# Pub. L. 99-514: changes to the Internal Revenue Code 1986-10-22, 100 Stat. 2096. Source: . ## Legislative history - Bill: [H.R. 3838](https://www.congress.gov/bill/99th-congress/house-bill/3838) - Bluebook: [JCS-10-87 (1987)](https://www.jct.gov/publications/1987/jcs-10-87/) ## § 1: Tax imposed - § 1(a), § 1(b), § 1(c), § 1(d), § 1(e): Pub. L. 99–514, § 101(a), in amending subsecs. (a) to (e) generally, substituted a general tax table for tax tables (1), (2), and (3) in each subsec. applicable to taxable years beginning in 1982, 1983, and after 1983, respectively. - § 1(f): Pub. L. 99–514, § 101(a), in amending subsec. (f) generally, in par. (1) substituted “1988,” for “1984” and struck out “paragraph (3) of” before “subsections”, in par. (2) struck out “paragraph (3) of” before “subsection” in introductory provisions, substituted subpars. (A) to (C) for former subpars. (A) to (C) which read as follows: - § 1(g), § 1(h): Pub. L. 99–514, § 101(a), in amending section generally, added subsecs. (g) and (h). - § 1(i): Pub. L. 99–514, § 1411(a), added subsec. (i). - § 1(j): Pub. L. 99–514, § 302(a), added subsec. (j). ## § 2: Definitions and special rules - § 2(a)(3)(B): Pub. L. 99–514, § 1708(a)(1), amended subpar. (B) generally. Prior to amendment, subpar. (B) read as follows: “the date which is— - § 2(c): Pub. L. 99–514, § 1301(j)(10), substituted “section 7703(b)” for “section 143(b)”. ## § 3: Tax tables for individuals - § 3(a): Pub. L. 99–514, § 102(b), substituted subsec. (a) for former subsec. (a) which read as follows: - § 3(b): Pub. L. 99–514, § 141(b)(1), struck out par. (1) which read: “an individual to whom section 1301 (relating to income averaging) applies for the taxable year,” and redesignated pars. (2) and (3) as (1) and (2), respectively. ## § 5: Cross references relating to tax on individuals - § 5(a)(4): Pub. L. 99–514, § 701(e)(4)(A), amended par. (4) generally, substituting “alternative minimum tax” for “minimum tax for taxpayers other than corporations”. - § 5(b)(2), § 5(b): Pub. L. 99–514, § 141(b)(2), struck out par. (2) which read: “For limitation on tax where an individual chooses the benefits of income averaging, see section 1301.” and redesignated former par. (3) as (2). ## § 11: Tax imposed - § 11(b): Pub. L. 99–514 amended subsec. (b) generally. Prior to amendment, subsec. (b) read as follows: “The amount of the tax imposed by subsection (a) shall be the sum of— ## § 12: Cross references relating to tax on corporations - § 12: Pub. L. 99–514 amended par. (7) generally, substituting “alternative minimum tax” and “55” for “minimum tax for tax preferences” and “56”, respectively. ## § 15: Effect of changes - § 15(d): Pub. L. 99–514 amended subsec. (d) generally, substituting “apply to inflation adjustments” for “apply to section 1 rate changes made by Economic Recovery Tax Act of 1981” in heading and struck out “section 1 attributable to the amendments made by section 101 of the Economic Tax Act of 1981 or” before “subsection (f)” in text. ## § 21: Expenses for household and dependent care services necessary for gainful employment - § 21(b)(1)(A), § 21(e)(6)(A): Pub. L. 99–514, § 104(b)(1)(A), substituted “section 151(c)” for “section 151(e)”. - § 21(e)(6)(B): Pub. L. 99–514, § 104(b)(1)(B), substituted “section 151(c)(3)” for “section 151(e)(3)”. ## § 22: Credit for the elderly and the permanently and totally disabled - § 22(e)(2): Pub. L. 99–514 substituted “section 7703” for “section 143”. ## § 25: Interest on certain home mortgages - § 25(a)(1)(B): Pub. L. 99–514, § 1862(d)(1), substituted “paid or accrued” for “paid or incurred”. - § 25(b)(2)(A)(ii): Pub. L. 99–514, § 1301(f)(2)(A), substituted “section 143(k)(4)” for “section 103A(l)(6)”. - § 25(b)(2)(A)(iii): Pub. L. 99–514, § 1301(f)(2)(B), substituted “section 143(k)(5)” for “section 103A(l)(7)”. - § 25(c)(2)(A): Pub. L. 99–514, § 1301(f)(2)(E), substituted “section 143(a)(2)” for “section 103A(c)(2)” in provision following cl. (vii). - § 25(c)(2)(A): Pub. L. 99–514, § 1862(b), inserted “Under regulations, rules similar to the rules of subparagraphs (B) and (C) of section 103A(c)(2) shall apply to the requirements of this subparagraph.” - § 25(c)(2)(A)(ii): Pub. L. 99–514, § 1301(f)(2)(C)(ii), as amended by Pub. L. 100–647, § 1013(a)(25), substituted “private activity bonds which it may otherwise issue during such calendar year under section 146” for “qualified mortgage bonds which it may otherwise issue during such calendar year under section 103A”. - § 25(c)(2)(A)(iii): Pub. L. 99–514, § 1301(f)(2)(C)(i), substituted “section 143” for “section 103A” in introductory provisions, added subcls. (I) to (VI), and struck out former subcls. (I) to (V) which read as follows: - § 25(c)(2)(A)(iii)(V): Pub. L. 99–514, § 1862(a), substituted “subsection (j), other than paragraph (2) thereof” for “paragraph (1) of subsection (j)”. - § 25(c)(2)(B): Pub. L. 99–514, § 1301(f)(2)(C)(i), substituted in heading and introductory provisions “section 143” for “section 103A”. - § 25(c)(2)(B): Pub. L. 99–514, § 1301(f)(2)(F), inserted in introductory provisions reference to subcl. (V), added cl. (iii) and closing provisions, and struck out former cl. (iii) and closing provisions which read as follows: - § 25(d)(2)(A): Pub. L. 99–514, § 1301(f)(1)(A), substituted “25 percent” for “20 percent” in concluding provisions. - § 25(d): Pub. L. 99–514, § 1301(f)(2)(G), struck out par. (3) “Additional limit in certain cases” which read as follows: “In the case of a qualified mortgage credit certificate program in a State which— - § 25(e)(1)(B): Pub. L. 99–514, § 1862(c), amended subpar. (B) generally. Prior to amendment, subpar. (B) “Limitations” read as follows: “The amount of the unused credit which may be taken into account under subparagraph (A) for any taxable year shall not exceed the amount by which the applicable tax limit for such taxable year exceeds the sum of the amounts which, by reason of this paragraph, are carried to such taxable year and are attributable to taxable years before the unused credit year.” - § 25(e)(2): Pub. L. 99–514, § 1301(f)(2)(H), substituted “subsections (c)(1), (d), (e), (f), and (i) of section 143” for “subsection (d)(1), (e), (f), and (j) of section 103A”. - § 25(e)(6): Pub. L. 99–514, § 1301(f)(2)(I), substituted “section 144(a)(3)(A)” for “section 103(b)(6)(C)(i)”. - § 25(e)(8)(A): Pub. L. 99–514, § 1301(f)(2)(J), substituted “section 143(k)(5)(B)” for “section 103A(l)(7)(B)”. - § 25(e)(8)(B): Pub. L. 99–514, § 1301(f)(2)(K), substituted “section 143(k)(4)” for “section 103A(l)(6)”. - § 25(e)(9): Pub. L. 99–514, § 1301(f)(2)(L), substituted “section 143(a)(1)” for “section 103A(c)(1)”. - § 25(e)(10): Pub. L. 99–514, § 1301(f)(2)(M), substituted “section 143” for “section 103A”. - § 25(f)(1): Pub. L. 99–514, § 1301(f)(2)(N), substituted “subsection (d) of section 146” for “paragraph (4) of section 103A(g)”. - § 25(f)(2)(A): Pub. L. 99–514, § 1301(f)(1)(B), substituted “0.25” for “0.20”. - § 25(f)(3): Pub. L. 99–514, § 1301(f)(2)(O), substituted “section 146(d)(3)(C)” for “section 103A(g)(5)(C)”. - § 25(f)(4): Pub. L. 99–514, § 1899A(1), substituted “ensure” for “insure”. ## § 26: Limitation based on tax liability; definition of tax liability - § 26(a): Pub. L. 99–514, § 701(c)(1)(A), amended subsec. (a) generally. Prior to amendment, subsec. (a) read as follows: “The aggregate amount of credits allowed by this subpart for the taxable year shall not exceed the taxpayer’s tax liability for such taxable year.” - § 26(b): Pub. L. 99–514, § 701(c)(1)(B)(i), (v), substituted “Regular tax liability” for “Tax liability” in heading and “this part” for “this section” in introductory provisions. - § 26(b)(1): Pub. L. 99–514, § 701(c)(1)(B)(ii), substituted “regular tax liability” for “tax liability”. - § 26(b)(2): Pub. L. 99–514, § 701(c)(1)(B)(iii), substituted “section 55 (relating to minimum tax)” for “section 56 (relating to corporate minimum tax)” in subpar. (A). - § 26(b)(2): Pub. L. 99–514, § 632(c)(1), substituted “certain built-in gains” for “certain capital gains” in subpar. (G). - § 26(b)(2): Pub. L. 99–514, § 261(c), added subpar. (I). - § 26(b)(2): Pub. L. 99–514, § 701(c)(1)(B)(iv), added subpar. (J). - § 26(c): Pub. L. 99–514, § 701(c)(1)(C), amended subsec. (c) generally, substituting provisions relating to tentative minimum tax for provisions referring to section 55(c) of this title for similar rule for alternative minimum tax for taxpayers other than corporations. ## § 32: Earned income - § 32(a): Pub. L. 99–514, § 111(a), substituted “14 percent” for “11 percent” and “$5,714” for “$5,000”. - § 32(b): Pub. L. 99–514, § 111(b), amended subsec. (b) generally. Prior to amendment, subsec. (b) read as follows: “The amount of the credit allowable to a taxpayer under subsection (a) for any taxable year shall not exceed the excess (if any) of— - § 32(c)(1)(A)(i): Pub. L. 99–514, § 1301(j)(8), substituted “section 7703” for “section 143”. - § 32(c)(1)(A)(i): Pub. L. 99–514, § 104(b)(1)(B), substituted “section 151(c)(3)” for “section 151(e)(3)”. - § 32(c)(1)(C): Pub. L. 99–514, § 1272(d)(4), struck out “or 931” after “911” in heading, and amended text generally. Prior to amendment, text read as follows: “The term ‘eligible individual’ does not include an individual who, for the taxable year, claims the benefits of— - § 32(d): Pub. L. 99–514, § 1301(j)(8), substituted “section 7703” for “section 143”. - § 32(f)(2)(A), § 32(f)(2)(B): Pub. L. 99–514, § 111(d)(1), added subpars. (A) and (B) and struck out former subpars. (A) and (B) which read as follows: - § 32(i): Pub. L. 99–514, § 111(c), added subsec. (i). ## § 34: Certain uses of gasoline and special fuels - § 34(a)(3): Pub. L. 99–514, § 1877(a), amended par. (3) generally. Prior to amendment, par. (3) read as follows: “under section 6427 with respect to fuels used for nontaxable purposes or resold during the taxable year (determined without regard to section 6427(j)).” - § 34(a)(3): Pub. L. 99–514, § 1703(e)(2)(F), substituted “6427(k)” for “6427(j)”. ## § 38: General business credit - § 38(b)(4): Pub. L. 99–514, § 231(d)(1), added par. (4). - § 38(b)(4): Pub. L. 99–514, § 1171(b)(1), struck out former par. (4) which read as follows: “the employee stock ownership credit determined under section 41(a)”. - § 38(b)(5): Pub. L. 99–514, § 252(b)(1), added par. (5). - § 38(c): Pub. L. 99–514, § 701(c)(4), as amended by Pub. L. 100–647, § 1007(g)(8), added pars. (1) to (3), redesignated former par. (3) as (4), and struck out former par. (1) “In general” which provided: “The credit allowed under subsection (a) for any taxable year shall not exceed the sum of— - § 38(c)(1)(B): Pub. L. 99–514, § 221(a), substituted “75 percent” for “85 percent”. - § 38(d): Pub. L. 99–514, § 252(b)(2), inserted “42(a),”. - § 38(d): Pub. L. 99–514, § 1171(b)(2), substituted “and 196(a)” for “196(a), and 404(i)” and struck out “41(a),” after “40(a)”. - § 38(d): Pub. L. 99–514, § 231(d)(3)(B), inserted “41(a),” after “40(a),”. ## § 39: Carryback and carryforward of unused credits - § 39(d): Pub. L. 99–514, § 1846(1), inserted “(as in effect before the enactment of the Tax Reform Act of 1984)”. - § 39(d): Pub. L. 99–514, § 1846(2), substituted “as defined in section 26(b)” for “as so defined in section 25(b)”. - § 39(d): Pub. L. 99–514, § 231(d)(3)(C)(i), added par. (3). ## § 41: Credit for increasing research activities - § 41: Pub. L. 99–514, § 231(d)(2), renumbered section 30 of this title as this section. - § 41(a): Pub. L. 99–514, § 231(c)(1), amended subsec. (a) generally. Prior to amendment, subsec. (a) read as follows: “There shall be allowed as a credit against the tax imposed by this chapter for the taxable year an amount equal to 25 percent of the excess (if any) of— - § 41(b)(2)(A)(iii): Pub. L. 99–514, § 231(e), amended cl. (iii) generally. Prior to amendment, cl. (iii) read as follows: “any amount paid or incurred to another person for the right to use personal property in the conduct of qualified research.” - § 41(b)(2)(D)(iii): Pub. L. 99–514, § 1847(b)(1), substituted “targeted jobs credit” for “new jobs or WIN credit” in heading. - § 41(d): Pub. L. 99–514, § 231(b), inserted “defined” in heading and amended text generally. Prior to amendment, text read as follows: “For purposes of this section the term ‘qualified research’ has the same meaning as the term research or experimental has under section 174, except that such term shall not include— - § 41(e): Pub. L. 99–514, § 231(c)(2), amended subsec. (e) generally, substituting “Credit allowable with respect to certain payments to qualified organizations for basic research” for “Credit available with respect to certain basic research by colleges, universities, and certain research organizations” in heading, and restating and expanding provisions of former pars. (1) to (4) into new pars. (1) to (7). - § 41(g): Pub. L. 99–514, § 231(d)(3)(C)(ii), amended subsec. (g) generally, substituting provisions relating to special rule for pass-thru of credit for provisions relating to limitation on amount of credit for research based on amount of tax liability. - § 41(h): Pub. L. 99–514, § 231(a)(1), added subsec. (h). ## § 42: Low-income housing credit - Enacted 26 U.S.C. § 42. ## § 45C: Clinical testing expenses for certain drugs for rare diseases or conditions - § 45C(b)(1): Pub. L. 99–514, § 231(d)(3)(A)(i), (iv), substituted “41” for “30” in subpars. (A), (B), and (D), and substituted “1988” for “1985” in subpar. (D). - § 45C(b)(2)(A)(ii)(I): Pub. L. 99–514, § 1879(b)(1)(A), substituted “the date such drug” for “the date of such drug”. - § 45C(b)(2)(A)(ii)(II): Pub. L. 99–514, § 1879(b)(1)(B), inserted “or, if the drug is a biological product, before the date on which a license for such drug is issued under section 351 of the Public Health Services Act”. - § 45C(c): Pub. L. 99–514, § 231(d)(3)(A)(i), (ii), substituted “41” for “30” in pars. (1) and (2) and “41(b)” for “30(b)” in par. (2). - § 45C(d)(1): Pub. L. 99–514, § 1879(b)(2), amended par. (1) generally. Prior to amendment, par. (1) read as follows: “For purposes of this section, the term ‘rare disease or condition’ means any disease or condition which occurs so infrequently in the United States that there is no reasonable expectation that the cost of developing and making available in the United States a drug for such disease or condition will be recovered from sales in the United States of such drug. Determinations under the preceding sentence with respect to any drug shall be made on the basis of the facts and circumstances as of the date such drug is designated under section 526 of the Federal Food, Drug, and Cosmetic Act.” - § 45C(d)(2): Pub. L. 99–514, § 701(c)(2), amended par. (2) generally. Prior to amendment, par. (2) read as follows: “The credit allowed by this section for any taxable year shall not exceed the taxpayer’s tax liability for the taxable year (as defined in section 26(b)), reduced by the sum of the credits allowable under subpart A and section 27.” - § 45C(d)(3): Pub. L. 99–514, § 1275(c)(4), struck out “934(b) or” before “936” in heading and amended text generally. Prior to amendment, text read as follows: “No credit shall be allowed under this section with respect to any clinical testing conducted by a corporation to which section 934(b) applies or to which an election under section 936 applies.” - § 45C(d)(4): Pub. L. 99–514, § 231(d)(3)(A)(iii), substituted “section 41(f)” for “section 30(f)”. - § 45C: Pub. L. 99–514, § 232, substituted “1990” for “1987”. ## § 45K: Credit for producing fuel from a nonconventional source - § 45K(b)(5): Pub. L. 99–514, § 701(c)(3), amended par. (5) generally. Prior to amendment, par. (5) read as follows: “The credit allowed by subsection (a) for a taxable year shall not exceed the taxpayer’s tax liability for the taxable year (as defined in section 26(b)), reduced by the sum of the credits allowable under subpart A and sections 27 and 28.” - § 45K(d)(8): Pub. L. 99–514, § 1879(c)(1), inserted provision directing that a corporation which is a member of an affiliated group of corporations filing a consolidated return shall be treated as selling qualified fuels to an unrelated person if such fuels are sold to such person by another member of such group. ## § 46: Amount of credit - § 46: Pub. L. 99–514, § 1847(b)(11), substituted “48(l)(3)(A)(viii)” for “48(l)(3)(A)(vii)” in table item (ii). - § 46: Pub. L. 99–514, § 421(a), inserted table items (viii) to (xi). - § 46: Pub. L. 99–514, § 421(b), added subpar. (E). - § 46: Pub. L. 99–514, § 251(a), in amending par. (4) generally, substituted in subpar. (A) definition of “rehabilitation percentage” for former table specifying specific rehabilitation percentages, reenacted subpar. (B), and struck out subpar. (C) which related to definitions. - § 46: Pub. L. 99–514, § 1844(a), substituted “this subparagraph” for “clause (i)”. - § 46: Pub. L. 99–514, § 201(d)(7)(B), substituted “section 465(b)(3)(C)” for “section 168(e)(4)”. - § 46: Pub. L. 99–514, § 1844(b)(3), substituted “an increase in the credit base for” for “additional qualified investment in”. - § 46: Pub. L. 99–514, § 1844(b)(5), substituted “any increase in a taxpayer’s credit base for any property by reason of this paragraph shall be taken into account as if it were property placed in service by the taxpayer in the taxable year in which the property referred to in subparagraph (A) was first placed in service” for “any increase in a taxpayer’s qualified investment in property by reason of this paragraph shall be deemed to be additional qualified investment made by the taxpayer in the year in which the property referred to in subparagraph (A) was first placed in service”. - § 46: Pub. L. 99–514, § 1802(a)(6), (8), added subpars. (D) and (E). - § 46: Pub. L. 99–514, § 1848(a), struck out par. (9) which related to a special rule for additional credit. ## § 47: Rehabilitation credit - § 47(a): Pub. L. 99–514, § 1802(a)(5)(A), added par. (9). - § 47(d)(1): Pub. L. 99–514, § 1844(b)(1), substituted “reducing the credit base (as defined in section 48(c)(8)(C))” for “reducing the qualified investment” and inserted “For purposes of determining the amount of credit subject to the early disposition or cessation rules of subsection (a), the net increase in the amount of the nonqualified nonrecourse financing with respect to the property shall be treated as reducing the property’s credit base (and correspondingly reducing the qualified investment in the property) in the year in which the property was first placed in service.” - § 47(d)(3)(E): Pub. L. 99–514, § 1844(b)(4), inserted “reduced by the sum of the credit recapture amounts with respect to such property for all preceding years”. - § 47(d)(3)(F): Pub. L. 99–514, § 1844(b)(2), struck out subpar. (F) which read as follows: “The amount of any increase in tax under subsection (a) with respect to any property to which this paragraph applies shall be determined by reducing the qualified investment with respect to such property by the aggregate credit recapture amounts for all taxable years under this paragraph.” - § 47(d)(3): Pub. L. 99–514, § 1511(c)(2), substituted “determined at the underpayment rate established under section 6621” for “determined under section 6621”. ## § 48: Energy credit - § 48(a)(2)(B): Pub. L. 99–514, §§ 1272(d)(5), 1275(c)(5), struck out “932,” after “931,” and “or which is entitled to the benefits of section 934(b)” after “in effect under section 936”, and substituted “or 933” for “, 933, or 934(c)”. - § 48(a)(4): Pub. L. 99–514, § 1802(a)(9)(A), substituted “514(b)” for “514(c)” and “514(a)” for “514(b)”. - § 48(a)(5)(B): Pub. L. 99–514, § 1802(a)(5)(B), struck out cl. (iii) which provided that (I) in the case of any aircraft used under a qualifying lease (as defined in section 47(a)(7)(C)) and which is leased to a foreign person or entity before January 1, 1990, clause (i) shall be applied by substituting “3 years” for “6 months” and that (II) for purposes of applying section 47(a)(1) and (5)(B) there shall not be taken into account any period of a lease to which subclause (I) applies. - § 48(a)(5)(D), § 48(a)(5)(E): Pub. L. 99–514, § 1802(a)(4)(C), added subpar. (D) and redesignated former subpar. (D) as (E). - § 48(b): Pub. L. 99–514, § 1809(e)(1), inserted “Such term includes any section 38 property the reconstruction of which is completed by the taxpayer, but only with respect to that portion of the basis which is properly attributable to such reconstruction.” - § 48(b): Pub. L. 99–514, § 1809(e)(2), in introductory provisions substituted “the first sentence of paragraph (1)” for “paragraph (1)”, in subpar. (B) substituted “3 months after” for “3 months of”, in closing provisions substituted “used under the leaseback (or lease) referred to in subparagraph (B)” for “used under the lease” and inserted “The preceding sentence shall not apply to any property if the lessee and lessor of such property make an election under this sentence. Such an election, once made, may be revoked only with the consent of the Secretary.” - § 48(d): Pub. L. 99–514, § 701(e)(4)(C), inserted “(as in effect on the day before the date of the enactment of the Tax Reform Act of 1986)”. - § 48(d): Pub. L. 99–514, § 1511(c)(3), substituted “the underpayment rate” for “the rate” in closing provisions. - § 48: Pub. L. 99–514, § 251(b), amended par. (1) generally, restating in subpars. (A) to (D) provisions relating to qualified rehabilitated buildings which had in subpar. (A) provided general definition of qualified rehabilitated building, in subpar. (B) directed that 30 years must have elapsed since construction, in subpar. (C) provided general definition of substantially rehabilitated with special rule for phased rehabilitation and application of provision to lessees, and in subpar. (D) provided that rehabilitation included reconstruction, and striking out former subpar. (E) which had provided an alternative test for definition of qualified rehabilitated building. - § 48: Pub. L. 99–514, § 251(b), amended par. (2) generally, in subpar. (A) striking out reference to amounts “incurred after December 31, 1981” in introductory provision, and in cl. (i) substituting subcls. (I) to (IV) for “for real property (or additions or improvements to real property) which have a recovery period (within the meaning of section 168) of 19 (15 years in the case of low-income housing) years,”, in subpar. (B), in cl. (i), substituting provision relating to use of straight line depreciation for provision relating to use of accelerated methods of depreciation, redesignating former cl. (vi) as (v) and substituting “section 168(h)” for “section 168(j)”, redesignating former cl. (v) as (vi) and substituting “less than the recovery period determined under section 168(c)” for “less than 19 years (15 years in the case of low-income housing”, restating subpar. (C) without change, and in subpar. (D) substituting provisions defining nonresidential real property, residential rental property and class life for provisions defining low-income housing. - § 48: Pub. L. 99–514, § 1802(a)(9)(B), substituted “section 168(j)” for “section 168(j)(3)”. - § 48: Pub. L. 99–514, § 251(b), in amending par. (3) generally, inserted introductory phrase “For purposes of this subsection—”. - § 48: Pub. L. 99–514, § 251(b), in amending subsec. (g) generally, reenacted par. (4) without change. - § 48: Pub. L. 99–514, § 1847(b)(6), substituted “section 23(c)” for “section 44C(c)” and “section 23(c)(4)(A)(viii)” for “section 44C(c)(4)(A)(viii)”. - § 48: Pub. L. 99–514, § 251(c), struck out “other than a certified historic structure” after “qualified rehabilitated building”. - § 48: Pub. L. 99–514, § 1809(d)(2), renumbered par. (6), relating to special rule for qualified films, as (7). - § 48: Pub. L. 99–514, § 1879(j)(1), added subsec. (r). Former subsec. (r) redesignated (s). - § 48: Pub. L. 99–514, § 1879(j)(1), redesignated former subsec. (r) as (s). - § 48: Pub. L. 99–514, § 803(b)(2)(B), which directed the general amendment of par. (5) of subsec. (r), was executed by amending par. (5) of subsec. (s) to reflect the probable intent of Congress and the intervening redesignation of subsec. (r) as (s) by Pub. L. 99–514, § 1879(j)(1), see note above. Prior to amendment, par. (5) read as follows: “For purposes of this subsection, the term ‘sound recording’ means any sound recording described in section 280(c)(2).” ## § 49: At-risk rules - Enacted 26 U.S.C. § 49. ## § 51: Amount of credit - § 51(a): Pub. L. 99–514, § 1701(b)(1), amended subsec. (a) generally. Prior to amendment, subsec. (a) read as follows: “For purposes of section 38, the amount of the targeted jobs credit determined under this section for the taxable year shall be the sum of— - § 51(b)(3), § 51(b): Pub. L. 99–514, § 1701(b)(2)(A), redesignated par. (4) as (3) and struck out “, and the amount of the qualified second-year wages,” after “first-year wages” and struck out par. (3) which defined “qualified second-year wages”. - § 51(c)(3): Pub. L. 99–514, § 1701(a), substituted “December 31, 1988” for “December 31, 1985”. - § 51(d)(12): Pub. L. 99–514, § 1701(b)(2)(B), in cl. (i), substituted “40 percent” for “50 percent”, struck out cl. (ii) which directed that subsecs. (a)(2) and (b)(3) were not to apply, redesignated cl. (iii) as cl. (ii), redesignated cl. (iv) as cl. (iii), and in cl. (iii) as so redesignated substituted “subsection (b)(3)” for “subsection (b)(4)”. - § 51(i)(3): Pub. L. 99–514, § 1701(c), added par. (3). - § 51(k): Pub. L. 99–514, § 1878(f)(1), redesignated subsec. (j) added by section 1041(c)(1) of Pub. L. 98–369 and relating to treatment of successor employers, and employees performing services for other persons, as subsec. (k). ## § 53: Credit for prior year minimum tax liability - Enacted 26 U.S.C. § 53. ## § 55: Alternative minimum tax imposed - Enacted 26 U.S.C. § 55. - § 55(c)(1): Pub. L. 99–514, § 252(c), inserted “or section 42(j)”. ## § 56: Adjustments in computing alternative minimum taxable income - Enacted 26 U.S.C. § 56. ## § 57: Items of tax preference - Enacted 26 U.S.C. § 57. ## § 58: Denial of certain losses - Enacted 26 U.S.C. § 58. ## § 59: Other definitions and special rules - Enacted 26 U.S.C. § 59. ## § 62: Adjusted gross income defined - § 62(a): Pub. L. 99–514, § 132(b)(2)(A), designated existing provisions as subsec. (a) and added heading. - § 62(a)(2): Pub. L. 99–514, § 132(b)(1), amended par. (2) generally, substituting “Certain trade” for “Trade” in heading and inserting “of employees” in subpar. (A) heading, substituting provision relating to deduction of certain expenses of performing artists for provision relating to deduction of expenses for travel away from home in subpar. (B), and striking out subpar. (C) relating to deduction of travel expenses and subpar. (D) relating to deduction of expenses of outside salesmen. - § 62(a)(3), § 62(a)(4), § 62(a)(5): Pub. L. 99–514, § 301(b)(1), redesignated pars. (4) to (6) as (3) to (5), respectively, and struck out former par. (3) which related to long-term capital gains and read as follows: “The deduction allowed by section 1202.” - § 62(a)(6): Pub. L. 99–514, § 301(b)(1), redesignated par. (7) as (6). Former par. (6) redesignated (5). - § 62(a)(6): Pub. L. 99–514, § 1875(c)(3), struck out “to the extent attributable to contributions made on behalf of such individual” after “section 404”. - § 62(a)(7): Pub. L. 99–514, § 301(b)(1), redesignated par. (10) as (7). Former par. (7) redesignated (6). - § 62(a)(8): Pub. L. 99–514, § 301(b)(1), redesignated par. (11) as (8). Former par. (8) struck out. - § 62(a)(8): Pub. L. 99–514, § 132(c), struck out par. (8) which related to moving expense deduction and read as follows: “The deduction allowed by section 217.” - § 62(a)(9), § 62(a)(10), § 62(a)(11), § 62(a)(12), § 62(a)(13), § 62(a)(14), § 62(a)(15): Pub. L. 99–514, § 301(b)(1), redesignated pars. (12) to (15) as (9) to (12), respectively. Former pars. (10) and (11) redesignated (7) and (8), respectively. - § 62(a)(16): Pub. L. 99–514, § 131(b)(1), struck out par. (16) which related to deduction for two-earner married couples and read as follows: “The deduction allowed by section 221.” - § 62(b): Pub. L. 99–514, § 132(b)(2)(B), added subsec. (b). ## § 63: Taxable income defined - § 63(a): Pub. L. 99–514, § 102(a), substituted “In general” for “Corporations” in heading and amended text generally. Prior to amendment, text read as follows: “For purposes of this subtitle, in the case of a corporation, the term ‘taxable income’ means gross income minus the deductions allowed by this chapter.” - § 63(b): Pub. L. 99–514, § 102(a), substituted “Individuals who do not itemize their deductions” for “Individuals” in heading and amended text generally. Prior to amendment, text read as follows: “For purposes of this subtitle, in the case of an individual, the term ‘taxable income’ means adjusted gross income— - § 63(c): Pub. L. 99–514, § 102(a), substituted “Standard deduction” for “Excess itemized deductions” in heading and amended text generally. Prior to amendment, text read as follows: “For purposes of this subtitle, the term ‘excess itemized deductions’ means the excess (if any) of— - § 63(c)(6)(C), § 63(c)(6)(D), § 63(c)(6): Pub. L. 99–514, § 1272(d)(6), redesignated subpars. (D) and (E) as (C) and (D), respectively, and struck out former subpar. (C) which read as follows: “a citizen of the United States entitled to the benefits of section 931 (relating to income from sources within possessions of the United States),”. - § 63(d): Pub. L. 99–514, § 102(a), substituted “Itemized deductions” for “Zero bracket amount” in heading and amended text generally. Prior to amendment, subsec. (d) read as follows: “For purposes of this subtitle, the term ‘zero bracket amount’ means— - § 63(e): Pub. L. 99–514, § 102(a), substituted “Election to itemize” for “Unused zero bracket amount” in heading. - § 63(e)(1): Pub. L. 99–514, § 102(a), substituted “In general” for “Individuals for whom computation must be made” in heading and amended text generally. Prior to amendment, text read as follows: “A computation for the taxable year shall be made under this subsection for the following individuals: - § 63(e)(2): Pub. L. 99–514, § 102(a), substituted “Time and manner of election” for “Computation” in heading and amended text generally. Prior to amendment, text read as follows: “For purposes of this subtitle, an individual’s unused zero bracket amount for the taxable year is an amount equal to the excess (if any) of— - § 63(e)(3): Pub. L. 99–514, § 102(a), in amending subsec. (e) generally, added par. (3). - § 63(f): Pub. L. 99–514, § 102(a), substituted “Aged or blind additional amounts” for “Itemized deductions” in heading and amended text generally. Prior to amendment, text read as follows: “For purposes of this subtitle, the term ‘itemized deductions’ means the deductions allowable by this chapter other than— - § 63(g): Pub. L. 99–514, § 102(a), amended subsec. (g) generally, substituting provision that marital status be determined under section 7703 for provisions relating to election to itemize. See subsec. (e). - § 63: Pub. L. 99–514, § 102(a), substituted “Transitional rule for taxable years beginning in 1987” for “Marital status” in heading and amended text generally. Prior to amendment, text read as follows: “For purposes of this section, marital status shall be determined under section 143.” - § 63: Pub. L. 99–514, § 102(a), in amending section generally, struck out subsec. (i), “Direct charitable deduction”, which read as follows: “For purposes of this section, the term ‘direct charitable deduction’ means that portion of the amount allowable under section 170(a) which is taken as a direct charitable deduction for the taxable year under section 170(i).” ## § 67: 2-percent floor on miscellaneous itemized deductions - Enacted 26 U.S.C. § 67. ## § 72: Annuities; certain proceeds of endowment and life insurance contracts - § 72(b): Pub. L. 99–514, § 1122(c)(2), amended subsec. (b) generally. Prior to amendment, subsec. (b) read as follows: “Gross income does not include that part of any amount received as an annuity under an annuity, endowment, or life insurance contract which bears the same ratio to such amount as the investment in the contract (as of the annuity starting date) bears to the expected return under the contract (as of such date). This subsection shall not apply to any amount to which subsection (d)(1) (relating to certain employee annuities) applies.” - § 72(d): Pub. L. 99–514, § 1122(c)(1), struck out subsec. (d) which related to employee’s annuities where the employee’s contributions were recoverable in 3 years. - § 72(e)(4)(C): Pub. L. 99–514, § 1826(b)(3), added subpar. (C). - § 72(e)(5)(D): Pub. L. 99–514, § 1122(c)(3)(B), substituted “paragraphs (7) and (8)” for “paragraph (7)” in introductory provisions. - § 72(e)(5)(D): Pub. L. 99–514, § 1854(b)(1), inserted closing provisions which read as follows: “Any dividend described in section 404(k) which is received by a participant or beneficiary shall, for purposes of this subparagraph, be treated as paid under a separate contract to which clause (ii)(I) applies.” - § 72(e)(7): Pub. L. 99–514, § 1852(c)(1), in introductory provisions substituted “any plan or contract” for “any trust or contract”, in cl. (ii) substituted “85 percent or more of” for “85 percent of”, and inserted closing provision: “For purposes of clause (ii), deductible employee contributions (as defined in subsection (o)(5)(A)) shall not be taken into account.” - § 72(e)(8), § 72(e)(9): Pub. L. 99–514, § 1122(c)(3)(A), added pars. (8) and (9). - § 72(f): Pub. L. 99–514, § 1852(c)(3), in introductory provisions, substituted “subsections (d)(1) and (e)(7)” for “subsection (d)(1)” and “subsection (e)(6)” for “subsection (e)(1)(B)”. - § 72(m)(2)(B): Pub. L. 99–514, § 1852(c)(4)(A), inserted “and subsection (e)(7) (relating to plans where substantially all contributions are employee contributions)”. - § 72(m)(2): Pub. L. 99–514, § 1852(c)(4)(B), substituted “subsection (e)(6)” for “subsection (e)(1)(B)”. - § 72(m)(5): Pub. L. 99–514, § 1852(a)(2)(C), which directed that par. (5) be amended by substituting “5-percent owners” for “owner-employees” in heading, was executed by substituting “5-percent owners” for “key employees”, to reflect the probable intent of Congress and intervening amendment by section 713(c)(1)(B) of Pub. L. 98–369. - § 72(m)(5)(A): Pub. L. 99–514, § 1123(d)(1), amended subpar. (A) generally. Prior to amendment, subpar. (A) read as follows: “This subparagraph shall apply— - § 72(m)(5)(A): Pub. L. 99–514, § 1852(a)(2)(A), amended subpar. (A) generally. Prior to amendment, subpar. (A) read as follows: “This paragraph shall apply— - § 72(m)(5)(C): Pub. L. 99–514, § 1852(a)(2)(B), amended subpar. (C) generally. Prior to amendment, subpar. (C) read as follows: “For purposes of this paragraph, the term ‘5 percent owner’ have the same meanings as when used in section 416.” - § 72(m)(10): Pub. L. 99–514, § 1898(c)(1)(B), inserted “who is the spouse or former spouse of the participant”. - § 72(o)(5): Pub. L. 99–514, § 1101(b)(2)(C), inserted “and made for a taxable year beginning before January 1, 1987,” in subpar. (A), substituted “subsection (p)(3)(A)(i)” for “section 219(e)(3)” in subpar. (C), and substituted “subsection (p)(3)(B)” for “section 219(e)(4)” in subpar. (D). - § 72(p)(2)(A)(i): Pub. L. 99–514, § 1134(a), amended cl. (i) generally. Prior to amendment, cl. (i) read as follows: “$50,000, or”. - § 72(p)(2)(B)(ii): Pub. L. 99–514, § 1134(d), amended cl. (ii) generally. Prior to amendment, cl. (ii) read as follows: “Clause (i) shall not apply to any loan used to acquire, construct, reconstruct, or substantially rehabilitate any dwelling unit which within a reasonable time is to be used (determined at the time the loan is made) as a principal residence of the participant or a member of the family (within the meaning of section 267(c)(4)) of the participant.” - § 72(p)(2)(C), § 72(p)(2)(D): Pub. L. 99–514, § 1134(b), added subpar. (C) and redesignated former subpar. (C) as (D). - § 72(p)(3): Pub. L. 99–514, § 1134(c), added par. (3) and redesignated former par. (3) as (4). - § 72(p)(3): Pub. L. 99–514, § 1101(b)(2)(B), amended par. (3) generally. Prior to amendment, par. (3) read as follows: “For purposes of this subsection, the term ‘qualified employer plan’ means any plan which was (or was determined to be) a qualified employer plan (as defined in section 219(e)(3) other than a plan described in subsection (e)(7)). For purposes of this subsection, such term includes any government plan (as defined in section 219(e)(4)).” - § 72(p)(4), § 72(p)(5): Pub. L. 99–514, § 1134(c), redesignated former pars. (3) and (4) as (4) and 5, respectively. - § 72(q): Pub. L. 99–514, § 1123(b)(1)(B), substituted “10-percent” for “5-percent” in heading. - § 72(q)(1): Pub. L. 99–514, § 1123(b)(1)(A), substituted “10 percent” for “5 percent”. - § 72(q)(2): Pub. L. 99–514, § 1123(b)(3), substituted “Paragraph (1)” for “This subsection” in introductory provisions. - § 72(q)(2)(B): Pub. L. 99–514, § 1826(c), amended subpar. (B) generally. Prior to amendment, subpar. (B) read as follows: “made to a beneficiary (or to the estate of an annuitant) on or after the death of an annuitant,”. - § 72(q)(2)(D): Pub. L. 99–514, § 1123(b)(2), amended subpar. (D) generally. Prior to amendment, subpar. (D) read as follows: “which is one of a series of substantially equal periodic payments made for the life of a taxpayer or over a period extending for at least 60 months after the annuity starting date,”. - § 72(q)(2)(E): Pub. L. 99–514, § 1852(c)(2), inserted “(determined without regard to subsection (e)(7))”. - § 72(q)(2)(G): Pub. L. 99–514, § 1826(d), added subpar. (G). - § 72(q)(2)(I), § 72(q)(2)(J): Pub. L. 99–514, § 1123(b)(4), which added subpars. (I) and (J) directed the amendment of subpar. (G) by striking out “or” at the end thereof, and of subpar. (H) by striking out the period at the end thereof, could not be executed to subpars. (G) and (H) because subpar. (G) does not contain “or”, and no subpar. (H) was enacted. - § 72(q)(3): Pub. L. 99–514, § 1123(b)(3), added par. (3). - § 72(s)(1): Pub. L. 99–514, § 1826(b)(2), substituted “any holder of such contract” for “the holder of such contract” in subpars. (A) and (B). - § 72(s)(5): Pub. L. 99–514, § 1826(a), added par. (5). - § 72(s)(6), § 72(s)(7): Pub. L. 99–514, § 1826(b)(1), added pars. (6) and (7). - § 72(t): Pub. L. 99–514, § 1123(a), added subsec. (t) and redesignated former subsec. (t) as (u). - § 72(u), § 72(v): Pub. L. 99–514, § 1135(a), added subsec. (u) and redesignated former subsec. (u) as (v). ## § 74: Prizes and awards - § 74(a): Pub. L. 99–514, § 123(b)(1), which directed that subsec. (a) be amended by substituting “(relating to qualified scholarships)” for “(relating to scholarship and fellowship grants)”, was executed by making the substitution for “(relating to scholarships and fellowship grants)” to reflect the probable intent of Congress. - § 74(a): Pub. L. 99–514, § 122(a)(1)(A), substituted “Except as otherwise provided in this section or” for “Except as provided in subsection (b) and”. - § 74(b): Pub. L. 99–514, § 122(a)(1)(B), (C), inserted “for certain prizes and awards transferred to charities” in heading and added par. (3). - § 74(c): Pub. L. 99–514, § 122(a)(1)(D), added subsec. (c). ## § 79: Group-term life insurance purchased for employees - § 79(d): Pub. L. 99–514, § 1151(c)(1), amended subsec. (d) generally, substituting “In the case of a group-term life insurance plan which is a discriminatory employee benefit plan, subsection (a)(1) shall apply only to the extent provided in section 89.” for provisions formerly designated as pars. (1)(A) and (B) that in the case of a discriminatory group-term life insurance plan subsec. (a)(1) shall not apply with respect to any key employee and the cost of group-term life insurance on the life of any key employee shall be determined without regard to subsec. (c), and striking out pars. (2) to (7) relating to classifications and eligibility classifications of nondiscriminatory plans. - § 79(d)(1)(B): Pub. L. 99–514, § 1827(a)(1), amended subpar. (B) generally. Prior to amendment, subpar. (B) read as follows: “the cost of group-term life insurance on the life of any key employee shall be determined without regard to subsection (c).” - § 79(d)(6): Pub. L. 99–514, § 1827(c), struck out “, except that subparagraph (A)(iv) of such paragraph shall be applied by not taking into account employees described in paragraph (3)(B) who are not participants in the plan” from first sentence and inserted provision that such term also includes any retired employee if such employee when he retired or separated from service was a key employee. - § 79(d)(8): Pub. L. 99–514, § 1827(d), added par. (8). ## § 83: Property transferred in connection with performance of services - § 83(e)(5): Pub. L. 99–514 struck out “the cost of” before “group-life insurance”. ## § 85: Unemployment compensation - § 85(a): Pub. L. 99–514 substituted “General rule” for “In general” in heading and amended text generally. Prior to amendment, text read as follows: “If the sum for the taxable year of the adjusted gross income of the taxpayer (determined without regard to this section, section 86 and section 221) and the unemployment compensation exceeds the base amount, gross income for the taxable year includes unemployment compensation in an amount equal to the lesser of— - § 85(b), § 85(c): Pub. L. 99–514, in amending section generally, redesignated former subsec. (c) as (b) and struck out former subsec. (b), “Base amount defined”, which read as follows: “For purposes of this section, the term ‘base amount’ means— ## § 86: Social security and tier 1 railroad retirement benefits - § 86(b)(2)(A): Pub. L. 99–514, § 131(b)(2), substituted “sections” for “sections 221,”. - § 86(c): Pub. L. 99–514, § 1301(j)(8), substituted “section 7703” for “section 143”. - § 86(f)(1): Pub. L. 99–514, § 1847(b)(2), substituted “section 22(c)(3)(A)” for “section 37(c)(3)(A)”. ## § 88: Certain amounts with respect to nuclear decommissioning costs - § 88: Pub. L. 99–514 substituted “for ratemaking purposes” for “of ratemaking purposes”. ## § 101: Certain death benefits - § 101(d)(1): Pub. L. 99–514, § 1001(a), amended second sentence generally, which prior to amendment read as follows: “There shall be excluded from the gross income of such beneficiary in the taxable year received— - § 101(d)(2)(B): Pub. L. 99–514, § 1001(c)(2), substituted “equal” for “is equal” in introductory provisions. - § 101(d)(2)(B)(ii): Pub. L. 99–514, § 1001(b), amended cl. (ii) generally. Prior to amendment, cl. (ii) read as follows: “as discounted on the basis of the interest rate and mortality tables used by the insurer in calculating payments under the agreement.” - § 101(d)(3), § 101(d): Pub. L. 99–514, § 1001(c)(1), redesignated par. (4) as (3), and struck out former par. (3), “Surviving spouse”, which read as follows: “For purposes of this subsection, the term ‘surviving spouse’ means the spouse of the insured as of the date of death, including a spouse legally separated but not under a decree of absolute divorce.” ## § 102: Gifts and inheritances - § 102(c): Pub. L. 99–514 added subsec. (c). ## § 103: Interest on State and local bonds - § 103: Pub. L. 99–514, § 1301(a), in amending section generally, substituted “Interest on State and local bonds” for “Interest on certain governmental obligations” in section catchline. - § 103(a): Pub. L. 99–514, § 1301(a), substituted “Exclusion” for “General rule” in heading and amended text generally. Prior to amendment, text read as follows: “Gross income does not include interest on— - § 103(b): Pub. L. 99–514, § 1301(a), in amending section generally, substituted provision relating to exceptions for provision relating to industrial development bonds. - § 103(b): Pub. L. 99–514, § 1871(b), substituted “and (6)” for “(6), and (7)”. - § 103(b): Pub. L. 99–514, § 1870, substituted “clause (ii)” for “clause (i)”. - § 103(b): Pub. L. 99–514, § 1871(b), substituted “and (6)” for “(6), and (7)”. - § 103(c): Pub. L. 99–514, § 1301(a), in amending section generally, substituted provision relating to definitions for provision relating to arbitrage. - § 103: Pub. L. 99–514, § 1301(a), in amending section generally, struck out subsecs. (d) to (g) which related to certain irrigation dams, qualified scholarship funding bonds, certain federally guaranteed obligations, and qualified steam-generating or alcohol-producing facilities, respectively. - § 103: Pub. L. 99–514, § 1301(a), in amending section generally, struck out subsec. (h) which provided that obligations must not be guaranteed. - § 103: Pub. L. 99–514, § 1899A(2), substituted “guaranteed” for “guaranted”. - § 103: Pub. L. 99–514, § 1865(a), struck out “the United States,” after “program of”. - § 103: Pub. L. 99–514, § 1301(a), in amending section generally, struck out subsecs. (i) to (k) which related to obligations of certain volunteer fire departments, provided that obligations must be in registered form to be tax-exempt, and required public approval for industrial development bonds, respectively. - § 103: Pub. L. 99–514, § 1301(a), in amending section generally, struck out subsec. (l) which related to information reporting requirements for certain bonds. - § 103: Pub. L. 99–514, § 1864(d), added subpar. (F) which read: “if such obligation is a private activity bond (as defined in subsection (n)(7)), such information as the Secretary may require for purposes of determining whether the requirements of subsection (n) are met with respect to such obligation.” - § 103: Pub. L. 99–514, § 1301(a), in amending section generally, struck out subsec. (m) which related to obligations exempt other than under this title. - § 103: Pub. L. 99–514, § 1871(a)(1), substituted “(j), (k), (l), (n), and (o)” for “(k), (l), and (n)”. - § 103: Pub. L. 99–514, § 1899A(3), substituted “608(a)(6)(A)” for “608(6)(A)”. - § 103: Pub. L. 99–514, § 1301(a), in amending section generally, struck out subsec. (n) which related to limitation on aggregate amount of private activity bonds issued during any calendar year. - § 103: Pub. L. 99–514, § 1864(b), substituted “governmental units or other authorities” for “governmental units”. - § 103: Pub. L. 99–514, § 1864(c), substituted “all of the property to be financed by the obligation” for “the property described in such paragraph”. - § 103: Pub. L. 99–514, § 1864(e), substituted “identify project” for “specify project” in heading and “identify (with reasonable specificity) the project” for “specify the project” in text of subpar. (B)(i). - § 103: Pub. L. 99–514, § 1864(e)(2), substituted “any identification or specification” for “any specification”. - § 103: Pub. L. 99–514, § 1864(a)(1), added par. (13). - § 103: Pub. L. 99–514, § 1301(a), in amending section generally, struck out subsec. (o) relating to consumer loan bonds. - § 103: Pub. L. 99–514, § 1869(a), (b)(1), substituted “Private loan bonds” for “Consumer loan bonds” in subsection and par. (2) headings, “private loan bond” for “consumer loan bond” in text of pars. (1), (2)(A) and (B), and “subsection (c)(6)(H)(i)” for “subsection (c)(6)(G)(i)” in par. (2)(C)(ii). - § 103: Pub. L. 99–514, § 1869(b)(2), redesignated subsec. (o), relating to cross references, as (p). - § 103: Pub. L. 99–514, § 1301(a), in amending section generally, struck out subsec. (p) which related to cross references. - § 103: Pub. L. 99–514, § 1869(b)(2), redesignated former subsec. (o), relating to cross references, as (p). - § 103: Pub. L. 99–514, § 1899A(4), substituted “October 27, 1949 (48 U.S.C. 1403)” for “October 27, 1919 (48 U.S.C. 1403)”. ## § 105: Amounts received under accident and health plans - § 105(d): Pub. L. 99–514, § 1301(j)(9), which directed that subpar. (C) be amended by substituting “section 7703(a)” for “section 143(a)”, could not be executed because subsec. (d) was previously repealed by Pub. L. 98–21. See 1983 Amendment note below. - § 105(h), § 105(i): Pub. L. 99–514, § 1151(c)(2), redesignated subsec. (i) as (h) and struck out former subsec. (h) which related to amount paid to highly compensated individuals under a discriminatory self-insured medical expense reimbursement plan. ## § 106: Contributions by employer to accident and health plans - § 106(a): Pub. L. 99–514, § 1151(j)(2), amended subsec. (a) generally. Prior to amendment, subsec. (a) read as follows: “Gross income does not include contributions by the employer to accident or health plans for compensation (through insurance or otherwise) to his employees for personal injuries or sickness.” - § 106(b)(1): Pub. L. 99–514, § 1114(b)(1), substituted “highly compensated employee (within the meaning of section 414(q))” for “highly compensated individual (within the meaning of section 105(h)(5))”. ## § 108: Income from discharge of indebtedness - § 108(a)(1)(C): Pub. L. 99–514, § 822(a), struck out subpar. (C) relating to exclusion