholding allowances for any additional items specified in Treasury regulations. ## § 4251: Imposition of tax - § 4251(a)(2): Pub. L. 97–34, § 821(a), substituted “During 1982, 1983, or 1984” for “During 1982” in table. - § 4251(b): Pub. L. 97–34, § 821(b), extended termination date to Jan. 1, 1985, from Jan. 1, 1983. ## § 4942: Taxes on failure to distribute income - § 4942(d)(1): Pub. L. 97–34, § 823(a)(1), struck out “or the adjusted net income (whichever is higher)” after “return”. - § 4942(j)(3): Pub. L. 97–34, § 823(a)(2), (3), inserted in subpar. (A) “the lesser of” after “substantially all of”, designated existing provisions as cl. (i), added cl. (ii), and inserted provision respecting applicability of subpar. (A)(ii). ## § 4973: Tax on excess contributions to certain tax-favored accounts and annuities - § 4973(a): Pub. L. 97–34, § 311(h)(9), substituted “The tax imposed by this subsection shall be paid by such individual” for “The tax imposed by this subsection shall be paid by the individual to whom a deduction is allowed for the taxable year under section 219 (determined without regard to subsection (b)(1) thereof) or section 220 (determined without regard to subsection (b)(1) thereof), whichever is appropriate”. - § 4973(b)(1)(A): Pub. L. 97–34, § 313(b)(2), inserted “405(d)(3),” after “403(b)(8),”. - § 4973(b)(1)(B): Pub. L. 97–34, § 311(h)(7), substituted “section 219” for “section 219 or 220”. - § 4973(b)(2)(C): Pub. L. 97–34, § 311(h)(7), (10), substituted “section 219” for “section 219 or 220”, and “section 219(f)(6)” for “sections 219(c)(5) and 220(c)(6)”. ## § 5684: Penalties relating to the payment and collection of liquor taxes - § 5684(b): Pub. L. 97–34, § 724(b)(4)(A), redesignated subsec. (c) as (b). Former subsec. (b), which related to penalties for failure to make deposit of taxes, was struck out. - § 5684(c): Pub. L. 97–34, § 724(b)(4), redesignated subsec. (d) as (c), added par. (4), and redesignated pars. (5) and (6) as (4) and (5), respectively. Former subsec. (c) redesignated (b). - § 5684(c): Pub. L. 97–34, § 722(a)(3), substituted “6660” for “6659” in heading and text. - § 5684: Pub. L. 97–34, § 724(b)(4), redesignated subsec. (d) as (c). ## § 5761: Civil penalties - § 5761(c): Pub. L. 97–34, § 724(b)(5), added subsec. (c). Former subsec. (c), which related to applicability of section 6656 to failure to make deposit of taxes imposed under subchapter A on the prescribed date and imposition of penalty, was struck out. - § 5761(d): Pub. L. 97–34, §§ 722(a)(3), 724(b)(5), added subsec. (d). Former subsec. (d), which related to applicability of section 6660 and penalties imposed by subsections (b) and (c) to be assessed, collected, and paid in the manner as taxes provided in section 6660(a), was struck out. See subsec. (c). ## § 6012: Persons required to make returns of income - § 6012(a)(1): Pub. L. 97–34, § 104(d)(1)(D), substituted “the exemption amount” for “$1,000”, wherever appearing, substituted “the sum of the exemption amount plus the zero bracket amount applicable to such an individual” for “$3,300” in subpar. (A)(i) and for “$4,400” in subpar. (A)(ii), substituted “the sum of twice the exemption amount plus the zero bracket amount applicable to a joint return” for “$5,400” in subpar. (A)(iii), and added subpar. (D). - § 6012(c): Pub. L. 97–34, § 111(b)(3), substituted “relating to citizens or residents of the United States living abroad” for “relating to income earned by employees in certain camps”. ## § 6013: Joint returns of income tax by husband and wife - § 6013(b)(3)(A): Pub. L. 97–34 substituted “the exemption amount” for “$1,000” and “twice the exemption amount” for “$2,000” in cls. (ii) and (iii) and inserted provision following cl. (iii) defining “exemption amount”. ## § 6018: Estate tax returns - § 6018(a)(1): Pub. L. 97–34, § 401(a)(2)(B)(i), substituted “$600,000” for “$175,000”. - § 6018(a)(3): Pub. L. 97–34, § 401(a)(2)(B)(ii), set forth par. (1) substitutions for “$600,000” amount of “$225,000”, “$275,000”, “$325,000”, “$400,000”, and “$500,000” in the case of decedents dying in 1982, 1983, 1984, 1985, and 1986, respectively, and struck out par. (1) substitutions for “$175,000” amount of “$120,000”, “$134,000”, “$147,000”, and “$161,000” in the case of decedents dying during 1977, 1978, 1979, and 1980, respectively. ## § 6019: Gift tax returns - § 6019: Pub. L. 97–34 struck out subsec. “(a) In general” designation, substituted “calendar year” for “calendar quarter” and “year” for “quarter” wherever appearing, inserted in provision designated par. (1) reference to subsec. (e) of section 2503, added par. (2), and deleted provision respecting transfers by gift other than qualified charitable transfers, repealed