from gross income if the indebtedness discharged is qualified business indebtedness. - § 108(a)(2): Pub. L. 99–514, § 822(b)(1), substituted “Subparagraph (B) of paragraph (1)” for “Subparagraphs (B) and (C) of paragraph (1)” in subpar. (A), struck out subpar. (A) designation and heading, and struck out subpar. (B) providing that insolvency exclusion takes precedence over qualified business exclusion. - § 108(b)(2)(B): Pub. L. 99–514, § 231(d)(3)(D), substituted “General business credit” for “Research credit and general business credit” in heading and amended text, as amended by this Act (Pub. L. 99–514, § 1171(b)(4) (see below)), generally. Prior to amendment, text read as follows: “Any carryover to or from the taxable year of a discharge of an amount for purposes of determining the amount allowable as a credit under— - § 108(b)(2)(B): Pub. L. 99–514, § 1171(b)(4), struck out last sentence which had been eliminated by the general amendment of subpar. (B) by Pub. L. 99–514, § 231(d)(3)(D). See above. - § 108(b)(2)(E): Pub. L. 99–514, § 1847(b)(7), substituted “section 27” for “section 33”. - § 108(b)(3): Pub. L. 99–514, § 104(b)(2), substituted “33⅓ cents” for “50 cents”. - § 108(c): Pub. L. 99–514, § 822(b)(2), struck out subsec. (c) relating to tax treatment of discharge of qualified business indebtedness. - § 108(d): Pub. L. 99–514, § 822(b)(3)(B), struck out reference to subsec. (c) in heading. - § 108(d)(4): Pub. L. 99–514, § 822(b)(3)(A), struck out par. (4) relating to treatment of indebtedness as qualified business indebtedness. - § 108(d)(6), § 108(d)(7)(A): Pub. L. 99–514, § 822(b)(3)(B), struck out reference to subsec. (c) in heading and text. - § 108(d)(7)(B): Pub. L. 99–514, § 822(b)(3)(C), struck out “The preceding sentence shall not apply to any discharge to the extent that subsection (a)(1)(C) applies to such discharge.” - § 108(d)(9)(A): Pub. L. 99–514, § 822(b)(3)(D), struck out “under paragraph (4) of this subsection or” after “An election”. - § 108(e)(7)(A)(ii)(I): Pub. L. 99–514, § 805(c)(2), substituted “subsection (a) or (b) of section 166” for “subsection (a), (b), or (c) of section 166”. - § 108(e)(7)(B), § 108(e)(7)(C), § 108(e)(7)(D): Pub. L. 99–514, § 805(c)(3), redesignated subpars. (C) to (E) as (B) to (D), respectively, and struck out former subpar. (B) which related to taxpayers on reserve method. - § 108(e)(7)(E), § 108(e)(7): Pub. L. 99–514, § 805(c)(3), (4), redesignated subpar. (F) as (E) and substituted “the foregoing subparagraphs” for “subparagraphs (A), (B), (C), (D), and (E)”. Former subpar. (E) redesignated (D). - § 108(e)(10): Pub. L. 99–514, § 621(e), repealed the amendment by Pub. L. 98–369, § 59(b)(1), which had added subpar. (C) creating an exception for transfers in certain workouts of the satisfaction of indebtedness by corporation’s stock. See 1984 Amendment note below. - § 108(g): Pub. L. 99–514, § 405(a), added subsec. (g). ## § 111: Recovery of tax benefit items - § 111(a): Pub. L. 99–514, § 1812(a)(1), substituted “did not reduce the amount of tax imposed by this chapter” for “did not reduce income subject to tax”. - § 111(c): Pub. L. 99–514, § 1812(a)(2), substituted “reducing tax imposed by this chapter” for “reducing income subject to tax or reducing tax imposed by this chapter, as the case may be”. ## § 117: Qualified scholarships - § 117: Pub. L. 99–514, § 123(a), in amending section generally, substituted “Qualified scholarships” for “Scholarships and fellowship grants” in section catchline. - § 117(a): Pub. L. 99–514, § 123(a), amended subsec. (a) generally. Prior to amendment, subsec. (a) read as follows: “In the case of an individual, gross income does not include— - § 117(b): Pub. L. 99–514, § 123(a), in amending subsec. (b) generally, substituted qualified scholarship provision for former limitations provision, which related in par. (1) to individuals who were candidates for degrees, and in par. (2) to individuals who were not candidates for degrees, describing in subpar. (A) conditions for exclusion and in subpar. (B) extent of exclusion, such detailed provision now covered in subsec. (c). - § 117(c): Pub. L. 99–514, § 123(a), in amending subsec. (c) generally, substituted limitation provision for former provision relating to Federal grants for tuition and related expenses not includable merely because there was requirement of future service as Federal employee. - § 117(d): Pub. L. 99–514, § 123(a), in amending subsec. (d) generally, substituted “reduction” for “reductions” in heading and inserted “(within the meaning of section 414(q))” after “highly compensated employees” in par. (3). - § 117(d)(3): Pub. L. 99–514, § 1114(b)(2), struck out “officer, owner, or” after “with respect to any” and “officers, owners, or” after “in favor of” and inserted at end “For purposes of this paragraph, the term ‘highly compensated employee’ has the meaning given such term by section 414(q).” - § 117(d)(4): Pub. L. 99–514, § 1151(g)(2), added par. (4). ## § 118: Contributions to the capital of a corporation - § 118(b): Pub. L. 99–514, § 824(a), added subsec. (b) and struck out former subsec. (b) relating to contributions in aid of construction, containing par. (1) general rule, par. (2) expenditure rule, par. (3) definitions, and par. (4) disallowance of deductions and investment credit; adjusted basis. - § 118(c), § 118(d): Pub. L. 99–514, § 824(a), redesignated former subsec. (d) as (c) and struck out former subsec. (c), statute of limitations, which read as follows: “If the taxpayer for any taxable year treats an amount as a contribution to the capital of the taxpayer described in subsection (b), then— ## § 119: Meals or lodging furnished for the convenience of the employer - § 119(d): Pub. L. 99–514 added subsec. (d). ## § 125: Cafeteria plans - § 125: Pub. L. 99–514, § 1151(d)(1), amended section generally, revising and restating as subsecs. (a) to (g) provisions of former subsecs. (a) to (i) so as to coincide with the coming into effect of section 89 of this title. - § 125(c), § 125(d)(1)(B): Pub. L. 99–514, § 1853(b)(1)(A), substituted “qualified benefits” for “statutory nontaxable benefits” wherever appearing. - § 125(f): Pub. L. 99–514, § 1853(b)(1)(B), substituted “Qualified benefits defined” for “Statutory nontaxable benefits defined” in heading and amended text generally. Prior to amendment, text read as follows: “For purposes of this section, the term ‘statutory nontaxable benefit’ means any benefit which, with the application of subsection (a) is not includible in the gross income of the employee by reason of an express provision of this chapter (other than section 117, 124, 127, or 132). Such term includes any group term life insurance which is includible in gross income only because it exceeds the dollar limitation of section 79.” ## § 127: Educational assistance programs - § 127(a)(2): Pub. L. 99–514, § 1162(a)(2), substituted “$5,250” for “$5,000” in heading and twice in text. - § 127(b)(1): Pub. L. 99–514, § 1151(c)(4)(A), added par. (1) and struck out former par (1) which read as follows: “For purposes of this section an educational assistance program is a separate written plan of an employer for the exclusive benefit of his employees to provide such employees with educational assistance. The program must meet the requirements of paragraphs (2) through (6) of this subsection.” - § 127(b)(2): Pub. L. 99–514, § 1151(g)(3), substituted “For purposes of this paragraph, there may be excluded from consideration employees who may be excluded from consideration under section 89(h).” for “For purposes of this paragraph, there shall be excluded from consideration employees not included in the program who are included in a unit of employees covered by an agreement which the Secretary of Labor finds to be a collective bargaining agreement between employee representatives and one or more employers, if there is evidence that educational assistance benefits were the subject of good faith bargaining between such employee representatives and such employer or employers.” - § 127(b)(2): Pub. L. 99–514, § 1114(b)(4), substituted “highly compensated employees (within the meaning of section 414(q))” for “officers, owners, or highly compensated,”. - § 127(b)(6): Pub. L. 99–514, § 1151(c)(4)(B), struck out par. (6) which read as follows: “Notification of employees.—Reasonable notification of the availability and terms of the program must be provided to eligible employees.” - § 127(d): Pub. L. 99–514, § 1162(a)(1), substituted “December 31, 1987” for “December 31, 1985”. ## § 129: Dependent care assistance programs - § 129(a): Pub. L. 99–514, § 1163(a), substituted “Exclusion” for “In general” in heading and amended text generally. Prior to amendment, text read as follows: “Gross income of an employee does not include amounts paid or incurred by the employer for dependent care assistance provided to such employee if the assistance is furnished pursuant to a program which is described in subsection (d).” - § 129(c)(1): Pub. L. 99–514, § 104(b)(1)(A), substituted “section 151(c)” for “section 151(e)”. - § 129(c)(2): Pub. L. 99–514, § 104(b)(1)(B), substituted “section 151(c)(3)” for “section 151(e)(3)”. - § 129(d)(1): Pub. L. 99–514, § 1151(c)(5)(A), added par. (1) and struck out former par. (1) which read as follows: “For purposes of this section a dependent care assistance program is a separate written plan of an employer for the exclusive benefit of his employees to provide such employees with dependent care assistance which meets the requirements of paragraphs (2) through (7) of this subsection.” - § 129(d)(2): Pub. L. 99–514, § 1114(b)(4), substituted “highly compensated employees (within the meaning of section 414(q))” for “officers, owners, or highly compensated,”. - § 129(d)(3): Pub. L. 99–514, § 1151(g)(4), substituted “For purposes of this paragraph, there may be excluded from consideration employees who may be excluded from consideration under section 89(h).” for “For purposes of this paragraph, there shall be excluded from consideration employees not included in the program who are included in a unit of employees covered by an agreement which the Secretary of Labor finds to be a collective bargaining agreement between employee representatives and one or more employers, if there is evidence that dependent care benefits were the subject of good faith bargaining between such employee representatives and such employer or employers.” - § 129(d)(6), § 129(d)(7): Pub. L. 99–514, § 1151(c)(5)(B), redesignated par. (7) as (6) and struck out former par. (6) which read as follows: “Notification of eligible employees.—Reasonable notification of the availability and terms of the program shall be provided to eligible employees.” - § 129(d)(8): Pub. L. 99–514, § 1151(f), added par. (8). - § 129(e)(8): Pub. L. 99–514, § 1163(b), added par. (8). ## § 130: Certain personal injury liability assignments - § 130(c): Pub. L. 99–514 inserted “(in a case involving physical injury or physical sickness)”. ## § 131: Certain foster care payments - § 131(a): Pub. L. 99–514 amended subsec. (a) generally. Prior to amendment, subsec. (a) read as follows: “Gross income shall not include amounts received by a foster parent during the taxable year as qualified foster care payments.” - § 131(b): Pub. L. 99–514 amended subsec. (b) generally. Prior to amendment, par. (1) “In general” read as follows: “The term ‘qualified foster care payment’ means any amount— - § 131(c): Pub. L. 99–514, in amending subsec. (c) generally, in par. (1)(A), substituted references to “qualified foster individual”, “such individual”, and “foster care provider” for references to “qualified foster child”, “such child”, and “foster parent”, respectively, and in par. (2) substituted “more than (A) 10 qualified foster individuals who have not attained age 19, and (B) 5 qualified foster individuals not described in subparagraph (A)” for “more than 10 qualified foster children”. ## § 132: Certain fringe benefits - § 132(c)(3)(A): Pub. L. 99–514, § 1853(a)(2), substituted “are provided by the employer to an employee for use by such employee” for “are provided to the employee by the employer”. - § 132(e)(2): Pub. L. 99–514, § 1114(b)(5)(A), struck out “officer, owner, or” before “highly compensated employee” and “officers, owners, or” before “highly compensated employees” in last sentence. - § 132(f)(2)(B): Pub. L. 99–514, § 1853(a)(1), substituted “are deceased and who has not attained age 25” for “are deceased”. - § 132(g): Pub. L. 99–514, § 1151(e)(2)(A), in amending subsec. (g) generally, designated par. (2) as the entire subsection, struck out former subsec. heading, “Special rules relating to employer”, struck out “For purposes of this section—”, and struck out par. (1) which read as follows: “All employees treated as employed by a single employer under subsection (b), (c), or (m) of section 414 shall be treated as employed by a single employer for purposes of this section.” - § 132(h)(1): Pub. L. 99–514, § 1151(g)(5), inserted “For purposes of this paragraph and subsection (e), there may be excluded from consideration employees who may be excluded from consideration under section 89(h).” - § 132(h)(1): Pub. L. 99–514, § 1114(b)(5)(A), struck out “officer, owner, or” before “highly compensated employee” and “officers, owners, or” before “highly compensated employees”. - § 132(h)(3): Pub. L. 99–514, § 1899A(5), substituted “such use is” for “such use in”. - § 132(h): Pub. L. 99–514, § 1114(b)(5)(B), added par. (7). - § 132(i): Pub. L. 99–514, § 1853(a)(3), substituted “subsection (c)(2)” for “subsection (c)(2)(B)”. ## § 134: Certain military benefits - Enacted 26 U.S.C. § 134. ## § 140: Cross references to other Acts - § 140: Pub. L. 99–514 renumbered section 134 of this title as this section. ## § 141: Private activity bond; qualified bond - Enacted 26 U.S.C. § 141. ## § 142: Exempt facility bond - Enacted 26 U.S.C. § 142. ## § 143: Mortgage revenue bonds: qualified mortgage bond and qualified veterans’ mortgage bond - Enacted 26 U.S.C. § 143. ## § 144: Qualified small issue bond; qualified student loan bond; qualified redevelopment bond - Enacted 26 U.S.C. § 144. ## § 145: Qualified 501(c)(3) bond - Enacted 26 U.S.C. § 145. ## § 146: Volume cap - Enacted 26 U.S.C. § 146. ## § 147: Other requirements applicable to certain private activity bonds - Enacted 26 U.S.C. § 147. ## § 148: Arbitrage - Enacted 26 U.S.C. § 148. ## § 149: Bonds must be registered to be tax exempt; other requirements - Enacted 26 U.S.C. § 149. ## § 150: Definitions and special rules - Enacted 26 U.S.C. § 150. ## § 151: Allowance of deductions for personal exemptions - § 151(c): Pub. L. 99–514, § 103(b), redesignated subsec. (e) as (c) and struck out former subsec. (c) which provided for an additional exemption for taxpayer or spouse aged 65 or more. - § 151(d): Pub. L. 99–514, § 103(b), redesignated subsec. (f) as (d) and struck out former subsec. (d) which provided for an additional exemption for blindness of taxpayer or spouse. - § 151(e): Pub. L. 99–514, § 103(b), redesignated subsec. (e) as (c). - § 151(e): Pub. L. 99–514, § 1847(b)(3), substituted “section 22(e)” for “section 37(e)” in par. (5)(C). - § 151: Pub. L. 99–514, § 103(b), redesignated subsec. (f) as (d). - § 151: Pub. L. 99–514, § 103(a), amended subsec. (f) generally. Prior to amendment, subsec. (f) read as follows: “For purposes of this section, the term ‘exemption amount’ means, with respect to any taxable year, $1,000 increased by an amount equal to $1,000 multiplied by the cost-of-living adjustment (as defined in section 1(f)(3)) for the calendar year in which the taxable year begins. If the amount determined under the preceding sentence is not a multiple of $10, such amount shall be rounded to the nearest multiple of $10 (or if such amount is a multiple of $5, such amount shall be increased to the next highest multiple of $10).” ## § 152: Dependent defined - § 152(a): Pub. L. 99–514, § 1301(j)(8), substituted “section 7703” for “section 143”. - § 152(d)(2): Pub. L. 99–514, § 104(b)(3), substituted “section 151(c)(4)” for “section 151(e)(4)”. - § 152(e)(1)(A): Pub. L. 99–514, § 104(b)(1)(B), substituted “section 151(c)(3)” for “section 151(e)(3)”. ## § 153: Cross references - § 153: Pub. L. 99–514, § 1272(d)(7), redesignated par. (5) as (4) and struck out former par. (4) which read as follows: “For exemptions of citizens deriving income mainly from sources within possessions of the United States, see section 931(e).” - § 153: Pub. L. 99–514, § 1272(d)(7), redesignated par. (5) as (4). - § 153: Pub. L. 99–514, § 1301(j)(8), substituted “section 7703” for “section 143”. ## § 162: Trade or business expenses - § 162(k)(2)(A): Pub. L. 99–514, § 1895(d)(1)(A), inserted “If coverage under the plan is modified for any group of similarly situated beneficiaries, the coverage shall also be modified in the same manner for all individuals who are qualified beneficiaries under the plan pursuant to this subsection in connection with such group.” - § 162(k)(2)(B): Pub. L. 99–514, § 1895(d)(2)(A), substituted “Maximum required period” for “Maximum period” in heading and amended text generally. Prior to amendment, text read as follows: “In the case of— - § 162(k)(2)(B): Pub. L. 99–514, § 1895(d)(3)(A), inserted “The payment of any premium (other than any payment referred to in the last sentence of subparagraph (C)) shall be considered to be timely if made within 30 days after the date due or within such longer period as applies to or under the plan.” - § 162(k)(2)(B): Pub. L. 99–514, § 1895(d)(4)(A)(iii), substituted “Group health plan coverage” for “Reemployment” in heading. - § 162(k)(2)(B): Pub. L. 99–514, § 1895(d)(4)(A)(ii), substituted “covered under any other group health plan (as an employee or otherwise)” for “a covered employee under any other group health plan”. - § 162(k)(2)(B): Pub. L. 99–514, § 1895(d)(4)(A)(i), struck out cl. (v), remarriage of spouse, which read as follows: “In the case of an individual who is a qualified beneficiary by reason of being the spouse of a covered employee, the date on which the beneficiary remarries and becomes covered under a group health plan.” - § 162(k): Pub. L. 99–514, § 1895(d)(5)(A), as amended by Pub. L. 99–509, § 9307(c)(2)(B), and Pub. L. 100–647, § 1018(t)(7)(B), inserted “of continuation coverage” and “If there is a choice among types of coverage under the plan, each qualified beneficiary is entitled to make a separate selection among such types of coverage.” See 1988 Amendment note above. - § 162(k): Pub. L. 99–514, § 1895(d)(6)(A), inserted “within 60 days after the date of the qualifying event”. - § 162(k): Pub. L. 99–514, § 1895(d)(7), added cl. (iii). - § 162(l): Pub. L. 99–514, § 613(a), added subsec. (l). Former subsec. (l) redesignated (m). - § 162(m): Pub. L. 99–514, § 1161(a), added subsec. (m) relating to special rules for health insurance costs of self-employed individuals, and further directed that this section be amended “by redesignating subsection (n) as subsection (m)”, which directory language could not be executed because this section does not contain a subsec. (n). - § 162(m): Pub. L. 99–514, § 613(a), redesignated subsec. (l), relating to cross references, as (m). ## § 163: Interest - § 163(d): Pub. L. 99–514, § 511(a), substituted “Limitation on investment interest” for “Limitation on interest on investment indebtedness” in heading, and amended text generally, revising and restating as pars. (1) to (6) provisions of former pars. (1) to (7). - § 163(e)(2)(C): Pub. L. 99–514, § 1803(a)(4), added subpar. (C). - § 163(e)(3)(A): Pub. L. 99–514, § 1810(e)(1)(A), inserted “The preceding sentence shall not apply to the extent that the original issue discount is effectively connected with the conduct by such foreign related person of a trade or business within the United States unless such original issue discount is exempt from taxation (or is subject to a reduced rate of tax) pursuant to a treaty obligation of the United States.” - § 163(e)(5): Pub. L. 99–514, § 1810(e)(1)(B), redesignated par. (4), relating to cross references, as (5). - § 163(f)(3): Pub. L. 99–514, § 1301(j)(3), substituted “section 149(a)(3)” for “section 103(j)(3)”. - § 163(h): Pub. L. 99–514, § 511(b), added subsec. (h). Former subsec. (h) redesignated (i). - § 163(i)(2): Pub. L. 99–514, § 902(e)(1), as amended by Pub. L. 100–647, § 1009(b)(6), substituted “section 265(a)(2)” for “section 265(2)”. - § 163(i)(2): Pub. L. 99–514, § 511(b), redesignated former subsec. (h) as (i). ## § 164: Taxes - § 164(a): Pub. L. 99–514, § 134(a)(2), inserted “Notwithstanding the preceding sentence, any tax (not described in the first sentence of this subsection) which is paid or accrued by the taxpayer in connection with an acquisition or disposition of property shall be treated as part of the cost of the acquired property or, in the case of a disposition, as a reduction in the amount realized on the disposition.” - § 164(a)(4): Pub. L. 99–514, § 134(a)(1), struck out par. (4) relating to “State and local general sales taxes” and redesignated as par. (4) former par. (5) relating to windfall profit tax. - § 164(a): Pub. L. 99–514, § 1432(a)(1), added par. (5) relating to GST tax imposed on income distributions. - § 164(b)(2): Pub. L. 99–514, § 134(b)(1), (2), redesignated par. (3) as (2) and struck out former par. (2), general sales taxes provisions, subpars. (A) to (E) of which covered in general rule, special rules for food, etc., items taxed at different rates, compensating use taxes, and special rules for motor vehicles, respectively. - § 164(b)(3): Pub. L. 99–514, § 134(b)(2), redesignated par. (4) as (3). Former par. (3) redesignated (2). - § 164(b)(4): Pub. L. 99–514, § 1432(a)(2), added par. (4). - § 164(b)(4): Pub. L. 99–514, § 134(b)(2), redesignated par. (4) as (3). - § 164(b)(5): Pub. L. 99–514, § 134(b)(1), struck out par. (5), separately stated general sales taxes, which read as follows: “If the amount of any general sales tax is separately stated, then, to the extent that the amount so stated is paid by the consumer (otherwise than in connection with the consumer’s trade or business) to his seller, such amount shall be treated as a tax imposed on, and paid by, such consumer.” ## § 165: Losses - § 165(h)(4)(E): Pub. L. 99–514, § 1004(a), added subpar. (E). - § 165(l), § 165(m): Pub. L. 99–514, § 905(a), added subsec. (l) and redesignated former subsec. (l) as (m). ## § 166: Bad debts - § 166(c): Pub. L. 99–514, § 805(a), struck out subsec. (c), reserve for bad debts, which read as follows: “In lieu of any deduction under subsection (a), there shall be allowed (in the discretion of the Secretary) a deduction for a reasonable addition to a reserve for bad debts.” - § 166(f): Pub. L. 99–514, § 805(b), as amended by Pub. L. 100–647, § 1008(d)(2), redesignated subsec. (g) as (f) and struck out former subsec. (f) which related to reserve for certain guaranteed debt obligations, par. (1) thereof providing for allowance of deduction, par. (2) disallowing deduction in other cases, par. (3) relating to opening balance of reserve, and par. (4) relating to suspense account. - § 166: Pub. L. 99–514, § 805(b), as amended by Pub. L. 100–647, § 1008(d)(2), redesignated subsec. (g) as (f). - § 166: Pub. L. 99–514, § 901(d)(4)(A), struck out pars. (3) and (4) which read as follows: ## § 167: Depreciation - § 167(c): Pub. L. 99–514, § 1809(d)(1), inserted “Paragraphs (2), (3), and (4) of subsection (b) shall not apply to any motion picture film, video tape, or sound recording.” - § 167: Pub. L. 99–514, § 201(d)(1), amended par. (4) generally. Prior to amendment, par. (4) read as follows: “This subsection shall not apply with respect to recovery property (within the meaning of section 168) placed in service after December 31, 1980.” - § 167: Pub. L. 99–514, § 1511(c)(4), substituted “at the underpayment rate established under section 6621” for “at the rate determined under section 6621”. ## § 168: Accelerated cost recovery system - § 168: Pub. L. 99–514, § 201(a), amended section generally, applicable, with exceptions enumerated in sections 203, 204, and 251(d) of Pub. L. 99–514 [set out as notes below and under section 46 of this title], to property placed in service after Dec. 31, 1986, modifying existing accelerated cost recovery system by substituting new subsecs. (a) to (i) for former subsecs. (a) to (k). See following paragraphs of 1986 Amendment note for amendments to former text by sections 1802 and 1809 of Pub. L. 99–514. - § 168(b)(2)(A): Pub. L. 99–514, § 1809(a)(2)(A)(i)(I), struck out closing provisions relating to determination, in the case of 19-year real property, of applicable percentage in taxable year in which the property is placed in service. - § 168(b)(2)(B): Pub. L. 99–514, § 1809(a)(2)(A)(i)(II), substituted “Mid-month convention for 19-year real property” for “Special rule for year of disposition” in heading and amended text generally, substituting “In the case of 19-year real property, the amount of the deduction determined under any provision of this section (or for purposes of section 57(a)(12)(B) or 312(k)) for any taxable year shall be determined on the basis of the number of months (using a mid-month convention) in which the property is in service.” for prior provisions. - § 168(b)(3)(A): Pub. L. 99–514, § 1809(a)(1)(A), which directed that the table be amended by striking “and low-income housing” in last item, was executed by striking “and low-income housing” after “19-year real property” in next-to-the-last item, to reflect the probable intent of Congress, because that phrase did not appear in last item. - § 168(b)(3)(A): Pub. L. 99–514, § 1809(a)(1)(B), inserted at the end item for low-income housing with recovery periods of 15, 35, or 45 years. - § 168(b)(4): Pub. L. 99–514, § 1809(a)(2)(B), substituted “Monthly convention” for “Special rule for year of disposition” in heading and amended text generally, substituting “In the case of low-income housing, the amount of the deduction determined under any provision of this section (or for purposes of section 57(a)(12)(B) or 312(k)) for any taxable year shall be determined on the basis of the number of months (treating all property placed in service or disposed of during any month as placed in service or disposed of on the first day of such month) in which the property is in service.” for prior provisions. - § 168(f)(2): Pub. L. 99–514, § 1809(a)(2)(A)(ii), redesignated existing provisions as entire subpar. (B), struck out “(i) In general”, redesignated subcls. (I) and (II) as cls. (i) and (ii), and in cl. (ii) struck out “(taking into account the next to the last sentence of subsection (b)(2)(A))” after “assign percentages” and struck out heading, “(ii) Special rule for disposition” and text, “In the case of a disposition of 19-year real property or low-income housing described in clause (i), subsection (b)(2)(B) shall apply.” - § 168(f): Pub. L. 99–514, § 1809(b)(1), amended subpar. (A) generally, substituting “In the case of recovery property transferred in a transaction described in subparagraph (B), for purposes of computing the deduction allowable under subsection (a) with respect to so much of the basis in the hands of the transferee as does not exceed the adjusted basis in the hands of the transferor— - § 168(f): Pub. L. 99–514, § 1809(b)(2), inserted at end “Clause (i) shall not apply in the case of the termination of a partnership under section 708(b)(1)(B).” - § 168(f): Pub. L. 99–514, § 1809(a)(4)(A), amended cl. (ii) generally, substituting “In the case of 19-year real property, the amount of the deduction allowed shall be determined by using the straight-line method (without regard to salvage value) and a recovery period of 19 years.” for prior provisions. - § 168(f): Pub. L. 99–514, § 1809(a)(4)(B), substituted “Exception for low- and moderate-income housing” for “Exception for projects for residential rental property” in heading and amended text generally, substituting “Subparagraph (A) shall not apply to— - § 168(f): Pub. L. 99–514, § 1802(b)(1), redesignated the par. (13) relating to motor vehicle operating leases as (14) and redesignated former par. (14) as (15). - § 168(j)(2): Pub. L. 99–514, § 1809(a)(2)(C)(i), substituted “Cross reference” for “19-year real property” in heading and amended text generally, substituting “For other applicable conventions, see paragraphs (2)(B) and (4)(B) of subsection (b).” for prior provisions. - § 168(j)(3): Pub. L. 99–514, § 1802(a)(1), inserted at end “For purposes of subparagraph (B)(iii), any portion of a property so used shall not be treated as leased to a tax-exempt entity in a disqualified lease.” - § 168(j)(4): Pub. L. 99–514, § 1802(a)(2)(A), (G), substituted “any property (other than property held by such organization)” for “any property of which such organization is the lessee”, “first used by” for “first leased to”, and “preceding sentence and subparagraph (D)(ii)” for “preceding sentence”. - § 168(j)(4): Pub. L. 99–514, § 1802(a)(2)(B), (C), struck out “of which such organization is the lessee” after “respect to any property” in subcl. (I) and substituted “is first used by the organization” for “is placed in service under the lease” in subcl. (II). - § 168(j)(4): Pub. L. 99–514, § 1802(a)(2)(D), added cl. (iv), first used, which read as follows: “For purposes of this subparagraph, property shall be treated as first used by the organization— - § 168(j)(5): Pub. L. 99–514, § 1802(a)(3), struck out cl. (iv), relating to exclusion of property not subject to rapid obsolescence. - § 168(j)(8), § 168(j)(9): Pub. L. 99–514, § 1802(a)(4)(A), (B)(i), struck out “and paragraphs (4) and (5) of section 48(a)” after “For purposes of this subsection” in introductory provisions. - § 168(j)(9): Pub. L. 99–514, § 1802(a)(4)(B)(ii), inserted a comma between “loss” and “deduction”. - § 168(j)(9): Pub. L. 99–514, § 1802(a)(7)(A), added subpar. (D), determination of whether property used in unrelated trade or business, which read as follows: “For purposes of this subsection, in the case of any property which is owned by a partnership which has both a tax-exempt entity and a person who is not a tax-exempt entity as partners, the determination of whether such property is used in an unrelated trade or business of such an entity shall be made without regard to section 514.” Former subpar. (D) was redesignated (E). - § 168(j)(9): Pub. L. 99–514, § 1802(a)(7), redesignated subpar. (D) as (E) and substituted “(C), and (D)” for “and (C)”. Former subpar. (E) redesignated (F). - § 168(j)(9): Pub. L. 99–514, § 1802(a)(2)(E)(i), added subpar. (E), treatment of certain taxable entities, consisting of cl. (i), in general, which read: “For purposes of this paragraph, except as otherwise provided in this subparagraph, any tax-exempt controlled entity shall be treated as a tax-exempt entity.”, cl. (ii), election, which read: “If a tax-exempt controlled entity makes an election under this clause— - § 168(j)(9): Pub. L. 99–514, § 1802(a)(7)(A), redesignated subpar. (E) as (F). Former subpar. (F) redesignated (G). - § 168(j)(9): Pub. L. 99–514, § 1802(a)(2)(E)(i), redesignated former subpar. (E) as (F). - § 168(j)(9): Pub. L. 99–514, § 1802(a)(7)(A), redesignated subpar. (F) as (G). ## § 170: Charitable, etc., contributions and gifts - § 170(b)(1)(C)(iv): Pub. L. 99–514, § 1831, substituted “this paragraph” for “this subparagraph”. - § 170(e)(1)(B): Pub. L. 99–514, § 301(b)(2), in closing provisions, struck out “40 percent (28⁄46 in the case of a corporation) of” before “the amount of gain”. - § 170(e)(4)(B)(i): Pub. L. 99–514, § 231(f), amended cl. (i) generally. Prior to amendment, cl. (i) read as follows: “the contribution is to an educational organization which is described in subsection (b)(1)(A)(ii) of this section and which is an institution of higher education (as defined in section 3304(f)),”. - § 170(k), § 170(l), § 170(m): Pub. L. 99–514, § 142(d), added subsec. (k) and redesignated former subsecs. (k) and (l) as (l) and (m), respectively. ## § 171: Amortizable bond premium - § 171(b)(3): Pub. L. 99–514, § 1803(a)(11)(A), amended par. (3) generally. Prior to amendment, par. (3) read as follows: “The determinations required under paragraphs (1) and (2) shall be made— - § 171(b)(4): Pub. L. 99–514, § 1803(a)(12)(A), added par. (4). - § 171(d): Pub. L. 99–514, § 1803(a)(11)(B), struck out “issued by any corporation and bearing interest (including any like obligation issued by a government or political subdivision thereof),” after “evidence of indebtedness,”. - § 171(e), § 171(f): Pub. L. 99–514, § 643(a), added subsec. (e) and redesignated former subsec. (e) as (f). ## § 172: Net operating loss deduction - § 172(b)(1)(A), § 172(b)(1)(B): Pub. L. 99–514, § 903(b)(2)(A), (B), inserted reference to subpars. (L) and (M). - § 172(b)(1): Pub. L. 99–514, § 903(a)(1), inserted “and before January 1, 1987,”. - § 172(b)(1): Pub. L. 99–514, § 901(d)(4)(B), substituted “referred to in section 582(c)(5)” for “to which section 585, 586, or 593 applies”. - § 172(b)(1): Pub. L. 99–514, § 903(a)(2), inserted “and before January 1, 1987,”. - § 172(b)(1): Pub. L. 99–514, § 903(a)(3)(A), struck out “after December 31, 1981,” and inserted “after December 31, 1981, and before January 1, 1987,”. - § 172(b)(1): Pub. L. 99–514, § 903(a)(3)(B), which directed that subpar. (H) be amended by striking out “after December 31, 1984,” and inserting “after December 31, 1984, and before January 1, 1987,”, was executed by striking out “after December 31, 1984” and inserting “after December 31, 1984, and before January 1, 1987”, to reflect the probable intent of Congress and the fact that no comma appeared after “1984” and was not necessary after “1987”. - § 172(b)(1): Pub. L. 99–514, § 1303(b)(1), redesignated subpar. (K) as (J) and struck out former subpar. (J) which read as follows: “In the case of an electing GSOC which has a net operating loss for any taxable year such loss shall not be a net operating loss carryback to any taxable year preceding the year of such loss, but shall be a net operating loss carryover to each of the 10 taxable years following the year of such loss.” - § 172(b)(1): Pub. L. 99–514, § 903(b)(1), added subpars. (L) and (M). - § 172(d)(2): Pub. L. 99–514, § 301(b)(3), amended par. (2) generally. Prior to amendment, par. (2) read as follows: “In the case of a taxpayer other than a corporation— - § 172(d)(6): Pub. L. 99–514, § 1899A(6), added heading. - § 172(d)(7): Pub. L. 99–514, § 104(b)(4), struck out par. (7), zero bracket amount, which read as follows: “In the case of a taxpayer other than a corporation, the zero bracket amount shall be treated as a deduction allowed by this chapter. For purposes of subsection (c)— - § 172: Pub. L. 99–514, § 1303(b)(2), substituted “subsection (b)(1)(J)” for “subsection (b)(1)(K)”. - § 172: Pub. L. 99–514, § 903(b)(2)(C), added subsec. (l) and redesignated former subsec. (l) as (m). ## § 173: Circulation expenditures - § 173(b): Pub. L. 99–514 substituted “section 59(d)” for “section 58(i)”. ## § 174: Amortization of research and experimental expenditures - § 174: Pub. L. 99–514 substituted “section 59(d)” for “section 58(i)”. ## § 175: Soil and water conservation expenditures; endangered species recovery expenditures - § 175(c)(3): Pub. L. 99–514 added par. (3). ## § 178: Amortization of cost of acquiring a lease - § 178: Pub. L. 99–514, § 201(d)(2)(A), in amending section generally, substituted provision relating to amortization of cost of acquiring a lease, subsec. (a) setting out a general rule and subsec. (b) excluding certain periods, for former provision for depreciation or amortization of improvements made by lessee on lessor’s property, subsec. (a) setting out a general rule, subsec. (b), in case of related lessee and lessor, setting out a general rule in par. (1) and defining related persons in par. (2), and subsec. (c) setting out a reasonable certainty test. - § 178(b): Pub. L. 99–514, § 1812(c)(4)(B), inserted before the period “and subsection (f)(1)(A) of such section shall not apply”. ## § 179: Election to expense certain depreciable business assets - § 179(b): Pub. L. 99–514, § 202(a), in amending subsec. (b) generally, substituted “Limitations” for “Dollar limitation” in heading, in par. (1) substituted as heading “Dollar limitation” for “In general” and in text “shall not exceed $10,000” for “shall not exceed the following applicable amount:” and a table specifying amounts for specific years, added pars. (2) to (4), and struck out former par. (2) which read as follows: “In the case of a husband and wife filing separate returns for a taxable year, the applicable amount under paragraph (1) shall be equal to 50 percent of the amount otherwise determined under paragraph (1).” - § 179(d)(1): Pub. L. 99–514, § 202(b), inserted “in the active conduct of”. - § 179(d)(8): Pub. L. 99–514, § 201(d)(3), substituted “Treatment of” for “Dollar limitation in case of” in heading and amended text generally. Prior to amendment, text read as follows: “In the case of a partnership, the dollar limitation contained in subsection (b)(1) shall apply with respect to the partnership and with respect to each partner. A similar rule shall apply in the case of an S corporation and its shareholders.” - § 179(d)(10): Pub. L. 99–514, § 202(c), struck out “before the close of the second taxable year following the taxable year in which it is placed in service by the taxpayer” after “at any time”. ## § 183: Activities not engaged in for profit - § 183(d): Pub. L. 99–514 substituted “3” for “2” before “or more” in first sentence and “ ‘2’ for ‘3’ and ‘7’ for ‘5’ ” for “the period of 7 consecutive taxable years for the period of 5 consecutive taxable years” in second sentence. ## § 190: Expenditures to remove architectural and transportation barriers to the handicapped and elderly - § 190: Pub. L. 99–514 substituted “1983” for “1983, and before January 1, 1986”. ## § 194: Treatment of reforestation expenditures - § 194(b)(1): Pub. L. 99–514 substituted “section 7703” for “section 143”. ## § 213: Medical, dental, etc., expenses - § 213(a): Pub. L. 99–514 substituted “7.5 percent” for “5 percent”. ## § 216: Deduction of taxes, interest, and business depreciation by cooperative housing corporation tenant-stockholder - § 216(b)(2): Pub. L. 99–514, § 644(a)(1), substituted “a person” and “such person” for “an individual” and “such individual”, respectively. - § 216(b)(3): Pub. L. 99–514, § 644(d), added heading and amended text generally. Prior to amendment, text read as follows: “The term ‘tenant-stockholder’s proportionate share’ means that proportion which the stock of the cooperative housing corporation owned by the tenant-stockholder is of the total outstanding stock of the corporation (including any stock held by the corporation).” - § 216(b)(5): Pub. L. 99–514, § 644(a)(2), substituted “Prior approval of occupancy” for “Stock acquired through foreclosure by lending institution” in heading and amended text generally. Prior to amendment, text read as follows: “If a bank or other lending institution acquires by foreclosure (or by instrument in lieu of foreclosure) the stock of a tenant-stockholder, and a lease or the right to occupy an apartment or house to which such stock is appurtenant, such bank or other lending institution shall be treated as a tenant-stockholder for a period not to exceed three years from the date of acquisition. The preceding sentence shall apply even though, by agreement with the cooperative housing corporation, the bank (or other lending institution) or its nominee may not occupy the house or apartment without the prior approval of such corporation.” - § 216(b)(6): Pub. L. 99–514, § 644(a)(2), amended par. (6) generally, substituting provisions defining “original seller” for purposes of par. (5) for provisions relating to stock owned by person from whom corporation acquired its property, subpar. (A) thereof providing for general rule, subpar. (B) providing that stock acquisition must take place not later than 1 year after transfer of dwelling units, subpar. (C) providing that original seller must have right to occupy apartment or house, and subpar. (D) defining “original seller” for purposes of former par. (6). - § 216(c): Pub. L. 99–514, § 644(b), amended subsec. (c) generally. Prior to amendment, subsec. (c) read as follows: “So much of the stock of a tenant-stockholder in a cooperative housing corporation as is allocable, under regulations prescribed by the Secretary, to a proprietary lease or right of tenancy in property subject to the allowance for depreciation under section 167(a) shall, to the extent such proprietary lease or right of tenancy is used by such tenant-stockholder in a trade or business or for the production of income, be treated as property subject to the allowance for depreciation under section 167(a). The preceding sentence shall not be construed to limit or deny a deduction for depreciation under 167(a) by a cooperative housing corporation with respect to property owned by such a corporation and leased to tenant-stockholders.” - § 216(d): Pub. L. 99–514, § 644(c), added subsec. (d). ## § 219: Retirement savings - § 219(b)(2): Pub. L. 99–514, § 1108(g)(2), amended par. (2) generally, substituting provision that this section shall not apply with respect to an employer contribution to a simplified employee pension for former provisions consisting of subpars. (A), (B), and (C) which set out detailed limits on deductibility of employer contributions. - § 219(b)(2): Pub. L. 99–514, § 1875(c)(6)(B), substituted “the dollar limitation in effect under section 415(c)(1)(A)” for “the $15,000 amount specified in subparagraph (A)(ii)”. - § 219(b)(3): Pub. L. 99–514, § 1109(b), added par. (3). - § 219(b)(3): Pub. L. 99–514, § 1101(b)(2)(A), struck out par. (3), special rule for individual retirement plans, which read as follows: “If the individual has paid any qualified voluntary employee contributions for the taxable year, the amount of the qualified retirement contributions (other than employer contributions to a simplified employee pension) which are paid for the taxable year to an individual retirement plan and which are allowable as a deduction under subsection (a) for such taxable year shall not exceed— - § 219(c)(1)(B): Pub. L. 99–514, § 1103(a), amended subpar. (B) generally. Prior to amendment, subpar. (B) read as follows: “whose spouse has no compensation (determined without regard to section 911) for such taxable year,”. - § 219(c)(2)(B): Pub. L. 99–514, § 1108(g)(3), struck out “(determined without regard to so much of the employer contributions to a simplified employee pension as is allowable by reason of paragraph (2) of subsection (b))” after “for the taxable year”. - § 219(e): Pub. L. 99–514, § 1101(b)(1), amended subsec. (e) generally, revising the definition of “qualified retirement contribution”. - § 219(f)(1): Pub. L. 99–514, § 301(b)(4), which directed that par. (1) be amended by substituting “paragraph (6)” for “paragraph (7)”, could not be executed because prior amendment by Pub. L. 99–514, § 1875(c)(4), see below, struck out language which included phrase “paragraph (7)”. - § 219(f)(1): Pub. L. 99–514, § 1875(c)(4), struck out “reduced by any amount allowable as a deduction to the individual in computing adjusted gross income under paragraph (7) of section 62” after “(as defined in section 401(c)(2))”. - § 219(f)(3): Pub. L. 99–514, § 1101(a)(2), in amending par. (3) generally, reenacted existing provision without its subpar. “(A) Individual retirement plans” designation, and struck out subpar. (B) relating to time when contributions deemed made with respect to qualified employer or government plans. - § 219(f)(7): Pub. L. 99–514, § 1102(f), added par. (7). - § 219(g): Pub. L. 99–514, § 1101(a)(1), added subsec. (g). Former subsec. (g) redesignated (h). - § 219: Pub. L. 99–514, § 1501(d)(1)(B), which directed that subsec. (g) be amended by substituting “6652(g)” for “6652(h)”, was executed by making the substitution in subsec. (h) to reflect the probable intent of Congress and the prior redesignation of former subsec. (g) as (h) by Pub. L. 99–514, § 1101(a)(1). - § 219: Pub. L. 99–514, § 1101(a)(1), redesignated former subsec. (g) as (h). ## § 226: Cross reference - § 226: Pub. L. 99–514, § 135(b)(1), renumbered section 223 of this title as this section. - § 226: Pub. L. 99–514, § 301(b)(5)(A), amended section generally, substituting “reference” for “references” in section catchline, striking out par. (1) which referred to section 1202 for deduction for long-term capital gains in the case of a taxpayer other than a corporation, and striking out par. (2) designation. ## § 243: Dividends received by corporations - § 243(a)(1): Pub. L. 99–514, § 611(a)(1), substituted “80 percent” for “85 percent”. - § 243(b)(3)(C): Pub. L. 99–514, § 411(b)(2)(C)(iv), inserted “and” at end of cl. (i), redesignated cl. (iii) as (ii), and struck out former cl. (ii) which read as follows: “$400,000 limitation for certain exploration expenditures under section 617(h)(1), and”. ## § 245: Dividends received from certain foreign corporations - § 245(a): Pub. L. 99–514, § 1226(a), in amending subsec. (a) generally, substituted “Dividends from 10-percent owned foreign corporations” for “General rule” as heading, and in text substituted provisions set out in nine numbered paragraphs allowing for deduction for dividends received from certain foreign corporations qualifying as “10-percent owned foreign corporations” for former provisions which directed that, in the case of dividends received from a foreign corporation (other than a foreign personal holding company) which was subject to taxation under this chapter, if, for an uninterrupted period of not less than 36 months ending with the close of such foreign corporation’s taxable year in which such dividends were paid (or, if the corporation had not been in existence for 36 months at the close of such taxable year, for the period the foreign corporation had been in existence as of the close of such taxable year) such foreign corporation had been engaged in trade or business within the United States and if 50 percent or more of the gross income of such corporation from all sources for such period was effectively connected with the conduct of a trade or business within the United States, there was allowed as a deduction in the case of a corporation a percentage of dividends received. - § 245(c)(1): Pub. L. 99–514, § 1876(d)(1)(A), amended par. (1) generally. Prior to amendment, par. (1) read as follows: “In the case of a domestic corporation, there shall be allowed as a deduction an amount equal to 100 percent of any dividend received by such corporation from another corporation which is distributed out of earnings and profits attributable to foreign trade income for a period during which such other corporation was a FSC. The deduction allowable under the preceding sentence with respect to any dividend shall be in lieu of any deduction allowable under subsection (a) or (b) with respect to such dividend.” - § 245(c)(3): Pub. L. 99–514, § 1876(j), added par. (3). Former par. (3) redesignated (4). - § 245(c)(3): Pub. L. 99–514, § 1876(d)(1)(B), inserted “For purposes of this subsection, the term ‘qualified interest and carrying charges’ means any interest or carrying charges (as defined in section 927(d)(1)) derived from a transaction which results in foreign trade income.” - § 245(c)(4): Pub. L. 99–514, § 1876(j), redesignated former par. (3) as (4). ## § 246: Rules applying to deductions for dividends received - § 246(a)(2)(B): Pub. L. 99–514, § 1812(d)(1)(A), substituted “In” for “For purposes of subparagraph (A), in” in introductory provisions and substituted cl. (i)(II) for former cl. (i)(II) which read as follows: “which were not taken into account under subparagraph (A), bears to”. - § 246(a)(2)(C), § 246(a)(2)(D): Pub. L. 99–514, § 1812(d)(1)(B), (C), added subpar. (C), redesignated former subpar. (C) as (D), and added cl. (iv) to subpar. (D). - § 246(b)(1): Pub. L. 99–514, § 611(a)(3), substituted “80 percent” for “85 percent”. - § 246(c)(1)(A): Pub. L. 99–514, § 1804(b)(1)(A), amended subpar. (A) generally. Prior to amendment, subpar. (A) read as follows: “which is sold or otherwise disposed of in any case in which the taxpayer has held such share for 45 days or less, or”. - § 246(c)(4): Pub. L. 99–514, § 1804(b)(1)(B), substituted “determined for purposes of this subsection” for “determined under paragraph (3)”. - § 246: Pub. L. 99–514, § 1275(a)(2)(B), struck out “or 934(e)(3)” after “936(h)(4)”. ## § 246A: Dividends received deduction reduced where portfolio stock is debt financed - § 246A(a): Pub. L. 99–514, § 1804(a), substituted “or 245(a)” for “or 245” and inserted “The preceding sentence shall be applied before any determination of a ratio under paragraph (1) or (2) of section 245(a).” - § 246A(a)(1): Pub. L. 99–514, § 611(a)(4), substituted “80 percent” for “85 percent”. ## § 263: Capital expenditures - § 263(a)(1)(E), § 263(a)(1)(F), § 263(a)(1)(G), § 263(a)(1)(H): Pub. L. 99–514, § 402(b)(1), struck out subpar. (E) relating to nonapplication of par. (1) to expenditures by farmers for clearing land deductible under section 182, and redesignated subpars. (F) to (H) as (E) to (G), respectively. - § 263(c): Pub. L. 99–514, § 701(e)(4)(D), substituted “59(d)” for “58(i)”. - § 263(c): Pub. L. 99–514, § 411(b)(1)(B), inserted “and except as provided in subsection (i),”. - § 263(i): Pub. L. 99–514, § 411(b)(1)(A), added subsec. (i). ## § 263A: Capitalization and inclusion in inventory costs of certain expenses - Enacted 26 U.S.C. § 263A. ## § 264: Certain amounts paid in connection with insurance contracts - § 264(a): Pub. L. 99–514 added par. (4) and last sentence providing that par. (4) shall apply with respect to contracts purchased after June 20, 1986. ## § 265: Expenses and interest relating to tax-exempt income - § 265: Pub. L. 99–514, § 902(a), (d), designated existing provisions as subsec. (a), inserted heading, and added subsec. (b). - § 265: Pub. L. 99–514, § 902(b), struck out last sentence which read as follows: “In applying the preceding sentence to a financial institution (other than a bank) which is a face-amount certificate company registered under the Investment Company Act of 1940 (15 U.S.C. 80a–1 and following) and which is subject to the banking laws of the State in which such institution is incorporated, interest on face-amount certificates (as defined in section 2(a)(15) of such Act) issued by such institution, and interest on amounts received for the purchase of such certificates to be issued by such institution, shall not be considered as interest on indebtedness incurred or continued to purchase or carry obligations the interest on which is wholly exempt from the taxes imposed by this subtitle, to the extent that the average amount of such obligations held by such institution during the taxable year (as determined under regulations prescribed by the Secretary) does not exceed 15 percent of the average of the total assets held by such institution during the taxable year (as so determined).” - § 265: Pub. L. 99–514, § 144, added par. (6). ## § 267: Losses, expenses, and interest with respect to transactions between related taxpayers - § 267(a)(2): Pub. L. 99–514, § 806(c)(2), as amended by Pub. L. 100–647, § 1008(e)(6), inserted at end “For purposes of this paragraph, in the case of a personal service corporation (within the meaning of section 441(i)(2)), such corporation and any employee-owner (within the meaning of section 269A(b)(2), as modified by section 441(i)(2)) shall be treated as persons specified in subsection (b).” - § 267(a)(3): Pub. L. 99–514, § 1812(c)(1), added par. (3). - § 267(b)(12): Pub. L. 99–514, § 1812(c)(4)(A), substituted “same persons own” for “same persons owns”. - § 267(e)(5)(D): Pub. L. 99–514, § 803(b)(5), substituted in cl. (i) “interest in property described in clause (i), (ii), (iii), or (iv) of section 1250(a)(1)(B)” for “interest in low-income housing (as defined in paragraph (5) of section 189(e))” and in cl. (ii) “such property” for “low-income housing (as so defined)”. - § 267(e)(6): Pub. L. 99–514, § 1812(c)(3)(C), added par. (6). - § 267(f)(3)(B): Pub. L. 99–514, § 1812(c)(2), inserted “(or persons described in subsection (b)(10))”. - § 267(g): Pub. L. 99–514, § 1842(a), added subsec. (g). ## § 269A: Personal service corporations formed or availed of to avoid or evade income tax - § 269A(b)(3): Pub. L. 99–514 substituted “section 144(a)(3)” for “section 103(b)(6)(C)”. ## § 269B: Stapled entities - § 269B(b): Pub. L. 99–514, § 1810(j)(1), inserted “and regulations providing that any tax imposed on the foreign corporation referred to in subsection (a)(1) may, if not paid by such corporation, be collected from the domestic corporation referred to in such subsection or the shareholders of such foreign corporation”. - § 269B(e): Pub. L. 99–514, § 1810(j)(2), added subsec. (e). ## § 274: Disallowance of certain entertainment, etc., expenses - § 274(b)(1): Pub. L. 99–514, § 122(c)(1)–(3), and Pub. L. 100–647, § 1018(u)(2), made conforming amendments to subpars. (A) and (B) and struck out subpar. (C) which read as follows: “an item of tangible personal property which is awarded to an employee by reason of length of service, productivity, or safety achievement, but only to the extent that— - § 274(b): Pub. L. 99–514, § 122(c)(4), struck out par. (3) relating to qualified plan award, defining such term in subpar. (A), and providing for average amount of awards in subpar. (B) and maximum amount per item in subpar. (C). - § 274(e)(1): Pub. L. 99–514, § 142(a)(2)(A), redesignated par. (2) as (1) and struck out former par. (1), business meals, which read as follows: “Expenses for food and beverages furnished to any individual under circumstances which (taking into account the surroundings in which furnished, the taxpayer’s trade, business, or income-producing activity and the relationship to such trade, business, or activity of the persons to whom the food and beverages are furnished) are of a type generally considered to be conducive to a business discussion.” - § 274(e)(2): Pub. L. 99–514, § 142(a)(2)(A), redesignated par. (3) as (2). Former par. (2) redesignated (1). - § 274(e)(3): Pub. L. 99–514, § 142(a)(2), redesignated par. (4) as (3) and substituted “paragraph (2)” for “paragraph (3)” in subpar. (A). Former par. (3) redesignated (2). - § 274(e)(4): Pub. L. 99–514, § 1114(b)(6), which directed the substitution of “highly compensated employees (within the meaning of section 414(q))” for “officers, shareholders or other owners, or highly compensated employees” in par. (5) was executed to par. (4) to reflect the probable intent of Congress, in view of the redesignation of par. (5) as (4) by section 142(a)(2)(A) of Pub. L. 99–514. - § 274(e)(4): Pub. L. 99–514, § 142(a)(2)(A), redesignated par. (5) as (4). Former par. (4) redesignated (3). - § 274(e)(5), § 274(e)(6), § 274(e)(7), § 274(e)(8), § 274(e)(9), § 274(e): Pub. L. 99–514, § 142(a)(2)(A), redesignated pars. (5) to (10) as pars. (4) to (9), respectively. - § 274(h): Pub. L. 99–514, § 142(c), struck out “or 212” after “section 162” in introductory provisions of pars. (1), (2), and (5), in closing provisions of par. (2), and in par. (4)(A), struck out “or to an activity described in section 212 and” after “active conduct of his trade or business” in introductory provisions of pars. (1) and (2), and added par. (7). - § 274(j): Pub. L. 99–514, § 122(d), added subsec. (j). Former subsec. (j) redesignated (k). - § 274(k): Pub. L. 99–514, § 142(a)(1), added subsec. (k). Former subsec. (k) redesignated (o). - § 274(l), § 274(m), § 274(n): Pub. L. 99–514, § 142(b), added subsecs. (l) to (n). - § 274(o): Pub. L. 99–514, § 142(a)(1), redesignated former subsec. (k) as (o). ## § 277: Deductions incurred by certain membership organizations in transactions with members - § 277(b)(4): Pub. L. 99–514 added par. (4). ## § 280A: Disallowance of certain expenses in connection with business use of home, rental of vacation homes, etc. - § 280A(c)(5)(B): Pub. L. 99–514, § 143(c), added subpar. (B) and struck out former subpar. (B) which read as follows: “the deductions allocable to such use which are allowable under this chapter for the taxable year whether or not such unit (or portion thereof) was so used.” - § 280A(c)(6): Pub. L. 99–514, § 143(b), added par. (6). ## § 280C: Certain expenses for which credits are allowable - § 280C(b)(1), § 280C(b)(2)(A): Pub. L. 99–514, § 1847(b)(8), substituted “section 28(b)” for “section 29(b)” in par. (1) and “section 28” for “section 29” in pars. (1) and (2)(A). - § 280C(b)(3): Pub. L. 99–514, § 231(d)(3)(E), substituted “section 41(f)(5)”, “section 41(f)(1)(B)”, and “section 41(f)(1)” for “section 30(f)(5)”, “section 30(f)(1)(B)”, and “section 30(f)(1)”, respectively. ## § 280F: Limitation on depreciation for luxury automobiles; limitation where certain property used for personal purposes - § 280F(a)(2)(A): Pub. L. 99–514, § 201(d)(4)(A)(i), (K), substituted “depreciation deduction” for “recovery deduction” in introductory provisions and substituted cls. (i) to (iv) for former cls. (i) and (ii) which read as follows: - § 280F(a)(2)(B): Pub. L. 99–514, § 201(d)(4)(A)(ii), (K), substituted “$1,475” for “$4,800” in heading and text of cl. (ii), and “depreciation deduction” for “recovery deduction” in heading and text of cl. (iv). - § 280F(a): Pub. L. 99–514, § 201(d)(4)(K), substituted “depreciation deduction” for “recovery deduction” in two places. - § 280F(b)(2): Pub. L. 99–514, § 201(d)(4)(J), substituted “section 168(g) (relating to alternative depreciation system)” for “the straight line method over the earnings and profits life for such property”. - § 280F(b)(3): Pub. L. 99–514, § 201(d)(4)(B), (K), substituted “depreciation deduction” for “recovery deduction” and “section 168(g) (relating to alternative depreciation system)” for “the straight line method over the earnings and profits life” in closing provisions. - § 280F(b): Pub. L. 99–514, § 201(d)(4)(C), in amending par. (4) generally, struck out heading “Definitions”, redesignated as par. (4) former subpar. (A) heading and text, substituted “For purposes of this section, property” for “Property”, and struck out former subpar. (B) definition of straight line method over earnings and profits life. - § 280F(c)(4): Pub. L. 99–514, § 201(d)(4)(D), substituted “section 168(i)(3)(A)” for “section 168(j)(6)(B)”. - § 280F(d)(1): Pub. L. 99–514, § 201(d)(4)(E), substituted “depreciation deduction” for “recovery deduction”. - § 280F(d)(2): Pub. L. 99–514, § 1812(e)(5), substituted “is use described in” for “is not use described in”. - § 280F(d)(2): Pub. L. 99–514, § 201(d)(4)(F), substituted “depreciation deduction” for “recovery deduction” and “use in a trade or business (including the holding for the production of income)” for “use described in section 168(c)(1) (defining recovery property)”. - § 280F(d)(3)(A): Pub. L. 99–514, § 1812(e)(2), inserted “(or the amount of any deduction allowable to the employee for rentals or other payments under a lease of listed property)”. - § 280F(d)(4)(A)(iv): Pub. L. 99–514, § 201(d)(4)(G), substituted “section 168(i)(2)(B)” for “section 168(j)(5)(D)”. - § 280F(d)(4)(B): Pub. L. 99–514, § 1812(e)(3), inserted “and owned or leased by the person operating such establishment”. - § 280F(d)(4): Pub. L. 99–514, § 1812(e)(4), added subpar. (C). - § 280F(d)(5)(A): Pub. L. 99–514, § 1812(e)(1)(A), (C), substituted “unloaded gross vehicle weight” for “gross vehicle weight” in cl. (ii) and inserted at end “In the case of a truck or van, clause (ii) shall be applied by substituting ‘gross vehicle weight’ for ‘unloaded gross vehicle weight’.” - § 280F(d)(8): Pub. L. 99–514, § 201(d)(4)(H), amended par. (8) generally. Prior to amendment, par. (8) read as follows: “For purposes of subsection (a)(2), the term ‘unrecovered basis’ means the excess (if any) of— - § 280F(d)(10): Pub. L. 99–514, § 201(d)(4)(I), struck out “, notwithstanding any regulations prescribed under section 168(f)(7),” after “For purposes of subsection (a)(2)”. ## § 280G: Golden parachute payments - § 280G(b)(2)(A): Pub. L. 99–514, § 1804(j)(6), inserted “For purposes of clause (ii), payments not treated as parachute payments under paragraph (4)(A), (5), or (6) shall not be taken into account.” - § 280G(b)(2)(B): Pub. L. 99–514, § 1804(j)(7), amended subpar. (B) generally. Prior to amendment, subpar. (B) read as follows: “The term ‘parachute payment’ shall also include any payment in the nature of compensation to (or for the benefit of) a disqualified individual if such payment is pursuant to an agreement which violates any securities laws or regulations.” - § 280G(b)(4): Pub. L. 99–514, § 1804(j)(2), substituted “Treatment of amounts which taxpayer establishes as reasonable compensation” for “Excess parachute payments reduced to extent taxpayer establishes reasonable compensation” in heading and amended text generally. Prior to amendment, text read as follows: “In the case of any parachute payment described in paragraph (2)(A), the amount of any excess parachute payment shall be reduced by the portion of such payment which the taxpayer establishes by clear and convincing evidence is reasonable compensation for personal services actually rendered. For purposes of the preceding sentence, reasonable compensation shall be first offset against the base amount.” - § 280G(b)(5): Pub. L. 99–514, § 1804(j)(1), added par. (5). - § 280G(b)(6): Pub. L. 99–514, § 1804(j)(3), added par. (6). - § 280G(c): Pub. L. 99–514, § 1804(j)(5), inserted provision defining “highly-compensated individual”. - § 280G(d)(2): Pub. L. 99–514, § 1804(j)(8), substituted “performed personal services for the corporation” for “was an employee of the corporation”. - § 280G(d)(5): Pub. L. 99–514, § 1804(j)(4), added par. (5). ## § 291: Special rules relating to corporate preference items - § 291(a): Pub. L. 99–514, § 1804(k)(3)(A), substituted “Reduction” for “20-percent reduction” in heading. - § 291(a)(1)(A): Pub. L. 99–514, § 201(d)(5)(A), struck out “or section 1245 recovery property” after “section 1245 property”. - § 291(a)(2): Pub. L. 99–514, § 412(b)(1), substituted “20 percent” for “15 percent”. - § 291(a)(4): Pub. L. 99–514, § 1876(b)(1), substituted “Certain FSC income” for “Certain deferred FSC income” in heading and amended text generally. Prior to amendment, text read as follows: “If a C corporation is a shareholder of the FSC, in the case of taxable years beginning after December 31, 1984, section 923(a) shall be applied with respect to such corporation by substituting— - § 291(a)(4): Pub. L. 99–514, § 1804(k)(1), substituted “If a C corporation” for “If a corporation”. - § 291(b)(1): Pub. L. 99–514, § 411(a)(1), (b)(2)(C)(ii), substituted “30 percent” for “20 percent” in closing provisions and “617(a)” for “617” in subpar. (B). - § 291(b)(2), § 291(b)(3), § 291(b)(4), § 291(b)(5), § 291(b): Pub. L. 99–514, § 411(a)(2), added pars. (2) to (5) and struck out former pars. (2) to (6) as follows: former par. (2), special rule for amounts not allowable as deductions under paragraph (1), related in subpar. (A) to intangible drilling costs and in subpar. (B) to mineral exploration and development costs; former par. (3) defined applicable percentage in accordance with table for taxable years 1 to 5; former par. (4) dispositions, related in subpar. (A) to oil, gas, and geothermal property, in subpar. (B) to application of section 617(d) of this title, and in subpar. (C) to recapture of investment credit; former par. (5) defined integrated oil company; and former par. (6) related to coordination with cost depletion. - § 291(c)(1): Pub. L. 99–514, § 201(d)(5)(B), amended par. (1) generally. Prior to amendment, par. (1) read as follows: “For purposes of subclause (1) of section 168(d)(1)(A)(ii), a taxpayer shall not be treated as electing the amortization deduction under section 169 with respect to that portion of the basis not taken into account under section 169 by reason of subsection (a)(5).” - § 291(e)(1)(A): Pub. L. 99–514, § 901(b)(4), struck out “or 593” after “section 585”. - § 291(e)(1)(B): Pub. L. 99–514, § 902(c)(2)(C), substituted “1982, and before August 8, 1986” for “1982” in heading. - § 291(e)(1)(B)(i): Pub. L. 99–514, § 902(c)(1), (2)(A), substituted “1982, and before August 8, 1986” for “1982” and “(but for this paragraph or section 265(b))” for “(but for this paragraph)”. - § 291(e)(1)(B)(i): Pub. L. 99–514, § 901(d)(4)(C), substituted “which is a bank (as defined in section 582(a)(2)) or to which section 593 applies” for “to which section 585 or 593 applies”. - § 291(e)(1)(B)(ii): Pub. L. 99–514, § 902(c)(2)(B), inserted “and section 265(b)”. - § 291(e)(1)(B)(iv): Pub. L. 99–514, § 1854(c)(1), added cl. (iv) relating to special rules for obligations to which section 133 applies. - § 291(e)(1)(B)(iv): Pub. L. 99–514, § 902(c)(2)(D), added cl. (iv) relating to application of subparagraph to certain obligations issued after August 7, 1986. - § 291(e)(2): Pub. L. 99–514, § 201(d)(5)(C), struck out “, ‘section 1245 recovery property’,” after “ ‘section 1245 property’ ” and directed that par. (2) be amended by striking out “, section 1245(a)(5),” which was executed by striking out “, 1245(a)(5),” after “sections 1245(a)(3)” to reflect the probable intent of Congress. ## § 301: Distributions of property - § 301(f)(3): Pub. L. 99–514, § 1804(f)(2)(B), substituted “this subsection” for “this section”. - § 301: Pub. L. 99–514, § 612(b)(1), struck out par. (4) which provided: “For partial exclusion from gross income of dividends received by individuals, see section 116.” ## § 303: Distributions in redemption of stock to pay death taxes - § 303(d): Pub. L. 99–514 amended subsec. (d) generally. Prior to amendment, subsec. (d) read as follows: “Under regulations prescribed by the Secretary, where stock in a corporation is subject to tax under section 2601 as a result of a generation-skipping transfer (within the meaning of section 2611(a)), which occurs at or after the death of the deemed transferor (within the meaning of section 2612)— ## § 304: Redemption through use of related corporations - § 304(a)(1): Pub. L. 99–514 substituted “To the extent that such distribution is treated as a distribution to which section 301 applies” for “In any such case” in last sentence. ## § 311: Taxability of corporation on distribution - § 311: Pub. L. 99–514 amended section generally, substituting provisions relating to distributions of appreciated property for provisions relating to LIFO inventory, liability in excess of basis, and appreciated property used to redeem stock. ## § 312: Effect on earnings and profits - § 312(b): Pub. L. 99–514, § 1804(f)(1)(A), amended subsec. (b) generally, substituting provisions relating to distributions of appreciated property for provisions relating to distribution of certain inventory assets. - § 312(c): Pub. L. 99–514, § 1804(f)(1)(B), (C), struck out “, etc.” after “liabilities” in heading and struck out par. (3) which read as follows: “any gain recognized to the corporation on the distribution.” - § 312(k)(3): Pub. L. 99–514, § 201(b), amended par. (3) generally, substituting provisions relating to tangible property to which section 168 applies and amounts deductible under section 179 for provisions relating to recovery property within the meaning of section 168, amounts deductible under section 179, and flexibility if a different recovery percentage is elected under section 168 based on a longer recovery period. - § 312(k)(3)(A): Pub. L. 99–514, § 1809(a)(2)(C)(ii), in subpar. (A), struck out “and rules similar to the rules under the next to the last sentence of section 168(b)(2)(A) and section 168(b)(2)(B) shall apply” after “low-income housing)”. - § 312(k)(4): Pub. L. 99–514, § 201(d)(6), struck out last sentence “In determining the earnings and profits of such corporation in the case of recovery property (within the meaning of section 168), the rules of section 168(f)(2) shall apply.” - § 312(n)(1)(B): Pub. L. 99–514, § 803(b)(3)(A), as amended by Pub. L. 100–647, § 1018(u)(4), struck out “(determined without regard to section 189)” after “incurred”. - § 312(n)(1)(C): Pub. L. 99–514, § 803(b)(3)(B), added subpar. (C) and struck out former subpar. (C) which read as follows: “The term ‘construction period’ has the meaning given such term by section 189(e)(2) (determined without regard to any real property limitation).” - § 312(n)(3): Pub. L. 99–514, § 241(b)(1), struck out “, 177,” after “sections 173”. - § 312(n)(4): Pub. L. 99–514, § 631(e)(1), amended par. (4) generally. Prior to amendment, par. (4) read as follows: “Earnings and profits shall be increased or decreased by the amount of any increase or decrease in the LIFO recapture amount (determined under section 336(b)(3)) as of the close of each taxable year; except that any decrease below the LIFO recapture amount as of the close of the taxable year preceding the first taxable year to which this paragraph applies to the taxpayer shall be taken into account only to the extent provided in regulations prescribed by the Secretary.” - § 312(n)(4): Pub. L. 99–514, § 1804(f)(1)(D), redesignated par. (5) as (4). Former par. (4), relating to certain untaxed appreciation of distributed property, was struck out. - § 312(n)(5), § 312(n)(6), § 312(n)(7): Pub. L. 99–514, § 1804(f)(1)(D), redesignated pars. (6) to (8) as (5) to (7), respectively. Former par. (5) redesignated (4). - § 312(n)(8), § 312(n): Pub. L. 99–514, § 1804(f)(1)(D), (E), redesignated par. (9) as (8) and substituted provisions of subpars. (A) and (B) for “paragraphs (5), (6), and (7) shall apply only in the case of taxable years beginning after December 31, 1985.” Former par. (8) redesignated (7). ## § 318: Constructive ownership of stock - § 318(b)(5): Pub. L. 99–514 substituted “382(l)(3)” for “382(a)(3)”. ## § 332: Complete liquidations of subsidiaries - § 332(b)(1): Pub. L. 99–514, § 1804(e)(6)(A), amended par. (1) generally. Prior to amendment, par. (1) read as follows: “the corporation receiving such property was, on the date of the adoption of the plan of liquidation, and has continued to be at all times until the receipt of the property, the owner of stock (in such other corporation) possessing at least 80 percent of the total combined voting power of all classes of stock entitled to vote and the owner of at least 80 percent of the total number of shares of all other classes of stock (except nonvoting stock which is limited and preferred as to dividends); and either”. - § 332(c): Pub. L. 99–514, § 631(e)(2), struck out subsec. (c) containing special rule for indebtedness of subsidiary to parent in relation to complete liquidations of subsidiaries. ## § 334: Basis of property received in liquidations - § 334(a): Pub. L. 99–514, § 631(e)(4)(A), struck out “(other than a distribution to which section 333 applies)” after “liquidation”. - § 334: Pub. L. 99–514, § 631(e)(4)(B), struck out subsec. (c) relating to property received in liquidation under section 333. ## § 336: Gain or loss recognized on property distributed in complete liquidation - Enacted 26 U.S.C. § 336. ## § 337: Nonrecognition for property distributed to parent in complete liquidation of subsidiary - Enacted 26 U.S.C. § 337. ## § 338: Certain stock purchases treated as asset acquisitions - § 338(a)(1): Pub. L. 99–514, § 631(b)(1), struck out “to which section 337 applies” after “in a single transaction”. - § 338(c): Pub. L. 99–514, § 631(b)(2), struck out subsec. (c) relating to special rules for coordination with section 337 where purchasing corporation holds less than 100 percent of stock, and in case of certain redemptions where an election is made under this section. - § 338(d)(3): Pub. L. 99–514, § 1804(e)(8)(A), amended par. (3) generally. Prior to amendment, par. (3) read as follows: “The term ‘qualified stock purchase’ means any transaction or series of transactions in which stock of 1 corporation possessing— - § 338(h)(3)(C)(i): Pub. L. 99–514, § 1899A(7), substituted “subparagraphs” for “subparagraph”. - § 338(h)(6)(B)(i): Pub. L. 99–514, § 1275(c)(6), struck out “a corporation described in section 934(b),” after “DISC,”. - § 338(h)(10)(B): Pub. L. 99–514, § 631(b)(3), inserted provision that to the extent provided in regulations, term “selling consolidated group” also includes any affiliated group of corporations which includes the target corporation (whether or not such group files a consolidated return). - § 338(h)(12): Pub. L. 99–514, § 631(e)(5), struck out par. (12) relating to applicability of section 337 where target had adopted plan for complete liquidation. ## § 346: Definition and special rule - § 346(b): Pub. L. 99–514 struck out “337,” after “351,”. ## § 361: Nonrecognition of gain or loss to corporations; treatment of distributions - § 361: Pub. L. 99–514 amended section generally. Prior to amendment, section related to whether gain or loss was recognized if corporation which was party to reorganization exchanged property, pursuant to plan of reorganization, for stock or securities in another corporation which was party to the reorganization or for other property or money. ## § 362: Basis to corporations - § 362(c): Pub. L. 99–514 struck out par. (3) relating to exceptions for contributions in aid of construction. ## § 367: Foreign corporations - § 367(a)(1): Pub. L. 99–514, § 1810(g)(4)(A), struck out “355,” after “354,”. - § 367(d)(2)(A): Pub. L. 99–514, § 1231(e)(2), inserted at end “The amounts taken into account under clause (ii) shall be commensurate with the income attributable to the intangible.” - § 367(e): Pub. L. 99–514, § 631(d)(1), amended subsec. (e) generally. Prior to amendment, subsec. (e), treatment of distributions described in section 336 or 355, read as follows: “In the case of any distribution described in section 336 or 355 (or so much of section 356 as relates to section 355) by a domestic corporation which is made to a person who is not a United States person, to the extent provided in regulations, gain shall be recognized under principles similar to the principles of this section.” - § 367(f): Pub. L. 99–514, § 1810(g)(1), struck out subsec. (f) which related to transitional rules in the case of any exchanges beginning before Jan. 1, 1978. - § 367(f): Pub. L. 99–514, § 1810(g)(4)(B), in heading substituted “distributions described in section 336 or 355” for “liquidations under section 336”, and in text inserted “or 355 (or so much of section 356 as relates to section 355)”. ## § 368: Definitions relating to corporate reorganizations - § 368(a)(2)(A): Pub. L. 99–514, § 1804(h)(3), inserted “(other than for purposes of subparagraph (C))” after “subchapter”. - § 368(a)(2)(F)(ii): Pub. L. 99–514, § 1879(l)(1), amended cl. (ii) generally. Prior to amendment, cl. (ii) read as follows: “A corporation meets the requirements of this clause if not more than 25 percent of the value of its total assets is invested in the stock and securities of any one issuer, and not more than 50 percent of the value of its total assets is invested in the stock and securities of 5 or fewer issuers. For purposes of this clause, all members of a controlled group of corporations (within the meaning of section 1563(a)) shall be treated as one issuer.” - § 368(a)(2)(G)(i): Pub. L. 99–514, § 1804(g)(2), inserted “For purposes of the preceding sentence, if the acquired corporation is liquidated pursuant to the plan of reorganization, any distribution to its creditors in connection with such liquidation shall be treated as pursuant to the plan of reorganization.” - § 368(a)(2)(H): Pub. L. 99–514, § 1804(h)(2), added subpar. (H). - § 368(a)(3)(D): Pub. L. 99–514, § 904(a), (c)(1), as amended by Pub. L. 100–647, § 4012(a)(1), which (applicable to acquisitions after Dec. 31, 1989, in taxable years ending after such date) directed amendment of subpar. (D) to read “(D) Agency receivership proceedings which involve financial institutions.—For purposes of subparagraphs (A) and (B), in the case of a receivership, foreclosure, or similar proceeding before a Federal or State agency involving a financial institution referred to in section 581 or 591, the agency shall be treated as a court.”, was repealed by Pub. L. 101–73, § 1401(b)(1), (c)(4), eff. Oct. 22, 1986, and I.R.C. of 1986 applicable as if the amendments made by such section had not been enacted. - § 368(c): Pub. L. 99–514, § 1804(h)(1), in amending subsec. (c) generally, struck out par. (1) designation and struck out par. (2) defining term “control” as having meaning given to such term by section 304(c) in case of any transaction with respect to which requirements of subpars. (A) and (B) of section 354(b)(1) are met, for purposes of determining whether such transaction is described in subpar. (D) of subsec. (a)(1). - § 368(c): Pub. L. 99–514, § 621(e)(1), repealed amendment by Pub. L. 94–455, § 806(f)(1). See 1976 Amendment note below. ## § 381: Carryovers in certain corporate acquisitions - § 381(c)(10): Pub. L. 99–514, § 411(b)(2)(C)(iii), struck out last sentence which read: “For the purpose of applying the limitation provided in section 617(h), if, for any taxable year, the distributor or transferor corporation was allowed a deduction under section 617(a), the acquiring corporation shall be deemed to have been allowed such deduction.” - § 381(c)(12): Pub. L. 99–514, § 1812(a)(3), amended par. (12) generally. Prior to amendment, par. (12), recovery of bad debts, prior taxes, or delinquency amounts, read as follows: “If the acquiring corporation is entitled to the recovery of bad debts, prior taxes, or delinquency amounts previously deducted or credited by the distributor or transferor corporation, the acquiring corporation shall include in its income such amounts as would have been includible by the distributor or transferor corporation in accordance with section 111 (relating to the recovery of bad debts, prior taxes, and delinquency amounts).” - § 381(c)(25), § 381(c)(26): Pub. L. 99–514, § 231(d)(3)(F), redesignated par. (26) as (25). Former par. (25), relating to credit under section 30, was struck out. - § 381(c): Pub. L. 99–514, § 701(e)(1), added par. (27). ## § 382: Limitation on net operating loss carryforwards and certain built-in losses following ownership change - § 382: Pub. L. 99–514, § 621(a), in amending section generally, in subsec. (a), substituted provisions setting forth general rule that amount of taxable income of any new loss corporation for any post-change year which may be offset by pre-change losses shall not exceed section 382 limitation for such year for provisions relating to change in ownership of corporation and change in its business, description of persons owning corporation, attribution of ownership, and definition of “purchase”, in subsec. (b), substituted provisions relating to section 382 limitation for provisions relating to change in ownership as result of reorganization, in subsec. (c), substituted provisions relating to disallowance of carryforwards if continuity of business requirements are not met for provisions defining stock as all shares except nonvoting stock which is limited and preferred as to dividends, and added subsecs. (d) to (m). - § 382: Pub. L. 99–514, § 621(e)(1), repealed amendment by Pub. L. 94–455, § 806(e). See 1976 Amendment note below. ## § 383: Special limitations on certain excess credits, etc. - § 383: Pub. L. 99–514, § 621(b), amended section generally. Prior to amendment, section read as follows: “If— - § 383: Pub. L. 99–514, § 621(e)(1), repealed amendment by Pub. L. 94–455, § 806(f)(2). See 1976 Amendment note below. ## § 401: Qualified pension, profit-sharing, and stock bonus plans - § 401(a)(4): Pub. L. 99–514, § 1114(b)(7), amended par. (4) generally. Prior to amendment, par. (4) read as follows: “if the contributions or the benefits provided under the plan do not discriminate in favor of employees who are— - § 401(a)(5): Pub. L. 99–514, § 1111(b), amended par. (5) generally. Prior to amendment, par. (5) related to conditions which taken alone would not require a classification to be considered discriminatory and means of determining the basic or regular rate of compensation of an employee and whether two or more plans of an employer satisfy requirements of par. (4) when considered as a single plan. - § 401(a)(8): Pub. L. 99–514, § 1119(a), substituted “defined benefit plan” for “pension plan”. - § 401(a)(9)(C): Pub. L. 99–514, § 1121(b), amended subpar. (C) generally. Prior to amendment, subpar. (C) read as follows: “For purposes of this paragraph, the term ‘required beginning date’ means April 1 of the calendar year following the later of— - § 401(a)(9)(C): Pub. L. 99–514, § 1852(a)(4)(A), substituted last 2 sentences for “Except as provided in section 409(d), clause (ii) shall not apply in the case of an employee who is a 5-percent owner (as defined in section 416) with respect to the plan year ending in the calendar year in which the employee attains 70½.” - § 401(a)(9)(G): Pub. L. 99–514, § 1852(a)(6), added subpar. (G). - § 401(a)(11)(A)(i): Pub. L. 99–514, § 1898(b)(3)(A), substituted “who does not die before the annuity starting date” for “who retires under the plan”. - § 401(a)(11)(B): Pub. L. 99–514, § 1898(b)(2)(A)(ii), inserted at end “Clause (iii)(III) shall apply only with respect to the transferred assets (and income therefrom) if the plan separately accounts for such assets and any income therefrom.” - § 401(a)(11)(B)(iii)(I): Pub. L. 99–514, § 1898(b)(7)(A), inserted “(reduced by any security interest held by the plan by reason of a loan outstanding to such participant)”. - § 401(a)(11)(B)(iii)(I): Pub. L. 99–514, § 1898(b)(13)(A), substituted “section 417(a)(2)” for “section 417(a)(2)(A)”. - § 401(a)(11)(B)(iii)(III): Pub. L. 99–514, § 1898(b)(2)(A)(i), inserted “(in a transfer after December 31, 1984)”. - § 401(a)(11)(D), § 401(a)(11)(E): Pub. L. 99–514, § 1145(a), added subpar. (E) relating to exception for plans described in section 404(c) and redesignated former subpar. (D), relating to cross references, as (E). - § 401(a)(11)(D), § 401(a)(11)(E): Pub. L. 99–514, § 1898(b)(14)(A), added subpar. (D) and redesignated former subpar. (D), relating to cross references, as (E). - § 401(a)(17): Pub. L. 99–514, § 1106(d)(1), added par. (17). - § 401(a)(20): Pub. L. 99–514, § 1852(b)(8), substituted “qualified total distribution described in section 402(a)(5)(E)(i)(I)” for “qualifying rollover distribution (determined as if section 402(a)(5)(D)(i) did not contain subclause (II) thereof) described in section 402(a)(5)(A)(i) or 403(a)(4)(A)(i)”. - § 401(a)(21): Pub. L. 99–514, § 1171(b)(5), struck out par. (21) which read as follows: “A trust forming part of a tax credit employee stock ownership plan shall not fail to be considered a permanent program merely because employer contributions under the plan are determined solely by reference to the amount of credit which would be allowable under section 41 if the employer made the transfer described in section 41(c)(1)(B)”. - § 401(a)(22): Pub. L. 99–514, § 1899A(10), substituted “If” for “if”. - § 401(a)(22): Pub. L. 99–514, § 1176(a), inserted at end “The requirements of subsection (e) of section 409 shall not apply to any employees of an employer who are participants in any defined contribution plan established and maintained by such employer if the stock of such employer is not publicly traded and the trade or business of such employer consists of publishing on a regular basis a newspaper for general circulation.” - § 401(a)(23): Pub. L. 99–514, § 1174(c)(2)(A), amended par. (23) generally. Prior to amendment, par. (23) read as follows: “A stock bonus plan which otherwise meets the requirements of this section shall not be considered to fail to meet the requirements of this section because it provides a cash distribution option to participants if that option meets the requirements of section 409(h), except that in applying section 409(h) for purposes of this paragraph, the term ‘employer securities’ shall include any securities of the employer held by the plan.” - § 401(a)(26): Pub. L. 99–514, § 1112(b), added par. (26). - § 401(a)(27): Pub. L. 99–514, § 1136(a), added par. (27). - § 401(a)(28): Pub. L. 99–514, § 1175(a)(1), added par. (28). - § 401(c)(2)(A)(v): Pub. L. 99–514, § 1848(b), substituted “section 404” for “sections 404 and 405(c)”. - § 401(c)(6): Pub. L. 99–514, § 1143(a), added par. (6). - § 401(h): Pub. L. 99–514, § 1852(h)(1), substituted “key employee” for “5-percent owner” in two places in par. (6) and amended last sentence generally, substituting “ ‘key employee’ means any employee, who” for “ ‘5-percent owner’ means any employee who,” and “key employee as defined in section 416(i)” for “5-percent owner (as defined in section 416(i)(1)(B))”. - § 401(k)(1), § 401(k)(2): Pub. L. 99–514, § 1879(g)(1), substituted “, a pre-ERISA money purchase plan, or a rural electric cooperative plan” for “(or a pre-ERISA money purchase plan)”. - § 401(k)(2)(B): Pub. L. 99–514, § 1116(b)(1), amended subpar. (B) generally. Prior to amendment, subpar. (B) read as follows: “under which amounts held by the trust which are attributable to employer contributions made pursuant to the employee’s election may not be distributable to participants or other beneficiaries earlier than upon retirement, death, disability, or separation from service (or in the case of a profit sharing or stock bonus plan, hardship or the attainment of age 59½) and will not be distributable merely by reason of the completion of a stated period of participation or the lapse of a fixed number of years; and”. - § 401(k)(2)(C): Pub. L. 99–514, § 1852(g)(3), substituted “is nonforfeitable” for “are nonforfeitable”. - § 401(k)(2)(D): Pub. L. 99–514, § 1116(b)(2), added subpar. (D). - § 401(k)(3): Pub. L. 99–514, § 1116(d)(3), which directed that the last sentence of subpar. (B) be struck out was executed by striking out the last sentence of par. (3) as the probable intent of Congress because subpar. (B) is composed of only one sentence. Prior to being stricken, such last sentence read as follows: “For purposes of the preceding sentence, the compensation of any employee for a plan year shall be the amount of his compensation which is taken into account under the plan in calculating the contribution which may be made on his behalf for such plan year.” - § 401(k)(3)(A): Pub. L. 99–514, § 1116(b)(4), as amended by Pub. L. 100–647, § 1011(k)(3)(B), substituted “any highly compensated employee” for “an employee” in concluding provisions. - § 401(k)(3)(A): Pub. L. 99–514, § 1852(g)(2), substituted “If an employee is a participant under 2 or more cash or deferred arrangements of the employer, for purposes of determining the deferral percentage with respect to such employee, all such cash or deferred arrangements shall be treated as 1 cash or deferred arrangement” for “The deferral percentage taken into account under this subparagraph for any employee who is a participant under 2 or more cash or deferred arrangements of the employer shall be the sum of the deferral percentages for such employee under each of such arrangements”. - § 401(k)(3)(A)(i): Pub. L. 99–514, § 1112(d)(1), struck out “subparagraph (A) or (B) of” before “section 410(b)(1)”. - § 401(k)(3)(A)(ii): Pub. L. 99–514, § 1116(c)(2), substituted “paragraph (5)” for “paragraph (4)”. - § 401(k)(3)(A)(ii): Pub. L. 99–514, § 1116(a), substituted “1.25” for “1.5” in subcl. (I), and “2 percentage points” for “3 percentage points” and “2” for “2.5” in subcl. (II). - § 401(k)(3)(C): Pub. L. 99–514, § 1852(g)(1), added subpar. (C) relating to treatment of cash or deferred arrangements. - § 401(k)(3)(C): Pub. L. 99–514, § 1116(e), added subpar. (C) relating to employer contributions. - § 401(k)(4): Pub. L. 99–514, § 1116(b)(3), added par. (4). Former par. (4) redesignated (5). - § 401(k)(5): Pub. L. 99–514, § 1116(b)(3), (d)(1), redesignated former par. (4) as (5) and substituted “the term ‘highly compensated employee’ has the meaning given such term by section 414(q)” for “the term ‘highly compensated employee’ means any employee who is more highly compensated than two-thirds of all eligible employees, taking into account only compensation which is considered in applying paragraph (3)”. Former par. (5) redesignated (6). - § 401(k)(6): Pub. L. 99–514, § 1116(b)(3), redesignated former par. (5) as (6). Former par. (6) redesignated (7). - § 401(k)(6): Pub. L. 99–514, § 1879(g)(2), added par. (6). - § 401(k)(7): Pub. L. 99–514, § 1116(b)(3), redesignated former par. (6) as (7). - § 401(k)(8): Pub. L. 99–514, § 1116(c)(1), added par. (8). - § 401(k)(9): Pub. L. 99–514, § 1116(d)(2), added par. (9). - § 401(l): Pub. L. 99–514, § 1111(a), amended subsec. (l) generally, substituting provisions relating to permitted disparity in plan contributions or benefits for provisions relating to nondiscriminatory coordination of defined contribution plans with OASDI. - § 401(m): Pub. L. 99–514, § 1117(a), added subsec. (m) and redesignated former subsec. (m) as (n). - § 401(m): Pub. L. 99–514, § 1898(c)(3), added subsec. (m). - § 401(n): Pub. L. 99–514, § 1117(a), redesignated former subsec. (m) as (n). Former subsec. (n) redesignated (o). - § 401(n): Pub. L. 99–514, § 1898(c)(3), redesignated subsec. (o) as (n). - § 401(o): Pub. L. 99–514, § 1117(a), redesignated former subsec. (n) as (o). - § 401(o): Pub. L. 99–514, § 1898(c)(3), redesignated subsec. (o) as (n). ## § 402: Taxability of beneficiary of employees’ trust - § 402(a): Pub. L. 99–514, § 1122(b)(1)(A), struck out par. (2) relating to capital gains treatment for portion of lump sum distribution. - § 402(a): Pub. L. 99–514, § 1122(e)(1), amended cl. (i) generally, to read as follows: “Subparagraph (A) shall apply to a partial distribution only if the employee elects to have subparagraph (A) apply to such distribution and such distribution would be a lump sum distribution if subsection (e)(4)(A) were applied— - § 402(a): Pub. L. 99–514, § 1852(b)(2), inserted at end “For purposes of subclause (I), the balance to the credit of the employee shall not include any accumulated deductible employee contributions (within the meaning of section 72(o)(5)).” - § 402(a): Pub. L. 99–514, § 1852(b)(5), substituted “a trust or plan described in subclause (III) or (IV)” for “a plan described in subclause (IV) or (V)”. - § 402(a): Pub. L. 99–514, § 1122(b)(2)(A), struck out “and capital gains treatment” in heading and amended text generally. Prior to amendment, cl. (iii) read as follows: “If an election under clause (i) is made with respect to any partial distribution paid to any employee— - § 402(a): Pub. L. 99–514, § 1852(b)(1), substituted “of all or any portion of” for “of any portion of”. - § 402(a): Pub. L. 99–514, § 1121(c)(1), amended subpar. (F) generally. Prior to amendment, subpar. (F) heading read “Special rules” and text read as follows: - § 402(a): Pub. L. 99–514, § 1852(b)(6), in cl. (i) substituted “a transfer resulting in any portion of a distribution being excluded from gross income under subparagraph (A)” for “a transfer described in subparagraph (A)”. - § 402(a): Pub. L. 99–514, § 1875(c)(1)(A), amended cl. (ii) generally. Prior to amendment, cl. (ii), key employees, read as follows: “An eligible retirement plan described in subclause (III) or (IV) of subparagraph (E)(iv) shall not be treated as an eligible retirement plan for the transfer of a distribution if any part of the distribution is attributable to contributions made on behalf of the employee while he was a key employee in a top-heavy plan. For purposes of the preceding sentence, the terms ‘key employee’ and ‘top-heavy plan’ have the same respective meanings as when used in section 416.” - § 402(a): Pub. L. 99–514, § 1852(a)(5)(A), added subpar. (G). - § 402(a): Pub. L. 99–514, § 1852(b)(7), substituted “(7)” for “(7)(B)”. - § 402(a): Pub. L. 99–514, § 1898(c)(7)(A)(i), substituted “paragraph (5)” for “paragraph (5)(A)”. - § 402(a): Pub. L. 99–514, § 1898(a)(3), added subpar. (G) relating to treatment of potential future vesting. - § 402(a): Pub. L. 99–514, § 1122(e)(2)(A), added subpar. (H). - § 402(a): Pub. L. 99–514, § 1852(b)(4), inserted “; except that a trust or plan described in subclause (III) or (IV) of paragraph (5)(E)(iv) shall not be treated as an eligible retirement plan with respect to such distribution” after “the spouse were the employee”. - § 402(a): Pub. L. 99–514, § 1898(c)(1)(A), substituted “any alternate payee who is the spouse or former spouse of the participant shall be treated” for “the alternate payee shall be treated”. - § 402(b): Pub. L. 99–514, § 1112(c), designated existing provisions as par. (1), inserted par. (1) heading, and added par. (2). - § 402(b): Pub. L. 99–514, § 1852(c)(5), substituted “section 72(e)(5)” for “section 72(e)(1)”. - § 402(e)(1)(B): Pub. L. 99–514, § 1122(b)(2)(B), and Pub. L. 100–647, § 1018(u)(6), redesignated subpar. (C) as (B), substituted “Amount of tax” for “Initial separate tax” in heading and “The amount of tax imposed by subparagraph (A)” for “The initial separate tax”, and struck out former subpar. (B) which related to computation of tax on lump sum distributions. - § 402(e)(1)(B): Pub. L. 99–514, § 104(b)(5), as amended by Pub. L. 100–647, § 1018(u)(1), struck out “the zero bracket amount applicable to such individual for the taxable year plus” after “amount equal to”. - § 402(e)(1)(B): Pub. L. 99–514, § 1122(a)(2)(A), (B), substituted “5” for “10” and “⅕” for “one-tenth”. - § 402(e)(1): Pub. L. 99–514, § 1122(b)(2)(B)(i), redesignated subpars. (C) to (E) as (B) to (D), respectively. - § 402(e)(3): Pub. L. 99–514, § 1122(b)(2)(C), and Pub. L. 100-647, § 1018(u)(7), substituted “total taxable amount” for “ordinary income portion”. - § 402(e)(4)(B): Pub. L. 99–514, § 1122(a)(1), amended subpar. (B) generally. Prior to amendment, subpar. (B) read as follows: “For purposes of this section and section 403, no amount which is not an annuity contract may be treated as a lump sum distribution under subparagraph (A) unless the taxpayer elects for the taxable year to have all such amounts received during such year so treated at the time and in the manner provided under regulations prescribed by the Secretary. Not more than one election may be made under this subparagraph with respect to any individual after such individual has attained age 59½. No election may be made under this subparagraph by any taxpayer other than an individual, an estate, or a trust. In the case of a lump sum distribution made with respect to an employee to two or more trusts, the election under this subparagraph shall be made by the personal representative of the employee.” - § 402(e)(4)(E): Pub. L. 99–514, § 1122(b)(2)(D), struck out subpar. (E) defining “ordinary income portion” with respect to a lump sum distribution. - § 402(e)(4): Pub. L. 99–514, § 1852(b)(3)(B), struck out subpar. (F) defining “employee”. See subsec. (g) of this section relating to treatment of self-employed individuals. - § 402(e)(4): Pub. L. 99–514, § 1122(b)(2)(E), struck out “(but not for purposes of subsection (a)(2) or section 403(a)(2)(A))” after “For purposes of this subsection”. - § 402(e)(4): Pub. L. 99–514, § 1122(g), inserted at end “To the extent provided by the Secretary, a taxpayer may elect before any distribution not to have this paragraph apply with respect to such distribution.” - § 402(e)(4): Pub. L. 99–514, § 1106(c)(2), added subpar. (N). - § 402(e)(6): Pub. L. 99–514, § 1898(a)(2), added par. (6). - § 402(f)(1): Pub. L. 99–514, § 1898(e)(1), substituted “eligible rollover distribution” for “qualifying rollover distribution”. - § 402(f)(2): Pub. L. 99–514, § 1898(e)(2), amended par. (2) generally. Prior to amendment, par. (2) read as follows: “For purposes of this subsection, the terms ‘qualifying rollover distribution’ and ‘eligible retirement plan’ have the respective meanings given such terms by subsection (a)(5)(E).” - § 402(g): Pub. L. 99–514, § 1854(f)(2), added subsec. (g) relating to effect of disposition of stock by plan on net unrealized appreciation. - § 402(g): Pub. L. 99–514, § 1852(b)(3)(A), added subsec. (g) relating to treatment of self-employed individuals. - § 402(g): Pub. L. 99–514, § 1105(a), added subsec. (g) relating to limitation on exclusion for elective deferrals. - § 402(h): Pub. L. 99–514, § 1108(b), added subsec. (h). ## § 403: Taxation of employee annuities - § 403(a)(1): Pub. L. 99–514, § 1122(d)(1), substituted “Distributee taxable under section 72” for “General rule” in heading and amended par. (1) generally. Prior to amendment, par. (1) read as follows: “Except as provided in paragraph (2), if an annuity contract is purchased by an employer for an employee under a plan which meets the requirements of section 404(a)(2) (whether or not the employer deducts the amounts paid for the contract under such section), the employee shall include in his gross income the amounts received under such contract for the year received as provided in section 72 (relating to annuities).” - § 403(a)(2): Pub. L. 99–514, § 1122(b)(1)(B), struck out par. (2) which read as follows: - § 403(a)(4)(B): Pub. L. 99–514, § 1852(a)(5)(B)(i), substituted “through (G)” for “through (F)”. - § 403(b)(1): Pub. L. 99–514, § 1122(d)(2), amended second sentence generally. Prior to amendment, second sentence read as follows: “The employee shall include in his gross income the amounts received under such contract for the year received as provided in section 72 (relating to annuities)”. - § 403(b)(1)(D): Pub. L. 99–514, § 1120(a), added subpar. (D). - § 403(b)(7)(A)(ii): Pub. L. 99–514, § 1123(c)(2), inserted “in the case of contributions made pursuant to a salary reduction agreement (within the meaning of section 3121(a)(1)(D)),” after “section 72(m)(7)), or”. - § 403(b)(7)(D): Pub. L. 99–514, § 1852(a)(3)(B), struck out subpar. (D) “Distribution requirements” which read as follows: “For purposes of determining when the interest of an employee in a custodial