subsec. (b) setting forth return requirement and definition of qualified charitable transfer, and repealed subsec. (c) setting forth cross reference to section 2515(c) relating to tenancy by the entirety. ## § 6039: Returns required in connection with certain options - § 6039(a)(1): Pub. L. 97–34, § 251(b)(5)(A), inserted “, an incentive stock option,” after “qualified stock option”. - § 6039(b): Pub. L. 97–34, § 251(b)(5)(B), inserted “incentive stock option,” after “qualified stock option,”. - § 6039(c): Pub. L. 97–34, § 251(b)(5)(C), added par. (4). ## § 6039C: Returns with respect to foreign persons holding direct investments in United States real property interests - § 6039C(b): Pub. L. 97–34, § 831(e), substituted “For purposes of determining whether an entity to which this subsection applies has a substantial investor in United States real property, the assets of any person shall include the person’s pro rata share of the United States real property interest held by any corporation (whether domestic or foreign) if the person’s pro rata share of the United States real property interests exceeded $50,000” for “The assets of any entity to which this subsection applies shall include its pro rata share of the United States real property interests held by any corporation in which the entity is a substantial investor in United States real property”. - § 6039C: Pub. L. 97–34, § 831(a)(3), added subsec. (f). ## § 6041: Information at source - § 6041(d), § 6041(e): Pub. L. 97–34 added subsec. (d) and redesignated former subsec. (d) as (e). ## § 6047: Information relating to certain trusts and annuity plans - § 6047(d): Pub. L. 97–34 substituted “section 219(a)” for “section 219(a) or 220(a)”. ## § 6075: Time for filing estate and gift tax returns - § 6075(b): Pub. L. 97–34 substituted in par. (1) the rule for filing gift tax returns on or before the 15th day of April following the close of the calendar year for prior provision for such filing on or before, in the case of a return for the first, second, or third calendar quarter of any calendar year, the 15th day of the second month following the close of the calendar quarter, or, in the case of a return for the fourth calendar quarter of any calendar year, the 15th day of the fourth month following the close of the calendar quarter, redesignated former par. (3) as (2), and, as so redesignated, substituted “under section 6019 for such calendar year” for “under section 6019 for the fourth calendar quarter of such taxable year”, struck out former par. (2) setting forth special rule where gifts in a calendar quarter totalled $25,000 or less, added par. (3), and struck out par. (4) respecting application of the special rule to nonresidents not citizens of the United States. ## § 6091: Place for filing returns or other documents - § 6091(b)(1)(B)(iii): Pub. L. 97–34 substituted “section 911 (relating to citizens or residents of the United States living abroad)” for “section 911 (relating to income earned by employees in certain camps)” and struck out “section 913 (relating to deduction for certain expenses of living abroad)”. ## § 6096: Designation by individuals - § 6096(b): Pub. L. 97–34, § 331(e)(1), inserted reference to section 44G. - § 6096(b): Pub. L. 97–34, § 221(c)(1), inserted reference to section 44F. ## § 6103: Confidentiality and disclosure of returns and return information - § 6103(b)(2): Pub. L. 97–34 inserted prohibition against disclosure of methods for selection of tax returns for audit. ## § 6161: Extension of time for paying tax - § 6161(a)(2)(B): Pub. L. 97–34 struck out reference to section 6166A. ## § 6166: Extension of time for payment of estate tax where estate consists largely of interest in closely held business - § 6166: Pub. L. 97–34, § 422(e)(5)(B), substituted “Extension of time” for “Alternate extension of time” in section catchline. - § 6166(a): Pub. L. 97–34, § 422(a)(1), (e)(5)(A), substituted in par. (1) “35 percent” for “65 percent” and struck out par. (4) which provided that no election be made under this section by the executor of the estate of any decedent if an election under section 6166A applies with respect to the estate of such decedent. - § 6166(c): Pub. L. 97–34, § 422(a)(2), substituted “20 percent or more” for “more than 20 percent”. - § 6166(g)(1)(A): Pub. L. 97–34, § 422(c)(1), redesignated cl. (i) as cl. (i)(I), substituted “any portion” for “one-third or more in value”, added cl. (i)(II), substituted in cl. (ii) “the aggregate of such distributions, sales, exchanges, or other dispositions and withdrawals equals or exceeds 50 percent of the value of such interest” for “aggregate withdrawals of money and other property from the trade or business, an interest