account must be distributed, such account shall be treated in the same manner as an annuity contract.” - § 403(b)(8): Pub. L. 99–514, § 1852(b)(10), inserted “and” before “(F)(i)”. - § 403(b)(8): Pub. L. 99–514, § 1852(a)(5)(B)(ii), added subpar. (D). - § 403(b)(10): Pub. L. 99–514, § 1120(b), added par. (10) relating to nondiscrimination requirements. - § 403(b)(10): Pub. L. 99–514, § 1852(a)(3)(A), added par. (10) relating to distribution requirements. - § 403(b)(11): Pub. L. 99–514, § 1123(c)(1), added par. (11). - § 403(c): Pub. L. 99–514, § 1122(d)(3), amended last sentence generally. Prior to amendment, last sentence read as follows: “The amount actually paid or made available to any beneficiary under such contract shall be taxable to him in the year in which so paid or made available under section 72 (relating to annuities).” ## § 404: Deduction for contributions of an employer to an employees’ trust or annuity plan and compensation under a deferred-payment plan - § 404(a): Pub. L. 99–514, § 1851(b)(2)(C)(i), substituted “this chapter; but, if they would otherwise be deductible” for “section 162 (relating to trade or business expenses) or section 212 (relating to expenses for the production of income); but, if they satisfy the conditions of either of such sections”. - § 404(a)(2): Pub. L. 99–514, § 1136(b), substituted “(26), and (27)” for “and (26)”. - § 404(a)(2): Pub. L. 99–514, § 1112(d)(2), substituted “(22), and (26)” for “and (22)”. - § 404(a)(3)(A): Pub. L. 99–514, § 1131(a), amended subpar. (A) generally, revising and restating as cls. (i) to (v) provisions formerly contained in single paragraph. - § 404(a)(7): Pub. L. 99–514, § 1131(b), amended par. (7) generally, revising and restating as subpars. (A) to (C) provisions formerly contained in single paragraph, and adding subpar. (D). - § 404(a)(8)(C): Pub. L. 99–514, § 1875(c)(7)(A), inserted “(determined without regard to the deductions allowed by this section)”. - § 404(a)(8)(D): Pub. L. 99–514, § 1875(c)(7)(B), as amended by Pub. L. 100–647, § 1018(t)(5), struck out “(determined without regard to the deductions allowed by this section)” after “earned income of such individual”. - § 404(a)(8)(D): Pub. L. 99–514, § 1848(c), substituted “the deduction allowed by this section” for “the deductions allowed by this section and section 405(c)”. - § 404(b): Pub. L. 99–514, § 1851(b)(2)(B)(i), substituted “certain” for “unfunded” in heading. - § 404(b)(2): Pub. L. 99–514, § 1851(b)(2)(A), (B)(ii), substituted “certain” for “unfunded” in heading, and in subpar. (B)(ii), substituted “any benefit” for “to any benefit”. - § 404(d): Pub. L. 99–514, § 1851(b)(2)(C)(ii), substituted “under this chapter” for “under section 162 or 212” in pars. (1) and (2). - § 404(h)(1)(A), § 404(h)(1)(B): Pub. L. 99–514, § 1108(c), amended subpars. (A) and (B) generally. Prior to amendment, subpars. (A) and (B) read as follows: - § 404(i): Pub. L. 99–514, § 1171(b)(6), struck out subsec. (i) relating to the deductibility of unused portions of employee stock ownership credit. - § 404(k): Pub. L. 99–514, § 1854(b)(2)(B), struck out “during the taxable year” after “cash by such corporation” in introductory provisions. - § 404(k): Pub. L. 99–514, § 1854(b)(4), inserted “The Secretary may disallow the deduction under this subsection for any dividend if the Secretary determines that such dividend constitutes, in substance, an avoidance of taxation.” - § 404(k): Pub. L. 99–514, § 1854(b)(3), inserted “A plan to which this subsection applies shall not be treated as violating the requirements of section 401, 409, or 4975(e)(7) merely by reason of any distribution described in paragraph (2).” - § 404(k): Pub. L. 99–514, § 1854(b)(2)(A), inserted “Any deduction under subparagraph (A) or (B) of paragraph (2) shall be allowed in the taxable year of the corporation in which the dividend is paid or distributed to the participant under paragraph (2).” - § 404(k): Pub. L. 99–514, § 1173(a)(2), inserted “Any deduction under paragraph (2)(C) shall be allowable in the taxable year of the corporation in which the dividend is used to repay the loan described in such paragraph.” - § 404(k)(2)(A), § 404(k)(2)(B): Pub. L. 99–514, § 1854(b)(5), inserted “or their beneficiaries”. - § 404(k)(2): Pub. L. 99–514, § 1173(a)(1), added subpar. (C). - § 404(l): Pub. L. 99–514, § 1106(d)(2), added subsec. (l). ## § 404A: Deduction for certain foreign deferred compensation plans - § 404A(a): Pub. L. 99–514, § 1851(b)(2)(C)(iii), substituted “under this chapter” for “under section 162, 212, or 404” in par. (1) and “they would otherwise be deductible” for “they satisfy the conditions of section 162” in par. (2). - § 404A(g)(1)(A): Pub. L. 99–514, § 1114(b)(8), substituted “a highly compensated employee (within the meaning of section 414(q))” for “an officer, shareholder, or highly compensated”. ## § 406: Employees of foreign affiliates covered by section 3121(l) agreements - § 406(b)(1): Pub. L. 99–514, § 1112(d)(3), struck out “(without regard to paragraph (1)(A) thereof)” after “section 410(b)” in introductory text. - § 406(b)(1)(A): Pub. L. 99–514, § 1114(b)(9)(A), as amended by Pub. L. 101–239, § 7831(f), substituted “a highly compensated employee (within the meaning of section 414(q))” for “an officer, shareholder, or person whose principal duties consist in supervising the work of other employees of a foreign affiliate of such American employer”. - § 406(b)(1)(B): Pub. L. 99–514, § 1114(b)(9)(C), inserted “(as so defined)” after “employee”. - § 406(e): Pub. L. 99–514, § 1852(e)(2)(C), struck out par. (5) which read as follows: “Section 2517 (relating to certain annuities under qualified plans).” ## § 407: Certain employees of domestic subsidiaries engaged in business outside the United States - § 407(b)(1): Pub. L. 99–514, § 1112(d)(3), struck out “(without regard to paragraph (1)(A) thereof)” after “section 410(b)” in introductory text. - § 407(b)(1)(A): Pub. L. 99–514, § 1114(b)(9)(B), as amended by Pub. L. 101–239, § 7831(f), substituted “a highly compensated employee (within the meaning of section 414(q))” for “an officer, shareholder, or person whose principal duties consist in supervising the work of other employees of a domestic subsidiary”. - § 407(b)(1)(B): Pub. L. 99–514, § 1114(b)(9)(C), inserted “(as so defined)” after “employee”. - § 407(e): Pub. L. 99–514, § 1852(e)(2)(D), struck out par. (5) which read as follows: “Section 2517 (relating to certain annuities under qualified plans).” ## § 408: Individual retirement accounts - § 408(a)(6), § 408(b)(3): Pub. L. 99–514, § 1852(a)(1), substituted “(without regard to subparagraph (C)(ii) thereof) and the incidental death benefit requirements of section 401(a)” for “(relating to required distributions)”. - § 408(c)(1): Pub. L. 99–514, § 1852(a)(7)(A), substituted “paragraphs (1) through (6)” for “paragraphs (1) through (7)”. - § 408(d)(1): Pub. L. 99–514, § 1102(c), amended par. (1) generally. Prior to amendment, par. (1) read as follows: “Except as otherwise provided in this subsection, any amount paid or distributed out of an individual retirement account or under an individual retirement annuity shall be included in gross income by the payee or distributee, as the case may be, for the taxable year in which the payment or distribution is received. Notwithstanding any other provision of this title (including chapters 11 and 12), the basis any person in such an account or annuity is zero.” - § 408(d)(2): Pub. L. 99–514, § 1102(c), substituted “Special rules for applying section 72” for “Distributions of annuity contracts” in heading and amended par. generally. Prior to amendment, par. (2) read as follows: “Paragraph (1) does not apply to any annuity contract which meets the requirements of paragraphs (1), (3), (4), and (5) of subsection (b) and which is distributed from an individual retirement account. Section 72 applies to any such annuity contract, and for purposes of section 72 the investment in such contract is zero.” - § 408(d)(3)(A): Pub. L. 99–514, § 1875(c)(8)(C), inserted at end “Clause (ii) shall not apply during the 5-year period beginning on the date of the qualified total distribution referred to in such clause if the individual was treated as a 5-percent owner with respect to such distribution under section 402(a)(5)(F)(ii).” - § 408(d)(3)(A)(ii): Pub. L. 99–514, § 1875(c)(8)(A), (B), struck out “(other than a trust forming part of a plan under which the individual was an employee within the meaning of section 401(c)(1) at the time contributions were made on his behalf under the plan)” after “section 501(a)” and struck out “(other than a plan under which the individual was an employee within the meaning of section 401(c)(1) at the time contributions were made on his behalf under the plan)” after “section 403(a)”. - § 408(d)(3)(A)(ii): Pub. L. 99–514, § 1121(c)(2), made amendment identical to Pub. L. 99–514, § 1875(c)(8)(A), (B), see above. - § 408(d)(3)(E): Pub. L. 99–514, § 1852(a)(5)(C), added subpar. (E). - § 408(d)(3)(F): Pub. L. 99–514, § 1122(e)(2)(B), added subpar. (F). - § 408(d)(5): Pub. L. 99–514, § 1102(b)(2), inserted at end “For purposes of this paragraph, the amount allowable as a deduction under section 219 (after application of section 408(o)(2)(B)(ii)) shall be increased by the nondeductible limit under section 408(o)(2)(B).” - § 408(d)(5)(A): Pub. L. 99–514, § 1875(c)(6)(A), substituted “the dollar limitation in effect under section 415(c)(1)(A) for such taxable year” for “$15,000”. - § 408(f): Pub. L. 99–514, § 1123(d)(2), struck out subsec. (f) which related to additional tax on certain amounts included in gross income before age 59½. - § 408(i): Pub. L. 99–514, § 1102(e)(2), amended last sentence generally. Prior to amendment, last sentence read as follows: “The reports required by this subsection shall be filed at such time and in such manner and furnished to such individuals at such time and in such manner as may be required by those regulations.” - § 408(k)(2): Pub. L. 99–514, § 1108(d), amended par. (2) generally. Prior to amendment, par. (2) read as follows: “This paragraph is satisfied with respect to a simplified employee pension for a calendar year only if for such year the employer contributes to the simplified employee pension of each employee who— - § 408(k)(2)(A): Pub. L. 99–514, § 1898(a)(5), substituted “age 21” for “age 25”. - § 408(k)(3)(A): Pub. L. 99–514, § 1108(g)(4), substituted “year” for “calendar year”. - § 408(k)(3)(A): Pub. L. 99–514, § 1108(g)(1)(A), substituted “any highly compensated employee (within the meaning of section 414(q))” for “any employee who is— - § 408(k)(3)(C): Pub. L. 99–514, § 1108(g)(1)(B), inserted “and except as provided in subparagraph (D),” and “(other than contributions under an arrangement described in paragraph (6))”, and struck out end sentence which read as follows: “The Secretary shall annually adjust the $200,000 amount contained in the preceding sentence at the same time and in the same manner as he adjusts the dollar amount contained in section 415(c)(1)(A).” - § 408(k)(3)(D), § 408(k)(3): Pub. L. 99–514, § 1108(g)(1)(C), added subpar. (D) and struck out former subpar. (D), treatment of certain contributions and taxes, which read “Except as provided in this subparagraph, employer contributions do not meet the requirements of this paragraph unless such contributions meet the requirements of this paragraph without taking into account contributions or benefits under chapter 2 (relating to tax on self-employment income), chapter 21 (relating to Federal Insurance Contribution Act), title II of the Social Security Act, or any other Federal or State law. If the employer does not maintain an integrated plan at any time during the taxable year, OASDI contributions (as defined in section 401(l)(2)) may, for purposes of this paragraph, be taken into account as contributions by the employer to the employee’s simplified employee pension, but only if such contributions are so taken into account with respect to each employee maintaining a simplified employee pension.”, and former subpar. (E), integrated plan defined, which read “For purposes of subparagraph (D), the term ‘integrated plan’ means a plan which meets the requirements of section 401(a) or 403(a) but would not meet such requirements if contributions or benefits under chapter 2 (relating to tax on self-employment income), chapter 21 (relating to Federal Insurance Contributions Act), title II of the Social Security Act, or any other Federal or State law were not taken into account.” - § 408(k)(6): Pub. L. 99–514, § 1108(a), added par. (6). - § 408(k)(7): Pub. L. 99–514, § 1108(f), added subpar. (C). - § 408(k)(8): Pub. L. 99–514, § 1108(e), added par. (8). - § 408(k)(9): Pub. L. 99–514, § 1108(g)(6), added par. (9). - § 408(m)(3): Pub. L. 99–514, § 1144(a), added par. (3). - § 408(o), § 408(p): Pub. L. 99–514, § 1102(a), added subsec. (o) and redesignated former subsec. (o) as (p). ## § 409: Qualifications for tax credit employee stock ownership plans - § 409(a)(3): Pub. L. 99–514, § 1174(b)(2), inserted reference to subsec. (o). - § 409(d): Pub. L. 99–514, § 1899A(11), substituted “participant’s” for “participants’s”. - § 409(d): Pub. L. 99–514, § 1852(a)(4)(B), inserted at end “This subsection shall not apply to any distribution required under section 401(a)(9).” - § 409(d)(1): Pub. L. 99–514, § 1174(a)(1), substituted “separation from service, or termination of the plan” for “or separation from service”. - § 409(e)(2): Pub. L. 99–514, § 1854(f)(1)(C), (D), inserted “or beneficiary” after “participant” in two places and substituted “securities of the employer” for “employer securities”. - § 409(e)(3): Pub. L. 99–514, § 1854(f)(1)(B)–(D), inserted “or beneficiary” after “participant” in two places and substituted “securities of the employer” for “employer securities” and “any corporate matter which involves the voting of such shares with respect to the approval or disapproval of any corporate merger or consolidation, recapitalization, reclassification, liquidation, dissolution, sale of substantially all assets of a trade or business, or such similar transaction as the Secretary may prescribe in regulations” for “a corporate matter which (by law or charter) must be decided by more than a majority vote of outstanding common shares voted”. - § 409(e)(5): Pub. L. 99–514, § 1854(f)(1)(A), added par. (5). - § 409(h)(2): Pub. L. 99–514, § 1854(f)(3)(C), inserted “, except that such plan may distribute employer securities subject to a requirement that such securities may be resold to the employer under terms which meet the requirements of section 409(o)”. - § 409(h)(5), § 409(h)(6): Pub. L. 99–514, § 1174(c)(1)(A), added pars. (5) and (6). - § 409(l)(4): Pub. L. 99–514, § 1176(b), added par. (4) relating to acquisition of nonvoting common stock. - § 409(n): Pub. L. 99–514, § 1854(a)(3)(A), added subsec. (n). Former subsec. (n) redesignated (o). - § 409(n)(1): Pub. L. 99–514, § 1172(b)(1), as amended by Pub. L. 100–647, § 1011B(g)(1), inserted “or section 2057” in two places in introductory provisions, “or any decedent if the executor of the estate of such decedent makes a qualified sale to which section 2057 applies,” in subpar. (A)(i), and “or the decedent” in subpar. (A)(ii). - § 409(o): Pub. L. 99–514, § 1174(b)(1), added subsec. (o). Former subsec. (o) redesignated (p). - § 409(o): Pub. L. 99–514, § 1854(a)(3)(A), redesignated former subsec. (n) as (o). - § 409(p): Pub. L. 99–514, § 1174(b)(1), redesignated former subsec. (o) as (p). ## § 410: Minimum participation standards - § 410(a)(1)(B)(i): Pub. L. 99–514, § 1113(c), substituted “2 years of service” for “3 years of service” in two places. - § 410(a)(5)(B): Pub. L. 99–514, § 1113(d)(A), substituted “2-year” for “3-year” in heading. - § 410(b): Pub. L. 99–514, § 1112(a), substituted “Minimum coverage requirements” for “Eligibility” as subsec. (b) heading and amended subsec. generally, revising and restating as pars. (1) to (6) provisions formerly contained in pars. (1) to (3). ## § 411: Minimum vesting standards - § 411(a): Pub. L. 99–514, § 1898(d)(1)(A)(ii), inserted reference to par. (11) in introductory text. - § 411(a)(2): Pub. L. 99–514, § 1113(a), amended par. (2) generally, substituting provisions covering 5-year vesting, 3 to 7 year vesting, and multiemployer plans, for former provisions which had covered 10-year vesting, 5- to 15-year vesting, and the “rule of 45”. - § 411(a)(3)(D)(ii): Pub. L. 99–514, § 1898(a)(4)(A)(i), substituted last sentence for former last sentence which read as follows: “In the case of a defined contribution plan, the plan provision required under this clause may provide that such repayment must be made before the participant has any one-year break in service commencing after the withdrawal.” - § 411(a)(7)(C): Pub. L. 99–514, § 1898(a)(4)(A)(ii), substituted last sentence for former last sentence which read as follows: “In the case of a defined contribution plan, the plan provision required under this subparagraph may provide that such repayment must be made before the participant has 5 consecutive 1-year breaks in service commencing after such withdrawal.” - § 411(a)(10)(B): Pub. L. 99–514, § 1113(d)(B), substituted “3 years” for “5 years”. - § 411(a)(11)(A): Pub. L. 99–514, § 1898(d)(1)(A)(i), amended subpar. (A) generally. Prior to amendment, subpar. (A) read as follows: “If the present value of any accrued benefit exceeds $3,500, such benefit shall not be treated as nonforfeitable if the plan provides that the present value of such benefit could be immediately distributed without the consent of the participant.” - § 411(a)(11)(B): Pub. L. 99–514, § 1139(a), amended subpar. (B) generally. Prior to amendment, subpar. (B) read as follows: “For purposes of subparagraph (A), the present value shall be calculated by using an interest rate not greater than the interest rate which would be used (as of the date of the distribution) by the Pension Benefit Guaranty Corporation for purposes of determining the present value of a lump sum distribution on plan termination.” - § 411(a)(11)(C): Pub. L. 99–514, § 1898(d)(2)(A), added subpar. (C). - § 411(d)(1)(A), § 411(d)(1)(B): Pub. L. 99–514, § 1114(b)(10), substituted “highly compensated employees (within the meaning of section 414(q))” for “officers, shareholders, or highly compensated”. - § 411(d)(4): Pub. L. 99–514, § 1113(b), repealed par. (4) which provided that a class year plan satisfied the requirements of subsec. (a)(2) if it provided that 100 percent of each employee’s right to or derived from the contributions of the employer on his behalf with respect to any plan year were nonforfeitable not later than the end of the 5th plan year following the plan year for which such contributions were made. - § 411(d)(4): Pub. L. 99–514, § 1898(a)(1)(A), substituted “Class-year” for “Class year” in heading and amended par. (4) generally. Prior to amendment, par. (4) read as follows: “The requirements of subsection (a)(2) shall be deemed to be satisfied in the case of a class year plan if such plan provides that 100 percent of each employee’s right to or derived from the contributions of the employer on his behalf with respect to any plan year are nonforfeitable not later than the end of the 5th plan year following the plan year for which such contributions were made. For purposes of this section, the term ‘class year plan’ means a profit-sharing, stock bonus, or money purchase plan which provides for the separate nonforfeitability of employees’ rights to or derived from the contributions for each plan year.” - § 411(d)(6)(C): Pub. L. 99–514, § 1898(f)(1)(A), added subpar. (C). ## § 414: Definitions and special rules - § 414(k)(2): Pub. L. 99–514, § 1117(c), inserted reference to section 401(m) (relating to nondiscrimination tests for matching requirements and employee contributions). - § 414(m)(2)(B)(ii): Pub. L. 99–514, § 1114(b)(11), substituted “highly compensated employees (within the meaning of section 414(q))” for “officers, highly compensated employees, or owners”. - § 414(m)(5): Pub. L. 99–514, § 1301(j)(4), substituted “section 144(a)(3)” for “section 103(b)(6)(C)”. - § 414(m): Pub. L. 99–514, § 1852(f), amended directory language of Pub. L. 98–369, § 526(d)(2), to correct an error, and did not involve any change in text. See 1984 Amendment note below. - § 414(n)(1): Pub. L. 99–514, § 1151(i)(1), substituted “requirements” for “pension requirements”. - § 414(n)(1): Pub. L. 99–514, § 1146(b)(2), struck out “except to the extent otherwise provided in regulations,” after “listed in paragraph (3),”. - § 414(n)(2)(B): Pub. L. 99–514, § 1151(i)(2), inserted “(6 months in the case of core health benefits)” after “1 year”. - § 414(n)(3): Pub. L. 99–514, § 1151(i)(3), substituted “Requirements” for “Pension requirements” in heading, substituted “requirements” for “pension requirements” in text, and added subpar. (C). - § 414(n)(4): Pub. L. 99–514, § 1146(a)(2), substituted “Time when first considered as employee” for “Time when leased employee is first considered as employee” in heading and amended text generally. Prior to amendment, text read as follows: “In the case of any leased employee, paragraph (1) shall apply only for purposes of determining whether the pension requirements listed in paragraph (3) are met for periods after the close of the 1-year period referred to in paragraph (2); except that years of service for the recipient shall be determined by taking into account the entire period for which the leased employee performed services for the recipient (or related persons).” - § 414(n)(5): Pub. L. 99–514, § 1146(a)(1), amended par. (5) generally. Prior to amendment, par. (5) read as follows: “This subsection shall not apply to any leased employee if such employee is covered by a plan which is maintained by the leasing organization if, with respect to such employee, such plan— - § 414(n)(6): Pub. L. 99–514, § 1301(j)(4), substituted “section 144(a)(3)” for “section 103(b)(6)(C)” in subpar. (A). - § 414(n)(6): Pub. L. 99–514, § 1146(a)(3), substituted “Other rules” for “Related persons” in heading and amended text generally. Prior to amendment, text read as follows: “For purposes of this subsection, the term ‘related persons’ has the same meaning as when used in section 103(b)(6)(C).” - § 414(o): Pub. L. 99–514, § 1146(b)(1), inserted provision relating to regulations to minimize recordkeeping requirements in case of employer which has no top-heavy plans and uses the services of persons other than employees for an insignificant percentage of the employer’s total workload. - § 414(p)(1)(B)(i): Pub. L. 99–514, § 1898(c)(7)(A)(ii), inserted “former spouse,”. - § 414(p)(3)(B): Pub. L. 99–514, § 1899A(12), struck out the comma after “benefits”. - § 414(p)(4)(A): Pub. L. 99–514, § 1898(c)(7)(A)(vi), substituted “A” for “In the case of any payment before a participant has separated from service, a” in introductory provisions and inserted “in the case of any payment before a participant has separated from service,” in cl. (i). - § 414(p)(4)(B): Pub. L. 99–514, § 1898(c)(7)(A)(vii), amended subpar. (B) generally. Prior to amendment, subpar. (B) read as follows: “For purposes of this paragraph, the term ‘earliest retirement age’ has the meaning given such term by section 417(f)(3), except that in the case of any defined contribution plan, the earliest retirement age shall be the date which is 10 years before the normal retirement age (within the meaning of section 411(a)(8)).” - § 414(p)(5): Pub. L. 99–514, § 1898(c)(7)(A)(v), struck out last sentence which read as follows: “A plan shall not be treated as failing to meet the requirements of subsection (a) or (k) of section 401 which prohibit payment of benefits before termination of employment solely by reason of payments to an alternate payee pursuant to a qualified domestic relations order.” - § 414(p)(5)(A): Pub. L. 99–514, § 1898(c)(6)(A), inserted “(and any spouse of the participant shall not be treated as a spouse of the participant for such purposes)”. - § 414(p)(5)(B): Pub. L. 99–514, § 1898(c)(7)(A)(iv), substituted “the surviving former spouse” for “the surviving spouse”. - § 414(p)(6)(A)(i): Pub. L. 99–514, § 1898(c)(7)(A)(iii), substituted “each alternate payee” for “any other alternate payee”. - § 414(p)(7)(A): Pub. L. 99–514, § 1898(c)(2)(A)(i), substituted “shall separately account for the amounts (hereinafter in this paragraph referred to as the ‘segregated amounts’)” for “shall segregate in a separate account in the plan or in an escrow account the amounts”. - § 414(p)(7)(B): Pub. L. 99–514, § 1898(c)(2)(A)(ii), substituted “the 18-month period described in subparagraph (E)” for “18 months” and “including any interest” for “plus any interest”. - § 414(p)(7)(C): Pub. L. 99–514, § 1898(c)(2)(A)(iii), substituted “the 18-month period described in subparagraph (E)” for “18 months” and “including any interest” for “plus any interest”. - § 414(p)(7)(D): Pub. L. 99–514, § 1898(c)(2)(A)(iv), inserted “described in subparagraph (E)”. - § 414(p)(7)(E): Pub. L. 99–514, § 1898(c)(2)(A)(v), added subpar. (E). - § 414(p)(9): Pub. L. 99–514, § 1898(c)(4)(A), added par. (9). Former par. (9) redesignated (11). - § 414(p)(10): Pub. L. 99–514, § 1898(c)(7)(A)(v), added par. (10). - § 414(p)(11): Pub. L. 99–514, § 1898(c)(4)(A), redesignated former par. (9) as (11). - § 414(q): Pub. L. 99–514, § 1114(a), added subsec. (q). - § 414(r), § 414(s): Pub. L. 99–514, § 1115(a), added subsecs. (r) and (s). - § 414(t): Pub. L. 99–514, § 1151(e)(1), added subsec. (t). ## § 415: Limitations on benefits and contribution under qualified plans - § 415(b)(2)(B): Pub. L. 99–514, § 1898(b)(15)(C), substituted reference to section 417 for reference to section 401(a)(11)(G)(iii). - § 415(b)(2)(C): Pub. L. 99–514, § 1106(b)(1)(A), substituted in heading and in two places in text “the social security retirement age” for “age 62” and substituted new last sentence for “The reduction under this subparagraph shall not reduce the limitation of paragraph (1)(A) below— - § 415(b)(2)(D): Pub. L. 99–514, § 1106(b)(1)(A)(i), substituted in heading and in two places in text “the social security retirement age” for “age 65”. - § 415(b)(2)(E)(iii): Pub. L. 99–514, § 1875(c)(9), substituted “this subsection” for “adjusting any benefit or limitation under subparagraph (B), (C), or (D)”. - § 415(b)(2)(F), § 415(b)(2)(G), § 415(b)(2)(H): Pub. L. 99–514, § 1106(b)(2), added subpars. (F) to (H). - § 415(b)(5): Pub. L. 99–514, § 1106(f), substituted “Reduction for participation or service of less than 10 years” for “Reduction for service less than 10 years” in heading and amended text generally. Prior to amendment, text read as follows: “In the case of an employee who has less than 10 years of service with the employer, the limitation referred to in paragraph (1), and the limitation referred to in paragraph (4), shall be the limitation determined under such paragraph (without regard to this paragraph), multiplied by a fraction, the numerator of which is the number of years (or part thereof) of service with the employer and the denominator of which is 10.” - § 415(b)(8): Pub. L. 99–514, § 1106(b)(1)(B), added par. (8). - § 415(b)(9): Pub. L. 99–514, § 1106(b)(3), added par. (9). - § 415(c)(1)(A): Pub. L. 99–514, § 1106(a), amended subpar. (A) generally, inserting “(or, if greater, ¼ of the dollar limitation in effect under subsection (b)(1)(A))”. - § 415(c)(2): Pub. L. 99–514, § 1108(g)(5), substituted “which are excludable from gross income under section 408(k)(6)” for “allowable as a deduction under section 219(a), and without regard to deductible employee contributions within the meaning of section 72(o)(5)” in last sentence. - § 415(c)(2): Pub. L. 99–514, § 1106(e)(2), inserted at end “Subparagraph (B) of paragraph (1) shall not apply to any contribution for medical benefits (within the meaning of section 419A(f)(2)) after separation from service which is treated as an annual addition.” - § 415(c)(2)(B): Pub. L. 99–514, § 1106(e)(1), amended subpar. (B) generally. Prior to amendment, subpar. (B) read as follows: “the lesser of— - § 415(c)(3)(C): Pub. L. 99–514, § 1875(c)(11), substituted “any defined contribution plan” for “a profit-sharing or stock bonus plan”. - § 415(c)(3)(C)(i): Pub. L. 99–514, § 1847(b)(4), substituted “section 22(e)(3)” for “section 37(e)(3)”. - § 415(c)(3)(C)(ii): Pub. L. 99–514, § 1114(b)(12), substituted “a highly compensated employee (within the meaning of section 414(q))” for “an officer, owner, or highly compensated”. - § 415(c)(4): Pub. L. 99–514, § 1106(b)(4), inserted “a health and welfare service agency,” after “a home health service agency,”. - § 415(c)(6)(A): Pub. L. 99–514, § 1174(d)(1), substituted “highly compensated employees (within the meaning of section 414(q))” for “the group of employees consisting of officers, shareholders owning more than 10 percent of the employer’s stock (determined under subparagraph (B)(iv)), or employees described in subparagraph (B)(iii)”. - § 415(c)(6)(B): Pub. L. 99–514, § 1174(d)(2)(A), struck out cls. (iii) and (iv) which read as follows: - § 415(c)(6): Pub. L. 99–514, § 1174(d)(2)(B), substituted “highly compensated employees (within the meaning of section 414(q))” for “the group of employees consisting of officers, shareholders owning more than 10 percent of the employer’s stock (determined under subparagraph (B)(iv)), or employees described in subparagraph (B)(iii)”. - § 415(d)(1)(B), § 415(d)(1)(C): Pub. L. 99–514, § 1106(g)(1), redesignated subpar. (C) as (B) and struck out former subpar. (B), which related to the $30,000 amount in subsection (c)(1)(A). - § 415(d)(2)(A): Pub. L. 99–514, § 1106(g)(2)(A), substituted “subparagraph (A)” for “subparagraphs (A) and (B)”. - § 415(d)(2)(B): Pub. L. 99–514, § 1106(g)(2)(B), substituted “subparagraph (B)” for “subparagraph (C)”. - § 415(d)(3): Pub. L. 99–514, § 1106(g)(3), substituted “subparagraph (A)” for “subparagraph (A) or (B)”. - § 415(k): Pub. L. 99–514, § 1899A(13), which directed the general amendment of subsec. (k) by striking out par. (1) designation and redesignating subpars. (A) to (F) as pars. (1) to (6), respectively, was repealed by Pub. L. 100–647, § 1018(t)(8)(D). - § 415(k)(2): Pub. L. 99–514, § 1106(c)(1), added par. (2) relating to contributions to provide cost-of-living protection under defined benefit plans. - § 415(l): Pub. L. 99–514, § 1852(h)(3), substituted “a pension or annuity plan” for “a defined benefit plan” in pars. (1) and (2)(A). - § 415(l): Pub. L. 99–514, § 1852(h)(2), as amended by Pub. L. 100–647, § 1018(t)(3)(B), inserted at end of par. (1) “Subparagraph (B) of subsection (c)(1) shall not apply to any amount treated as an annual addition under the preceding sentence.” ## § 416: Special rules for top-heavy plans - § 416(a): Pub. L. 99–514, § 1106(d)(3)(A), struck out par. (3) which read as follows: “the limitation on compensation requirement of subsection (d).” - § 416(c)(2)(B)(ii), § 416(c)(2)(B): Pub. L. 99–514, § 1106(d)(3)(B)(ii), redesignated cl. (iii) as (ii) and struck out former cl. (ii) which read as follows: “Determination of percentage.—The determination referred to in clause (i) shall be determined for each key employee by dividing the contributions for such employee by so much of his total compensation for the year as does not exceed $200,000.” - § 416(d): Pub. L. 99–514, § 1106(d)(3)(B)(i), repealed subsec. (d) which provided for a $200,000 limitation on the amount of annual compensation of each employee taken into account. - § 416(g)(4)(E): Pub. L. 99–514, § 1852(d)(2), amended subpar. (E) generally. Prior to amendment, subpar. (E) read as follows: “If any individual has not received any compensation from any employer maintaining the plan (other than benefits under the plan) at any time during the 5-year period ending on the determination date, any accrued benefit for such individual (and the account of such individual) shall not be taken into account.” - § 416(g)(4)(F): Pub. L. 99–514, § 1118(a), added subpar. (F). - § 416(i)(1)(A): Pub. L. 99–514, § 1852(d)(1), inserted at end “Such term shall not include any officer or employee of an entity referred to in section 414(d) (relating to governmental plans).” ## § 417: Definitions and special rules for purposes of minimum survivor annuity requirements - § 417(a)(1): Pub. L. 99–514, § 1898(b)(15)(A), substituted “section 401(a)(11)” for “section 401(a)(ii)”. - § 417(a)(1)(B): Pub. L. 99–514, § 1898(b)(4)(A)(i), substituted “paragraphs (2), (3), and (4)” for “paragraphs (2) and (3)”. - § 417(a)(2)(A): Pub. L. 99–514, § 1898(b)(6)(A), amended subpar. (A) generally. Prior to amendment, subpar. (A) read as follows: “the spouse of the participant consents in writing to such election, and the spouse’s consent acknowledges the effect of such election and is witnessed by a plan representative or a notary public, or”. - § 417(a)(3)(B): Pub. L. 99–514, § 1898(b)(5)(A), amended subpar. (B) generally. Prior to amendment, subpar. (B) read as follows: “Each plan shall provide to each participant, within the period beginning with the first day of the plan year in which the participant attains age 32 and ending with the close of the plan year preceding the plan year in which the participant attains age 35 (and consistent with such regulations as the Secretary may prescribe), a written explanation with respect to the qualified preretirement survivor annuity comparable to that required under subparagraph (A).” - § 417(a)(4): Pub. L. 99–514, § 1898(b)(4)(A)(ii), added par. (4). Former par. (4) redesignated (5). - § 417(a)(5), § 417(a)(6): Pub. L. 99–514, § 1898(b)(4)(A)(ii), (11)(A), redesignated former par. (4) as (5) and inserted in subpar. (A) “if such benefit may not be waived (or another beneficiary selected) and” before “if the plan”. Former par. (5) redesignated (6). - § 417(c)(1): Pub. L. 99–514, § 1898(b)(15)(B), substituted “survivor annuity for the life of” for “survivor annuity or the life of”. - § 417(c)(1): Pub. L. 99–514, § 1898(b)(1)(A), inserted “In the case of an individual who separated from service before the date of such individual’s death, subparagraph (A)(ii)(I) shall not apply.” - § 417(c)(2): Pub. L. 99–514, § 1898(b)(9)(A)(i), substituted “the portion of the account balance of the participant (as of the date of death) to which the participant had a nonforfeitable right (within the meaning of section 411(a))” for “the account balance of the participant as of the date of death”. - § 417(c)(3): Pub. L. 99–514, § 1898(b)(9)(A)(ii), added par. (3). - § 417(e)(3): Pub. L. 99–514, § 1139(b), amended par. (3) generally. Prior to amendment, par. (3) read as follows: “For purposes of paragraphs (1) and (2), the present value of a qualified joint and survivor annuity or a qualified preretirement survivor annuity shall be determined as of the date of the distribution and by using an interest rate not greater than the interest rate which would be used (as of the date of the distribution) by the Pension Benefit Guaranty Corporation for purposes of determining the present value of a lump sum distribution on plan termination.” - § 417(f)(1): Pub. L. 99–514, § 1898(b)(8)(A), substituted “such participant’s accrued benefit” for “the accrued benefit derived from employer contributions”. - § 417(f)(2): Pub. L. 99–514, § 1898(b)(12)(A), amended par. (2) generally. Prior to amendment, par. (2) read as follows: “The term ‘annuity starting date’ means the first day of the first period for which an amount is received as an annuity (whether by reason of retirement or disability).” - § 417(f)(5): Pub. L. 99–514, § 1898(b)(4)(A)(iii), added par. (5) and redesignated former par. (5) as (6). - § 417(f)(6), § 417(f)(7): Pub. L. 99–514, § 1898(b)(10)(A), added par. (6) and redesignated former par. (6) as (7). - § 417(f)(6), § 417(f)(7): Pub. L. 99–514, § 1898(b)(4)(A)(iii), redesignated former par. (5) as (6). ## § 419: Treatment of funded welfare benefit plans - § 419(a)(1): Pub. L. 99–514, § 1851(b)(2)(C)(iv)(I), substituted “under this subchapter” for “under section 162 or 212”. - § 419(a)(2): Pub. L. 99–514, § 1851(b)(2)(C)(iv)(II), substituted “they would otherwise be deductible” for “they satisfy the requirements of either of such sections”. - § 419(e)(4): Pub. L. 99–514, § 1851(a)(8)(A), added par. (4). - § 419(g)(1): Pub. L. 99–514, § 1851(a)(1), substituted “such a relationship” for “such a plan”. ## § 419A: Qualified asset account; limitation on additions to account - § 419A(a): Pub. L. 99–514, § 1851(a)(6)(B), as amended by Pub. L. 100–647, § 1018(u)(12), inserted “and section 512” after “this subpart”. - § 419A(c)(5)(A): Pub. L. 99–514, § 1851(a)(5), substituted “under this subsection” for “under paragraph (1)”. - § 419A(d)(1): Pub. L. 99–514, § 1851(a)(2)(B), inserted “The requirements of this paragraph shall apply to the first taxable year for which a reserve is taken into account under subsection (c)(2) and to all subsequent taxable years.” - § 419A(d)(2): Pub. L. 99–514, § 1851(a)(2)(A), inserted “Subparagraph (B) of section 415(c)(1) shall not apply to any amount treated as an annual addition under the preceding sentence.” - § 419A(e): Pub. L. 99–514, § 1851(a)(3)(A), amended subsec. (e) generally. Prior to amendment, par. (1), benefits must be nondiscriminatory, read as follows: “No reserve may be taken into account under subsection (c)(2) for post-retirement medical benefits or life insurance benefits to be provided to covered employees unless the plan meets the requirements of section 505(b)(1) with respect to such benefits.”, and par. (2), taxable life insurance benefits not taken into account, read as follows: “No life insurance benefit may be taken into account under subsection (c)(2) to the extent— - § 419A(f)(5): Pub. L. 99–514, § 1851(a)(13), amended par. (5) generally. Prior to amendment, par. (5) read as follows: “Higher limit in case of collectively bargained plans.—Not later than July 1, 1985, the Secretary shall by regulations provide for special account limits in the case of any qualified asset account under a welfare benefit fund established under a collective bargaining agreement.” - § 419A(f)(5): Pub. L. 99–514, § 1851(a)(4), which directed amendment of par. (5) by substituting “welfare benefit fund maintained pursuant to” for “welfare benefit fund established under”, was repealed by Pub. L. 100–647, § 1018(t)(2)(A). - § 419A(f)(7)(C), § 419A(f)(7)(D): Pub. L. 99–514, § 1851(a)(7), added subpars. (C) and (D) and struck out former subpar. (C) which read as follows: “For purposes of this paragraph, the term ‘existing excess reserve’ means the excess (if any) of— - § 419A(g)(3): Pub. L. 99–514, § 1851(a)(9), added par. (3). - § 419A(h)(1): Pub. L. 99–514, § 1851(a)(6)(A), amended par. (1) generally. Prior to amendment, par. (1) read as follows: “At the election of the employer, 2 or more welfare benefit funds of such employer may be treated as 1 fund.” ## § 422: Incentive stock options - § 422(b): Pub. L. 99–514, § 321(a), added par. (7) and struck out former par. (7) which read as follows: “such option by its terms is not exercisable while there is outstanding (within the meaning of subsection (c)(7)) any incentive stock option which was granted, before the granting of such option, to such individual to purchase stock in his employer corporation or in a corporation which (at the time of the granting of such option) is a parent or subsidiary corporation of the employer corporation, or in a predecessor corporation of any of such corporations; and”. - § 422(b): Pub. L. 99–514, § 321(a), struck out par. (8) which read as follows: “in the case of an option granted after December 31, 1980, under the terms of the plan the aggregate fair market value (determined as of the time the option is granted) of the stock for which any employee may be granted incentive stock options in any calendar year (under all such plans of his employer corporation and its parent and subsidiary corporation) shall not exceed $100,000 plus any unused limit carryover to such year.” - § 422(c)(1): Pub. L. 99–514, § 321(b)(2), substituted “paragraph (7) of subsection (b)” for “paragraph (8) of subsection (b) and paragraph (4) of this subsection”. - § 422(c)(4): Pub. L. 99–514, § 321(b)(1), redesignated par. (5) as (4) and struck out former par. (4) relating to carryover of unused limit. - § 422(c)(5), § 422(c)(6): Pub. L. 99–514, § 321(b)(1)(B), redesignated pars. (6) and (8) as (5) and (6), respectively. Former par. (5) redesignated (4). - § 422(c)(7): Pub. L. 99–514, § 321(b)(1), redesignated par. (9) as (7) and struck out former par. (7) which provided that for purposes of subsec. (b)(7) any incentive stock option be treated as outstanding until such option was exercised in full or expired by reason of lapse of time. - § 422(c): Pub. L. 99–514, § 321(b)(1)(B), redesignated par. (10) as (8). Former par. (8) redesignated (6). - § 422(c): Pub. L. 99–514, § 321(b)(1)(B), redesignated par. (9) as (7). - § 422(c): Pub. L. 99–514, § 1847(b)(5), substituted “section 22(e)(3)” for “section 37(e)(3)”. - § 422(c): Pub. L. 99–514, § 321(b)(1)(B), redesignated par. (10) as (8). ## § 423: Employee stock purchase plans - § 423(b)(4)(D): Pub. L. 99–514 substituted “highly compensated employees (within the meaning of section 414(q))” for “officers, persons whose principal duties consist of supervising the work of other employees, or highly compensated employees”. ## § 441: Period for computation of taxable income - § 441(f)(2)(B)(iii): Pub. L. 99–514, § 104(b)(6), struck out “and by adding the zero bracket amount,” after “in the short period,”. - § 441(f)(3), § 441(f)(4): Pub. L. 99–514, § 806(d), added par. (3) and redesignated former par. (3) as (4). - § 441(i): Pub. L. 99–514, § 806(c)(1), added subsec. (i). ## § 443: Returns for a period of less than 12 months - § 443(b)(1): Pub. L. 99–514, § 104(b)(7)(A), struck out “, and adding the zero bracket amount” after “by the number of months in the short period”. - § 443(b)(2)(A)(ii): Pub. L. 99–514, § 104(b)(7)(B), amended cl. (ii) generally. Prior to amendment, cl. (ii) read as follows: “the tax computed on the sum of the modified taxable income for the short period plus the zero bracket amount.” - § 443(d): Pub. L. 99–514, § 701(e)(3), substituted “and tax preferences” for “for tax preferences” in heading and amended text generally. Prior to amendment, subsec. (d) read as follows: “If a return is made for a short period by reason of subsection (a), then— ## § 447: Method of accounting for corporations engaged in farming - § 447(a): Pub. L. 99–514, § 803(b)(7)(B), which directed that subsec. (a) be amended by striking out “and with the capitalization of preproductive period of expenses described in subsection (b)”, was executed by striking out “and with the capitalization of preproductive period expenses described in subsection (b)” after “accrual method of accounting”, as the probable intent of Congress. - § 447(b): Pub. L. 99–514, § 803(b)(7)(A), in amending subsec. (b) generally, substituted in heading “period of expenses” for “period expenses” and in text the cross reference to section 263A for former par. (1) defining “preproductive period expenses”, par. (2) relating to exceptions, and par. (3) defining “preproductive period”. - § 447: Pub. L. 99–514, § 803(b)(7)(C), substituted “Notwithstanding subsection (a) or section 263A, if” for “If”. ## § 448: Limitation on use of cash method of accounting - Enacted 26 U.S.C. § 448. ## § 451: General rule for taxable year of inclusion - § 451(f): Pub. L. 99–514, § 905(b), added subsec. (f) relating to treatment of interest on frozen deposits in certain financial institutions. - § 451(f): Pub. L. 99–514, § 821(a), added subsec. (f) relating to special rule for utility services. ## § 453: Installment method - § 453(f)(1): Pub. L. 99–514, § 642(a)(3), amended par. (1) generally. Prior to amendment, par. (1) read as follows: “Except for purposes of subsections (g) and (h), the term ‘related person’ means a person whose stock would be attributed under section 318(a) (other than paragraph (4) thereof) to the person first disposing of the property.” - § 453(f)(8): Pub. L. 99–514, § 642(b)(1), added par. (8). - § 453(g): Pub. L. 99–514, § 642(a)(1)(D), substituted “controlled entity” for “80-percent owned entity” in heading. - § 453(g)(1): Pub. L. 99–514, § 642(b)(2), amended par. (1) generally. Prior to amendment, par. (1) read as follows: “In the case of an installment sale of depreciable property between related persons within the meaning of section 1239(b), subsection (a) shall not apply, and, for purposes of this title, all payments to be received shall be deemed received in the year of the disposition.” - § 453(h): Pub. L. 99–514, § 631(e)(8)(C), substituted “certain liquidations” for “section 337 liquidations” in heading. - § 453(h)(1)(A): Pub. L. 99–514, § 631(e)(8)(A), amended subpar. (A) generally. Prior to amendment, subpar. (A) read as follows: “If, in connection with a liquidation to which section 337 applies, in a transaction to which section 331 applies the shareholder receives (in exchange for the shareholder’s stock) an installment obligation acquired in respect of a sale or exchange by the corporation during the 12-month period set forth in section 337(a), then, for purposes of this section, the receipt of payments under such obligation (but not the receipt of such obligation) by the shareholder shall be treated as the receipt of payment for the stock.” - § 453(h)(1)(B): Pub. L. 99–514, § 631(e)(8)(A), amended subpar. (B) generally. Prior to amendment, subpar. (B) read as follows: “Subparagraph (A) shall not apply to an installment obligation described in section 337(b)(1)(B) unless such obligation is also described in section 337(b)(2)(B).” - § 453(h)(1)(E): Pub. L. 99–514, § 631(e)(8)(B), substituted “subsidiaries” for “subsidiary” in heading and amended text generally. Prior to amendment, subpar. (E) read as follows: “For purposes of subparagraph (A), in any case to which section 337(c)(3) applies, an obligation acquired in respect of a sale or exchange by the selling corporation shall be treated as so acquired by the corporation distributing the obligation to the shareholder.” - § 453(i)(2): Pub. L. 99–514, § 1809(c), substituted “section 1245 or 1250 (or so much of section 751 as relates to section 1245 or 1250)” for “section 1245 or 1250”. - § 453(j): Pub. L. 99–514, § 812(a), added subsec. (j) relating to current inclusion in case of revolving credit plans, etc. ## § 453A: Special rules for nondealers - § 453A(a)(2): Pub. L. 99–514, § 812(b)(1), struck out last sentence which read as follows: “This paragraph shall not apply with respect to sales of personal property under a revolving credit type plan.” - § 453A(c): Pub. L. 99–514, § 812(b)(2), added subsec. (c). ## § 453B: Gain or loss on disposition of installment obligations - § 453B(d): Pub. L. 99–514, § 631(e)(9), amended subsec. (d) generally, substituting “liquidations to which section 332 applies” for “certain liquidations” in heading, striking out par. (1) designation, redesignating subpars. (A) and (B) as pars. (1) and (2), and striking out former par. (2) relating to liquidations to which section 337 applies. - § 453B(e)(2)(B): Pub. L. 99–514, § 1011(b)(1), substituted “section 806(b)(3)” for “section 806(c)(3)”. - § 453B(g): Pub. L. 99–514, § 1842(c), inserted “(other than a transfer in trust)”. ## § 457: Deferred compensation plans of State and local governments and tax-exempt organizations - § 457: Pub. L. 99–514 amended section generally, substituting “Deferred compensation plans of State and local governments and tax-exempt organizations” for “Deferred compensation plans with respect to service for State and local governments” as section catchline and revising and restating as subsecs. (a) to (c), (e), and (f) provisions formerly contained in subsecs. (a) to (e) and adding provisions comprising subsec. (d). ## § 460: Special rules for long-term contracts - Enacted 26 U.S.C. § 460. ## § 461: General rule for taxable year of deduction - § 461(h)(5): Pub. L. 99–514, § 805(c)(5), redesignated subpar. (B) as (A) and struck out former subpar. (A) which referred to subsec. (c) or (f) of section 166. - § 461(h)(5): Pub. L. 99–514, § 823(b)(1), as amended by Pub. L. 100–647, § 1018(u)(5), redesignated subpar. (C) as (B) and struck out former subpar. (B) which read as follows: “Section 466 (relating to discount coupons).” - § 461(h)(5): Pub. L. 99–514, § 805(c)(5), redesignated subpar. (C) as (B). Former subpar. (B) redesignated (A). - § 461(h)(5): Pub. L. 99–514, § 823(b)(1), as amended by Pub. L. 100–647, § 1018(u)(5), redesignated subpar. (C) as (B). - § 461(h)(5): Pub. L. 99–514, § 805(c)(5), redesignated subpar. (D) as (C). Former subpar. (C) redesignated (B). - § 461(h)(5): Pub. L. 99–514, § 805(c)(5), redesignated subpar. (D) as (C). - § 461(i): Pub. L. 99–514, § 801(b)(1), substituted “Special rules for tax shelters” for “Tax shelters may not deduct items earlier than when economic performance occurs” in heading. - § 461(i)(1): Pub. L. 99–514, § 801(b)(1), substituted “Recurring item exception not to apply” for “In general” in heading and amended par. (1) generally. Prior to amendment, par. (1) read as follows: “In the case of a tax shelter computing taxable income under the cash receipts and disbursements method of accounting, such tax shelter shall not be allowed a deduction under this chapter with respect to any item any earlier than the time when such item would be treated as incurred under subsection (h) (determined without regard to paragraph (3) thereof).” - § 461(i)(2): Pub. L. 99–514, § 801(b)(1), amended par. (2) generally, substituting provisions relating to special rule for spudding of oil or gas wells for former provisions consisting of subpars. (A) to (D) which related to deduction of items when economic performance occurs on or before 90th day after close of the taxable year to the extent of cash basis. - § 461(i)(2): Pub. L. 99–514, § 1807(a)(1), substituted “on or before the 90th day” for “within 90 days” in heading and substituted “before the close of the 90th day after the close of the taxable year” for “within 90 days after the close of the taxable year” in subpar. (A). - § 461(i)(4): Pub. L. 99–514, § 801(b)(2), amended par. (4) generally. Prior to amendment, par. (4) read as follows: “In the case of the trade or business of farming (as defined in section 464(e))— - § 461(i)(4): Pub. L. 99–514, § 1807(a)(2), amended subpar. (A) generally. Prior to amendment, subpar. (A) read as follows: “section 464 shall be applied to any tax shelter described in paragraph (3)(C),”. ## § 464: Limitations on deductions for certain farming expenses - § 464: Pub. L. 99–514, § 404(b)(1), substituted “for certain farming” for “in case of farming syndicates” in section catchline. - § 464(d): Pub. L. 99–514, § 803(b)(8), substituted “Exception” for “Exceptions” as heading and amended text generally. Prior to amendment, text read as follows: “Subsection (a) shall not apply to— - § 464: Pub. L. 99–514, § 404(a), added subsec. (f). ## § 465: Deductions limited to amount at risk - § 465(b)(3)(C): Pub. L. 99–514, § 201(d)(7)(A), struck out “defined” after “person” in heading and amended text generally. Prior to amendment, text read as follows: “For purposes of subparagraph (A), the term ‘related person’ has the meaning given such term by section 168(e)(4).” - § 465(b)(6): Pub. L. 99–514, § 503(b), added par. (6). - § 465(c)(3)(D), § 465(c)(3): Pub. L. 99–514, § 503(a), redesignated subpar. (E) as (D) and struck out former subpar. (D) which read as follows: “In the case of activities described in subparagraph (A), the holding of real property (other than mineral property) shall be treated as a separate activity, and subsection (a) shall not apply to losses from such activity. For purposes of the preceding sentence, personal property and services which are incidental to making real property available as living accommodations shall be treated as part of the activity of holding such real property.” - § 465(c)(7)(D)(v)(II): Pub. L. 99–514, § 1011(b)(1), substituted “section 806(b)(3)” for “section 806(c)(3)”. ## § 467: Certain payments for the use of property or services - § 467(b)(4)(A): Pub. L. 99–514, § 1807(b)(2)(A), substituted “statutory recovery period” for “statutory recover period”. - § 467(c)(4): Pub. L. 99–514, § 1807(b)(2)(B), substituted “subsection (b)(4)(A)” for “subsection (b)(3)(A)”. - § 467(c)(5)(C): Pub. L. 99–514, § 631(e)(10), struck out “453B(d)(2),” after “341(e)(12),”. - § 467(c)(5)(C): Pub. L. 99–514, § 511(d)(2)(A), as amended by Pub. L. 100–647, § 1005(c)(10), struck out “163(d),” after “sections”. - § 467(d)(2): Pub. L. 99–514, § 1807(b)(2)(C), substituted “section 1274(c)(4)(C)” for “section 1274(c)(2)(C)”. - § 467(e)(3)(A): Pub. L. 99–514, § 201(d)(8)(A), in amending subpar. (A) generally, included in table 7-year property, 15-year and 20-year property, and residential rental property and nonresidential real property having recovery periods of 7, 15, and 19 years, respectively, and struck out from table low-income housing, 15-year public utility property, and 19-year real property having recovery periods of 15, 15, and 19 years, respectively. - § 467(e)(3)(A): Pub. L. 99–514, § 1879(f)(1), substituted “19-year real property” and “19 years” for “18-year real property” and “18 years”, respectively. - § 467(e)(3)(B): Pub. L. 99–514, § 201(d)(8)(A), in amending subpar. (B) generally, substituted in heading “not depreciable under section 168” for “which is not recovery property” and in text “In the case of property to which section 168 does not apply, subparagraph (A) shall be applied as if section 168 applies to such property.” for “In the case of any property, which is not recovery property, subparagraph (A) shall be applied as if such property were recovery property.” - § 467(e)(5): Pub. L. 99–514, § 201(d)(8)(B), substituted “section 465(b)(3)(C)” for “section 168(e)(4)(D)”. - § 467(e)(5): Pub. L. 99–514, § 1807(b)(2)(D), substituted “section 168(e)(4)(D)” for “section 168(d)(4)(D)”. - § 467(g): Pub. L. 99–514, § 1807(b)(1), inserted at end “The preceding sentence shall not apply to any amount to which section 404 or 404A (or any other provision specified in regulations) applies.” ## § 468: Special rules for mining and solid waste reclamation and closing costs - § 468(a)(1): Pub. L. 99–514, § 1807(a)(3)(C), substituted “this section” for “this subsection”. - § 468(a)(2)(D): Pub. L. 99–514, § 1807(a)(3)(A), added subpar. (D). - § 468(d)(2)(B)(ii): Pub. L. 99–514, § 1899A(14), substituted “Comprehensive Environmental Response, Compensation, and Liability Act of 1980” for “Comprehensive Environmental, Compensation, and Liability Act of 1980”. ## § 468A: Special rules for nuclear decommissioning costs - § 468A(a): Pub. L. 99–514, § 1807(a)(4)(E)(i), substituted “this section” for “this subsection”. - § 468A(c)(1)(A): Pub. L. 99–514, § 1807(a)(4)(B), substituted “subsection (e)(4)(B)” for “subsection (e)(2)(B)”. - § 468A(d): Pub. L. 99–514, § 1807(a)(4)(E)(ii), substituted “this section” for “this subsection” in introductory text. - § 468A(e): Pub. L. 99–514, § 1807(a)(4)(E)(iii), substituted “Reserve Fund” for “Trust Fund” in heading. - § 468A(e)(1): Pub. L. 99–514, § 1807(a)(4)(E)(iv), substituted “this section” for “this subsection” and “Reserve Fund” for “Trust Fund”. - § 468A(e)(2): Pub. L. 99–514, § 1807(a)(4)(C), amended par. (2) generally. Prior to amendment, par. (2) read as follows: “There is imposed on the gross income of the Fund for any taxable year a tax at a rate equal to the maximum rate in effect under section 11(b), except that— - § 468A(e)(4)(C): Pub. L. 99–514, § 1807(a)(4)(D), added subpar. (C). - § 468A(e)(6): Pub. L. 99–514, § 1807(a)(4)(E)(v), substituted “this section” for “this subsection” in two places and “this paragraph” for “this subparagraph”. - § 468A(f): Pub. L. 99–514, § 1807(a)(4)(E)(vi), substituted “For purposes of this section, the” for “The”. - § 468A(g): Pub. L. 99–514, § 1807(a)(4)(A)(i), added subsec. (g). ## § 468B: Special rules for designated settlement funds - Enacted 26 U.S.C. § 468B. ## § 469: Passive activity losses and credits limited - Enacted 26 U.S.C. § 469. ## § 471: General rule for inventories - § 471: Pub. L. 99–514 designated existing provisions as subsec. (a) and added subsec. (b). ## § 474: Simplified dollar-value LIFO method for certain small businesses - § 474: Pub. L. 99–514 amended section generally, substituting provisions relating to election by eligible small business to use simplified dollar-value method of pricing inventories for purposes of LIFO method for provisions relating to election by eligible small business which uses dollar-value method of pricing inventories under method provided by section 472(b) of this title to use one inventory pool for any trade or business of such eligible small business. ## § 482: Allocation of income and deductions among taxpayers - § 482: Pub. L. 99–514 inserted at end “In the case of any transfer (or license) of intangible property (within the meaning of section 936(h)(3)(B)), the income with respect to such transfer or license shall be commensurate with the income attributable to the intangible.” ## § 483: Interest on certain deferred payments - § 483(d)(3): Pub. L. 99–514 substituted “for which an issue price is determined under section 1273(b) (other than paragraph (4) thereof) or section 1274” for “to which section 1272 applies”. ## § 501: Exemption from tax on corporations, certain trusts, etc. - § 501(c)(1)(A)(i): Pub. L. 99–514, § 1899A(15), substituted “July 18, 1984” for “the date of the enactment of the Tax Reform Act of 1984”. - § 501(c)(14)(B)(iv): Pub. L. 99–514, § 1879(k)(1), added cl. (iv). - § 501(c)(15): Pub. L. 99–514, § 1024(b), amended par. (15) generally. Prior to amendment, par. (15) read as follows: “Mutual insurance companies or associations other than life or marine (including inter-insurers and reciprocal underwriters) if the gross amount received during the taxable year from the items described in section 822(b) (other than paragraph (1)(D) thereof) and premiums (including deposits and assessments) does not exceed $150,000.” - § 501(c)(17)(A)(ii), § 501(c)(17)(A)(iii), § 501(c)(18)(B), § 501(c)(18)(C): Pub. L. 99–514, § 1114(b)(14), as amended by Pub. L. 100–647, § 1018(u)(34), substituted “highly compensated employees (within the meaning of section 414(q))” for “officers, shareholders, persons whose principal duties consist of supervising the work of other employees, or highly compensated employees”. - § 501(c)(18)(D): Pub. L. 99–514, § 1109(a), added subpar. (D). - § 501(c)(25): Pub. L. 99–514, § 1603(a), added par. (25). - § 501(m), § 501(n): Pub. L. 99–514, § 1012(a), added subsec. (m) and redesignated former subsec. (m) as (n). ## § 505: Additional requirements for organizations described in paragraph (9) or (17) of section 501(c) - § 505(a)(1): Pub. L. 99–514, § 1851(c)(1), struck out “of an employer” before “shall”. - § 505(a)(2): Pub. L. 99–514, § 1851(c)(4), amended par. (2) generally. Prior to amendment, par. (2) read as follows: “Paragraph (1) shall not apply to any organization which is part of a plan maintained pursuant to 1 or more collective bargaining agreements between 1 or more employee organizations and 1 or more employers.” - § 505(b)(1): Pub. L. 99–514, § 1851(c)(2), (3), substituted “as otherwise provided in this subsection” for “as provided in paragraph (2)” in introductory provision, and in subpar. (B) substituted “highly compensated individuals” for “highly compensated employees”. - § 505(b)(2): Pub. L. 99–514, § 1151(g)(6), amended par. (2) generally. Prior to amendment, par. (2) read as follows: “For purposes of paragraph (1), there may be excluded from consideration— - § 505(b)(4): Pub. L. 99–514, § 1151(e)(2)(B), amended par. (4) generally. Prior to amendment, par. (4) read as follows: “For purposes of this subsection— - § 505(b)(5): Pub. L. 99–514, § 1114(b)(16), amended par. (5) generally. Prior to amendment, par. (5) read as follows: “For purposes of this subsection, the term ‘highly compensated individual’ has the meaning given such term by section 105(h)(5). For purposes of the preceding sentence, section 105(h)(5) shall be applied by substituting ‘10 percent’ for ‘25 percent’.” - § 505(b)(6): Pub. L. 99–514, § 1151(j)(3), added par. (6). - § 505(c)(2): Pub. L. 99–514, § 1899A(16), substituted “July 18, 1984” for “the date of the enactment of the Tax Reform Act of 1984”. ## § 512: Unrelated business taxable income - § 512(a)(3)(E)(i): Pub. L. 99–514, § 1851(a)(10)(A), substituted “determined under section 419A (without regard to subsection (f)(6) thereof)” for “determined under section 419A(c)”. - § 512(a)(3)(E)(ii): Pub. L. 99–514, § 1851(a)(10)(B), (C), redesignated cl. (iii) as (ii), in subcl. I substituted “an existing reserve” for “a existing reserve”, and substituted new subcl. (II) for former subcl. (II) which read as follows: “For purposes of subclause (I), the term ‘existing reserve or post-retirement medical or life insurance benefit’ means the amount of assets set aside as of the close of the last plan year ending before the date of the enactment of the Tax Reform Act of 1984 for purposes of post-retirement medical benefits or life insurance benefits to be provided to covered employees.” Former cl. (ii), which provided that no set aside for assets used in the provision of benefits described in cl. (ii) of subpar. (B), could be taken into account, was struck out. - § 512(a)(3)(E)(iii), § 512(a)(3)(E): Pub. L. 99–514, § 1851(a)(10)(B), (D), redesignated former cl. (iv) as (iii) and substituted “subparagraph shall not” for “paragraph shall not”. Former cl. (iii) redesignated (ii). ## § 513: Unrelated trade or business - § 513(d)(3)(B): Pub. L. 99–514, § 1602(a), inserted “or to educate persons in attendance regarding new developments or products and services related to the exempt activities of the organization”. - § 513(d)(3)(C): Pub. L. 99–514, § 1602(b), substituted “section 501(c)(3), (4), (5), or (6)” for “section 501(c)(5) or (6)” and inserted “or which educates persons in attendance regarding new developments or products and services related to the exempt activities of the organization”. - § 513(h): Pub. L. 99–514, § 1601(a), added subsec. (h). ## § 514: Unrelated debt-financed income - § 514(c)(9)(B): Pub. L. 99–514, § 1878(e)(1), as amended by Pub. L. 100–647, § 1018(u)(13)(A), which directed amendment of penultimate sentence by substituting “is unrelated business taxable income” for “would be unrelated business taxable income (determined without regard to this paragraph)”, was executed by making the substitution for “would be unrelated business taxable income (determined without regard to this paragraph”, as the probable intent of Congress. - § 514(c)(9)(B): Pub. L. 99–514, § 1878(e)(3), as amended by Pub. L. 100–647, § 1018(u)(13)(B), amended concluding provisions generally. Prior to amendment, concluding provisions read as follows: “For purposes of clause (vi)(I), an organization shall not be treated as a qualified organization if any income of such organization would be unrelated business taxable income (determined without regard to this paragraph).” - § 514(c)(9)(B)(vi): Pub. L. 99–514, § 1878(e)(3), as amended by Pub. L. 100–647, § 1018(u)(13)(B), amended cl. (vi) generally. Prior to amendment, cl. (vi) read as follows: “the real property is held by a partnership unless the partnership meets the requirements of clauses (i) through (v) and unless— - § 514(c)(9)(B)(vi)(II): Pub. L. 99–514, § 201(d)(9), substituted “section 168(h)(6)” for “section 168(j)(9)”. - § 514(c)(9)(C)(i): Pub. L. 99–514, § 1878(e)(2), substituted “section 509(a)(3)” for “section 509(a)”. - § 514(c)(9)(C)(iii): Pub. L. 99–514, § 1603(b), added cl. (iii). ## § 527: Political organizations - § 527(g)(1): Pub. L. 99–514, § 112(b)(1)(A), substituted “paragraph (3)” for “section 24(c)(2)”. - § 527(g)(3): Pub. L. 99–514, § 112(b)(1)(B), added par. (3). ## § 532: Corporations subject to accumulated earnings tax - § 532(b): Pub. L. 99–514 added par. (4). ## § 535: Accumulated taxable income - § 535(b)(5)(C)(i), § 535(b)(8)(C): Pub. L. 99–514, § 1899A(17), substituted “July 18, 1984” for “the date of the enactment of the Tax Reform Act of 1984”. - § 535(b)(9): Pub. L. 99–514, § 1225(a), added par. (9). ## § 541: Imposition of personal holding company tax - § 541: Pub. L. 99–514 substituted “28 percent (38.5 percent in the case of taxable years beginning in 1987)” for “50 percent”. ## § 542: Definition of personal holding company - § 542(c): Pub. L. 99–514 added par. (10). ## § 543: Personal holding company income - § 543(a)(1)(B): Pub. L. 99–514, § 1899A(18), substituted “46 U.S.C. App.” for “46 U.S.C.”. - § 543(a)(1)(C): Pub. L. 99–514, § 645(a)(1), added subpar. (C). - § 543(a)(4): Pub. L. 99–514, § 645(a)(4)(A), inserted “This paragraph shall not apply to active business computer software royalties.” - § 543(b)(3)(E): Pub. L. 99–514, § 645(a)(4)(B), added subpar. (E). - § 543(d): Pub. L. 99–514, § 645(a)(2), added subsec. (d). ## § 545: Undistributed personal holding company income - § 545(b)(7): Pub. L. 99–514 added par. (7). ## § 562: Rules applicable in determining dividends eligible for dividends paid deduction - § 562(b)(1): Pub. L. 99–514, § 1804(d)(1), inserted at end “Except to the extent provided in regulations, the preceding sentence shall not apply in the case of any mere holding or investment company which is not a regulated investment company.” - § 562(c): Pub. L. 99–514, § 657(a), inserted at end “In the case of a distribution by a regulated investment company to a shareholder who made an initial investment of at least $10,000,000 in such company, such distribution shall not be treated as not being pro rata or as being preferential solely by reason of an increase in the distribution by reason of reductions in administrative expenses of the company.” ## § 582: Bad debts, losses, and gains with respect to securities held by financial institutions - § 582(c)(1): Pub. L. 99–514, § 901(d)(3)(A), substituted “referred to in paragraph (5)” for “to which section 585, 586, or 593 applies”. - § 582(c)(1): Pub. L. 99–514, § 671(b)(4), inserted “For purposes of the preceding sentence, any regular or residual interest in a REMIC shall be treated as an evidence of indebtedness.” - § 582(c): Pub. L. 99–514, § 901(d)(3)(B), added par. (5). ## § 584: Common trust funds - § 584(c): Pub. L. 99–514, § 612(b)(2)(B), substituted “1 year” for “6 months” wherever appearing in pars. (1) and (2). - § 584(c): Pub. L. 99–514, § 612(b)(2)(A), amended subsec. (c) generally, restating subpars. (A) to (C) of former par. (1) as pars. (1) to (3) and striking out former par. (2) which read as follows: “The proportionate share of each participant in the amount of dividends or interest received by the common trust fund and to which section 116 or 128 applies shall be considered for purposes of such section as having been received by such participant.” ## § 585: Reserves for losses on loans of banks - § 585(a): Pub. L. 99–514, § 901(a)(1), amended subsec. (a) generally. Prior to amendment, subsec. (a) read as follows: “This section shall apply to the following financial institutions: - § 585(b)(1): Pub. L. 99–514, § 901(d)(1), substituted “subsection (a)” for “section 166(c)”. - § 585(c): Pub. L. 99–514, § 901(a)(2), added subsec. (c). ## § 593: Reserves for losses on loans - § 593(a): Pub. L. 99–514, § 901(b)(1), amended subsec. (a) generally. Prior to amendment, subsec. (a) read as follows: “This section shall apply to any mutual savings bank, domestic building and loan association, or cooperative bank without capital stock organized and operated for mutual purposes and without profit.” - § 593(b)(1): Pub. L. 99–514, § 901(d)(2)(A), (B), in introductory provisions, substituted “subsection (a)” for “section 166(c)” and in subpar. (B), substituted “paragraph (2) or (3), whichever is the larger” for “paragraph (2), (3), or (4), whichever amount is the largest” in introductory provisions and “paragraph (3)” for “paragraph (4)” in cl. (i). - § 593(b)(2)(A): Pub. L. 99–514, § 901(b)(2)(A), added subpar. (A) and struck out former subpar. (A) which provided that subject to subpars. (B), (C), and (D), the amount determined under par. (2) was to be an amount equal to applicable percentage of taxable income for such year determined under a table which fixed specific percentages for taxable years 1976, 1977, 1978, and 1979 or thereafter. - § 593(b)(2)(B): Pub. L. 99–514, § 901(b)(2)(A), added subpar. (B), which incorporated provisions of former subpar. (C), relating to reducing amounts referred to in par. (1)(A), and struck out former subpar. (B) which provided for reduction of applicable percentage in certain cases. - § 593(b)(2)(C): Pub. L. 99–514, § 901(b)(2)(A), (B), redesignated former subpar. (D) as (C) and struck out former subpar. (C) which related to reduction for amounts referred to in par. (1)(A). See par. (1)(B). - § 593(b)(2)(D): Pub. L. 99–514, § 901(b)(2)(B), (d)(2)(B), redesignated subpar. (E) as (D) and substituted in cl. (iv) “8 percent” for “the applicable percentage (determined under subparagraphs (A) and (B))”. Former subpar. (D) redesignated (C). - § 593(b)(2): Pub. L. 99–514, § 901(b)(2)(B), redesignated subpar. (E) as (D). - § 593(b)(2): Pub. L. 99–514, § 311(b)(2), redesignated former cl. (v) as (iv), and struck out former cl. (iv) which read as follows: “by excluding from gross income an amount equal to the lesser of 18⁄46 of the net long-term capital gain for the taxable year or 18⁄46 of the net long-term capital gain for the taxable year from the sale or exchange of property other than property described in clause (iii), and”. - § 593(b)(3), § 593(b): Pub. L. 99–514, § 901(b)(3), redesignated par. (4) as (3) and struck out former par. (3) which read as follows: “The amount determined under this paragraph to be a reasonable addition to the reserve for losses on qualifying real property loans shall be computed in the same manner as is provided with respect to additions to the reserves for losses on loans of banks under section 585(b)(2), reduced by the amount referred to in paragraph (1)(A) for the taxable year.” - § 593(b): Pub. L. 99–514, § 901(b)(3), struck out par. (5) which read as follows: “For purposes of paragraph (3), the amount deemed to be the balance of the reserve for losses on loans at the beginning of the taxable year shall be the total of the balances at such time of the reserve for losses on nonqualifying loans, the reserve for losses on qualifying real property loans, and the supplemental reserve for losses on loans.” - § 593(d)(4): Pub. L. 99–514, § 671(b)(2), added par. (4). - § 593(e)(1)(B): Pub. L. 99–514, § 901(d)(2)(C), substituted “subsection (b)(3)” for “subsection (B)(4)”. ## § 597: Treatment of transactions in which Federal financial assistance provided - § 597: Pub. L. 99–514, § 904(b)(1), (c)(2)(A), as amended by Pub. L. 100–647, title IV, § 4012(a)(2), which (applicable to transfers after Dec. 31, 1989, in taxable years ending after such date, with exceptions) directed repeal of this section, was repealed by Pub. L. 101–73, § 1401(b)(1), (c)(4), eff. Oct. 22, 1986, and I.R.C. of 1986 applicable as if the amendments made by such section had not been enacted. ## § 613: Percentage depletion - § 613(e): Pub. L. 99–514 added par. (4). ## § 613A: Limitations on percentage depletion in case of oil and gas wells - § 613A(d)(1): Pub. L. 99–514, § 104(b)(9), struck out “(reduced in the case of an individual by the zero bracket amount)” after “taxable income” in introductory provisions. - § 613A(d)(5): Pub. L. 99–514, § 412(a)(1), added par. (5). ## § 616: Development expenditures - § 616(a): Pub. L. 99–514, § 411(b)(2)(C)(i), inserted reference to subsec. (d). - § 616(d), § 616(e): Pub. L. 99–514, § 411(b)(2)(A), added subsec. (d) and redesignated former subsec. (d) as (e). ## § 617: Deduction and recapture of certain mining exploration expenditures - § 617(d)(5): Pub. L. 99–514, § 413(b), added par. (5). - § 617(h): Pub. L. 99–514, § 411(b)(2)(B), amended subsec. (h) generally, substituting provisions relating to special rules for foreign exploration for provisions relating to limitations. ## § 631: Gain or loss in the case of timber, coal, or domestic iron ore - § 631(c): Pub. L. 99–514 substituted “If for the taxable year of such gain or loss the maximum rate of tax imposed by this chapter on any net capital gain is less than such maximum rate for ordinary income, such owner” for “Such owner”. ## § 642: Special rules for credits and deductions - § 642(a): Pub. L. 99–514, § 112(b)(2), amended subsec. (a) generally, substituting “Foreign tax credit allowed” for “Credits against tax” in heading, striking out designation and heading for par. (1), and striking out par. (2) which read as follows: “An estate or trust shall not be allowed the credit against tax for political contributions provided by section 24.” - § 642(c)(4): Pub. L. 99–514, § 301(b)(6), in heading, substituted “Coordination with section 681” for “Adjustments”, and in text struck out first sentence which read as follows: “To the extent that the amount otherwise allowable as a deduction under this subsection consists of gain from the sale or exchange of capital assets held for more than 6 months, proper adjustment shall be made for any deduction allowable to the estate or trust under section 1202 (relating to deduction for excess of capital gains over capital losses).” - § 642: Pub. L. 99–514, § 612(b)(3), struck out subsec. (j) which provided a cross reference to section 116(c)(3). ## § 643: Definitions applicable to subparts A, B, C, and D - § 643(a)(3): Pub. L. 99–514, § 301(b)(7), struck out “The deduction under section 1202 (relating to deduction for excess of capital gains over capital losses) shall not be taken into account.” - § 643(a)(7): Pub. L. 99–514, § 612(b)(4), struck out par. (7), dividends or interest, which read as follows: “There shall be included the amount of any dividends or interest excluded from gross income pursuant to section 116 (relating to partial exclusion of dividends) or section 128 (relating to certain interest).” - § 643(d): Pub. L. 99–514, § 1806(c)(1), redesignated subsec. (d), relating to treatment of property distributed in kind, as (e). Former subsec. (e) redesignated (f). - § 643(e): Pub. L. 99–514, § 1806(a), (c)(1), redesignated subsec. (d) relating to treatment of property distributed in kind as (e) and amended par. (3)(B) generally, substituting “shall apply to all distributions made by the estate or trust during a taxable year and shall be made on the return of such estate or trust for such taxable year” for “shall be made by the estate or trust on its return for the taxable year for which the distribution was made”. Former subsec. (e) redesignated (f). - § 643(f): Pub. L. 99–514, § 1806(c)(2), redesignated subsec. (e) as (f). - § 643(g): Pub. L. 99–514, § 1404(b), added subsec. (g). ## § 644: Taxable year of trusts - Enacted 26 U.S.C. § 644. ## § 665: Definitions applicable to subpart D - § 665(d)(1): Pub. L. 99–514 substituted “part IV” for “subpart A of part IV”. ## § 667: Treatment of amounts deemed distributed by trust in preceding years - § 667(b)(2): Pub. L. 99–514 amended par. (2) generally. Prior to amendment, par. (2) read as follows: “For purposes of paragraph (1), the taxable income of the beneficiary for any taxable year shall be deemed to be not less than— ## § 672: Definitions and rules - § 672(e): Pub. L. 99–514 added subsec. (e). ## § 673: Reversionary interests - § 673: Pub. L. 99–514 amended section generally, substituting “the value of such interest exceeds 5 percent of the value of such portion” for “the interest will or may reasonably be expected to take effect in possession or enjoyment within 10 years commencing with the date of the transfer of that portion of the trust” in subsec. (a), adding subsec. (b), striking out subsec. (c) which provided that the grantor not be treated under subsec. (a) as the owner of any portion of a trust where his reversionary interest in such portion was not to take effect in possession or enjoyment until the death of the persons to whom the income therefrom was payable, and subsec. (d) which provided that any postponement of the date specified for the reacquisition of possession or enjoyment of the reversionary interest be treated as a new transfer in trust commencing with the date on which the postponement was effected and terminating with the date prescribed by the postponement. ## § 674: Power to control beneficial enjoyment - § 674(b)(2): Pub. L. 99–514 substituted “occurrence of event” for “expiration of 10-year period” in heading and in text substituted “the occurrence of an event” for “the expiration of a period” and “the occurrence of the event” for “the expiration of the period”. ## § 676: Power to revoke - § 676(b): Pub. L. 99–514 substituted “occurrence of event” for “expiration of 10-year period” in heading and in text substituted “the occurrence of an event” for “the expiration of a period” and “the occurrence of such event” for “the expiration of such period”. ## § 677: Income for benefit of grantor - § 677(a): Pub. L. 99–514 substituted “the occurrence of an event” for “the expiration of a period” and “the occurrence of the event” for “the expiration of the period” in last sentence. ## § 691: Recipients of income in respect of decedents - § 691(c)(3): Pub. L. 99–514, § 1432(a)(3), amended par. (3) generally. Prior to amendment, par. (3) read as follows: “For purposes of this section— - § 691(c)(4): Pub. L. 99–514, § 301(b)(8), substituted “capital gain provisions” for “capital gain deduction, etc.” in heading and in text substituted “1(j), 1201, and 1211” for “1201, 1202, and 1211, and for purposes of section 57(a)(9)”. ## § 692: Income taxes of members of Armed Forces, astronauts, and victims of certain terrorist attacks on death - § 692(b): Pub. L. 99–514 amended last sentence generally. Prior to amendment, sentence read as follows: “The preceding sentence shall not cause subsection (a)(1) to apply for any taxable year beginning— ## § 702: Income and credits of partner - § 702(a)(5): Pub. L. 99–514 amended par. (5) generally. Prior to amendment, par. (5) read as follows: “dividends or interest with respect to which there is an exclusion under section 116 or 128, or a deduction under part VIII of subchapter B,”. ## § 703: Partnership computations - § 703(b): Pub. L. 99–514 struck out former pars. (1) and (3) which related to elections under sections 57(c) and 163(d), respectively, and redesignated former pars. (2), (4), and (5), as pars. (1), (2), and (3), respectively. ## § 706: Taxable years of partner and partnership - § 706(b): Pub. L. 99–514, § 806(a)(3), struck out “Adoption of” before “taxable year” in heading. - § 706(b)(1): Pub. L. 99–514, § 806(a)(1), amended par. (1) generally. Prior to amendment, par. (1) read as follows: “The taxable year of a partnership shall be determined as though the partnership were a taxpayer. A partnership may not change to, or adopt, a taxable year other than that of all its principal partners unless it establishes, to the satisfaction of the Secretary, a business purpose therefor.” - § 706(b)(4): Pub. L. 99–514, § 806(a)(2), added par. (4). - § 706(d)(2)(A)(i): Pub. L. 99–514, § 1805(a)(1)(A), substituted “such item” for “each such item”. - § 706(d)(2)(B): Pub. L. 99–514, § 1805(a)(1)(B), in introductory provisions, struck out “which are described in paragraph (1) and” after “the following items”. - § 706(d)(2)(C)(i): Pub. L. 99–514, § 1805(a)(2), substituted “the first day of the taxable year” for “the first day of such taxable year”. ## § 707: Transactions between partner and partnership - § 707(a)(2)(B)(iii): Pub. L. 99–514, § 1805(b), substituted “sale or exchange of property” for “sale of property”. - § 707(b)(1): Pub. L. 99–514, § 1812(c)(3)(B), inserted at end “For purposes of section 267(a)(2), partnerships described in subparagraph (B) of this paragraph shall be treated as persons specified in section 267(b).” - § 707(b)(1)(A): Pub. L. 99–514, § 1812(c)(3)(A), substituted “a person” for “a partner”. - § 707(b)(2)(A): Pub. L. 99–514, § 1812(c)(3)(A), substituted “a person” for “a partner”. - § 707(b)(2)(A): Pub. L. 99–514, § 642(a)(2), substituted “50 percent” for “80 percent”. - § 707(b)(2)(B): Pub. L. 99–514, § 642(a)(2), substituted “50 percent” for “80 percent”. ## § 751: Unrealized receivables and inventory items - § 751(c): Pub. L. 99–514, § 1899A(19), substituted “section 617(f)(2)), stock” for “section 617(f)(2), stock” in second sentence. - § 751(c): Pub. L. 99–514, § 201(d)(10), struck out “section 1245 recovery property (as defined in section 1245(a)(5)),” before “stock in certain foreign corporations” in second sentence. ## § 761: Terms defined - § 761(e): Pub. L. 99–514 substituted “Distributions of partnership interests” for “Distributions” in heading, substituted “Except as otherwise provided in regulations, for purposes of” for “For purposes of” in introductory provision, and “any distribution of an interest in a partnership” for “any distribution” in closing provisions. ## § 801: Tax imposed - § 801(a): Pub. L. 99–514 substituted “the amount allowable as a deduction under paragraph (2)” for “the amounts allowable as deductions under paragraphs (2) and (3)” in text and struck from heading “special life insurance company deduction and” before “small”. ## § 804: Life insurance deductions - § 804: Pub. L. 99–514 redesignated par. (3) as (2), substituted “section 806(a)” for “section 806(b)”, and struck out former par. (2), which read as follows: “the special life insurance company deduction determined under section 806(a), and”. ## § 805: General deductions - § 805(a)(4)(B): Pub. L. 99–514, § 611(a)(5), substituted “80 percent” for “85 percent” in introductory provisions. - § 805(a)(4)(B)(i): Pub. L. 99–514, § 1011(b)(4), struck out “the special life insurance company deduction and” before “the small life”. - § 805(a)(4)(C), § 805(a)(4)(D), § 805(a)(4)(E): Pub. L. 99–514, § 1821(p), added subpars. (C) and (D), redesignated former subpar. (D) as (E), and struck out former subpar. (C) which read as follows: “For purposes of subparagraph (A), the term ‘100 percent dividend’ means any dividend if the percentage used for purposes of determining the deduction allowable under section 243 or 244 is 100 percent. Such term does not include any dividend to the extent it is a distribution out of tax-exempt interest or out of dividends which are not 100 percent dividends (determined with the application of this sentence).” - § 805(b)(2): Pub. L. 99–514, § 805(c)(6), redesignated par. (3) as (2). Former par. (2), which provided that section 166(c) (relating to reserve for bad debts) shall not apply, was struck out. - § 805(b)(2)(A)(iii): Pub. L. 99–514, § 1011(b)(4), which directed that subsec. (b)(3)(A)(iii) be amended by striking out “the special life insurance company deduction and” before “the small life”, was executed to subsec. (b)(2)(A)(iii) to reflect the probable intent of Congress and the redesignation of subsec. (b)(3) as (b)(2) by Pub. L. 99–514, § 805(c)(6). - § 805(b)(3), § 805(b)(4), § 805(b): Pub. L. 99–514, § 805(c)(6), redesignated pars. (3) to (6) as (2) to (5), respectively. ## § 807: Rules for certain reserves - § 807(c): Pub. L. 99–514, § 1023(b), inserted at end “For purposes of paragraph (2) and section 805(a)(1), the amount of the unpaid losses (other than losses on life insurance contracts) shall be the amount of the discounted unpaid losses as defined in section 846.” - § 807(c): Pub. L. 99–514, § 1821(a), inserted at end “In no case shall the amount determined under paragraph (3) for any contract be less than the net surrender value of such contract.” - § 807(d): Pub. L. 99–514, § 1821(s), inserted at end “When the Secretary by regulation changes the table applicable to a type of contract, the new table shall be treated (for purposes of subparagraph (B) and for purposes of determining the issue dates of contracts for which it shall be used) as if it were a new prevailing commissioner’s standard table adopted by the twenty-sixth State as of a date (no earlier than the date the regulation is issued) specified by the Secretary.” ## § 808: Policyholder dividends deduction - § 808(d)(1)(B): Pub. L. 99–514, § 1821(b), amended subpar. (B) generally. Prior to amendment, subpar. (B) read as follows: “determined at a rate in excess of the prevailing State assumed interest rate for such contract.” - § 808(f): Pub. L. 99–514, § 1821(c), added subsec. (f). ## § 812: Definition of company’s share and policyholder’s share - § 812(b): Pub. L. 99–514, § 1821(i)(1), inserted “or, where such rate is not used, another appropriate rate” after “assumed rate”, in subpar. (A) and added subpar. (D). - § 812(b): Pub. L. 99–514, § 1821(i)(2), struck out “(including tax-exempt interest)” after “insurance gross income” in cl. (ii) and inserted at end “For purposes of subparagraph (B)(ii), life insurance gross income shall be determined by including tax-exempt interest and by applying section 807(a)(2)(B) as if it did not contain clause (i) thereof.” - § 812: Pub. L. 99–514, § 1821(i)(3), amended subsec. (c) generally. Prior to amendment, subsec. (c) read as follows: “For purposes of this section, the term ‘net investment income’ means 90 percent of gross investment income.” - § 812: Pub. L. 99–514, § 1821(i)(4), added subsec. (g). ## § 816: Life insurance company defined - § 816(h): Pub. L. 99–514 added subsec. (h). ## § 817: Treatment of variable contracts - § 817(d): Pub. L. 99–514, § 1821(t)(1), inserted at end “Paragraph (3) shall be applied without regard to whether there is a guarantee, and obligations under such guarantee which exceed obligations under the contract without regard to such guarantee shall be accounted for as part of the company’s general account.” - § 817(h)(1): Pub. L. 99–514, § 1821(m)(2), struck out last sentence which read as follows: “For purposes of this paragraph and paragraph (2), beneficial interests in a regulated investment company or in a trust shall not be treated as 1 investment if all of the beneficial interests in such company or trust are held by 1 or more segregated asset accounts of 1 or more insurance companies.” - § 817(h)(3), § 817(h)(4), § 817(h)(5): Pub. L. 99–514, § 1821(m)(1), added pars. (3) and (4), redesignated former par. (4) as (5), and struck out former par. (3) which read as follows: “In the case of a segregated asset account with respect to variable life insurance contracts, paragraph (1) shall not apply in the case of securities issued by the United States Treasury which are owned by a regulated investment company or by a trust all the beneficial interests in which are held by 1 or more segregated asset accounts of the company issuing the contract.” ## § 818: Other definitions and special rules - § 818(a)(3): Pub. L. 99–514, § 1136(b), substituted “(26), and (27)” for “and (26)”. - § 818(a)(3): Pub. L. 99–514, § 1112(d)(4), substituted “(22), and (26)” for “and (22)”. - § 818(a)(3): Pub. L. 99–514, § 1106(d)(3)(C), inserted “(17),” after “(16),”. - § 818(a)(6)(A): Pub. L. 99–514, § 1821(n), in amending subpar. (A) generally, inserted “an eligible State deferred compensation plan (within the meaning of section 457(b)), or”. - § 818(e): Pub. L. 99–514, § 1821(o), amended subsec. (e) generally. Prior to amendment, subsec. (e) read as follows: “If an election under section 1504(c)(2) is in effect with respect to an affiliated group for the taxable year, all items of the members of such group which are not life insurance companies shall not be taken into account in determining the amount of the tentative LICTI of members of such group which are life insurance companies.” ## § 831: Tax on insurance companies other than life insurance companies - § 831: Pub. L. 99–514 amended section generally, substituting provisions imposing taxes on insurance companies other than life insurance companies, with an alternative tax on certain small companies, for provisions imposing taxes on insurance companies (other than life or mutual), mutual marine insurance companies, and certain mutual fire or flood insurance companies, with an election for multiple line companies to be taxed on total income. ## § 832: Insurance company taxable income - § 832(b)(1)(C): Pub. L. 99–514, § 1024(c)(1), substituted “exclusively issuing perpetual policies” for “described in section 831(a)(3)(A)”. - § 832(b)(1)(D): Pub. L. 99–514, § 1024(c)(2), amended subpar. (D) generally. Prior to amendment, subpar. (D) read as follows: “in the case of a mutual fire or flood insurance company described in section 831(a)(3)(B), an amount equal to 2 percent of the premiums earned on insurance contracts during the taxable year with respect to policies described in section 831(a)(3)(B) after deduction of premium deposits returned or credited during the same taxable year, and”. - § 832(b)(4): Pub. L. 99–514, § 1024(c)(3), substituted “paragraph (1)(D)” for “section 831(a)(3)(B)” in two places and amended last sentence generally, substituting “described in paragraph (1)(D) or issuing exclusively perpetual policies” for “referred to in paragraph (3) of section 831(a)” and “described in subparagraph (C) or (D) of paragraph (1)” for “referred to in such paragraph (3)”. - § 832(b)(4)(B), § 832(b)(4)(C): Pub. L. 99–514, § 1021(a), added subpars. (B) and (C) and struck out former subpar. (B) which read as follows: “To the result so obtained, add unearned premiums on outstanding business at the end of the preceding taxable year and deduct unearned premiums on outstanding business at the end of the taxable year.” - § 832(b)(5)(A): Pub. L. 99–514, § 1022(a), in amending par. (5) generally, designated existing provisions of par. (5) as subpar. (A), inserted subpar. heading “In general”, and redesignated former subpars. (A) and (B) as cls. (i) and (ii). - § 832(b)(5)(A)(ii): Pub. L. 99–514, § 1023(a)(1), amended cl. (ii) generally, inserting “on life insurance contracts plus all discounted unpaid losses (as defined in section 846)” and “on life insurance contracts plus all discounted unpaid losses”. - § 832(b)(5)(B), § 832(b)(5)(C), § 832(b)(5)(D), § 832(b)(5)(E): Pub. L. 99–514, § 1022(a), in amending par. (5) generally, added subpars. (B) to (E). Former subpar. (B) redesignated (A)(ii). - § 832(b)(6): Pub. L. 99–514, § 1023(a)(2), inserted second sentence defining “expenses unpaid”. - § 832(b)(7), § 832(b)(8): Pub. L. 99–514, § 1021(b), added pars. (7) and (8). - § 832(c)(5): Pub. L. 99–514, § 1024(c)(4), substituted “section 834(b)” for “section 822(b)”. - § 832(c)(11): Pub. L. 99–514, § 1024(c)(5), substituted “subsection (b)(1)(C)” for “section 831(a)(3)(A)” and “subsection (b)(1)(D)” for “section 831(a)(3)(B)”. - § 832(f): Pub. L. 99–514, § 1024(c)(6), added subsec. (f). ## § 833: Treatment of Blue Cross and Blue Shield organizations, etc. - Enacted 26 U.S.C. § 833. ## § 834: Determination of taxable investment income - § 834: Pub. L. 99–514, § 1024(a)(3), renumbered section 822 of this title as this section. - § 834(a): Pub. L. 99–514, § 1024(c)(7), amended subsec. (a) generally. Prior to amendment, subsec. (a), definitions, read as follows: “For purposes of this part— - § 834(d): Pub. L. 99–514, § 1024(c)(8), substituted “section 831” for “section 821” in pars. (1) and (2), and inserted “except in the case of discount which is original issue discount (as defined in section 1273)” at end of last sentence in par. ## § 835: Election by reciprocal - § 835: Pub. L. 99–514, § 1024(a)(3), renumbered section 826 of this title as this section. - § 835(d): Pub. L. 99–514, § 1024(c)(9)(A), redesignated subsec. (e) as (d) and struck out former subsec. (d), special rule, which read as follows: “In applying section 824(d)(1)(D), any amount which was added to the protection against loss account by reason of an election under this section shall be treated as having been added by reason of section 824(a)(1)(A).” - § 835(e): Pub. L. 99–514, § 1024(c)(9), redesignated subsec. (f) as (e), substituted “Benefits of graduated rates” for “Surtax exemption” in heading, and amended text generally. Prior to amendment, text read as follows: “Any increase in taxable income of a reciprocal attributable to the limitation provided in subsection (b) shall be taxed without regard to the surtax exemption provided in section 821(a)(2).” Former subsec. (e) redesignated (d). - § 835(f), § 835(g), § 835: Pub. L. 99–514, § 1024(c)(9)(A), redesignated subsecs. (f) to (h) as (e) to (g), respectively. ## § 841: Credit for foreign taxes - § 841: Pub. L. 99–514 substituted “section 801 or 831” for “section 801, 821, or 831” in introductory provisions, redesignated par. (3) as (2), and struck out former par. (2) which read as follows: “in the case of the tax imposed by section 821(a), the mutual insurance company taxable income (as defined in section 821(b)); and in the case of the tax imposed by section 821(c), the taxable investment income (as defined in section 822(a)), and”. ## § 842: Foreign companies carrying on insurance business - § 842: Pub. L. 99–514 struck out reference to part III of this subchapter. ## § 846: Discounted unpaid losses defined - Enacted 26 U.S.C. § 846. ## § 851: Definition of regulated investment company - § 851(a)(1): Pub. L. 99–514, § 652(a), substituted “as a management company, business development company, or unit investment trust” for “either as a management company or as a unit investment trust”. - § 851(b): Pub. L. 99–514, § 1235(f)(3), inserted “or 1293(a)” and “or 1293(c) (as the case may be)”, in concluding provision. - § 851(b): Pub. L. 99–514, § 653(c), inserted before last sentence “For purposes of paragraph (2), the Secretary may by regulation exclude from qualifying income foreign currency gains which are not ancillary to the company’s principal business of investing in stock or securities (or options and futures with respect to stock or securities).” - § 851(b)(2): Pub. L. 99–514, § 653(b), inserted “(as defined in section 2(a)(36) of the Investment Company Act of 1940, as amended) or foreign currencies, or other income (including but not limited to gains from options, futures, or forward contracts) derived with respect to its business of investing in such stock, securities, or currencies”. - § 851(e)(1): Pub. L. 99–514, § 652(b), substituted “registered management company or registered business development company” for “registered management company”. - § 851(g): Pub. L. 99–514, § 653(a), added subsec. (g). - § 851: Pub. L. 99–514, § 654(a), added subsec. (q). ## § 852: Taxation of regulated investment companies and their shareholders - § 852(a)(2), § 852(a): Pub. L. 99–514, § 1878(j)(1), redesignated par. (3) as (2) and struck out former par. (2) which read as follows: “the investment company complies for such year with regulations prescribed by the Secretary for the purpose of ascertaining the actual ownership of its outstanding stock, and”. - § 852(b)(1): Pub. L. 99–514, § 1878(j)(2), substituted last sentence for former last sentence which read as follows: “In the case of a regulated investment company which is a personal holding company (as defined in section 542), that tax shall be computed at the highest rate of tax specified in section 11(b).” - § 852(b)(3)(C): Pub. L. 99–514, § 655(a)(1), substituted “60 days” for “45 days”. - § 852(b)(3)(C): Pub. L. 99–514, § 651(b)(3), inserted provision for determination of the amount of the net capital gain for a taxable year (to which an election under section 4982(e)(4) does not apply) and made such provision applicable also for purposes of computing regulated investment company taxable income. - § 852(b)(3)(D)(i): Pub. L. 99–514, § 655(a)(1), substituted “60 days” for “45 days”. - § 852(b)(3)(D)(iii): Pub. L. 99–514, § 311(b)(1), substituted “66 percent” for “72 percent”. - § 852(b)(4): Pub. L. 99–514, § 1804(c)(5), substituted “6 months or less” for “less than 31 days” in heading. - § 852(b)(4)(B)(ii): Pub. L. 99–514, § 1804(c)(1), substituted “6 months or less” for “less than 31 days”. - § 852(b)(4)(C): Pub. L. 99–514, § 1804(c)(2), amended subpar. (C) generally. Prior to amendment, subpar. (C) read as follows: “For purposes of this paragraph, the rules of paragraphs (3) and (4) of section 246(c) shall apply in determining the period for which the taxpayer held any share of stock; except that for the number of days specified in subparagraph (B) of section 246(c)(3) there shall be substituted— - § 852(b)(4)(D): Pub. L. 99–514, § 1804(c)(3), substituted “subparagraphs (A) and (B)” for “subparagraph (A)”. - § 852(b)(4)(E): Pub. L. 99–514, § 1804(c)(4), added subpar. (E). - § 852(b)(5)(A): Pub. L. 99–514, § 655(a)(2), substituted “60 days” for “45 days”. - § 852(b)(5): Pub. L. 99–514, § 1173(b)(1)(B), added subpar. (C). - § 852(b)(6): Pub. L. 99–514, § 651(b)(1)(A), added par. (6) relating to time certain dividends are taken into account. - § 852(b)(6): Pub. L. 99–514, § 631(e)(11), added par. (6) relating to inapplicability of section 311(b) to certain distributions. - § 852(c): Pub. L. 99–514, § 651(b)(2), amended subsec. (c) generally, designating existing provisions as par. (1), inserting heading, and adding par. (2). - § 852(e)(3)(A): Pub. L. 99–514, § 1511(c)(6), substituted “the underpayment rate established under section 6621” for “the annual rate established under section 6621”. ## § 853: Foreign tax credit allowed to shareholders - § 853(c): Pub. L. 99–514 substituted “60 days” for “45 days”. ## § 854: Limitations applicable to dividends received from regulated investment company - § 854(a): Pub. L. 99–514, § 612(b)(6)(A), which directed that “section 116 (relating to an exclusion for dividends received by individuals), and” be struck out, was executed by striking out “section 116 (relating to an exclusion for dividends received by individuals) and” before “section 243” as the probable intent of Congress. - § 854(b)(1)(B), § 