in which qualifies under subsection (a)(1), made with respect to such interest, equal or exceed one-third of the value of such trade or business” and in provision following cl. (ii) substituted “the unpaid portion” for “any unpaid portion”. - § 6166(g)(1)(D): Pub. L. 97–34, § 422(c)(3), inserted provision for application of a similar rule in the case of a series of subsequent transfers of the property by reason of death so long as each transfer is to a member of the family of the transferor in such transfer. - § 6166(g)(3): Pub. L. 97–34, § 422(c)(2), substituted as heading “Failure to make payment of principal or interest” for “Failure to pay installment”, designated existing provisions as subpar. (A), and in subpar. (A) as so designated, substituted “Except as provided in subparagraph (B), if any payment of principal or interest” for “If any installment” and “extension of time” for “extension of time for the payment of such installment”, and added subpar. (B). ## § 6212: Notice of deficiency - § 6212(c)(1): Pub. L. 97–34 substituted “calendar year” for “calendar quarter”. ## § 6324A: Special lien for estate tax deferred under section 6166 - § 6324A: Pub. L. 97–34, § 422(e)(6)(C), struck out “or 6166A” after “section 6166” in section catchline. - § 6324A(a), § 6324A(c)(2): Pub. L. 97–34, § 422(e)(6)(A), struck out “or 6166A” after “section 6166”. - § 6324A(d)(3), § 6324A(d)(5): Pub. L. 97–34, § 422(e)(6)(B), struck out “or 6166A(h)” after “section 6166(g)”. - § 6324A(e)(1), § 6324A(e)(3), § 6324A(e)(4): Pub. L. 97–34, § 422(e)(6)(A), struck out “or 6166A” after “section 6166”. ## § 6324B: Special lien for additional estate tax attributable to farm, etc., valuation - § 6324B(c)(2): Pub. L. 97–34 defined “qualified real property” to include qualified exchange property (within the meaning of section 2032A(i)(3)). ## § 6411: Tentative carryback and refund adjustments - § 6411(a): Pub. L. 97–34, § 331(d)(2)(B), inserted in introductory provisions “by an employee stock ownership credit carryback provided by section 44G(b)(2)” after “section 44F(g)(2),” and substituted “unused research credit, or unused employee stock ownership credit” for “or unused research credit”, “a research credit carryback, or employee stock ownership credit carryback” for “or a research credit carryback”, and “new employee credit carryback, or, in the case of an employee stock ownership credit carryback, to an investment credit carryback, a new employee credit carryback or a research and experimental credit carryback)” for “new employee credit carryback)” and in par. (1) substituted “unused research credit, or unused employee stock ownership credit” for “or unused research credit”. - § 6411(a): Pub. L. 97–34, § 221(b)(2)(B), inserted in introductory provision “by a research credit carryback provided in section 44F(g)(2),” after “section 53(b),” and substituted “unused new employee credit, or unused research credit” for “or unused new employee credit”, “a new employee credit carryback, or a research credit carryback” for “or a new employee credit carryback”, and “work incentive program carryback, or, in the case of a research credit carryback, to an investment credit carryback, a work incentive program carryback, or new employee credit carryback)” for “work incentive program carryback)” and in par. (1) substituted “unused new employee credit, or unused research credit” for “or unused new employee credit”. - § 6411(b): Pub. L. 97–34, § 331(d)(2)(B)(i), substituted “unused research credit, or unused employee stock ownership credit” for “or unused research credit”. - § 6411(b): Pub. L. 97–34, § 221(b)(2)(B)(i), substituted “unused new employee credit, or unused research credit” for “or unused new employee credit”. - § 6411(c): Pub. L. 97–34, § 331(d)(2)(B)(i), substituted “unused research credit, or unused employee stock ownership credit” for “or unused research credit”. - § 6411(c): Pub. L. 97–34, § 221(b)(2)(B)(i), substituted “unused new employee credit, or unused research credit” for “or unused new employee credit”. ## § 6503: Suspension of running of period of limitation - § 6503(d): Pub. L. 97–34 struck out reference to section 6166A. ## § 6511: Limitations on credit or refund - § 6511(d)(4)(C): Pub. L. 97–34, § 331(d)(2)(A), inserted reference to employee stock ownership credit carryback. - § 6511(d)(4)(C): Pub. L. 97–34, § 221(b)(2)(A), inserted reference to research credit carryback. ## § 6621: Determination of rate of interest - § 6621(b): Pub. L. 97–34, § 711(a), struck out provision that an adjustment provided for under this subsection not be made prior to the expiration of 23 months following the date of any preceding adjustment under this subsection which changes the rate