854(b)(1)(C): Pub. L. 99–514, § 612(b)(6)(B)(i), (ii), redesignated subpar. (C) as (B), struck out “or (B)” before “shall not exceed”, and struck out former subpar. (B), exclusion under section 116, which read as follows: “If the aggregate dividends received by a regulated investment company during any taxable year are less than 95 percent of its gross income, then, in computing the exclusion under section 116, rules similar to the rules of subparagraph (A) shall apply.” - § 854(b)(2): Pub. L. 99–514, § 655(a)(4), substituted “60 days” for “45 days”. - § 854(b)(2): Pub. L. 99–514, § 612(b)(6)(B)(iii), struck out “the exclusion under section 116 and” before “the deduction under section 243”. - § 854(b)(3)(B): Pub. L. 99–514, § 612(b)(6)(B)(iv), amended subpar. (B) generally. Prior to amendment, subpar. (B) read as follows: “The term ‘aggregate dividends received’ includes only dividends received from domestic corporations other than dividends described in section 116(b) (relating to dividends excluded from gross income). In determining the amount of any dividend for purposes of this subparagraph, the rules provided in section 116(c) (relating to certain distributions) shall apply.” ## § 855: Dividends paid by regulated investment company after close of taxable year - § 855(b): Pub. L. 99–514, § 651(b)(1)(B), substituted “Except as provided in section 852(b)(6), amounts” for “Amounts”. - § 855(c): Pub. L. 99–514, § 655(a)(5), substituted “60 days” for “45 days”. ## § 856: Definition of real estate investment trust - § 856(a)(4): Pub. L. 99–514, § 901(d)(4)(E), substituted “referred to in section 582(c)(5)” for “to which section 585, 586, or 593 applies”. - § 856(a)(6): Pub. L. 99–514, § 661(a)(1), amended par. (6) generally. Prior to amendment, par. (6) read as follows: “which would not be a personal holding company (as defined in section 542) if all of its adjusted ordinary gross income (as defined in section 543(b)(2)) constituted personal holding company income (as defined in section 543); and”. - § 856(c)(3)(I): Pub. L. 99–514, § 662(b)(1), added subpar. (I). - § 856(c)(6)(B): Pub. L. 99–514, § 662(b)(2), inserted “Such term also includes any property (not otherwise a real estate asset) attributable to the temporary investment of new capital, but only if such property is stock or a debt instrument, and only for the 1-year period beginning on the date the real estate trust receives such capital.” - § 856(c)(6): Pub. L. 99–514, § 671(b)(1), added subpar. (D) relating to REMIC interest. Former subpar. (D) redesignated (E). - § 856(c)(6): Pub. L. 99–514, § 662(b)(3), added subpar. (D) relating to qualified temporary investment income. Former subpar. (D) redesignated (E). - § 856(c)(6): Pub. L. 99–514, §§ 662(b)(3), 671(b)(1), made identical redesignations of former subpar. (D) as (E). - § 856(d)(2): Pub. L. 99–514, § 663(a), (b)(3), inserted reference to par. (6) in subpar. (A) and inserted at end “Subparagraph (C) shall not apply with respect to any amount if such amount would be excluded from unrelated business taxable income under section 512(b)(3) if received by an organization described in section 511(a)(2).” - § 856(d)(6): Pub. L. 99–514, § 663(b)(1), added par. (6). - § 856(f): Pub. L. 99–514, § 663(b)(2), amended subsec. (f) generally, restating former introductory provisions and par. (1) as introductory provisions of par. (1) and as subpar. (A), restating provisions of par. (2), adding subpar. (1)(B), and striking out former concluding provisions which read as follows: “The provisions of this subsection shall apply only with respect to amounts received or accrued pursuant to loans made after May 27, 1976. For purposes of the preceding sentence, a loan is considered to be made before May 28, 1976, if such loan is made pursuant to a binding commitment entered into before May 28, 1976.” - § 856(h): Pub. L. 99–514, § 661(a)(2), added subsec. (h). - § 856(i): Pub. L. 99–514, § 662(a), added subsec. (i). - § 856(j): Pub. L. 99–514, § 662(c), added subsec. (j). ## § 857: Taxation of real estate investment trusts and their beneficiaries - § 857(a): Pub. L. 99–514, § 661(b), struck out “and” at end of par. (1), substituted “, and” for the period at end of par. (2), and added par. (3) and last sentence. - § 857(a)(1)(B): Pub. L. 99–514, § 664(a), amended subpar. (B) generally. Prior to amendment, subpar. (B) read as follows: “the sum of— - § 857(b)(2)(F): Pub. L. 99–514, § 666(b)(2), struck out “and there shall be included an amount equal to any net loss derived from prohibited transactions” after “prohibited transactions”. - § 857(b)(3)(C): Pub. L. 99–514, § 668(b)(3), inserted at end “For purposes of this subparagraph, the amount of the net capital gain for any taxable year which is not a calendar year shall be determined without regard to any net capital loss attributable to transactions after December 31 of such year, and any such net capital loss such be treated as arising on the 1st day of the next taxable year. To the extent provided in regulations, the preceding sentence shall apply also for purposes of computing real estate investment trust taxable income.” - § 857(b)(3)(C): Pub. L. 99–514, § 665(a)(2), (b)(1), inserted “(or mailed to its shareholders or holders of beneficial interests with its annual report for the taxable year)”, struck out last sentence which read as follows: “For purposes of this subparagraph, the net capital gain shall be deemed not to exceed the real estate investment trust taxable income (determined without regard to the deduction for dividends paid (as defined in section 561) for the taxable year).” - § 857(b)(3)(D): Pub. L. 99–514, § 665(a)(1), added subpar. (D). - § 857(b)(6)(B)(ii): Pub. L. 99–514, § 666(b)(1), amended cl. (ii) generally. Prior to amendment, cl. (ii) read as follows: “the term ‘net loss derived from prohibited transactions’ means the excess of the deductions allowed by this chapter which are directly connected with prohibited transactions over the gain from prohibited transactions; and”. - § 857(b)(6)(C)(ii): Pub. L. 99–514, § 666(a)(2), substituted “30 percent” for “20 percent”. - § 857(b)(6)(C)(iii): Pub. L. 99–514, § 666(a)(1), amended cl. (iii) generally. Prior to amendment, cl. (iii) read as follows: “during the taxable year the trust does not make more than 5 sales of property (other than foreclosure property); and”. - § 857(b)(6)(C)(v): Pub. L. 99–514, § 666(a)(3), added cl. (v). - § 857(b)(8): Pub. L. 99–514, § 668(b)(1)(A), added par. (8). - § 857(c): Pub. L. 99–514, § 612(b)(7), which directed that “section 116 (relating to an exclusion for dividends received by individuals), and” be struck out, was executed by striking out “section 116 (relating to an exclusion for dividends received by individuals) and” before “section 243” as the probable intent of Congress. - § 857(d): Pub. L. 99–514, § 668(b)(2), amended subsec. (d) generally. Prior to amendment, subsec. (d) read as follows: “The earnings and profits of a real estate investment trust for any taxable year (but not its accumulated earnings and profits) shall not be reduced by any amount which is not allowable as a deduction in computing its taxable income for such taxable year. For purposes of this subsection, the term ‘real estate investment trust’ includes a domestic corporation, trust, or association which is a real estate investment trust determined without regard to the requirements of subsection (a).” - § 857(e), § 857(f): Pub. L. 99–514, § 664(b), added subsec. (e) and redesignated former subsec. (e) as (f). ## § 858: Dividends paid by real estate investment trust after close of taxable year - § 858(b): Pub. L. 99–514, § 668(b)(1)(B), as amended by Pub. L. 100–647, § 1018(u)(27), substituted “Except as provided in section 857(b)(8), amounts” for “Amounts”. - § 858(c): Pub. L. 99–514, § 665(b)(2), inserted “(or mailed to its shareholders or holders of beneficial interests with its annual report for the taxable year)”. ## § 859: Adoption of annual accounting period - § 859: Pub. L. 99–514 designated existing provisions as subsec. (a) and added subsec. (b). ## § 860: Deduction for deficiency dividends - § 860: Pub. L. 99–514 substituted “regulated investment company” for “qualified investment entity”. ## § 860A: Taxation of REMIC’s - Enacted 26 U.S.C. § 860A. ## § 860B: Taxation of holders of regular interests - Enacted 26 U.S.C. § 860B. ## § 860C: Taxation of residual interests - Enacted 26 U.S.C. § 860C. ## § 860D: REMIC defined - Enacted 26 U.S.C. § 860D. ## § 860E: Treatment of income in excess of daily accruals on residual interests - Enacted 26 U.S.C. § 860E. ## § 860F: Other rules - Enacted 26 U.S.C. § 860F. ## § 860G: Other definitions and special rules - Enacted 26 U.S.C. § 860G. ## § 861: Income from sources within the United States - § 861(a)(1): Pub. L. 99–514, § 1241(b)(1)(A), substituted “noncorporate residents or domestic corporations” for “residents, corporate or otherwise,” in introductory text. - § 861(a)(1)(A): Pub. L. 99–514, § 1214(a)(1), (c)(5)(A), amended subpar. (B) generally and redesignated it as (A). Prior to amendment and redesignation, former subpar. (B) read as follows: “interest received from a resident alien individual or a domestic corporation, when it is shown to the satisfaction of the Secretary that less than 20 percent of the gross income from all sources of such individual or such corporation has been derived from sources within the United States, as determined under the provisions of this part, for the 3-year period ending with the close of the taxable year of such individual or such corporation preceding the payment of such interest, or for such part of such period as may be applicable,”. Former subpar. (A), which read “interest on amounts described in subsection (c) received by a nonresident alien individual or a foreign corporation, if such interest is not effectively connected with the conduct of a trade or business within the United States,”, was struck out. - § 861(a)(1)(B): Pub. L. 99–514, § 1241(b)(1)(B), redesignated subpar. (D), as previously redesignated and amended by § 1214(c)(5)(A), (B) of Pub. L. 99–514, as (B) and struck out former subpar. (B) [previously (C)] which read as follows: “interest received from a foreign corporation (other than interest paid or credited by a domestic branch of a foreign corporation, if such branch is engaged in the commercial banking business), when it is shown to the satisfaction of the Secretary that less than 50 percent of the gross income from all sources of such foreign corporation for the 3-year period ending with the close of its taxable year preceding the payment of such interest (or for such part of such period as the corporation has been in existence) was effectively connected with the conduct of a trade or business within the United States,”. - § 861(a)(1)(B): Pub. L. 99–514, § 1214(c)(5)(A), (B), redesignated former subpar. (F) as (D), substituted in cl. (ii), “subparagraph (B) of section 871(i)(3)” for “paragraph (2) of subsection (c)”, and redesignated former subpar. (C) as (B). Former subpar. (B) redesignated (A). - § 861(a)(1): Pub. L. 99–514, § 1241(b)(1)(B), redesignated subpar. (E), as previously redesignated by § 1214(c)(5)(A) of Pub. L. 99–514, as (C) and struck out former subpar. (C) [previously (D)] which read as follows: “in the case of interest received from a foreign corporation (other than interest paid or credited by a domestic branch of a foreign corporation, if such branch is engaged in the commercial banking business), 50 percent or more of the gross income of which from all sources for the 3-year period ending with the close of its taxable year preceding the payment of such interest (or for such part of such period as the corporation has been in existence) was effectively connected with the conduct of a trade or business within the United States, an amount of such interest which bears the same ratio to such interest as the gross income of such foreign corporation for such period which was not effectively connected with the conduct of a trade or business within the United States bears to its gross income from all sources,”. - § 861(a)(1): Pub. L. 99–514, § 1214(c)(5)(A), redesignated subpar. (D) as (C). Former subpar. (C) redesignated (B). - § 861(a)(1): Pub. L. 99–514, § 1214(c)(5)(A), redesignated subpar. (H) as (F). Pub. L. 99–514, § 1241(b)(1)(B), then redesignated such subpar. (F) as (D). The original subpar. (D) was redesignated (C) and struck out, and the original subpar. (F) was redesignated (D), then (B). - § 861(a)(1): Pub. L. 99–514, § 1241(b)(1)(B), redesignated subpar. (E), as previously redesignated by § 1214(c)(5)(A) of Pub. L. 99–514, as (C). - § 861(a)(1): Pub. L. 99–514, § 1214(c)(5)(A), redesignated subpar. (G) as (E) and struck out former subpar. (E) which read as follows: “income derived by a foreign central bank of issue from bankers’ acceptances,”. - § 861(a)(1): Pub. L. 99–514, §§ 1214(c)(5)(A), 1241(b)(1)(B), redesignated successively former subpar. (F) as (D) and (B), respectively. - § 861(a)(1): Pub. L. 99–514, §§ 1214(c)(5)(A), 1241(b)(1)(B), redesignated successively former subpar. (G) as (E) and (C), respectively. - § 861(a)(1): Pub. L. 99–514, §§ 1214(c)(5)(A), 1241(b)(1)(B), redesignated successively former subpar. (H) as (F) and (D), respectively. - § 861(a)(2)(A): Pub. L. 99–514, § 1214(b), amended subpar. (A) generally. Prior to amendment, subpar. (A) read as follows: “from a domestic corporation other than a corporation which has an election in effect under section 936, and other than a corporation less than 20 percent of whose gross income is shown to the satisfaction of the Secretary to have been derived from sources within the United States, as determined under the provisions of this part, for the 3-year period ending with the close of the taxable year of such corporation preceding the declaration of such dividends (or for such part of such period as the corporation has been in existence), or”. - § 861(a)(2)(B): Pub. L. 99–514, § 1241(b)(2), substituted “25 percent” for “50 percent” and inserted “(or treated as effectively connected other than under section 884(d)(2))” in two places. - § 861(a)(6): Pub. L. 99–514, § 1211(b)(1)(B), substituted “inventory property (within the meaning of section 865(h)(1))” for “personal property”. - § 861(b): Pub. L. 99–514, § 104(b)(11), substituted “the standard deduction” for “the zero bracket amount”. - § 861(c): Pub. L. 99–514, § 1214(a)(2), amended subsec. (c) generally, substituting provisions relating to foreign business requirements for provisions relating to interest on deposits. - § 861(d): Pub. L. 99–514, § 1214(c)(5)(C), amended subsec. (d) generally, substituting provision for special rule for application of subsec. (a)(2)(B) for former provision for special rules for application of subsec. (a), pars. (1)(B) to (1)(D) and (2)(B), pars. (1) and (2) thereof relating to new entities and transition rule provisions. - § 861(e), § 861: Pub. L. 99–514, § 1212(d), redesignated subsec. (f) as (e) and struck out former subsec. (e) relating to treatment of income from certain leased aircraft, vessels, and spacecraft as income from sources within the United States. ## § 862: Income from sources without the United States - § 862(a)(6): Pub. L. 99–514, § 1211(b)(1)(C), substituted “inventory property (within the meaning of section 865(h)(1))” for “personal property”. - § 862(b): Pub. L. 99–514, § 104(b)(12), substituted “the standard deduction” for “the zero bracket amount”. ## § 863: Special rules for determining source - § 863(b)(1): Pub. L. 99–514, § 1212(e), substituted “services” for “transportation or other services”. - § 863(b)(2), § 863(b)(3): Pub. L. 99–514, § 1211(b)(1)(A), substituted “inventory property (within the meaning of section 865(h)(1))” for “personal property”. - § 863(c)(2): Pub. L. 99–514, § 1212(a), amended par. (2) generally, in subpar. (A) substituting provisions relating to other transportation having United States connections for provisions relating to transportation between United States and any possession, and in subpar. (B) substituting provisions relating to special rule for personal service income for provisions relating to special rule for certain lessors of aircraft. - § 863(d), § 863(e): Pub. L. 99–514, § 1213(a), added subsecs. (d) and (e). ## § 864: Definitions and special rules - § 864: Pub. L. 99–514, § 1215(b)(1), inserted “and special rules” in section catchline. - § 864(c)(1)(A): Pub. L. 99–514, § 1242(b)(1), inserted reference to pars. (6) and (7). - § 864(c)(1)(B): Pub. L. 99–514, § 1242(b)(2), inserted “paragraph (6) or (7) or in”. - § 864(c)(2): Pub. L. 99–514, § 1899A(21), inserted a comma between “section 871(h)” and “section 881(a)”. - § 864(c)(4)(B)(iii): Pub. L. 99–514, § 1211(b)(2), struck out cl. (iii), which read as follows: “is derived from the sale or exchange (without the United States) through such office or other fixed place of business of personal property described in section 1221(1), except that this clause shall not apply if the property is sold or exchanged for use, consumption, or disposition outside the United States and an office or other fixed place of business of the taxpayer outside the United States participated materially in such sale or exchange.” - § 864(c)(6), § 864(c)(7): Pub. L. 99–514, § 1242(a), added pars. (6) and (7). - § 864(d)(5)(A): Pub. L. 99–514, § 1201(d)(4), amended cl. (i) generally. Prior to amendment, cl. (i) read as follows: “Subparagraphs (A), (B), (C), and (D) of section 904(d)(2) (relating to interest income to which separate limitation applies) and subparagraph (J) of section 904(d)(3) (relating to interest from members of same affiliated group).” - § 864(d)(5)(A): Pub. L. 99–514, § 1810(c)(3), inserted “and subparagraph (J) of section 904(d)(3) (relating to interest from members of same affiliated group)”. - § 864(d)(5)(A): Pub. L. 99–514, § 1223(b)(1), substituted “less than 5 percent or $1,000,000” for “less than 10 percent”. - § 864(d)(5)(A): Pub. L. 99–514, § 1221(a)(2), amended cl. (iii) generally, substituting “section 954(c)(2) (relating to certain export financing)” for “section 954(c)(3) (relating to certain income derived in active conduct of trade or business)”. - § 864(d)(5)(A): Pub. L. 99–514, § 1221(a)(2), amended cl. (iv) generally, substituting “Clause (i) of section 954(c)(3)(A) (relating to” for “Subparagraphs (A) and (B) of section 954(c)(4) (relating to exception for”. - § 864(d)(5)(B): Pub. L. 99–514, § 1275(c)(7), amended subpar. (B) generally, striking out cl. (i) heading, substituting “An amount” for “Any amount”, and striking out cl. (ii), Virgin Islands corporations, which read as follows: “Subsection (b) of section 934 shall not apply to any amount treated as interest under paragraph (1) unless such amount is from sources within the Virgin Islands (determined after the application of paragraph (1)).” - § 864(d)(7), § 864(d)(8): Pub. L. 99–514, § 1810(c)(2), added par. (7) and redesignated former par. (7) as (8). - § 864(e): Pub. L. 99–514, § 1215(a), added subsec. (e). ## § 865: Source rules for personal property sales - Enacted 26 U.S.C. § 865. ## § 871: Tax on nonresident alien individuals - § 871(a)(1): Pub. L. 99–514, § 1810(d)(3)(A), substituted “subsection (h)” for “subsection (i)” in introductory provisions. - § 871(a)(1)(C): Pub. L. 99–514, § 1810(e)(2)(A), amended subpar. (C) generally. Prior to amendment, subpar. (C) read as follows: “in the case of— - § 871(a)(1)(D): Pub. L. 99–514, § 1211(b)(4), struck out “or from payments which are treated as being so contingent under subsection (e),” after “sold or exchanged,”. - § 871(a)(2): Pub. L. 99–514, § 301(b)(9), struck out “such gains and losses shall be determined without regard to section 1202 (relating to deduction for capital gains) and” after “United States, except that”. - § 871(e): Pub. L. 99–514, § 1211(b)(5), struck out subsec. (e) which related to gains from sale or exchange of certain intangible property, par. (1) treating payments as contingent on use, etc., and par. (2) containing source rule. - § 871(h)(2): Pub. L. 99–514, § 1810(d)(1)(A), (3)(B), inserted “which would be subject to tax under subsection (a) but for this subsection and” in introductory provisions and substituted “receives a statement” for “has received a statement” in subpar. (B)(ii). - § 871(h)(3)(C)(ii), § 871(h)(3)(C)(iii): Pub. L. 99–514, § 1810(d)(2), added cl. (ii) and redesignated former cl. (ii) as (iii). - § 871(i), § 871(j): Pub. L. 99–514, § 1214(c)(1), added subsec. (i) and redesignated former subsec. (i) as (j). ## § 872: Gross income - § 872(b)(1): Pub. L. 99–514, § 1212(c)(1), added par. (1) and struck out former par. (1), ships under foreign flag, which read as follows: “Earnings derived from the operation of a ship or ships documented under the laws of a foreign country which grants an equivalent exemption to citizens of the United States and to corporations organized in the United States.” - § 872(b)(2): Pub. L. 99–514, § 1212(c)(1), added par. (2) and struck out former par. (2), aircraft of foreign registry, which read as follows: “Earnings derived from the operation of aircraft registered under the laws of a foreign country which grants an equivalent exemption to citizens of the United States and to corporations organized in the United States.” - § 872(b)(5), § 872(b)(6): Pub. L. 99–514, § 1212(c)(2), added pars. (5) and (6). ## § 876: Alien residents of Puerto Rico, Guam, American Samoa, or the Northern Mariana Islands - § 876: Pub. L. 99–514, § 1272(b), inserted “, Guam, American Samoa, or the Northern Mariana Islands” in section catchline. - § 876(a): Pub. L. 99–514, § 1272(b), amended subsec. (a) generally, substituting “General rule” for “No application to certain alien residents of Puerto Rico” in heading and inserting references to residents of Guam, American Samoa, and the Northern Mariana Islands in text. - § 876(b): Pub. L. 99–514, § 1272(b), amended subsec. (b) generally, inserting references to Guam, American Samoa, and the Northern Mariana Islands. ## § 877: Expatriation to avoid tax - § 877(c): Pub. L. 99–514 inserted at end “For purposes of this section, gain on the sale or exchange of property which has a basis determined in whole or in part by reference to property described in paragraph (1) or (2) shall be treated as gain described in paragraph (1) or (2).” ## § 879: Tax treatment of certain community income in the case of nonresident alien individuals - § 879(c)(3): Pub. L. 99–514 substituted “section 7703(a)” for “section 143(a)”. ## § 881: Tax on income of foreign corporations not connected with United States business - § 881(a)(3)(A): Pub. L. 99–514, § 1810(e)(2)(B), amended subpar. (A) generally, striking out “any gain not in excess of” before “the original issue discount”. - § 881(a)(3)(B): Pub. L. 99–514, § 1810(e)(2)(B), amended subpar. (B) generally. Prior to amendment, subpar. (B) read as follows: “the payment of interest on an original issue discount obligation, an amount equal to the original issue discount accrued on such obligation since the last payment of interest thereon (except that such original issue discount shall be taken into account under this subparagraph only to the extent that the tax thereon does not exceed the interest payment less the tax imposed by paragraph (1) thereon), and”. - § 881(a)(4): Pub. L. 99–514, § 1211(b)(6), struck out “or from payments which are treated as being so contingent under section 871(e),” after “sold or exchanged,”. - § 881(b)(1): Pub. L. 99–514, § 1273(b)(1), amended par. (1) generally. Prior to amendment, par. (1) read as follows: “For purposes of this section, a corporation created or organized in Guam or the Virgin Islands or under the law of Guam or the Virgin Islands shall not be treated as a foreign corporation for any taxable year if— - § 881(b)(2): Pub. L. 99–514, § 1273(b)(1), (2)(A), redesignated par. (3) as (2) and struck out former par. (2) which provided that par. (1) of this subsection not apply with respect to income tax liability incurred to Guam. - § 881(b)(2)(A): Pub. L. 99–514, § 1899A(22), substituted “paragraph” for “Paragraph”. - § 881(b)(3), § 881(b): Pub. L. 99–514, § 1273(b)(2)(A), redesignated par. (3) as (2) and struck out par. (4) which provided a cross reference to sections 934 and 934A. - § 881(c): Pub. L. 99–514, § 1899A(68), made clarifying amendment to directory language of Pub. L. 98–369, § 127(b)(1). See 1984 Amendment note below. - § 881(c)(2): Pub. L. 99–514, § 1810(d)(1)(B), (3)(C), inserted “which would be subject to tax under subsection (a) but for this subsection and” in introductory provisions and substituted “receives a statement” for “has received a statement” in subpar. (B)(ii). - § 881(c)(3)(C): Pub. L. 99–514, § 1899A(23), inserted a closing parenthesis following “section 864(d)(4)”. - § 881(c)(4): Pub. L. 99–514, § 1223(b)(2), substituted “less than 5 percent or $1,000,000” for “less than 10 percent”. - § 881(d), § 881(e): Pub. L. 99–514, § 1214(c)(2), added subsec. (d) and redesignated former subsec. (d) as (e). ## § 882: Tax on income of foreign corporations connected with United States business - § 882(a)(1): Pub. L. 99–514, § 701(e)(4)(F), inserted reference to section 55. - § 882(e): Pub. L. 99–514, § 1236(a), inserted “The preceding sentence shall not apply to any Guam corporation which is treated as not being a foreign corporation by section 881(b)(1) for the taxable year.” ## § 883: Exclusions from gross income - § 883(a)(1): Pub. L. 99–514, § 1212(c)(3), added par. (1) and struck out former par. (1), ships under foreign flag, which read as follows: “Earnings derived from the operation of a ship or ships documented under the laws of a foreign country which grants an equivalent exemption to citizens of the United States and to corporations organized in the United States.” - § 883(a)(2): Pub. L. 99–514, § 1212(c)(3), added par. (2) and struck out former par. (2), aircraft of foreign registry, which read as follows: “Earnings derived from the operation of aircraft registered under the laws of a foreign country which grants an equivalent exemption to citizens of the United States and to corporations organized in the United States.” - § 883(a)(4): Pub. L. 99–514, § 1212(c)(4), added par. (4). - § 883(c): Pub. L. 99–514, § 1212(c)(5), added subsec. (c). ## § 884: Branch profits tax - Enacted 26 U.S.C. § 884. ## § 885: Cross references - § 885: Pub. L. 99–514 renumbered section 884 of this title as this section. ## § 887: Imposition of tax on gross transportation income of nonresident aliens and foreign corporations - Enacted 26 U.S.C. § 887. ## § 891: Doubling of rates of tax on citizens and corporations of certain foreign countries - § 891: Pub. L. 99–514 struck out reference to section 821. ## § 892: Income of foreign governments and of international organizations - § 892: Pub. L. 99–514 amended section generally. Prior to amendment, section read as follows: “The income of foreign governments or international organizations received from investments in the United States in stocks, bonds, or other domestic securities, owned by such foreign governments or by international organizations, or from interest on deposits in banks in the United States of moneys belonging to such foreign governments or international organizations, or from any other source within the United States, shall not be included in gross income and shall be exempt from taxation under this subtitle.” ## § 897: Disposition of investment in United States real property - § 897(a)(2): Pub. L. 99–514, § 701(e)(4)(G), substituted “21-percent” for “20-percent” in heading and amended subpar. (A) generally. Prior to amendment, subpar. (A) read as follows: “In the case of any nonresident alien individual, the amount determined under section 55(a)(1) for the taxable year shall not be less than 20 percent of the lesser of— - § 897(d): Pub. L. 99–514, § 631(e)(12), in heading, struck out “, etc.,” after “distributions”, and in text, struck out heading and designation for par. (1), redesignated subpar. (A) as par. (1), redesignated subpar. (B) as par. (2) and substituted “paragraph (1)” for “subparagraph (A)” in introductory provisions, redesignated cl. (i) and its subcls. (I) and (II) as subpar. (A) and cls. (i) and (ii), respectively, redesignated cl. (ii) as subpar. (B), and struck out former par. (2) which provided that section 337 not apply to any sale or exchange of a United States real property interest by a foreign corporation. - § 897(i)(1), § 897(i)(4): Pub. L. 99–514, § 1810(f)(1), inserted reference to section 1445. ## § 901: Taxes of foreign countries and of possessions of United States - § 901(h): Pub. L. 99–514, § 1876(p)(2), inserted closing parenthesis after “section 927(d)(6)”. - § 901(i): Pub. L. 99–514, § 1204(a), added subsec. (i). Former subsec. (i) redesignated (j). - § 901(i): Pub. L. 99–514, § 112(b)(3), substituted “section 642(a)” for “section 642(a)(1)”. - § 901(j): Pub. L. 99–514, § 1204(a), redesignated former subsec. (i) as (j). ## § 904: Limitation on credit - § 904(a): Pub. L. 99–514, § 104(b)(13), struck out last sentence “For purposes of the preceding sentence, in the case of an individual the entire taxable income shall be reduced by an amount equal to the zero bracket amount.” - § 904(b)(3)(C): Pub. L. 99–514, § 1211(b)(3), redesignated subpar. (E) as (C) and struck out former subpar. (C), exception for gain from the sale of certain personal property, which read as follows: “There shall be included as gain from sources within the United States any gain from sources without the United States from the sale or exchange of a capital asset which is personal property which— - § 904(b)(3)(D): Pub. L. 99–514, § 1211(b)(3), redesignated subpar. (F) as (D) and struck out former subpar. (D), gain from liquidation of certain foreign corporations, which read as follows: “Subparagraph (C) shall not apply with respect to a distribution in liquidation of a foreign corporation to which part II of subchapter C applies if such corporation derived less than 50 percent of its gross income from sources within the United States for the 3-year period ending with the close of such corporation’s taxable year immediately preceding the year during which the distribution occurred.” - § 904(b)(3)(E), § 904(b)(3): Pub. L. 99–514, § 1211(b)(3), redesignated former subpars. (E) and (F) as (C) and (D), respectively. - § 904(d): Pub. L. 99–514, § 1201(d)(1), substituted “certain categories of income” for “certain interest income and income from DISC, former DISC, FSC, or former FSC” in heading. - § 904(d)(1): Pub. L. 99–514, § 1201(a), (d)(2), (3), inserted “and sections 902, 907, and 960” in introductory provisions, added subpars. (A) to (E), struck out former subpar. (A) which read “the interest income described in paragraph (2)”, redesignated former subpars. (B), (C), (D), and (E) as (F), (G), (H), and (I), respectively, and in subpar. (I), substituted “in any of the preceding subparagraphs” for “in subparagraph (A), (B), (C), or (D)”. - § 904(d)(1): Pub. L. 99–514, § 1899A(24), made technical correction clarifying heading. See 1984 Amendment note below. - § 904(d)(1)(D): Pub. L. 99–514, § 1876(d)(2), amended subpar. (D) generally. Prior to amendment, subpar. (D) read as follows: “distributions from a FSC (or former FSC) out of earnings and profits attributable to foreign trade income (within the meaning of section 923(b)), and”. - § 904(d)(2): Pub. L. 99–514, § 1201(b), added par. (2) and struck out former par. (2), interest income to which applicable, which read as follows: “For purposes of this subsection, the interest income described in this paragraph is interest other than interest— - § 904(d)(2): Pub. L. 99–514, § 1810(b)(3), inserted at end “For purposes of this subsection, interest (after the operation of section 904(d)(3)) received from a designated payor corporation described in section 904(d)(3)(E)(iii) by a taxpayer which owns directly or indirectly less than 10 percent of the voting stock of such designated payor corporation shall be treated as interest described in subparagraph (A) to the extent such interest would have been so treated had such taxpayer received it from other than a designated payor corporation.” - § 904(d)(3): Pub. L. 99–514, § 1201(b), added par. (3) and struck out former par. (3) treating as interest certain amounts attributable to United States-owned foreign corporations, etc., subpars. thereof relating to following subject matter: (A) general provisions, (B) separate limitation interest, (C) exception where designated corporation has small amount of separate limitation interest, (D) treatment of certain interest, (E) designated payor corporation, (F) determination of year to which amount is attributable, (G) ordering rules, (H) dividend, (I) interest and dividends from members of same affiliated group, and (J) distributions through other entities. - § 904(d)(3)(C): Pub. L. 99–514, § 1810(b)(1), inserted at end “The preceding sentence shall not apply to any amount includible in gross income under section 551 or 951.” - § 904(d)(3)(E): Pub. L. 99–514, § 1810(b)(4)(A), inserted at end: - § 904(d)(3): Pub. L. 99–514, § 1810(b)(2), redesignated subpar. (I) as (J) and added a new subpar. (I), interest and dividends from members of same affiliated group, which read as follows: “For purposes of this paragraph, dividends and interest received or accrued by the designated payor corporation from another member of the same affiliated group (determined under section 1504 without regard to subsection (b)(3) thereof) shall be treated as separate limitation interest if (and only if) such amounts are attributable (directly or indirectly) to separate limitation interest of any other member of such group.” - § 904(d)(3): Pub. L. 99–514, § 1810(b)(2), redesignated subpar. (I) as (J) and struck out former subpar. (J), interest from members of same affiliated group, which read as follows: “For purposes of this paragraph, interest received or accrued by the designated payor corporation from another member of the same affiliated group (determined under section 1504 without regard to subsection (b)(3) thereof) shall not be treated as separate limitation interest, unless such interest is attributable directly or indirectly to separate limitation interest of such other member.” - § 904(d)(4), § 904(d)(5): Pub. L. 99–514, § 1201(b), added pars. (4) and (5). - § 904(f)(5): Pub. L. 99–514, § 1203(a), added par. (5). - § 904(g)(1)(A): Pub. L. 99–514, § 1235(f)(4)(A), added cl. (iii). - § 904(g)(2): Pub. L. 99–514, § 1235(f)(4)(B), substituted “holding or passive foreign investment company” for “holding company” in heading. - § 904(g): Pub. L. 99–514, § 1810(a)(1)(A), added par. (9) and redesignated former par. (9) as (10). - § 904(i)(2): Pub. L. 99–514, § 701(e)(4)(H), struck out “by an individual” after “can be taken” and substituted “section 59(a)” for “section 55(c)”. ## § 906: Nonresident alien individuals and foreign corporations - § 906(b)(6): Pub. L. 99–514, § 1876(d)(3), added par. (6) relating to credit for income, war profits, and excess profits taxes paid or accrued to a foreign country or possession of the United States. - § 906(b)(6): Pub. L. 99–514, § 1241(c), added par. (6) relating to credit against tax imposed by section 884. ## § 911: Citizens or residents of the United States living abroad - § 911(b)(2)(A): Pub. L. 99–514, § 1233(a), in amending subpar. (A) generally, substituted “an annual rate of $70,000” for “the annual rate set forth in the following table for each day of the taxable year within the applicable period described in subparagraph (A) or (B) of subsection (d)(1): - § 911(d)(8), § 911(d)(9): Pub. L. 99–514, § 1233(b), added par. (8) and redesignated former par. (8) as (9). ## § 931: Income from sources within Guam, American Samoa, or the Northern Mariana Islands - § 931: Pub. L. 99–514 amended section generally, substituting provisions relating to income from sources within Guam, American Samoa, or the Northern Mariana Islands, for former provisions relating to income from sources within possessions of the United States, which had declared in: subsec. (a), general rule as to gross income, including requirements relating to 3-year period and trade or business; subsec. (b), rule as to amounts received in United States; subsec. (c), definition of “possession of the United States”; subsec. (d), general rule allowing deductions only to extent connected with income from sources within United States, and specific exceptions to limitations of general rule; subsec. (e), deduction for personal exemption; subsec. (f), allowance of deductions and credits; subsec. (g), foreign tax credit; subsec. (h), provisions relating to employees of United States. ## § 932: Coordination of United States and Virgin Islands income taxes - Enacted 26 U.S.C. § 932. ## § 933: Income from sources within Puerto Rico - § 933: Pub. L. 99–514 inserted “, or any credit,” in pars. (1) and (2). ## § 934: Limitation on reduction in income tax liability incurred to the Virgin Islands - § 934(a): Pub. L. 99–514, § 1275(c)(2)(A), struck out “or (c) or in section 934A” after “subsection (b)”. - § 934(b): Pub. L. 99–514, § 1275(c)(1), (2)(B), added subsec. (b) and struck out former subsec. (b) which excepted from subsec. (a) domestic or Virgin Islands corporations to the extent they derived income from sources without the United States under certain conditions. - § 934: Pub. L. 99–514, § 1275(c)(1), struck out subsec. (c) which provided an exception to subsec. (a) of this section for individual citizens of the United States residing in the Virgin Islands to the extent their income is derived from sources within the Virgin Islands. - § 934: Pub. L. 99–514, § 1275(c)(1), struck out subsec. (d) which related to requirement to supply information. - § 934: Pub. L. 99–514, § 1275(a)(2)(A), struck out subsec. (e) which provided for tax treatment of intangible property income of certain domestic corporations. - § 934: Pub. L. 99–514, § 1275(a)(2)(A), struck out subsec. (f) which provided a transitional rule for applying subsec. (b)(2) of this section with respect to taxable years beginning after Dec. 31, 1982, and before Jan. 1, 1985. - § 934: Pub. L. 99–514, § 1876(f)(2), struck out subsec. (f) which provided that subsec. (a) of this section not apply in the case of a Virgin Islands corporation which is a FSC. ## § 951: Amounts included in gross income of United States shareholders - § 951: Pub. L. 99–514, § 1876(c)(2), struck out last sentence which read as follows: “For purposes of the preceding sentence, income described in paragraph (2) or (3) of section 921(d) shall be treated as derived from sources within the United States.” - § 951: Pub. L. 99–514, § 1235(c), added subsec. (f). ## § 952: Subpart F income defined - § 952(a)(1): Pub. L. 99–514, § 1221(b)(3)(A), amended par. (1) generally. Prior to amendment, par. (1) read as follows: “the income derived from the insurance of United States risks (as determined under section 953), and”. - § 952(b): Pub. L. 99–514, § 1876(c)(1), inserted last sentence. - § 952(c): Pub. L. 99–514, § 1221(f), added subsec. (c) and struck out former subsec. (c) which read as follows: “For purposes of subsection (a), the subpart F income of any controlled foreign corporation for any taxable year shall not exceed the earnings and profits of such corporation for such year reduced by the amount (if any) by which— - § 952(d): Pub. L. 99–514, § 1221(f), struck out subsec. (d), special rule in case of indirect ownership, which read as follows: “For purposes of subsection (c), if— ## § 953: Insurance income - § 953: Pub. L. 99–514, § 1221(b)(3)(D), substituted “Insurance income” for “Income from insurance of United States risks” in section catchline. - § 953(a): Pub. L. 99–514, § 1221(b)(1), amended subsec. (a) generally, substituting provisions defining “insurance income” for former provisions defining “income derived from the insurance of United States risks”. - § 953(c): Pub. L. 99–514, § 1221(b)(2), added subsec. (c). ## § 954: Foreign base company income - § 954(a): Pub. L. 99–514, § 1221(c)(3)(A)(ii), substituted “determined under subsection (g)” for “determined under subsection (h)”. - § 954(b)(2): Pub. L. 99–514, § 1221(c)(1), struck out par. (2), exclusion for reinvested shipping income, which read as follows: “For purposes of subsection (a), foreign base company income does not include foreign base company shipping income to the extent that the amount of such income does not exceed the increase for the taxable year in qualified investments in foreign base company shipping operations of the controlled foreign corporation (as determined under subsection (g)).” - § 954(b)(3): Pub. L. 99–514, § 1223(a), amended par. (3) generally. Prior to amendment, par. (3), special rule where foreign base company income is less than 10 percent or more than 70 percent of gross income, read as follows: “For purposes of subsection (a)— - § 954(b)(4): Pub. L. 99–514, § 1221(d), amended par. (4) generally. Prior to amendment, par. (4), exception for foreign corporations not availed of to reduce taxes, read as follows: “For purposes of subsection (a), foreign base company income does not include any item of income received by a controlled foreign corporation if it is established to the satisfaction of the Secretary that neither— - § 954(b)(5): Pub. L. 99–514, § 1201(c), inserted at end “Except to the extent provided in regulations prescribed by the Secretary, any interest which is paid or accrued by the controlled foreign corporation to any United States shareholder in such corporation (or any controlled foreign corporation related to such a shareholder) shall be allocated first to foreign personal holding company income which is passive income (within the meaning of section 904(d)(2)) of such corporation to the extent thereof. The Secretary may, by regulations, provide that the preceding sentence shall apply also to interest paid or accrued to other persons.” - § 954(c): Pub. L. 99–514, § 1221(a)(1), amended subsec. (c) generally, substituting pars. (1) to (3) for former provisions which had provided: in par. (1), a reference to definition of “foreign personal holding company income” contained in section 553; in par. (2), that all rents would be included in “foreign personal holding company income” without regard to whether or not such rents constituted 50 percent or more of gross income; in par. (3), for exclusion of certain income derived in active conduct of a trade or business; and in par. (4), exclusion of certain income received from related persons from being included in “foreign personal holding company income”. See subsec. (c)(3). - § 954(d)(3): Pub. L. 99–514, § 1221(e), added subpars. (A) and (B) and concluding provisions and struck out former subpars. (A) to (C) and concluding provisions which read as follows: - § 954(e): Pub. L. 99–514, § 1810(k), in amending subsec. (e) generally, designated existing provisions as par. (1), added par. heading, and substituted subpar. (A) and (B) designations for prior par. (1) and (2) designations, struck out provisions relating to nonapplicability of preceding sentence to services performed in connection with manufactured or grown or extracted property, and provisions determining the place of performance of services for purposes of paragraph (2) with respect to any policy of insurance and reinsurance, and added pars. (2) and (3). - § 954(e): Pub. L. 99–514, § 1221(b)(3)(B), and Pub. L. 100–647, § 1018(u)(38), struck out par. (3) as enacted by section 1810(k) of Pub. L. 99–514, which read as follows: “For purposes of paragraph (1), in the case of any services performed with respect to any policy of insurance or reinsurance with respect to which the primary insured is a related person (within the meaning of section 864(d)(4))— - § 954(f): Pub. L. 99–514, § 1221(c)(2), inserted last sentence. - § 954(g), § 954(h): Pub. L. 99–514, § 1221(c)(3)(A)(i), redesignated subsec. (h) as (g) and struck out former subsec. (g), increase in qualified investments in foreign base company shipping operations, which read as follows: “For purposes of subsection (b)(2), the increase for any taxable year in qualified investments in foreign base company shipping operations of any controlled foreign corporation is the amount by which— ## § 956: Investment of earnings in United States property - § 956(b)(3)(A): Pub. L. 99–514 inserted “(other than subparagraph (H) thereof)”. ## § 957: Controlled foreign corporations; United States persons - § 957(a): Pub. L. 99–514, § 1222(a)(1), amended subsec. (a) generally. Prior to amendment, subsec. (a) read as follows: “For purposes of this subpart, the term ‘controlled foreign corporation’ means any foreign corporation of which more than 50 percent of the total combined voting power of all classes of stock entitled to vote is owned (within the meaning of section 958(a)), or is considered as owned by applying the rules of ownership of section 958(b), by United States shareholders on any day during the taxable year of such foreign corporation.” - § 957(b): Pub. L. 99–514, § 1222(a)(2), inserted “(or more than 25 percent of the total value of stock)”. - § 957(b): Pub. L. 99–514, § 1221(b)(3)(C), substituted “insurance income” for “income derived from insurance of United States risks”. - § 957(c): Pub. L. 99–514, § 1273(a), added par. (2) and concluding provisions and struck out former pars. (2) and (3) which read as follows: - § 957(c): Pub. L. 99–514, § 1224(a), redesignated subsec. (d) as (c) and struck out former subsec. (c) which provided circumstances under which for purposes of this subpart, the term “controlled foreign corporation” would not include certain corporations created or organized in Puerto Rico or a possession of the United States or under the laws of Puerto Rico or a possession of the United States. - § 957: Pub. L. 99–514, § 1224(a), redesignated subsec. (d) as (c). ## § 959: Exclusion from gross income of previously taxed earnings and profits - § 959(d): Pub. L. 99–514 inserted “; except that such distributions shall immediately reduce earnings and profits”. ## § 960: Deemed paid credit for subpart F inclusions - § 960(a): Pub. L. 99–514 substituted “then, except to the extent provided in regulations, such domestic corporation shall be deemed to have paid a portion of such foreign corporation’s post-1986 foreign income taxes determined under section 902 in the same manner as if the amount so included were a dividend paid by such foreign corporation (determined by applying section 902(c) in accordance with section 904(d)(3)(B))” for “then, under regulations prescribed by the Secretary, such domestic corporation shall be deemed to have paid the same proportion of the total income, war profits, and excess profits taxes paid (or deemed paid) by such foreign corporation to a foreign country or possession of the United States for the taxable year on or with respect to the earnings and profits of such foreign corporation which the amount of earnings and profits of such foreign corporation so included in gross income of the domestic corporation bears to the entire amount of the earnings and profits of such corporation for such taxable year”. ## § 985: Functional currency - Enacted 26 U.S.C. § 985. ## § 986: Determination of foreign taxes and foreign corporation’s earnings and profits - Enacted 26 U.S.C. § 986. ## § 987: Branch transactions - Enacted 26 U.S.C. § 987. ## § 988: Treatment of certain foreign currency transactions - Enacted 26 U.S.C. § 988. ## § 989: Other definitions and special rules - Enacted 26 U.S.C. § 989. ## § 995: Taxation of DISC income to shareholders - § 995(b)(1)(F)(i): Pub. L. 99–514, § 1876(b)(2)(A), inserted “in the case of a shareholder which is a C corporation,”. - § 995(b)(1)(F)(ii): Pub. L. 99–514, § 1876(b)(2)(B), substituted “16⁄17 of the excess referred to in clause (i),” for “the amount determined under clause (i)”. - § 995(f)(4), § 995(f)(5), § 995(f)(6): Pub. L. 99–514, § 1876(p)(1), redesignated as pars. (4), (5), and (6), respectively, former par. (3) relating to base period T-bill rate, (4) relating to short years, and (5) relating to payment and assessment and collection of interest. - § 995(f)(7): Pub. L. 99–514, § 1876(g), added par. (7). ## § 996: Rules for allocation in the case of distributions and losses - § 996(a)(2): Pub. L. 99–514 inserted last sentence and struck out former last sentence which read as follows: “In the case of any amount of any actual distribution made pursuant to section 992(c) which is required to satisfy the condition of section 992(a)(1)(A), the preceding sentence shall apply to one-half of such amount, and paragraph (1) shall apply to the remaining one-half of such amount.” ## § 999: Reports by taxpayers; determinations - § 999(c)(1), § 999(c)(2): Pub. L. 99–514 repealed section 802(c)(3) of Pub. L. 98–369 thereby restoring former text. See 1984 Amendment note below. ## § 1016: Adjustments to basis - § 1016(a): Pub. L. 99–514, § 1899A(25), which directed the amendment of pars. (23) to (26) by substituting a semicolon for a comma at the end thereof was executed to pars. (24) to (26) in view of the prior repeal of par. (23). - § 1016(a): Pub. L. 99–514, § 1303(b)(3), which directed the amendment of subsec. (a) by striking out par. (22) and redesignating pars. (23) to (27) as (22) to (26), respectively, was executed by striking out par. (21) to reflect the probable intent of Congress in view of the amendment by section 241(b)(2) of Pub. L. 99–514. Prior to the amendment, par. (21) read as follows: “to the extent provided in section 1395 in the case of stock of shareholders of a general stock ownership corporation (as defined in section 1391) which makes the election provided by section 1392;”. - § 1016(a): Pub. L. 99–514, § 241(b)(2), redesignated pars. (17) to (27) as (16) to (26), respectively, and struck out former par. (16) which read as follows: “for amounts allowed as deductions for expenditures treated as deferred expenses under section 177 (relating to trademark and trade name expenditures) and resulting in a reduction of the taxpayer’s taxes under this subtitle, but not less than the amounts allowable under such section for the taxable year and prior years;”. - § 1016(a)(24): Pub. L. 99–514, § 701(e)(4)(D), substituted “section 59(d)” for “section 58(i)”. ## § 1017: Discharge of indebtedness - § 1017(a)(2): Pub. L. 99–514, § 822(b)(4), substituted “or (b)(5)” for “, (b)(5), or (c)(1)(A)”. - § 1017(b)(3)(A): Pub. L. 99–514, § 822(b)(5), struck out “or (c)(1)(A)” after “subsection (b)(5)”. - § 1017(b)(4): Pub. L. 99–514, § 405(b), added par. (4). ## § 1031: Exchange of real property held for productive use or investment - § 1031(a)(3)(A): Pub. L. 99–514 substituted “on or before the day” for “before the day”. ## § 1035: Certain exchanges of insurance policies - § 1035(b)(1): Pub. L. 99–514 struck out “subject to tax under subchapter L” after “with an insurance company”. ## § 1041: Transfers of property between spouses or incident to divorce - § 1041(e): Pub. L. 99–514 added subsec. (e). ## § 1042: Sales of stock to employee stock ownership plans or certain cooperatives - § 1042: Pub. L. 99–514, § 1854(a)(11), which directed that “employee” be inserted before “stock” in section catchline was executed by making the insertion before “stock” the second time that term appears as the probable intent of Congress. - § 1042(a): Pub. L. 99–514, § 1854(a)(1), substituted “the taxpayer or executor elects in such form as the Secretary may prescribe” for “the taxpayer elects” in par. (1) and inserted “which would be recognized as long-term capital gain” in concluding provisions. - § 1042(b)(2): Pub. L. 99–514, § 1854(a)(2)(A), substituted “Plan must hold” for “Employees must own” in heading and amended text generally. Prior to amendment, par. (2) read as follows: “The plan or cooperative referred to in paragraph (1) owns, immediately after the sale, at least 30 percent of the total value of the employer securities (within the meaning of section 409(l)) outstanding as of such time.” - § 1042(b)(3): Pub. L. 99–514, § 1854(a)(3)(B), as amended by Pub. L. 100–647, § 1018(t)(4)(F), redesignated par. (4) as (3) and struck out former par. (3) which related to plans maintained for benefit of employees. - § 1042(b)(3)(B): Pub. L. 99–514, § 1854(f)(3)(B), amended subpar. (B) similar to amendment by section 1854(a)(9)(B) of Pub. L. 99–514, inserting reference to section 4979A. - § 1042(b)(3)(B): Pub. L. 99–514, § 1854(a)(9)(B), substituted “sections 4978 and 4979A” for “section 4978(a)”. - § 1042(b)(4): Pub. L. 99–514, § 1854(a)(3)(B), as amended by Pub. L. 100–647, § 1018(t)(4)(F), redesignated par. (4) as (3). - § 1042(c): Pub. L. 99–514, § 1899A(26), substituted “this section—” for “this section.—” in introductory provision. - § 1042(c)(1): Pub. L. 99–514, § 1854(a)(4), substituted “stock outstanding that is” for “securities outstanding that are” in subpar. (A), redesignated subpar. (C) as (B), and struck out former subpar. (B) which read as follows: “at the time of the sale described in subsection (a)(1), have been held by the taxpayer for more than 1 year, and”. - § 1042(c)(4): Pub. L. 99–514, § 1854(a)(5)(A), amended par. (4) generally. Prior to amendment, par. (4) read as follows: “The term ‘qualified replacement property’ means any securities (as defined in section 165(g)(2)) issued by a domestic corporation which does not, for the taxable year in which such stock is issued, have passive investment income (as defined in section 1362(d)(3)(D)) that exceeds 25 percent of the gross receipts of such corporation for such taxable year.” - § 1042(c)(5): Pub. L. 99–514, § 1854(a)(10), substituted “sold” for “acquired” in heading, and in text substituted “sale of securities” for “acquisition of securities” and inserted “to an employee stock ownership plan or eligible worker-owned cooperative”. - § 1042(c)(7): Pub. L. 99–514, § 1854(a)(6)(A), added par. (7). - § 1042(d): Pub. L. 99–514, § 1854(a)(7), inserted last sentence. - § 1042(e), § 1042(f): Pub. L. 99–514, § 1854(a)(8)(A), added subsec. (e) and redesignated former subsec. (e) as (f). ## § 1059: Corporate shareholder’s basis in stock reduced by nontaxed portion of extraordinary dividends - § 1059(a): Pub. L. 99–514, § 614(a)(1), amended subsec. (a) generally. Prior to amendment, subsec. (a) read as follows: “If any corporation— - § 1059(c)(1): Pub. L. 99–514, § 614(c)(2), struck out “(determined without regard to this section)” after “such share of stock”. - § 1059(c)(4): Pub. L. 99–514, § 614(b), added par. (4). - § 1059(d)(1): Pub. L. 99–514, § 614(c)(1), amended par. (1) generally. Prior to amendment, par. (1) read as follows: “Any reduction in basis under subsection (a) by reason of any distribution which is an extraordinary dividend shall occur at the beginning of the ex-dividend date for such distribution.” - § 1059(d)(3): Pub. L. 99–514, § 614(a)(3), substituted “2 years” for “1 year”. - § 1059(d)(6): Pub. L. 99–514, § 614(a)(2), added par. (6). - § 1059(d): Pub. L. 99–514, § 614(d), added par. (7). - § 1059(e), § 1059(f): Pub. L. 99–514, § 614(e), added subsec. (e) and redesignated former subsec. (e) as (f). ## § 1059A: Limitation on taxpayer’s basis or inventory cost in property imported from related persons - Enacted 26 U.S.C. § 1059A. ## § 1060: Special allocation rules for certain asset acquisitions - Enacted 26 U.S.C. § 1060. ## § 1063: Cross references - § 1063: Pub. L. 99–514, § 641(a), renumbered section 1060 of this title as this section. - § 1063(1), § 1063(2): Pub. L. 99–514, § 1899A(27), which directed the amendment of pars. (1) and (2) of section 1060 by substituting “46 U.S.C. App.” for “46 U.S.C.” was executed to section 1061 to reflect the probable intent of Congress in view of the renumbering of section 1060 as 1061 by section 641(a) of Pub. L. 99–514. ## § 1092: Straddles - § 1092(c)(4)(E): Pub. L. 99–514, § 331(a), in cl. (i), inserted “or the stock is disposed of at a loss”, in cl. (ii), substituted “or gains on such options are” for “is”, and in cl. (iii), inserted “or option” and “or the disposition of such stock”. - § 1092(d)(3)(A): Pub. L. 99–514, § 1808(c), inserted at end “The preceding sentence shall not apply to any interest in stock.” - § 1092(d)(5), § 1092(d)(6): Pub. L. 99–514, § 1899A(66), amended directory language of section 101(b)(2) of Pub. L. 98–369 to clarify general amendment by sections 101(d) and 102(e) of Pub. L. 98–369. See 1984 Amendment notes below. - § 1092(d)(7): Pub. L. 99–514, § 1261(b), added par. (7). ## § 1211: Limitation on capital losses - § 1211(b): Pub. L. 99–514 amended subsec. (b) generally, substituting present provisions for provisions which had declared in: par. (1), general rule for limitation on capital losses for taxpayer other than corporation; in par. (2), meaning of term “applicable amount”; and in par. (3), rule relating to computation of taxable income. ## § 1212: Capital loss carrybacks and carryovers - § 1212(b)(2): Pub. L. 99–514, § 301(b)(11), amended par. (2) generally. Prior to amendment, par. (2), special rules, read as follows: - § 1212(c)(6)(B), § 1212(c)(7)(A): Pub. L. 99–514, § 1899A(67), amended directory language of Pub. L. 98–369, § 102(e)(3)(C), resulting in amendment of subsec. (c)(6)(B). See 1984 Amendment note below. ## § 1239: Gain from sale of depreciable property between certain related taxpayers - § 1239(b)(1): Pub. L. 99–514, § 642(a)(1)(A), substituted “controlled entities” for “80-percent owned entities”. - § 1239(c): Pub. L. 99–514, § 642(a)(1)(B), (C), in heading, substituted “Controlled entity” for “80-percent owned entity”, in par. (1), in introductory provisions, substituted “controlled entity” for “80-percent owned entity”, in subpar. (A), substituted “more than 50 percent of the value” for “80 percent or more in value”, in subpar. (B), substituted “more than 50 percent” for “80 percent or more”, and added subpar. (C), and amended par. (2) generally. Prior to amendment, par. (2) read as follows: “For purposes of subparagraphs (A) and (B) of paragraph (1), the principles of section 318 shall apply, except that— ## § 1245: Gain from dispositions of certain depreciable property - § 1245(a)(1): Pub. L. 99–514, § 201(d)(11)(A), struck out “during a taxable year beginning after December 31, 1962, or section 1245 recovery property is disposed of after December 31, 1980,” after “if section 1245 property is disposed of”. - § 1245(a)(2): Pub. L. 99–514, § 201(d)(11)(B), amended par. (2) generally, restating former subpars. (A) to (E) and concluding provisions as subpars. (A) to (C). - § 1245(a)(3): Pub. L. 99–514, § 201(d)(11)(C), redesignated subpars. (D), (E), and (F) as (C), (D), and (E), respectively, and struck out former subpar. (C) which read as follows: “an elevator or an escalator”. - § 1245(a): Pub. L. 99–514, § 201(d)(11)(D), struck out par. (5) which defined “section 1245 recovery property” and par. (6) which provided special rule for qualified leased property. ## § 1248: Gain from certain sales or exchanges of stock in certain foreign corporations - § 1248(d)(6): Pub. L. 99–514, § 1876(a)(2), amended par. (6) generally. Prior to amendment, par. (6) read as follows: “Earnings and profits of the foreign corporation attributable to foreign trade income (within the meaning of section 923(b)) of a FSC.” - § 1248(e): Pub. L. 99–514, § 631(d)(2)(A), substituted “Except as provided in regulations” for “Under regulations”. - § 1248(f): Pub. L. 99–514, § 631(d)(2)(B), inserted “Except as provided in regulations prescribed by the Secretary—” after heading. - § 1248(g): Pub. L. 99–514, § 1875(g)(1), inserted “or” at end of par. (1), redesignated par. (3) as (2), and struck out former par. (2) which read as follows: “gain realized on exchanges to which section 356 (relating to receipt of additional consideration in certain reorganizations) applies; or”. - § 1248(i)(1)(B): Pub. L. 99–514, § 1810(i)(1), substituted “in redemption or liquidation (whichever is appropriate)” for “in redemption of his stock”. ## § 1250: Gain from dispositions of certain depreciable realty - § 1250(b)(3): Pub. L. 99–514 inserted “(as in effect before its repeal by the Tax Reform Act of 1986)” after “185”. ## § 1252: Gain from disposition of farm land - § 1252(a)(1)(A): Pub. L. 99–514 substituted “(as in effect on the day before the date of the enactment of the Tax Reform Act of 1986)” for “(relating to expenditures by farmers for clearing land)”. ## § 1254: Gain from disposition of interest in oil, gas, geothermal, or other mineral properties - § 1254: Pub. L. 99–514 amended section generally, substituting “geothermal, or other mineral properties” for “or geothermal property” in section catchline, revising and restating subsec. (a), pars. (1) to (4) as pars. (1) to (3), and reenacting subsec. (b) without change except for substituting “rule of subsection (g)” for “rules of subsection (g)” in par. (1). ## § 1255: Gain from disposition of section 126 property - § 1255(b)(2): Pub. L. 99–514, § 511(d)(2)(A), as amended by Pub. L. 100–647, struck out “163(d),” after “sections”. - § 1255(b)(2): Pub. L. 99–514, § 631(e)(14), struck out “453B(d)(2)” after “341(e)(12),”. ## § 1256: Section 1256 contracts marked to market - § 1256(e)(4), § 1256(e): Pub. L. 99–514 redesignated par. (5) as (4) and struck out former par. (4), special rule for banks, which read as follows: “In the case of a bank (as defined in section 581), subparagraph (A) of paragraph (2) shall be applied without regard to clause (i) or (ii) thereof.” ## § 1257: Disposition of converted wetlands or highly erodible croplands - Enacted 26 U.S.C. § 1257. ## § 1271: Treatment of amounts received on retirement or sale or exchange of debt instruments - § 1271(a)(3)(B): Pub. L. 99–514, § 1803(a)(3), amended subpar. (B) generally. Prior to amendment, subpar. (B) read as follows: “For purposes of this paragraph, the term ‘short-term Government obligation’ means any 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 which is— - § 1271(a)(3)(D): Pub. L. 99–514, § 1803(a)(2)(B), inserted “except as provided in subparagraph (E),”. - § 1271(a)(3)(E): Pub. L. 99–514, § 1803(a)(2)(A), added subpar. (E). - § 1271(a)(4): Pub. L. 99–514, § 1803(a)(1)(A), added par. (4). ## § 1272: Current inclusion in income of original issue discount - § 1272(a)(6), § 1272(a)(7): Pub. L. 99–514 added par. (6) and redesignated former par. (6) as (7). ## § 1273: Determination of amount of original issue discount - § 1273(b)(3)(B): Pub. L. 99–514 amended subpar. (B) generally, designating existing provisions as cl. (i) and adding cl. (ii). ## § 1274: Determination of issue price in the case of certain debt instruments issued for property - § 1274(c)(3)(A): Pub. L. 99–514 substituted “for $1,000,000 or less” for “for less than $1,000,000” in heading of subsec. (c)(4)(A) as so designated prior to its redesignation as subsec. (c)(3)(A) by Pub. L. 99–121, § 101(a)(1)(D), see 1985 Amendment note below. ## § 1275: Other definitions and special rules - § 1275(a)(4), § 1275(a): Pub. L. 99–514 redesignated par. (4), relating to treatment of obligations distributed to corporations, as (5), and substituted “by corporations” for “to corporations” in heading. ## § 1276: Disposition gain representing accrued market discount treated as ordinary income - § 1276(a)(3): Pub. L. 99–514, § 1803(a)(13)(A)(i), added par. (3). Former par. (3) redesignated (4). - § 1276(a)(4): Pub. L. 99–514, § 1803(a)(13)(A)(i), (ii), redesignated par. (3) as (4) and substituted “under paragraph (1) or (3)” for “under paragraph (1)”. - § 1276(b): Pub. L. 99–514, § 1803(a)(13)(A)(iii), added undesignated par. at end relating to special rule where partial principal payments. - § 1276(c)(3): Pub. L. 99–514, § 631(e)(15), struck out reference to section 334(c). - § 1276(d)(1)(C): Pub. L. 99–514, § 1803(a)(5), added subpar. (C). - § 1276: Pub. L. 99–514, § 1899A(28), substituted “July 18, 1984” for “the date of the enactment of this section”. ## § 1277: Deferral of interest deduction allocable to accrued market discount - § 1277(b)(1)(C): Pub. L. 99–514, § 1899A(29), substituted “this paragraph” for “this paragaph”. - § 1277(b)(2)(C): Pub. L. 99–514, § 1899A(30), substituted “paragraph (1)” for “paragraph 1” in heading. - § 1277(c): Pub. L. 99–514, § 901(d)(4)(F), substituted “which is a bank (as defined in section 585(a)(2) or to which section 593 applies” for “to which section 585 or 593 applies”. - § 1277(c): Pub. L. 99–514, § 902(e)(2), substituted “section 265(a)(5)” for “section 265(5)”. - § 1277: Pub. L. 99–514, § 1899A(31), substituted “July 18, 1984” for “the date of the enactment of this section”. ## § 1278: Definitions and special rules - § 1278(a)(1)(B)(i): Pub. L. 99–514, § 1878(a), amended Pub. L. 98–369, § 1001(b), by adding a par. (24), effective as if included in Pub. L. 98–369. See 1984 Amendment note below. - § 1278(a)(1)(C): Pub. L. 99–514, § 1803(a)(6), added subpar. (C). - § 1278(a)(4): Pub. L. 99–514, § 1899A(32), substituted “means” for “means of” in introductory provisions. ## § 1281: Current inclusion in income of discount on certain short-term obligations - § 1281(a): Pub. L. 99–514, § 1803(a)(8), amended subsec. (a) generally, designating existing provisions as par. (1) and adding par. (2). - § 1281(b)(1)(F): Pub. L. 99–514, § 1803(a)(7), added subpar. (F). ## § 1282: Deferral of interest deduction allocable to accrued discount - § 1282(a): Pub. L. 99–514 amended subsec. (a) generally, designating existing provisions as par. (1) and adding par. (2). ## § 1283: Definitions and special rules - § 1283(d)(3): Pub. L. 99–514 substituted “paragraphs (3) and (4) of section 1271(a)” for “section 1271(a)(3)”. ## § 1286: Tax treatment of stripped bonds - § 1286(b)(1): Pub. L. 99–514, § 1803(a)(13)(B)(i), amended par. (1) generally, designating existing provisions as subpar. (A) and adding subpar. (B). - § 1286(b)(2): Pub. L. 99–514, § 1803(a)(13)(B)(ii), substituted “the amount included in gross income under paragraph (1)” for “the amount of the accrued interest described in paragraph (1)”. - § 1286(d): Pub. L. 99–514, § 1879(s)(1), amended subsec. (d) generally. Prior to amendment, subsec. (d) read as follows: “In the case of any tax-exempt obligation (as defined in section 1275(a)(3))— ## § 1291: Interest on tax deferral - Enacted 26 U.S.C. § 1291. ## § 1293: Current taxation of income from qualified electing funds - Enacted 26 U.S.C. § 1293. ## § 1294: Election to extend time for payment of tax on undistributed earnings - Enacted 26 U.S.C. § 1294. ## § 1295: Qualified electing fund - Enacted 26 U.S.C. § 1295. ## § 1297: Passive foreign investment company - Enacted 26 U.S.C. § 1297. ## § 1298: Special rules - Enacted 26 U.S.C. § 1298. ## § 1351: Treatment of recoveries of foreign expropriation losses - § 1351(d)(2): Pub. L. 99–514 substituted “relating to recovery of tax benefit items” for “relating to recovery of bad debts, etc.” ## § 1361: S corporation defined - § 1361(b)(2)(B): Pub. L. 99–514, § 901(d)(4)(G), substituted “which is a bank (as defined in section 585(a)(2)) or to which section 593 applies” for “to which section 585 or 593 applies”. - § 1361(d)(3): Pub. L. 99–514, § 1879(m)(1)(A), inserted at end “A substantially separate and independent share of a trust treated as a separate trust under section 663(c) shall be treated as a separate trust for purposes of this subsection and subsection (c).” ## § 1363: Effect of election on corporation - § 1363(a): Pub. L. 99–514, § 701(e)(4)(J), struck out “and in section 58(d)” after “this subchapter”. - § 1363(c)(2): Pub. L. 99–514, § 511(d)(2)(C), redesignated subpars. (B) and (C) as (A) and (B), respectively, and struck out former subpar. (A) which read as follows: “section 163(d) (relating to limitation on interest on investment indebtedness),”. - § 1363: Pub. L. 99–514, § 632(b), amended subsec. (e) generally, substituting “reorganizations, etc.” for “complete liquidations and reorganizations”, in heading and in text struck out reference to property in complete liquidation of the corporation. ## § 1366: Pass-thru of items to shareholders - § 1366(f)(2): Pub. L. 99–514, § 632(c)(2), amended par. (2) generally. Prior to amendment, par. (2), reduction in pass-thru for tax imposed on capital gain, read as follows: “If any tax is imposed under section 1374 for any taxable year on an S corporation, for purposes of subsection (a)— - § 1366(f)(2): Pub. L. 99–514, § 701(e)(4)(K), struck out “56 or” before “1374”. ## § 1368: Distributions - § 1368(e)(1)(A): Pub. L. 99–514 inserted “and no adjustment shall be made for Federal taxes attributable to any taxable year in which the corporation was a C corporation” before period at end. ## § 1371: Coordination with subchapter C - § 1371(e)(1): Pub. L. 99–514, § 1899A(33), inserted “(within the meaning of section 1368(e))”. - § 1371(e)(2): Pub. L. 99–514, § 1899A(34), struck out “(within the meaning of section 1368(e))” after “to such election”. ## § 1374: Tax imposed on certain built-in gains - § 1374: Pub. L. 99–514 amended section generally, substituting provisions imposing tax on certain built-in gains for provisions imposing tax on certain capital gains which had declared in: subsec. (a), general rule for capital gains tax on S corporations; subsec. (b), amount of tax; subsec. (c), general rule as to exceptions from subsec. (a) in par. (1), exception as to new corporations in par. (2), provisions relating to property with substituted basis in par. (3), and treatment of certain gains of options and commodities dealers in par. (4); and subsec. (d), determination of taxable income of corporation. ## § 1375: Tax imposed when passive investment income of corporation having accumulated earnings and profits exceeds 25 percent of gross receipts - § 1375(b)(1)(B): Pub. L. 99–514 substituted “section 1374(d)(4)” for “section 1374(d)”. ## § 1378: Taxable year of S corporation - § 1378(a): Pub. L. 99–514, § 806(b)(1), amended subsec. (a) generally. Prior to amendment, subsec. (a) read as follows: “For purposes of this subtitle— - § 1378(b): Pub. L. 99–514, § 806(b)(2), inserted at end “For purposes of paragraph (2), any deferral of income to shareholders shall not be treated as a business purpose.” - § 1378: Pub. L. 99–514, § 806(b)(3), struck out subsec. (c) which required existing S corporations to use permitted year after 50-percent shift in ownership. ## § 1398: Rules relating to individuals’ title 11 cases - § 1398(c): Pub. L. 99–514, § 104(b)(14)(A), substituted “basic standard deduction” for “zero bracket amount” in heading. - § 1398(c)(3): Pub. L. 99–514, § 104(b)(14)(B), amended par. (3) generally, substituting “Basic standard deduction” for “Amount of zero bracket amount” in heading and substituting “In the case of an estate which does not itemize deductions, the basic standard deduction for the estate” for “The amount of the estate’s zero bracket amount” in text. - § 1398(d)(2)(B): Pub. L. 99–514, § 1301(j)(8), substituted “section 7703” for “section 143”. - § 1398(g)(3): Pub. L. 99–514, § 1812(a)(5), amended par. (3) generally. Prior to amendment, par. (3), recovery exclusion, read as follows: “Any recovery exclusion under section 111 (relating to recovery of bad debts, prior taxes, and delinquency amounts).” ## § 1402: Definitions - § 1402(a)(8): Pub. L. 99–514, § 1272(d)(8), inserted “and” after “of the employer),” and struck out “and section 931 (relating to income from sources within possessions of the United States)” after “living abroad)”. - § 1402(a)(9): Pub. L. 99–514, § 1272(d)(9), amended par. (9) generally. Prior to amendment, par. (9) read as follows: “the term ‘possession of the United States’ as used in sections 931 (relating to income from sources within possessions of the United States) and 932 (relating to citizens of possessions of the United States) shall be deemed not to include the Virgin Islands, Guam, or American Samoa;”. - § 1402(a)(14): Pub. L. 99–514, § 1882(b)(1)(B)(i), amended par. (14) generally. Prior to amendment, par. (14) read as follows: “with respect to remuneration for services which are treated as services in a trade or business under subsection (c)(2)(G)— - § 1402(b): Pub. L. 99–514, § 1882(b)(1)(B)(ii), (iii), substituted “paragraph” for “clause” in second sentence and inserted at end “In the case of church employee income, the special rules of subsection (j)(2) shall apply for purposes of paragraph (2).” - § 1402(c)(2)(G): Pub. L. 99–514, § 1883(a)(11)(A), realigned margin of subpar. (G). - § 1402(e)(1): Pub. L. 99–514, § 1704(a)(1), (2)(A), substituted “Subject to paragraph (2), any individual” for “Any individual” and inserted “and, in the case of an individual described in subparagraph (A), that he has informed the ordaining, commissioning, or licensing body of the church or order that he is opposed to such insurance”. - § 1402(e)(2), § 1402(e)(3), § 1402(e)(4): Pub. L. 99–514, § 1704(a)(2)(B), (C), added par. (2) and redesignated former pars. (2) and (3) as (3) and (4), respectively. - § 1402(g): Pub. L. 99–514, § 1882(a), added par. (5). - § 1402(i)(1): Pub. L. 99–514, § 301(b)(12), amended par. (1) generally. Prior to amendment, par. (1) read as follows: “In determining the net earnings from self-employment of any options dealer or commodities dealer— - § 1402(j): Pub. L. 99–514, § 1882(b)(1)(A), added subsec. (j). ## § 1441: Withholding of tax on nonresident aliens - § 1441(b): Pub. L. 99–514, § 123(b)(2), amended second sentence generally. Prior to amendment, second sentence read as follows: “The items of income referred to in subsection (a) from which tax shall be deducted and withheld at the rate of 14 percent are— - § 1441(c)(9): Pub. L. 99–514, § 1810(d)(3)(D), substituted “section 871(h)” for “871(h)(2)”. - § 1441(c)(10): Pub. L. 99–514, § 1214(c)(3), added par. (10). ## § 1442: Withholding of tax on foreign corporations - § 1442(a): Pub. L. 99–514, § 1810(d)(3)(E), substituted “871(h)” for “871(h)(2)”, “881(c)” for “881(c)(2)”, and “1441(c)(9)” for “1449(c)(9)”. - § 1442(c): Pub. L. 99–514, § 1273(b)(2)(B), amended subsec. (c) generally, substituting reference to “certain possessions corporations” for reference to “certain Guam and Virgin Islands corporations” in heading, and in text extending “foreign corporation” exception so as to not include corporation created or organized in Guam, American Samoa, Northern Mariana Islands, or the Virgin Islands, and striking out par. (2) which declared that par. (1) not apply to tax imposed in Guam, and par. (3) which referred to sections 934 and 943a for tax imposed in Virgin Islands. ## § 1445: Withholding of tax on dispositions of United States real property interests - § 1445(b)(3): Pub. L. 99–514, § 1810(f)(2), amended par. (3) generally, substituting “interests in corporation not United States real property interests” for “it is not a United States real property holding corporation” in heading, striking out the comma before “if the domestic corporation” in introductory provisions, inserting subpar. (A) designation and adding subpar. (B). - § 1445(d)(1)(A): Pub. L. 99–514, § 1810(f)(3)(B), substituted “paragraph (2)” for “paragraph (2)(A)”. - § 1445(d)(1)(B)(i): Pub. L. 99–514, § 1810(f)(3)(A), amended cl. (i) generally. Prior to amendment, cl. (i) read as follows: “any transferor’s agent, the transferor is a foreign corporation or such agent has actual knowledge that such affidavit is false, or”. - § 1445(e)(1): Pub. L. 99–514, § 311(b)(4), substituted “34 percent” for “28 percent”. - § 1445(e)(1): Pub. L. 99–514, § 1810(f)(4), amended par. (1) generally. Prior to amendment, par. (1) read as follows: “A domestic partnership, the trustee of a domestic trust, or the executor of a domestic estate shall be required to deduct and withhold under subsection (a) a tax equal to 10 percent of any amount of which such partnership, trustee, or executor has custody which is— - § 1445(e)(2): Pub. L. 99–514, § 311(b)(4), substituted “34 percent” for “28 percent”. - § 1445(e)(3): Pub. L. 99–514, § 1810(f)(5), inserted “The preceding sentence shall not apply if, as of the date of the distribution, interests in such corporation are not United States real property interests by reason of section 897(c)(1)(B).” - § 1445(e)(4): Pub. L. 99–514, § 1810(f)(6), substituted “section 897” for “section 897(g)”. - § 1445(e)(6): Pub. L. 99–514, § 1810(f)(8), inserted “and regulations for the application of this subsection in the case of payments through 1 or more entities”. ## § 1446: Withholding of tax on foreign partners’ share of effectively connected income - Enacted 26 U.S.C. § 1446. ## § 1503: Computation and payment of tax - § 1503(d): Pub. L. 99–514 added subsec. (d). ## § 1504: Definitions - § 1504(a)(4)(C): Pub. L. 99–514, § 1804(e)(1), amended subpar. (C) generally. Prior to amendment, subpar. (C) read as follows: “has redemption and liquidation rights which do not exceed the paid-in capital or par value represented by such stock (except for a reasonable redemption premium in excess of such paid-in capital or par value), and”. - § 1504(b)(2): Pub. L. 99–514, § 1024(c)(15), struck out “or 821” after “section 802”. - § 1504(b): Pub. L. 99–514, § 1804(e)(10), amended par. (7) generally. Prior to amendment, par. (7) read as follows: “A DISC or former DISC (as defined in section 992(a)).” - § 1504(c)(2)(A): Pub. L. 99–514, § 1899A(35), struck out “or 821” after “section 801”. - § 1504(c)(2)(A): Pub. L. 99–514, § 1024(c)(16), substituted “subsection (b)(2)) includes” for “subsection (b)(2) includes”. ## § 1561: Limitation on accumulated earnings credit in the case of certain controlled corporations - § 1561(a): Pub. L. 99–514 added par. (3), and in concluding provisions, substituted “amounts specified in paragraph (1) (and the amount specified in paragraph (3))” for “amounts specified in paragraph (1)” and inserted “In applying section 55(d)(3), the alternative minimum taxable income of all component members shall be taken into account and any decrease in the exemption amount shall be allocated to the component members in the same manner as under paragraph (3).” ## § 1563: Definitions and special rules - § 1563(b)(2)(D): Pub. L. 99–514 struck out “or section 821” after “section 801”. ## § 2013: Credit for tax on prior transfers - § 2013: Pub. L. 99–514 struck out subsec. (g) which provided for treatment of tax imposed on certain generation-skipping transfers. ## § 2032: Alternate valuation - § 2032(c)(2): Pub. L. 99–514 amended par. (2) generally. Prior to amendment, par. (2) read as follows: “the amount of the tax imposed by this chapter (reduced by credits allowable against such tax).” ## § 2032A: Valuation of certain farm, etc., real property - § 2032A(c)(7)(D): Pub. L. 99–514 substituted “section 151(c)(4)” for “section 151(e)(4)”. ## § 2039: Annuities - § 2039: Pub. L. 99–514, § 1852(e)(1), struck out subsec. (c) which provided an exclusion from gross estate of certain annuity interests created by community property laws. - § 2039: Pub. L. 99–514, § 1848(d), struck out “or a bond described in paragraph (3)” after “an annuity described in paragraph (2)” in concluding provisions as such provisions were applicable to obligations issued after Dec. 31, 1983, and prior to repeal of subsec. (e) by Pub. L. 98–369, § 525(a), see Effective Date of 1984 Amendment note below. ## § 2055: Transfers for public, charitable, and religious uses - § 2055(f), § 2055(g): Pub. L. 99–514 added subsec. (f) and redesignated former subsec. (f) as (g). ## § 2106: Taxable estate - § 2106(a)(2)(F)(ii): Pub. L. 99–514 substituted “section 2055(g)” for “section 2055(f)”. ## § 2503: Taxable gifts - § 2503(f): Pub. L. 99–514 added subsec. (f). ## § 2515: Treatment of generation-skipping transfer tax - Enacted 26 U.S.C. § 2515. ## § 2522: Charitable and similar gifts - § 2522(d), § 2522(e): Pub. L. 99–514 added subsec. (d) and redesignated former subsec. (d) as (e). ## § 2523: Gift to spouse - § 2523(f)(4)(A): Pub. L. 99–514 amended subpar. (A) generally. Prior to amendment, subpar. (A) read as follows: “An election under this subsection with respect to any property shall be made on or before the first April 15th after the calendar year in which the interest was transferred and shall be made in such manner as the Secretary shall by regulations prescribe.” ## § 2601: Tax imposed - § 2601: Pub. L. 99–514 amended section generally, substituting “(within the meaning of subchapter B)” for “in the amount determined under section 2602”. ## § 2602: Amount of tax - § 2602: Pub. L. 99–514 amended section generally, substituting provisions that amount of tax imposed by section 2601 is the taxable amount (determined under subchapter C), multiplied by the applicable rate (determined under subchapter E) for former provisions which set out in detail the calculations and formulae for determining amount of tax imposed by section 2601. ## § 2603: Liability for tax - § 2603: Pub. L. 99–514 amended section generally, substituting tax liability provisions consisting of language placing liability, under different circumstances, on the transferee, the trustee, or the transferor, the source of the tax, and a cross reference to section 2661 for former provisions which covered the question of liability for tax with language covering the trustee and the distributee, the limitation on personal liability of the trustee who relied on certain information furnished by the Secretary, the limitation on personal liability of distributee, and the lien on property transferred until the tax was paid in full or became unenforceable by reason of lapse of time. ## § 2611: Generation-skipping transfer defined - § 2611: Pub. L. 99–514 amended section generally, substituting provisions defining “generation-skipping transfers” and what that term does not include, for former provisions which defined “generation-skipping transfer”, “transfer”, and “generation-skipping trust”, contained provisions to be used in determining the ascertainment of generation, and provided for a generation-skipping trust equivalent. ## § 2612: Taxable termination; taxable distribution; direct skip - § 2612: Pub. L. 99–514 amended section generally, substituting provisions covering definition and application of “taxable termination”, “taxable distribution”, and “direct skip” for former provisions which indicated who the “deemed transferor” would be for purposes of this chapter and that, for purposes of determining the person deemed the transferor, a parent related to the grantor of a trust by blood or adoption was to be deemed more closely related than a parent related to a grantor by marriage. ## § 2613: Skip person and non-skip person defined - § 2613: Pub. L. 99–514 amended section generally, substituting definitions of “skip person” and “non-skip person” for former provisions which defined and applied the terms “taxable distribution”, “taxable termination”, “younger generation beneficiary”, and “related or subordinate trustee”. ## § 2621: Taxable amount in case of taxable distribution - § 2621: Pub. L. 99–514 amended section generally, substituting provisions relating to taxable amount in case of a taxable distribution for former provisions which related generally to administration of this chapter. See section 2661 of this title. ## § 2622: Taxable amount in case of taxable termination - § 2622: Pub. L. 99–514 amended section generally, substituting provisions relating to taxable amount in case of a taxable termination for former provisions which authorized the Secretary to promulgate regulations. See section 2663 of this title. ## § 2623: Taxable amount in case of direct skip - Enacted 26 U.S.C. § 2623. ## § 2624: Valuation - Enacted 26 U.S.C. § 2624. ## § 2631: GST exemption - Enacted 26 U.S.C. § 2631. ## § 2632: Special rules for allocation of GST exemption - Enacted 26 U.S.C. § 2632. ## § 2641: Applicable rate - Enacted 26 U.S.C. § 2641. ## § 2642: Inclusion ratio - Enacted 26 U.S.C. § 2642. ## § 2651: Generation assignment - Enacted 26 U.S.C. § 2651. ## § 2652: Other definitions - Enacted 26 U.S.C. § 2652. ## § 2653: Taxation of multiple skips - Enacted 26 U.S.C. § 2653. ## § 2654: Special rules - Enacted 26 U.S.C. § 2654. ## § 2661: Administration - Enacted 26 U.S.C. § 2661. ## § 2662: Return requirements - Enacted 26 U.S.C. § 2662. ## § 2663: Regulations - Enacted 26 U.S.C. § 2663. ## § 3121: Definitions - § 3121(a)(5)(C): Pub. L. 99–514, § 1108(g)(7), amended subpar. (C) generally. Prior to amendment, subpar. (C) read as follows: “under a simplified employee pension if, at the time of the payment, it is reasonable to believe that the employee will be entitled to a deduction under section 219(b)(2) for such payment,”. - § 3121(a)(5)(G): Pub. L. 99–514, § 1151(d)(2)(A), added subpar. (G). - § 3121(a)(8): Pub. L. 99–514, § 1883(a)(11)(B), realigned margin of subpar. (B). - § 3121(a)(20): Pub. L. 99–514, § 122(e)(1), inserted reference to section 74(c). - § 3121(u)(2)(B)(ii)(V): Pub. L. 99–514, § 1895(b)(18)(A), added subcl. (V). - § 3121(v)(2)(A)(ii): Pub. L. 99–514, § 1899A(38), substituted “forfeiture” for “forefeiture”. - § 3121(v)(3)(C): Pub. L. 99–514, § 1147(b), added subpar. (C). - § 3121(w)(1): Pub. L. 99–514, § 1899A(39), substituted “this chapter” for “chapter 21 of this Code” in first sentence. - § 3121(w)(2): Pub. L. 99–514, § 1882(c), substituted last three sentences for former last two sentences which read as follows: “The election may not be revoked by the church or organization, but shall be permanently revoked by the Secretary if such church or organization fails to furnish the information required under section 6051 to the Secretary for a period of 2 years or more with respect to remuneration paid for such services by such church or organization, and, upon request by the Secretary, fails to furnish all such previously unfurnished information for the period covered by the election. Such revocation shall apply retroactively to the beginning of the 2-year period for which the information was not furnished.” - § 3121(w)(2): Pub. L. 99–514, § 1899A(40), substituted “July 18, 1984” for “the date of the enactment of this subsection” in first sentence. ## § 3231: Definitions - § 3231(e)(5): Pub. L. 99–514, § 122(e)(2), inserted reference to section 74(c). - § 3231(e)(6), § 3231(e)(7): Pub. L. 99–514, § 1899A(41), redesignated par. (6), relating to amounts excludable under section 120, as (7). ## § 3301: Rate of tax - § 3301: Pub. L. 99–514 substituted “unemployment” for “unemployed”. ## § 3302: Credits against tax - § 3302(c)(2)(B): Pub. L. 99–514, § 1884(1), substituted “denominator” for second reference to “determination”, and in cl. (i) inserted “percent” after “2.7” and struck out “percent” after “is to be made”. - § 3302(f)(8)(A): Pub. L. 99–514, § 1884(2), substituted “1986” for “1987”. ## § 3304: Approval of State laws - § 3304(a)(6)(A)(iii): Pub. L. 99–514 struck out “and” at end. ## § 3306: Definitions - § 3306(b)(2)(A): Pub. L. 99–514, § 1899A(44), substituted “workmen’s compensation” for “workman’s compensation”. - § 3306(b)(5)(C): Pub. L. 99–514, § 1108(g)(8), added subpar. (C) and struck out former subpar. (C) which read as follows: “under a simplified employee pension if, at the time of the payment, it is reasonable to believe that the employee will be entitled to a deduction under section 219(b)(2) for such payment,”. - § 3306(b)(5)(G): Pub. L. 99–514, § 1151(d)(2)(B), added subpar. (G). - § 3306(b)(13): Pub. L. 99–514, § 1899A(45), substituted a semicolon for a comma. - § 3306(b)(16): Pub. L. 99–514, § 122(e)(3), inserted reference to section 74(c). - § 3306(o)(1)(A)(i): Pub. L. 99–514, § 1884(3), substituted “Migrant and Seasonal Agricultural Worker Protection Act” for “Farm Labor Contractor Registration Act of 1963”. ## § 3401: Definitions - § 3401(a)(8)(D): Pub. L. 99–514, § 1272(c), added subpar. (D). - § 3401(a)(20): Pub. L. 99–514, § 122(e)(4), inserted reference to section 74(c). ## § 3402: Income tax collected at source - § 3402(f)(1): Pub. L. 99–514, § 104(b)(15)(F), substituted “standard deduction” for “zero bracket” and “subparagraph (E)” for “subparagraph (G)” in last sentence. - § 3402(f)(1)(A): Pub. L. 99–514, § 104(b)(15)(B), inserted “unless he is an individual described in section 151(d)(2)” after “himself”. - § 3402(f)(1)(B): Pub. L. 99–514, § 104(b)(15)(A), redesignated subpar. (D) as (B) and struck out former subpar. (B) which read as follows: “one additional exemption for himself if, on the basis of facts existing at the beginning of such day, there may reasonably be expected to be allowable an exemption under section 151(c)(1) (relating to old age) for the taxable year under subtitle A in respect of which amounts deducted and withheld under this chapter in the calendar year in which such day falls are allowed as a credit;”. - § 3402(f)(1)(B): Pub. L. 99–514, § 104(b)(15)(C), which directed that “subparagraph (A) or (D)” be substituted for “subparagraph (A), (B), (C), or (F)” was executed by making the substitution for “subparagraph (A), (B), or (C)”, as the probable intent of Congress. - § 3402(f)(1)(C): Pub. L. 99–514, § 104(b)(15)(A), (D), redesignated subpar. (E) as (C), substituted “section 151(c)” for “section 151(e)”, and struck out former subpar. (C) which read as follows: “one additional exemption for himself if, on the basis of facts existing at the beginning of such day, there may reasonably be expected to be allowable an exemption under section 151(d)(1) (relating to the blind) for the taxable year under subtitle A in respect of which amounts deducted and withheld under this chapter in the calendar year in which such day falls are allowed as a credit;”. - § 3402(f)(1)(D): Pub. L. 99–514, § 104(b)(15)(A), redesignated subpar. (F) as (D). Former subpar. (D) redesignated (B). - § 3402(f)(1)(E): Pub. L. 99–514, § 104(b)(15)(A), (E), redesignated subpar. (G) as (E) and substituted “standard deduction” for “zero bracket”. Former subpar. (E) redesignated (C). - § 3402(f)(1)(E): Pub. L. 99–514, § 1301(j)(8), substituted “section 7703” for “section 143”. - § 3402(f)(1)(F), § 3402(f)(1): Pub. L. 99–514, § 104(b)(15)(A), redesignated subpars. (F) and (G) as (D) and (E), respectively. - § 3402(i)(1): Pub. L. 99–514, § 1581(b), struck out “or decreases” after “increases”. - § 3402(m)(3): Pub. L. 99–514, § 104(b)(15)(G), inserted “(including the additional standard deduction under section 63(c)(3) for the aged and blind)”. - § 3402(r): Pub. L. 99–514, § 1303(b)(4), struck out subsec. (r) which provided for extension of withholding to GSOC distributions. ## § 3405: Special rules for pensions, annuities, and certain other deferred income - § 3405(d)(1): Pub. L. 99–514, § 1102(e)(1), inserted last sentence for “For purposes of clause (ii), any distribution or payment from or under an individual retirement plan shall be treated as includible in gross income.” - § 3405(d)(1): Pub. L. 99–514, § 1875(c)(10), reenacted cl. (iii) relating to amounts subject to withholding under subchapter A of chapter 3 as cl. (iii) and reenacted cl. (iii) relating to distribution described in section 404(k)(2) as cl. (iv). - § 3405(d): Pub. L. 99–514, § 1234(b)(1), added par. (13). ## § 3406: Backup withholding - § 3406(b)(3)(E): Pub. L. 99–514, § 1523(b)(1), added subpar. (E). - § 3406(b)(6): Pub. L. 99–514, § 1899A(46), substituted “6041A(a)” for “6041(A)(a)” in heading. - § 3406(h)(5)(D): Pub. L. 99–514, § 1521(b), added subpar. (D). ## § 4041: Imposition of tax - § 4041(b): Pub. L. 99–514, § 422(a)(2), substituted “reduction in tax” for “exemption” in heading. - § 4041(b)(2)(A): Pub. L. 99–514, § 422(a)(1), amended subpar. (A) generally. Prior to amendment, subpar. (A) read as follows: “No tax shall be imposed by subsection (a) on any qualified methanol or ethanol fuel.” - § 4041(l): Pub. L. 99–514, § 1879(c)(1), amended par. (1) generally. Prior to amendment, par. (1) read as follows: - § 4041: Pub. L. 99–514, § 1702(a), added subsec. (n). ## § 4051: Imposition of tax on heavy trucks and trailers sold at retail - § 4051(d)(1): Pub. L. 99–514, § 1899A(47), substituted “July 18, 1984” for “the date of the enactment of the Tax Reform Act of 1984”. - § 4051(d): Pub. L. 99–514, § 1877(c), inserted at end “No tax shall be imposed by reason of this paragraph on any use or resale which occurs more than 6 years after the date of the first retail sale.” ## § 4064: Gas guzzler tax - § 4064(b)(1)(A)(ii): Pub. L. 99–514, § 1812(e)(1)(B)(i), substituted “unloaded gross vehicle weight” for “gross vehicle weight”. - § 4064(b)(5): Pub. L. 99–514, § 1812(e)(1)(B)(ii), amended par. (5) generally, designating existing provisions as subpar. (A), adding subpar. (A) heading, and adding subpar. (B). ## § 4081: Imposition of tax - § 4081: Pub. L. 99–514 amended section generally, substituting provisions imposing a tax on the removal or sale of gasoline by the refiner, importer, blender, or compounder thereof or the terminal operator for provisions imposing a tax on gasoline sold by the producer or importer thereof, or by any producer of gasoline. ## § 4082: Exemptions for diesel fuel and kerosene - § 4082(a): Pub. L. 99–514 amended subsec. (a) generally, substituting definitions of “gasoline” and “gasoline blended stocks” for definition of “producer”. - § 4082(b): Pub. L. 99–514 amended subsec. (b) generally, substituting provisions that certain use of gasoline be considered removal for provisions defining “gasoline”. - § 4082(c), § 4082(d), § 4082(e): Pub. L. 99–514, in amending section generally, struck out subsecs. (c) to (e) which defined “sales”, “wholesale distributor”, and “producer”, respectively. ## § 4083: Definitions; special rule; administrative authority - § 4083: Pub. L. 99–514 amended section generally. Prior to amendment, section 4083 “Exemption of sales to producer”, read as follows: “Under regulations prescribed by the Secretary the tax imposed by section 4081 shall not apply in the case of sales of gasoline to a producer of gasoline.” ## § 4101: Registration and bond - § 4101: Pub. L. 99–514 amended section generally, substituting “Registration and bond” for “Registration” in section catchline, designating existing provisions as subsec. (a), inserting subsec. (a) heading, and adding subsec. (b). ## § 4121: Imposition of tax - § 4121(b): Pub. L. 99–514 struck out “, in the case of sales during any calendar year beginning after December 31, 1985” after “subsection (a)”. ## § 4161: Imposition of tax - § 4161(b)(1)(B)(ii): Pub. L. 99–514 substituted a comma for the period at end. ## § 4162: Definitions; treatment of certain resales - § 4162(a)(6)(I): Pub. L. 99–514, § 1878(b), amended subpar. (I) generally, substituting “hook” for “hood”. - § 4162: Pub. L. 99–514, § 201(d)(7)(C), (12), made identical amendments, substituting “section 465(b)(3)(C)” for “section 168(e)(4)(D)”. ## § 4221: Certain tax-free sales - § 4221(a): Pub. L. 99–514, as amended by Pub. L. 99–499, § 521(d)(4)(B), in introductory text, inserted “or section 4081 (at the Highway Trust Fund financing rate)” after “section 4121” as the probable intent of Congress, notwithstanding directory language that the insertion be made before “section 4121”, and substituted “or 4071” for “4071, or 4081 (at the Highway Trust Fund financing rate)” in last sentence. ## § 4227: Cross reference - § 4227: Pub. L. 99–514 amended section generally, substituting “reference” for “references” in section catchline, struck out par. (1) designation, substituted “exception” for “exemption”, and struck out par. (2) relating to cross reference to credit for taxes on tires. ## § 4251: Imposition of tax - § 4251(b)(2): Pub. L. 99–514 inserted “1985,” after “1984,” in table. ## § 4261: Imposition of tax - § 4261(e)(1): Pub. L. 99–514, amended par. (1) generally. Prior to amendment, par. (1) read as follows: “transporting individuals, equipment, or supplies in— ## § 4701: Tax on issuer of registration-required obligation not in registered form - § 4701(b)(1): Pub. L. 99–514 substituted “section 149(a)” for “section 103(j)”. ## § 4940: Excise tax based on investment income - § 4940(c)(5): Pub. L. 99–514, § 1301(j), substituted “(relating to State and local bonds)” for “(relating to interest on certain governmental obligations)”. - § 4940: Pub. L. 99–514, § 1832, added subpar. (B) and struck out former subpar. (B) and concluding provision which read as follows: ## § 4941: Taxes on self-dealing - § 4941(d)(2)(B): Pub. L. 99–514, § 1812(b)(1), inserted “(determined without regard to section 7872)” after “without interest or other charge”. - § 4941(d)(2)(G)(i): Pub. L. 99–514, § 122(a)(2)(A), inserted “(without regard to paragraph (3) thereof)” after “section 74(b)”. ## § 4942: Taxes on failure to distribute income - § 4942(f)(2)(A): Pub. L. 99–514 substituted “(relating to State and local bonds)” for “(relating to interest on certain governmental obligations)”. ## § 4945: Taxes on taxable expenditures - § 4945(g)(2): Pub. L. 99–514 inserted “(without regard to paragraph (3) thereof)” after “section 74(b)”. ## § 4946: Definitions and special rules - § 4946(c)(5): Pub. L. 99–514 substituted “$20,000” for “$15,000”. ## § 4961: Abatement of second tier taxes where there is correction - § 4961(c)(1): Pub. L. 99–514 substituted “United States Claims Court” for “Court of Claims” in heading. ## § 4972: Tax on nondeductible contributions to qualified employer plans - Enacted 26 U.S.C. § 4972. ## § 4973: Tax on excess contributions to certain tax-favored accounts and annuities - § 4973(b): Pub. L. 99–514, § 1102(b)(1), inserted at end “For purposes of paragraphs (1)(B) and (2)(C), the amount allowable as a deduction under section 219 (after application of section 408(o)(2)(B)(ii)) shall be increased by the nondeductible limit under section 408(o)(2)(B).” - § 4973(b): Pub. L. 99–514, § 1848(f), in introductory provisions, substituted “or individual retirement annuities” for “, individual retirement annuities, or bonds”, in par. (1)(A), substituted “(other than a rollover contribution described in section 402(a)(5), 402(a)(7), 403(a)(4), 403(b)(8), or 408(d)(3)), over” for “or bonds (other than a rollover contribution described in section 402(a)(5), 402(a)(7), 