of interest. - § 6621(b): Pub. L. 97–34, § 711(c), substituted “January 1” for “February 1”. - § 6621(c): Pub. L. 97–34, § 711(b), struck out “90 percent of” before “the average predominant prime rate”. ## § 6652: Failure to file certain information returns, registration statements, etc. - § 6652(a): Pub. L. 97–34, § 723(a)(4), inserted in heading “information at source,” before “payments of dividends”. - § 6652(a)(1): Pub. L. 97–34, § 723(a)(1), added subpars. (A), (E), and (F), and redesignated former subpars. (A) to (C) as (B) to (D), respectively. - § 6652(b): Pub. L. 97–34, § 723(a)(3), substituted provisions relating to failure to file required statement of payment to another person under authority of section 6042(a)(2), 6044(a)(2), or 6049(a)(2) or (3), and imposition of penalties with a maximum of $1,000 for all failures during the calendar year, for provisions relating to failure to file required statement of payment to another person under authority of section 6041, 6042(a)(2), 6044(a)(2), 6049(a)(2) or (3), 6050A(a) or (b), 6050C, 6051(d), or 6053(b), and imposition of penalties with a maximum of $1,000 for all failures during the calendar year. - § 6652(h), § 6652(i): Pub. L. 97–34, § 311(f), added subsec. (h) and redesignated former subsec. (h) as (i). ## § 6653: Failure to pay stamp tax - § 6653: Pub. L. 97–34, § 722(b)(1), designated existing provisions as par. (1), inserted heading, struck out “(relating to income taxes and gift taxes)”, and added par. (2) after “subtitle B”. - § 6653: Pub. L. 97–34, § 501(b), added subsec. (g). ## § 6654: Failure by individual to pay estimated income tax - § 6654(f): Pub. L. 97–34, § 725(b), added subsec. (f). Former subsec. (f) redesignated (g). - § 6654(f)(3): Pub. L. 97–34, § 601(a)(6)(A), inserted “the sum of—” after “(3)”, designated former par. (3) as subpar. (A), and added subpar. (B). - § 6654(g), § 6654(h): Pub. L. 97–34, §§ 601(a)(6)(A), 725(b), (c)(5), redesignated former subsec. (f) as (g), inserted reference to subsec. (f) in introductory text, and “the sum of—” after “(3)”, designated former par. (3) as subpar. (A), and added subpar. (B). Former subsec. (g) redesignated (h). ## § 6655: Failure by corporation to pay estimated income tax - § 6655(e)(2): Pub. L. 97–34, § 601(a)(6)(B), inserted “the sum of—”, designated existing provisions as subpar. (A), inserted at end of subpar. (A) “, plus”, and added subpar. (B). - § 6655(h): Pub. L. 97–34, § 731(a), (b), substituted in heading “minimum percentage” for “at least 60 percent” and provisions of par. (1) respecting minimum percentage, for provisions respecting in the case of a large corporation, the amount treated as the estimated tax for the taxable year under paragraphs (1) and (2) of subsection (d) shall in no event be less than 60 percent of the tax shown on the return for the taxable year, or if no return was filed, the tax for such year. ## § 6656: Failure to make deposit of taxes - § 6656: Pub. L. 97–34, § 724(b)(1), inserted “or overstatement of deposits” after “taxes” in section catchline. - § 6656(a): Pub. L. 97–34, § 724(b)(3), substituted “Underpayment of deposits” for “Penalty” in heading. - § 6656(b): Pub. L. 97–34, § 724(a), substituted provisions relating to conditions for imposition of penalties for overstated deposit claims and definition of “overstated deposit claim”, for provisions relating to imposition of penalties after due date for return. ## § 6682: False information with respect to withholding - § 6682: Pub. L. 97–34 struck out “allowances based on itemized deductions” after “withholding” in section catchline. - § 6682(a): Pub. L. 97–34 substituted provisions relating to imposition of penalty of $500 for statement under section 3402 resulting in decreased amounts withheld under chapter 24 and no reasonable basis existed for making such statement at the time it was made, for provisions relating to imposition of penalty of $50 for statement under section 3402(f)(1)(F) concerning amount of wages under chapter 24, or itemized deductions under section 3402(m), and provisions setting forth conditions for mitigation of such penalty. - § 6682(b), § 6682(c): Pub. L. 97–34 added subsec. (b) and redesignated former subsec. (b) as (c). ## § 7205: Fraudulent withholding exemption certificate or failure to supply information - § 7205: Pub. L. 97–34 substituted “$1,000” for “$500”. ## § 7403: Action to enforce lien or to subject property to payment of tax - § 7403(a): Pub. L. 97–34 struck out “or 6166A(h)” after “section 6166(g)”. ## § 7451: Petitions - § 7451: Pub. L. 97–34 increased limitation on amount of fee to $60 from $10. ## § 7701: Definitions - § 7701(a)(34): Pub. L. 97–34 substituted “section 6015(d)” for “section 6015(c)”.