403(a)(4), 403(b)(8), 405(d)(3), or 408(d)(3)), over”, and in par. (2)(A), struck out “or bonds” after “for the annuities”. ## § 4974: Excise tax on certain accumulations in qualified retirement plans - § 4974: Pub. L. 99–514, § 1121(a)(1), amended section generally, substituting provisions imposing an excise tax on certain accumulations in qualified retirement plans for provisions imposing an excise tax on certain accumulations in individual retirement accounts and annuities. - § 4974(a): Pub. L. 99–514, § 1852(a)(7)(B), substituted “section 408(a)(6) or 408(b)(3)” for “section 408(a)(6) or (7), or 408(b)(3) or (4)”. - § 4974(b): Pub. L. 99–514, § 1852(a)(7)(C), substituted “section 408(a)(6) or 408(b)(3)” for “section 408(a)(6) or (7) or 408(b)(3) or (4)”. ## § 4975: Tax on prohibited transactions - § 4975(d): Pub. L. 99–514, § 1899A(51), inserted a closing parenthesis after “and (12)” in second sentence. - § 4975(d)(1)(B): Pub. L. 99–514, § 1114(b)(15)(A), substituted “highly compensated employees (within the meaning of section 414(q))” for “highly compensated employees, officers, or shareholders”. - § 4975(e)(7): Pub. L. 99–514, § 1854(f)(3)(A), inserted “, section 409(o), and, if applicable, section 409(n)” in last sentence. ## § 4976: Taxes with respect to funded welfare benefit plans - § 4976(b): Pub. L. 99–514 amended subsec. (b) generally. Prior to amendment, subsec. (b) read as follows: “For purposes of subsection (a), the term ‘disqualified benefit’ means— ## § 4977: Tax on certain fringe benefits provided by an employer - § 4977(c)(2): Pub. L. 99–514, § 1853(c)(1), amended par. (2) generally. Prior to amendment, par. (2) read as follows: “as of January 1, 1984, substantially all of the employees of the employer were entitled to employee discounts or services provided by the employer in 1 line of business,”. - § 4977(f): Pub. L. 99–514, § 1853(c)(2), added subsec. (f). ## § 4978: Tax on certain dispositions by employee stock ownership plans and certain cooperatives - § 4978(a)(1): Pub. L. 99–514, § 1854(e)(1), substituted “than” for “then”. - § 4978(b)(1): Pub. L. 99–514, § 1854(e)(2), substituted “subsection (a)” for “paragraph (1)”. - § 4978(c): Pub. L. 99–514, § 1854(e)(3), substituted “section 1042(b)(3)” for “section 1042(a)(2)(B)”. - § 4978(d)(1)(C): Pub. L. 99–514, § 1854(e)(4), substituted “section 72(m)(7)” for “section 72(m)(5)”. - § 4978(d)(3): Pub. L. 99–514, § 1854(e)(7), added par. (3). - § 4978(e)(2): Pub. L. 99–514, § 1854(e)(5), substituted “section 1042(c)(1)” for “section 1042(b)(1)”. - § 4978(e)(3): Pub. L. 99–514, § 1854(e)(6), substituted “section 1042(c)(2)” for “section 1042(b)(1)”. ## § 4979: Tax on certain excess contributions - Enacted 26 U.S.C. § 4979. ## § 4979A: Tax on certain prohibited allocations of qualified securities - Enacted 26 U.S.C. § 4979A. - § 4979A(b)(1): Pub. L. 99–514, § 1172(b)(2)(A), inserted reference to section 2057. - § 4979A(c): Pub. L. 99–514, § 1172(b)(2)(B), inserted reference to section 2057(d). ## § 4980: Tax on reversion of qualified plan assets to employer - Enacted 26 U.S.C. § 4980. ## § 4981: Excise tax on undistributed income of real estate investment trusts - § 4981: Pub. L. 99–514 substituted “Excise tax on undistributed income of real estate investment trusts” for “Excise tax based on certain real estate investment trust taxable income not distributed during the taxable year” as section catchline and amended text generally. Prior to amendment text read as follows: “Effective with respect to taxable years beginning after December 31, 1979, there is hereby imposed on each real estate investment trust for the taxable year a tax equal to 3 percent of the amount (if any) by which 75 percent of the real estate investment trust taxable income (as defined in section 857(b)(2), but determined without regard to section 857(b)(2)(B), and by excluding any net capital gain for the taxable year) exceeds the amount of the dividends paid deduction (as defined in section 561, but computed without regard to capital gains dividends as defined in section 857(b)(3)(C) and without regard to any dividend paid after the close of the taxable year) for the taxable year. For purposes of the preceding sentence, the determination of the real estate investment trust taxable income shall be made by taking into account only the amount and character of the items of income and deduction as reported by such trust in its return for the taxable year.” ## § 4982: Excise tax on undistributed income of regulated investment companies - Enacted 26 U.S.C. § 4982. ## § 5061: Method of collecting tax - § 5061(e)(3): Pub. L. 99–514 added par. (3). ## § 5703: Liability for tax and method of payment - § 5703(b)(3): Pub. L. 99–514 inserted last sentence. ## § 6011: General requirement of return, statement, or list - § 6011(f): Pub. L. 99–514 substituted “subparts B and C” for “sections 6012 to 6019, inclusive”. ## § 6012: Persons required to make returns of income - § 6012(a)(1): Pub. L. 99–514, § 104(a)(1)(A), amended par. (1) generally. Prior to amendment, par. (1) read as follows: - § 6012(a): Pub. L. 99–514, § 104(a)(1)(B), substituted “not less than the sum of the exemption amount plus the basic standard deduction under section 63(c)(2)(D)” for “$2,700 or more”. - § 6012(d), § 6012(e): Pub. L. 99–514, § 1525(a), added subsec. (d) and redesignated former subsec. (d) as (e). ## § 6013: Joint returns of income tax by husband and wife - § 6013(b)(3)(A): Pub. L. 99–514, § 104(a)(2), struck out “(twice the exemption amount in case such spouse was 65 or over)” before “for such taxable year” in cls. (ii) and (iii), substituted “section 151(d)” for “section 151(f)” in concluding provisions, and inserted last sentence. - § 6013(f)(1): Pub. L. 99–514, § 1708(a)(3), substituted “such election may be made for any taxable year while an individual is in missing status” for “no such election may be made for any taxable year beginning after December 31, 1982”. ## § 6014: Income tax return—tax not computed by taxpayer - § 6014(a): Pub. L. 99–514, § 104(b)(16)(A), substituted “who is not described in section 6012(a)(1)(C)(i)” for “who does not have an unused zero bracket amount (determined under section 63(e))”. - § 6014(b)(4): Pub. L. 99–514, § 104(b)(16)(B), amended par. (4) generally, substituting “where the taxpayer claims a reduced standard deduction by reason of section 63(c)(5)” for “has an unused zero bracket amount”. ## § 6031: Return of partnership income - § 6031(b): Pub. L. 99–514, § 1501(c)(16), substituted “was required to be filed” for “was filed” and “required to be shown on such return” for “shown on such return”. - § 6031(b): Pub. L. 99–514, § 1811(b)(1)(A)(i), inserted “or who holds an interest in such partnership as a nominee for another person” after “who is a partner”. - § 6031(c): Pub. L. 99–514, § 1811(b)(1)(A)(ii), added subsec. (c). ## § 6033: Returns by exempt organizations - § 6033(e): Pub. L. 99–514 substituted “section 6652(c)” for “section 6652(d)”. ## § 6034: Returns by certain trusts - § 6034: Pub. L. 99–514 substituted “section 6652(c)” for “section 6652(d)”. ## § 6034A: Information to beneficiaries of estates and trusts - § 6034A(a): Pub. L. 99–514, § 1501(c)(15), in introductory provisions, substituted “required to file a return” for “making the return required to be filed” and “was required to be filed” for “was filed”, and in concluding provisions, substituted “required to be shown on such return” for “shown on such return”. - § 6034A(a): Pub. L. 99–514, § 1875(d)(3)(A)(i), (ii), designated existing provisions as subsec. (a), inserted heading “General rule”, and substituted “each beneficiary (or nominee thereof)” for “each beneficiary” in text. - § 6034A(b): Pub. L. 99–514, § 1875(d)(3)(A)(iii), added subsec. (b). ## § 6038: Information reporting with respect to certain foreign corporations and partnerships - § 6038(a)(1)(B): Pub. L. 99–514, § 1202(c)(1), amended subpar. (B) generally. Prior to amendment, subpar. (B) read as follows: “the accumulated profits (as defined in section 902(c)) of such foreign corporation, including the items of income (whether or not included in gross income under chapter 1), deductions (whether or not allowed in computing taxable income under chapter 1), and any other items taken into account in computing such accumulated profits;”. - § 6038(a)(1): Pub. L. 99–514, § 1245(b)(5), added subpar. (F). - § 6038(c)(4): Pub. L. 99–514, § 1202(c)(2), substituted “post-1986 undistributed earnings” for “accumulated profits in excess of income, war profits, and excess profits taxes”. ## § 6038A: Information with respect to certain foreign-owned corporations - § 6038A(b)(1): Pub. L. 99–514, § 1245(a), substituted “each person” for “each corporation” in introductory provisions and amended subpar. (A) generally, substituting “related party to the reporting corporation” for “member of the same controlled group as the reporting corporation”. - § 6038A(b)(2): Pub. L. 99–514, § 1245(b)(1), substituted “each person” for “each corporation”. - § 6038A(b): Pub. L. 99–514, § 1245(b)(2), (3), amended par. (3) generally, substituting “foreign person which is a related party to the reporting corporation, and” for “foreign corporation which is a member of the same controlled group as the reporting corporation.” - § 6038A(b): Pub. L. 99–514, § 1245(b)(3), added par. (4). - § 6038A(c)(2): Pub. L. 99–514, § 1245(b)(4), amended par. (2) generally. Prior to amendment, par. (2), controlled group, read as follows: “The term ‘controlled group’ means any controlled group of corporations within the meaning of section 1563(a); except that— ## § 6039C: Returns with respect to foreign persons holding direct investments in United States real property interests - § 6039C(d): Pub. L. 99–514 inserted “(and any person required to withhold tax under section 1445)” after “section 897(a)”. ## § 6039D: Returns and records with respect to certain fringe benefit plans - § 6039D(a)(6): Pub. L. 99–514, § 1151(h)(2), added par. (6). - § 6039D(c): Pub. L. 99–514, § 1151(h)(3), as amended by Pub. L. 100–647, § 1011B(a)(24), inserted at end “The Secretary may require returns under this subsection only from a representative group of employers.” - § 6039D(d): Pub. L. 99–514, § 1151(h)(1), amended subsec. (d) generally. Prior to amendment, par. (1) defined a specified fringe benefit plan as (A) any qualified group legal services plan (as defined in section 120), (B) any cafeteria plan (as defined in section 125), and (C) any educational assistance plan (as defined in section 127), and par. (2) defined “applicable exclusion” as meaning (A) section 120 in the case of a qualified legal group services plan, (B) section 125 in the case of a cafeteria plan, and (C) section 127 in the case of an educational assistance plan. - § 6039D(d): Pub. L. 99–514, § 1879(d)(1), in amending subsec. (d) generally, added subpars. (1)(A) and (2)(A). Former subpars. (1)(A) and (B) and (2)(A) and (B) were redesignated as subpars. (1)(B) and (C) and (2)(B) and (C), respectively. ## § 6039E: Information concerning resident status - Enacted 26 U.S.C. § 6039E. ## § 6041: Information at source - § 6041(a): Pub. L. 99–514, § 1523(b)(2), substituted “6049(a), or 6050N(a)” for “or 6049(a)”. - § 6041(d): Pub. L. 99–514, § 1501(c)(1), in amending subsec. (d) generally, substituted “information is required” for “information is furnished” in heading and, in text, substituted references to persons required to make returns for former references to persons making returns. ## § 6042: Returns regarding payments of dividends and corporate earnings and profits - § 6042(c): Pub. L. 99–514, in amending subsec. (c) generally, substituted “information is required” for “information is furnished” in heading and, in text, substituted references to persons required to make returns for former references to persons making returns and struck out provisions directing that no statement was required to be furnished to any person under this subsection if the aggregate amount of payments to such person as shown on the return made under subsec. (a)(1) was less than $10. ## § 6043: Liquidating, etc., transactions - § 6043(c): Pub. L. 99–514 substituted “section 6652(c)” for “section 6652(d)”. ## § 6044: Returns regarding payments of patronage dividends - § 6044(e): Pub. L. 99–514, in amending subsec. (e) generally, substituted “information is required” for “information is furnished” in heading and, in text, substituted references to persons required to make a return for former references to persons making a return and struck out provision directing that no statement was required if the aggregate amount of payments made to the person as shown on the return was less than $10. ## § 6045: Returns of brokers - § 6045(b): Pub. L. 99–514, § 1501(c)(4), in amending subsec. (c) generally, substituted references to persons required to make a return for former references to persons making a return. - § 6045(e): Pub. L. 99–514, § 1521(a), added subsec. (e). ## § 6047: Information relating to certain trusts and annuity plans - § 6047(e)(1): Pub. L. 99–514, § 1501(d)(1)(D), substituted “section 6652(e)” for “section 6652(f)”. - § 6047(e): Pub. L. 99–514, § 1848(e)(2), added par. (3). ## § 6049: Returns regarding payments of interest - § 6049(b)(5)(B)(iii): Pub. L. 99–514, § 1803(a)(14)(C), substituted “section 1273(a)” for “section 1232(b)(1)”. - § 6049(b)(5)(B)(iv): Pub. L. 99–514, § 1214(c)(4), added cl. (iv). - § 6049(c): Pub. L. 99–514, § 1501(c)(5), in amending subsec. (c) generally, substituted “information is required” for “information is furnished” in subsection heading and, in text, substituted references to persons required to make a return for former references to persons making a return and struck out provisions that no statement was required if the aggregate amount of payments to the person shown on the return was less than $10. - § 6049(d)(7): Pub. L. 99–514, § 674, added par. (7). ## § 6050A: Reporting requirements of certain fishing boat operators - § 6050A(b): Pub. L. 99–514 amended subsec. (b) generally. Prior to amendment, subsec. (b) read as follows: “Every person making a return under subsection (a) shall furnish to each person whose name is set forth in such return a written statement showing the information relating to such person contained in such return. The written statement required under the preceding sentence shall be furnished to the person on or before January 31 of the year following the calendar year for which the return under subsection (a) was made.” ## § 6050B: Returns relating to unemployment compensation - § 6050B(b): Pub. L. 99–514, in amending subsec. (b) generally, substituted references to persons required to make a return for former references to persons making a return and references to individuals whose names are required to be set forth for former references to individuals whose names are set forth, and struck out provision directing that no statement is required to be furnished to individuals if the aggregate amount of payments to such individual shown on the return is less than $10. ## § 6050E: State and local income tax refunds - § 6050E(b): Pub. L. 99–514, in amending subsec. (b) generally, substituted “information is required” for “information is furnished” in heading and, in text, substituted references to persons required to make a return for former references to persons making a return and references to persons whose name is required to be set forth for former references to persons whose name is set forth. ## § 6050F: Returns relating to social security benefits - § 6050F(b): Pub. L. 99–514, in amending subsec. (b) generally, substituted “information is required” for “information is furnished” in heading and, in text, substituted references to persons required to make a return for former references to persons making a return and references to persons whose name is required to be set forth for former references to persons whose name is set forth. ## § 6050G: Returns relating to certain railroad retirement benefits - § 6050G(b): Pub. L. 99–514, in amending subsec. (b) generally, substituted “information is required” for “information is furnished” in heading and, in text, substituted references to persons required to make a return for former references to persons making a return and references to persons whose name is required to be set forth for former references to persons whose name is set forth. ## § 6050H: Returns relating to mortgage interest received in trade or business from individuals - § 6050H(d): Pub. L. 99–514, § 1501(c)(11), in amending subsec. (d) generally, substituted “information is required” for “information is furnished” in heading and, in text, substituted references to persons required to make a return for former references to persons making a return and references to persons whose name is required to be set forth for former references to persons whose name is set forth. - § 6050H(g): Pub. L. 99–514, § 1811(a)(1), added subsec. (g). ## § 6050I: Returns relating to cash received in trade or business, etc. - § 6050I(e): Pub. L. 99–514 substituted “information is required” for “information is furnished” in heading and, in text, substituted references to persons required to make a return for former references to persons making a return and references to persons whose name is required to be set forth for former references to persons whose name is set forth. ## § 6050K: Returns relating to exchanges of certain partnership interests - § 6050K(b): Pub. L. 99–514, § 1501(c)(13), in amending subsec. (b) generally, substituted references to partnerships required to make a return for former references to partnerships making a return and references to persons whose name is required to be set forth for former references to persons whose name is set forth. - § 6050K(c)(2): Pub. L. 99–514, § 1811(b)(2), substituted “this section” for “this subsection”. ## § 6050M: Returns relating to persons receiving contracts from Federal executive agencies - Enacted 26 U.S.C. § 6050M. ## § 6050N: Returns regarding payments of royalties - Enacted 26 U.S.C. § 6050N. ## § 6051: Receipts for employees - § 6051(a)(8): Pub. L. 99–514 added par. (8). ## § 6052: Returns regarding payment of wages in the form of group-term life insurance - § 6052(b): Pub. L. 99–514, in amending subsec. (b) generally, substituted “information is required” for “information is furnished” in heading, and in text substituted reference to employers required to make a return for former reference to employers making a return and reference to employees whose name is required to be set forth for former reference to employees whose name is set forth. ## § 6057: Annual registration, etc. - § 6057(g): Pub. L. 99–514 substituted “section 6652(d)” for “section 6652(e)”. ## § 6058: Information required in connection with certain plans of deferred compensation - § 6058(f): Pub. L. 99–514 substituted “section 6652(e)” for “section 6652(f)”. ## § 6091: Place for filing returns or other documents - § 6091(b)(1)(B)(iii): Pub. L. 99–514, § 1272(d)(10), substituted “Guam, American Samoa, or the Northern Mariana Islands” for “possessions of the United States”. - § 6091(b)(6): Pub. L. 99–514, § 1879(r)(1), added par. (6). ## § 6103: Confidentiality and disclosure of returns and return information - § 6103(b)(5): Pub. L. 99–514, § 1568(a)(1), amended par. (5) generally. Prior to amendment, par. (5) read as follows: “The term ‘State’ means any of the 50 States, the District of Columbia, the Commonwealth of Puerto Rico, the Virgin Islands, the Canal Zone, Guam, American Samoa, the Commonwealth of the Northern Mariana Islands, and the Trust Territory of the Pacific Islands.” - § 6103(b)(10): Pub. L. 99–514, § 1568(a)(2), added par. (10). - § 6103(e)(1)(A): Pub. L. 99–514, § 1411(b), added cl. (iv). - § 6103(l)(7)(D)(v): Pub. L. 99–514, § 1899A(53), substituted “this title” for “this Code”. ## § 6109: Identifying numbers - § 6109(e): Pub. L. 99–514 added subsec. (e). ## § 6111: Disclosure of reportable transactions - § 6111(c)(2): Pub. L. 99–514, § 1531(a), substituted “350 percent” for “200 percent”. - § 6111(c)(3): Pub. L. 99–514, § 201(d)(13), substituted “section 465(b)(3)(C)” for “section 168(e)(4)”. - § 6111: Pub. L. 99–514, § 1899A(54), substituted “subparagraph” for “subpargraph”. ## § 6166: Extension of time for payment of estate tax where estate consists largely of interest in closely held business - § 6166(i), § 6166(j), § 6166(k): Pub. L. 99–514 added subsec. (i) and redesignated former subsecs. (i) and (j) as (j) and (k), respectively. ## § 6212: Notice of deficiency - § 6212(c)(2)(A): Pub. L. 99–514, § 104(b)(17), amended subpar. (A) generally, substituting “, see section 63(e)(3)” for “and zero bracket amount, see section 63(g)(5)”. - § 6212(d): Pub. L. 99–514, § 1562(a), added subsec. (d). ## § 6213: Restrictions applicable to deficiencies; petition to Tax Court - § 6213(h): Pub. L. 99–514 amended par. (4) generally. Prior to amendment, par. (4) read as follows: “For provision that this subchapter shall not apply in the case of computational adjustments attributable to partnership items, see section 6230(a).” ## § 6214: Determinations by Tax Court - § 6214(a): Pub. L. 99–514, § 1554(a), substituted “any addition to the tax” for “addition to the tax”. - § 6214(c): Pub. L. 99–514, § 1833, substituted “section 4963(b)” for “section 4962(b)”. - § 6214(e): Pub. L. 99–514, § 1511(c)(8), substituted “section 6621(c)(4)” for “section 6621(d)(4)”. ## § 6215: Assessment of deficiency found by Tax Court - § 6215(b): Pub. L. 99–514 redesignated par. (8) as (7) and struck out former par. (7) which read as follows: “For proration of deficiency to installments, see section 6152(c).” ## § 6323: Validity and priority against certain persons - § 6323(i)(3): Pub. L. 99–514 added par. (3). ## § 6332: Surrender of property subject to levy - § 6332(c): Pub. L. 99–514 substituted “the underpayment rate established under section 6621” for “an annual rate established under section 6621”. ## § 6334: Property exempt from levy - § 6334(a)(10): Pub. L. 99–514 added par. (10). ## § 6335: Sale of seized property - § 6335(e)(1): Pub. L. 99–514 amended par. (1) generally. Prior to amendment, par. (1) “Minimum price” read as follows: “Before the sale the Secretary shall determine a minimum price for which the property shall be sold, and if no person offers for such property at the sale the amount of the minimum price, the property shall be declared to be purchased at such price for the United States; otherwise the property shall be declared to be sold to the highest bidder. In determining the minimum price, the Secretary shall take into account the expense of making the levy and sale.” ## § 6343: Authority to release levy and return property - § 6343(c): Pub. L. 99–514 substituted “the overpayment rate established under section 6621” for “an annual rate established under section 6621”. ## § 6401: Amounts treated as overpayments - § 6401(b)(2): Pub. L. 99–514 inserted last sentence. ## § 6404: Abatements - § 6404(e): Pub. L. 99–514 added subsec. (e). ## § 6405: Reports of refunds and credits - § 6405(b), § 6405(c), § 6405: Pub. L. 99–514 redesignated subsecs. (c) to (e) as (b) to (d), respectively, and struck out former subsec. (b) which read as follows: “A report to Congress shall be made annually by such committee of such refunds and credits, including the names of all persons and corporations to whom amounts are credited or payments are made, together with the amounts credited or paid to each.” ## § 6411: Tentative carryback and refund adjustments - § 6411(a): Pub. L. 99–514, § 231(d)(3)(H), in introductory provisions, struck out “by a research credit carryback provided in section 30(g)(2)” after “carryback provided in section 39,”, “unused research credit,” after “net capital loss,”, “a research credit carryback or” after “with respect to any portion of”, and “(or, with respect to any portion of a business credit carryback attributable to a research credit carryback from a subsequent taxable year within a period of 12 months from the end of such subsequent taxable year)” after “such subsequent taxable year”, and in par. (1), struck out “unused research credit,” after “net capital loss,”. - § 6411(a): Pub. L. 99–514, § 1847(b)(10), substituted “unused research credit, or unused business credit” for “or unused business credit”. - § 6411(b): Pub. L. 99–514, § 231(d)(3)(H)(iv), struck out “unused research credit,” after “net capital loss,”, in two places. ## § 6421: Gasoline used for certain nonhighway purposes, used by local transit systems, or sold for certain exempt purposes - § 6421: Pub. L. 99–514, § 1703(c)(2)(D), substituted “, used by local transit systems, or sold for certain exempt purposes” for “or by local transmit systems” in section catchline. - § 6421(c): Pub. L. 99–514, § 1703(c)(1)(B), added subsec. (c). Former subsec. (c) redesignated (d). - § 6421(d): Pub. L. 99–514, § 1703(c)(1)(A), (2)(A), redesignated subsec. (c) as (d) and, in par. (1), substituted “not more than claim may be filed under subsection (b), and not more than one claim may be filed under subsection (c)” for “and not more than one claim may be filed under subsection (b)”. Former subsec. (d) redesignated (e). - § 6421(e): Pub. L. 99–514, § 1703(c)(1)(A), redesignated subsec. (d) as (e). Former subsec. (e) redesignated (f). - § 6421(f): Pub. L. 99–514, § 1703(c)(1)(A), (2)(B), redesignated subsec. (e) as (f), redesignated pars. (2) and (3) as (1) and (2), respectively, and struck out former par. (1) “Exempt sales” which read as follows: “No amount shall be payable under this section with respect to any gasoline which the Secretary determines was exempt from the tax imposed by section 4081. The amount which (but for this sentence) would be payable under this section with respect to any gasoline shall be reduced by any other amount which the Secretary determines is payable under this section, or is refundable under any provision of this title, to any person with respect to such gasoline.” Former subsec. (f) redesignated (g). - § 6421(g): Pub. L. 99–514, § 1703(c)(1)(A), redesignated subsec. (f) as (g). Former subsec. (g) redesignated (h). - § 6421(h): Pub. L. 99–514, § 1703(c)(1)(A), redesignated subsec. (g) as (h). Former subsec. (h) redesignated (i). - § 6421(i): Pub. L. 99–514, § 1703(c)(1)(A), redesignated subsec. (h), relating to effective date, as (i). ## § 6425: Adjustment of overpayment of estimated income tax by corporation - § 6425(c)(1)(A): Pub. L. 99–514 amended subpar. (A) generally, restating existing provisions as cl. (i) and adding cl. (ii). ## § 6427: Fuels not used for taxable purposes - § 6427(a): Pub. L. 99–514, § 1703(e)(2)(A), substituted “subsection (k)” for “subsection (j)”. - § 6427(b)(1): Pub. L. 99–514, § 1899A(55), substituted “otherwise provided in this subsection” for “provided in paragraph (2)”. - § 6427(b)(1): Pub. L. 99–514, § 1703(e)(2)(A), substituted “subsection (k)” for “subsection (j)”. - § 6427(b)(2)(A): Pub. L. 99–514, § 1877(b)(2), substituted “subparagraphs (B) and (C)” for “subparagraph (B)”. - § 6427(b)(2)(B): Pub. L. 99–514, § 1877(b)(1), added subpar. (B). Former subpar. (B) redesignated (C). - § 6427(b)(2)(C): Pub. L. 99–514, § 1877(b)(1), (3), redesignated subpar. (B) as (C) and substituted “Exception for certain intracity transportation” for “Exception” in heading. Former subpar. (C) redesignated (D). - § 6427(b)(2)(D): Pub. L. 99–514, § 1877(b)(1), redesignated former subpar. (C) as (D). - § 6427(c), § 6427(d), § 6427(e)(1): Pub. L. 99–514, § 1703(e)(2)(A), substituted “subsection (k)” for “subsection (j)”. - § 6427(e)(3): Pub. L. 99–514, § 422(b), substituted “September 30, 1988” for “September 30, 1985”. - § 6427(f): Pub. L. 99–514, § 1703(e)(2)(A), substituted “subsection (k)” for “subsection (j)”. - § 6427(g): Pub. L. 99–514, § 1899A(56), substituted “amount” for “anount”. - § 6427(g): Pub. L. 99–514, § 1703(e)(2)(A), substituted “subsection (k)” for “subsection (j)”. - § 6427(h): Pub. L. 99–514, § 1703(e)(1)(B), added subsec. (h). Former subsec. (h) redesignated (i). - § 6427(i): Pub. L. 99–514, § 1703(e)(1)(A), redesignated subsec. (h) as (i). Former subsec. (i) redesignated (j). - § 6427(i)(1): Pub. L. 99–514, § 1703(d)(1)(B)(i), (e)(2)(B), struck out “(f)” after “subsection (a), (b), (c), (d), (e),” and substituted “(g), or (h)” for “or (g)”. - § 6427(i)(2)(A): Pub. L. 99–514, § 1703(d)(1)(B)(ii), inserted “or” at end of cl. (i), struck out “or” at end of cl. (ii), and struck out cl. (iii) which read as follows: “$200 or more is payable under subsection (f),”. - § 6427(i)(2)(A)(i): Pub. L. 99–514, § 1703(e)(2)(C), substituted “(g), and (h)” for “and (g)”. - § 6427(i)(2)(B): Pub. L. 99–514, § 1703(d)(1)(B)(ii)(III), struck out “(or clauses)” after “referred to in the clause”. Notwithstanding directory language that the amendment be made to subpar. (A) of this par., the amendment was executed to subpar. (B), the only place in the section where “(or clauses)” appeared, to reflect the probable intent of Congress. - § 6427(i)(2)(B): Pub. L. 99–514, § 1703(d)(1)(B)(iii), struck out “or clause (iii)” after “If the requirements of clause (ii)”. Notwithstanding directory language that the amendment be made to subsec. (f)(2)(B) of this section, the amendment was executed to subsec. (i)(2)(B), the only place in the section where “or clause (iii)” appeared, to reflect the probable intent of Congress. - § 6427(i)(3): Pub. L. 99–514, § 1703(d)(1), added par. (3). - § 6427(j): Pub. L. 99–514, § 1703(e)(1)(A), redesignated subsec. (i) as (j). Former subsec. (j) redesignated (k). - § 6427(k): Pub. L. 99–514, § 1703(e)(1)(A), redesignated subsec. (j) as (k). Former subsec. (k) redesignated (l). - § 6427(k)(2): Pub. L. 99–514, § 1703(e)(2)(E), which directed the substitution of “(i)(2)” for “subsection (h)(2)” in subsec. (i)(2) (as so redesignated), was executed to subsec. (k)(2), the only place in the section where “subsection (h)(2)” appeared, to reflect the probable intent of Congress. See 1988 Amendment note above. - § 6427(k)(2): Pub. L. 99–514, § 1703(d)(1)(B)(iv), substituted “subsection (h)(2) or (h)(3)” for “subsection (h)(2)”. - § 6427(l): Pub. L. 99–514, § 1703(e)(1)(A), redesignated subsec. (k) as (l). Former subsec. (l) redesignated (m). - § 6427(m): Pub. L. 99–514, § 1703(e)(1)(A), redesignated subsec. (l) as (m). Former subsec. (m) redesignated (n). - § 6427(n): Pub. L. 99–514, § 1703(e)(1)(A), (2)(C), (D), redesignated subsec. (m) as (n) and substituted “(g), and (h)” for “and (g)” in heading and text. Former subsec. (n) redesignated (o). - § 6427(o): Pub. L. 99–514, § 1703(e)(1)(A), as amended by Pub. L. 99–499, § 521(c)(3)(B)(ii), redesignated subsec. (n), as added by Pub. L. 99–499, § 521(c)(3)(B)(i), as (o). Former subsec. (o) redesignated (p). - § 6427(p): Pub. L. 99–514, § 1703(e)(1)(A), as amended by Pub. L. 99–499, § 521(c)(3)(B)(ii), redesignated subsec. (o) as (p). ## § 6501: Limitations on assessment and collection - § 6501(c)(8): Pub. L. 99–514, § 1810(g)(3), substituted “exchange or distribution” for “exchange” in two places, and “subsection (a), (d), or (e)” for “subsection (a) or (d)”. - § 6501(k), § 6501(l), § 6501(m), § 6501(n), § 6501(o), § 6501(p): Pub. L. 99–514, § 1847(b)(12), inserted “(as amended by sections 211, 314, and 474 of this Act)” in directory language of section 163(b)(1) of Pub. L. 98–369, which resulted in no change in text but removed an ambiguity which had resulted from failure of directory language as originally enacted to indicate that amendments of this section by sections 211, 314, and 474 of Pub. L. 98–369 were to be executed before the amendment by section 163(b)(1) of Pub. L. 98–369. See 1984 Amendment notes below. - § 6501(k): Pub. L. 99–514, § 1847(b)(14), substituted “or a credit carryback (as defined in section 6511(d)(4)(C))” for “an investment credit carryback, or a work incentive program carryback, or a new employee credit carryback”. - § 6501(n), § 6501(o): Pub. L. 99–514, § 1847(b)(13), added subsec. (n) and redesignated former subsec. (n) as (o). ## § 6503: Suspension of running of period of limitation - § 6503(a)(1): Pub. L. 99–514, § 1875(d)(2)(B)(ii), substituted “section 6501 or 6502 (or section 6229, but only with respect to a deficiency described in section 6230(a)(2)(A)).” for “section 6501 or 6502”. - § 6503(j), § 6503(k): Pub. L. 99–514, § 1235(d), added subsec. (j) and redesignated former subsec. (j) as (k). ## § 6504: Cross references - § 6504(2): Pub. L. 99–514 amended par. (2) generally, substituting “where taxpayer and his spouse make separate returns, see section 63(e)(3)” for “and zero bracket amount where taxpayer and his spouse make separate returns, see section 63(g)(5)”. ## § 6511: Limitations on credit or refund - § 6511(d)(2)(B): Pub. L. 99–514, § 141(b)(3), amended subpar. (B) generally, restating cl. (i) as cls. (i), (ii), and (iii) and striking out former cl. (ii) which read as follows: “A claim for credit or refund for a computation year (as defined in section 1302(c)(1)) shall be determined to relate to an overpayment attributable to a net operating loss carryback or a capital loss carryback, as the case may be, when such carryback relates to any base period year (as defined in section 1302(c)(3)).” - § 6511(d)(4)(C): Pub. L. 99–514, § 231(d)(3)(I), as amended by Pub. L. 100–647, § 1018(u)(21), struck out “and any research credit carryback under section 30(g)(2)” after “under section 39”. - § 6511(h)(1): Pub. L. 99–514, § 1847(b)(15)(A), substituted “section 6501(m)(1)(B)” for “section 6501(q)(1)(B)”. - § 6511(h)(2): Pub. L. 99–514, § 1847(b)(15)(B), substituted “section 6501(m)(2)(B)” for “section 6501(q)(2)(B)”. ## § 6601: Interest on underpayment, nonpayment, or extensions of time for payment, of tax - § 6601(a): Pub. L. 99–514, § 1511(c)(11), substituted “the underpayment rate established under section 6621” for “an annual rate established under section 6621”. - § 6601(b)(2): Pub. L. 99–514, § 1404(c)(3), as amended by Pub. L. 100–647, § 1018(u)(42), substituted “6156(a) or 6158(a)” for “6152(a), 6156(a), or 6158(a)” in introductory provisions and “6156(b) or 6158(a)” for “6152(b), 6156(b), or 6158(a)” in subpar. (A). - § 6601(b)(4), § 6601(b): Pub. L. 99–514, § 1512(a), added par. (4) and redesignated former par. (4) as (5). - § 6601(c): Pub. L. 99–514, § 1564(a), inserted “and interest shall not be imposed during such period on any interest with respect to such deficiency for any prior period”. ## § 6602: Interest on erroneous refund recoverable by suit - § 6602: Pub. L. 99–514 substituted “the underpayment rate established under section 6621” for “an annual rate established under section 6621”. ## § 6611: Interest on overpayments - § 6611(a): Pub. L. 99–514 substituted “the overpayment rate established under section 6621” for “an annual rate established under section 6621”. ## § 6621: Determination of rate of interest - § 6621(a): Pub. L. 99–514, § 1511(a), added subsec. (a) and struck out former subsec. (a) which read as follows: “The annual rate established under this section shall be such adjusted rate as is established by the Secretary under subsection (b).” - § 6621(b): Pub. L. 99–514, § 1511(a), added subsec. (b) relating to determination of Federal short-term rate and struck out former subsec. (b) which related to interest rate adjustments and establishment of adjusted rates. - § 6621(c): Pub. L. 99–514, § 1511(a), (c)(1), redesignated subsec. (d) as (c), in par. (1), struck out “annual” before “rate of interest” and substituted “the underpayment rate established under this section” for “the adjusted rate established under subsection (b)”, and struck out former subsec. (c) definition of prime rate, which read as follows: “For purposes of subsection (b), the term ‘adjusted prime rate charged by banks’ means the average predominant prime rate quoted by commercial banks to large businesses, as determined by the Board of Governors of the Federal Reserve System.” - § 6621(c)(3)(A): Pub. L. 99–514, § 1535(a), added cl. (v). - § 6621(d): Pub. L. 99–514, § 1511(c)(1)(A), redesignated subsec. (d) as (c). ## § 6651: Failure to file tax return or to pay tax - § 6651(c)(1): Pub. L. 99–514, § 1502(b), amended par. (1) generally, striking out the designation “(A)” before “With respect to”, inserting “(or fraction thereof)”, and striking out subpar. (B) which read as follows: “With respect to any return, the maximum amount of the addition permitted under paragraph (3) of subsection (a) shall be reduced by the amount of the addition under paragraph (1) of subsection (a) (determined without regard to the last sentence of such subsection) which is attributable to the tax for which the notice and demand is made and which is not paid within 10 days of notice and demand.” - § 6651(d), § 6651(e): Pub. L. 99–514, § 1502(a), added subsec. (d) and redesignated former subsec. (d) as (e). ## § 6652: Failure to file certain information returns, registration statements, etc. - § 6652(a): Pub. L. 99–514, § 1501(d)(1)(A), redesignated subsec. (b) as (a), substituted “Returns with respect to certain payments aggregating less than $10” for “Other returns” in heading, and struck out former subsec. (a) which provided penalties for failure to file returns relating to information at source, payments of dividends, etc. and certain transfers of stock. - § 6652(a): Pub. L. 99–514, § 1811(c)(2), inserted “(other than by subsection (d) of such section)” in par. (3)(A)(ii). - § 6652(b), § 6652(c), § 6652(d), § 6652(e), § 6652(f): Pub. L. 99–514, § 1501(d)(1)(A)(i), redesignated subsecs. (c) to (f) as (b) to (e), respectively. Former subsec. (b) redesignated (a). - § 6652(g): Pub. L. 99–514, § 1501(d)(1)(A)(i), redesignated subsec. (h) as (g). Former subsec. (g) redesignated (f). - § 6652(g): Pub. L. 99–514, § 1810(f)(9)(C), struck out “etc.,” after “Returns” in heading. - § 6652(g): Pub. L. 99–514, § 1810(f)(9)(A), in amending par. (1) generally, struck out “(A)” after “In the case of each failure”, and struck out “(B) to furnish a statement required by section 6039C(b)(3),” before “on the date required”. - § 6652(g): Pub. L. 99–514, § 1810(f)(9)(B), in amending par. (3) generally, designated former subpar. (B) of par. (3) as the entire paragraph, struck out former subpar. (A) setting a limitation of $25,000 with respect to each subsection for failure to meet the requirements of subsection (a) or (b) of section 6039C, struck out former subpar. (B) heading “For failure to meet requirements of section 6039C(c)” and in text substituted “requirements of section 6039C” for “requirements of subsection (c) of section 6039C” and inserted “(A)” before “$25,000” and “(B)” before “5 percent”. - § 6652(h), § 6652(i): Pub. L. 99–514, § 1501(d)(1)(A)(i), redesignated subsecs. (i) and (j) as (h) and (i), respectively. Former subsec. (h) redesignated (g). - § 6652(j): Pub. L. 99–514, § 1702(b), added subsec. (j) relating to failure to give written notice to certain sellers of diesel fuel, and redesignated former subsec. (j), relating to alcohol and tobacco taxes, as (k). - § 6652(j): Pub. L. 99–514, § 1301(g), added subsec. (j) relating to failure to file certification with respect to certain residential projects. - § 6652(j): Pub. L. 99–514, § 1501(d)(1)(A)(i), redesignated subsec. (k), relating to alcohol and tobacco taxes, as (j). Former subsec. (j), relating to failure to give written explanation to recipients of certain qualifying rollover distributions, redesignated (i). Such subsec. (j), relating to alcohol and tobacco taxes, was subsequently redesignated as subsec. (k) by section 1301(g) of Pub. L. 99–514, and also by section 1702(b) of Pub. L. 99–514, both of which added a new subsec. (j), see above. - § 6652(k): Pub. L. 99–514, § 1501(d)(1)(A)(i), redesignated subsec. (k), relating to alcohol and tobacco taxes, as (j). Subsequently, such subsec. (j) was redesignated as subsec. (k) by section 1301(g) of Pub. L. 99–514, and also by section 1702(b) of Pub. L. 99–514. - § 6652(l), § 6652(m): Pub. L. 99–514, § 1151(b), directed the redesignation of a nonexistent subsec. (l) as (m), and added a new subsec. (l) relating to information with respect to includible employee benefits. ## § 6653: Failure to pay stamp tax - § 6653: Pub. L. 99–514, § 1503(d)(1), substituted “Additions to tax for negligence and fraud” for “Failure to pay tax” in section catchline. - § 6653: Pub. L. 99–514, § 1503(a), added subsec. (a) and struck out former subsec. (a) which added percentage to tax due for underpayment of taxes where negligence or intentional disregard of rules and regulations with respect to income, gift, or windfall profit taxes was involved, and also provided additional interest penalty for portion of underpayment attributable to negligence, etc. - § 6653: Pub. L. 99–514, § 1503(b), added subsec. (b) and struck out former subsec. (b) which added percentage to tax due for underpayment of taxes where fraud was involved, and also provided for additional interest penalty, but stated that there would be no negligence addition where there was addition for fraud, and concluded with special rule for joint returns. - § 6653: Pub. L. 99–514, § 1503(c)(2), substituted “portion of the underpayment which is attributable to fraud” for “same underpayment”. - § 6653: Pub. L. 99–514, § 1503(c)(3), struck out “or intentional disregard of rules and regulations (but without intent to defraud)” after “underpayment due to negligence”. - § 6653: Pub. L. 99–514, § 1503(b), amended subsec. (g) generally, substituting provisions relating to special rule for amounts shown on information returns for provisions relating to special rule in case of interest or dividend payments, and struck out provision that penalty was to apply only to portion of underpayment due to failure to include interest or dividend payment. ## § 6654: Failure by individual to pay estimated income tax - § 6654(a)(1): Pub. L. 99–514, § 1511(c)(14), substituted “the underpayment rate established under section 6621” for “the applicable annual rate established under section 6621”. - § 6654(d)(1)(B)(i): Pub. L. 99–514, § 1541(a), substituted “90 percent” for “80 percent” in two places. - § 6654(d)(2)(C)(ii): Pub. L. 99–514, § 1541(b)(1), in table of applicable percentages increased applicable percentages from “20” to “22.5”, from “40” to “45”, from “60” to “67.5”, and from “80” to “90”, respectively. - § 6654(i)(1)(C): Pub. L. 99–514, § 1541(b)(2), substituted “90 percent” for “80 percent”. - § 6654(j): Pub. L. 99–514, § 1841, added subsec. (j). Former subsec. (j) redesignated (k). - § 6654(j)(3)(B): Pub. L. 99–514, § 1541(b)(3), which directed the amendment of the table in subpar. (B) by substituting “45” for “40”, “65.5” for “60”, and “90” for “80”, could not be executed because the higher figures appear in the text as enacted by section 1841 of Pub. L. 99–514. - § 6654(k): Pub. L. 99–514, § 1841, redesignated former subsec. (j) as (k). Former subsec. (k) redesignated (l). - § 6654(l): Pub. L. 99–514, § 1404(a), as amended by Pub. L. 100–647, § 1014(d)(1), amended subsec. (l) generally. Prior to amendment, subsec. (l) read as follows: “This section shall not apply to any estate or trust.” - § 6654(l): Pub. L. 99–514, § 1841, redesignated subsec. (k) as (l). Former subsec. (l) redesignated (m). - § 6654(m): Pub. L. 99–514, § 1841, redesignated former subsec. (l) as (m). ## § 6655: Failure by corporation to pay estimated income tax - § 6655(a)(1): Pub. L. 99–514, § 1511(c)(15), substituted “the underpayment rate established under section 6621” for “the rate established under section 6621”. - § 6655(f): Pub. L. 99–514, § 701(d)(3), amended par. (1) generally, restating existing provisions in subpar. (A) and adding subpar. (B). ## § 6673: Sanctions and costs awarded by courts - § 6673: Pub. L. 99–514 substituted “, that the taxpayer’s position in such proceeding is frivolous or groundless, or that the taxpayer unreasonably failed to pursue available administrative remedies” for “or that the taxpayer’s position in such proceedings is frivolous or groundless”. ## § 6693: Failure to provide reports on certain tax-favored accounts or annuities; penalties relating to designated nondeductible contributions - § 6693: Pub. L. 99–514, § 1102(d)(2)(B), inserted “; overstatement of designated nondeductible contributions” in section catchline. - § 6693(b): Pub. L. 99–514, § 1102(d)(1), added subsec. (b). Former subsec. (b) redesignated (c). - § 6693(c): Pub. L. 99–514, § 1102(d)(1), (2)(A), redesignated former subsec. (b) as (c) and substituted “this section” for “subsection (a)”. ## § 6704: Failure to keep records necessary to meet reporting requirements under section 6047(d) - § 6704: Pub. L. 99–514 substituted “section 6047(d)” for “section 6047(e)” in section catchline and in subsec. (a). ## § 6707: Failure to furnish information regarding reportable transactions - § 6707(a)(2): Pub. L. 99–514, § 1532(a), amended par. (2) generally. Prior to amendment, par. (2) read as follows: “The penalty imposed under paragraph (1) with respect to any tax shelter shall be an amount equal to the greater of— - § 6707(b)(2): Pub. L. 99–514, § 1533(a), substituted “$250” for “$50”. ## § 6708: Failure to maintain lists of advisees with respect to reportable transactions - § 6708(a): Pub. L. 99–514 substituted “$100,000” for “$50,000”. ## § 6709: Penalties with respect to mortgage credit certificates ## § 6721: Failure to file correct information returns - Enacted 26 U.S.C. § 6721. ## § 6722: Failure to furnish correct payee statements - Enacted 26 U.S.C. § 6722. ## § 6723: Failure to comply with other information reporting requirements - Enacted 26 U.S.C. § 6723. ## § 6724: Waiver; definitions and special rules - Enacted 26 U.S.C. § 6724. ## § 7103: Cross references—Other provisions for bonds - § 7103(b)(4): Pub. L. 99–514 substituted “$100,000” for “$1,000”. ## § 7210: Failure to obey summons - § 7210: Pub. L. 99–514, as amended by Pub. L. 100–647, § 1017(c)(12), substituted “6427(j)(2)” for “6427(i)(2)”. ## § 7325: Personal property valued at $100,000 or less - § 7325: Pub. L. 99–514 substituted “$100,000” for “$2,500” in section catchline, introductory provisions, and par. (2), and substituted “$2,500” for “$250” in par. (3). ## § 7422: Civil actions for refund - § 7422(g)(1)(B): Pub. L. 99–514 substituted “section 4963” for “section 4962”. ## § 7425: Discharge of liens - § 7425(c)(4): Pub. L. 99–514 added par. (4). ## § 7426: Civil actions by persons other than taxpayers - § 7426(g): Pub. L. 99–514 substituted “the overpayment rate established under section 6621” for “an annual rate established under section 6621”. ## § 7430: Awarding of costs and certain fees - § 7430(a): Pub. L. 99–514, § 1551(f), inserted “(payable in the case of the Tax Court in the same manner as such an award by a district court)” in concluding provisions. - § 7430(b): Pub. L. 99–514, § 1551(a), (b), redesignated pars. (2) to (4) as (1) to (3), respectively, added par. (4), and struck out former par. (1), maximum dollar amount, which read as follows: “The amount of reasonable litigation costs which may be awarded under subsection (a) with respect to any prevailing party in any civil proceeding shall not exceed $25,000.” - § 7430(c)(1)(A): Pub. L. 99–514, § 1551(c), amended subpar. (A) generally. Prior to amendment, subpar. (A) read as follows: “The term ‘reasonable litigation costs’ includes— - § 7430(c)(2)(A): Pub. L. 99–514, § 1551(d), substituted “was not substantially justified” for “was unreasonable” in cl. (i), and added cl. (iii). - § 7430(c)(4): Pub. L. 99–514, § 1551(e), added par. (4). - § 7430(f): Pub. L. 99–514, § 1551(g), struck out subsec. (f), termination, which read as follows: “This section shall not apply to any proceeding commenced after December 31, 1985.” ## § 7443A: Special trial judges - Enacted 26 U.S.C. § 7443A. ## § 7447: Retirement - § 7447(a)(2), § 7447(a)(3), § 7447(a): Pub. L. 99–514, § 1557(d)(1), redesignated pars. (3) and (5) as (2) and (3), respectively, and struck out former par. (2) which read as follows: “The term ‘Civil Service Commission’ means the United States Civil Service Commission.” - § 7447(b)(2): Pub. L. 99–514, § 1557(a), amended par. (2) generally. Prior to amendment, par. (2) read as follows: “Any judge who has attained the age of 65 may retire any time after serving as judge for 15 years or more.” - § 7447(e): Pub. L. 99–514, § 1557(d)(2), substituted “Office of Personnel Management” for “Civil Service Commission” in par. (4) and in last sentence. - § 7447(f): Pub. L. 99–514, § 1557(b), amended subsec. (f) generally. Prior to amendment, subsec. (f), individuals receiving retired pay to be available for recall, read as follows: “Any individual who has elected to receive retired pay under subsection (d) who thereafter— - § 7447(g)(2)(C): Pub. L. 99–514, § 1557(d)(3), substituted “Office of Personnel Management” for “Civil Service Commission”. ## § 7448: Annuities to surviving spouses and dependent children of judges and special trial judges - § 7448(c): Pub. L. 99–514, § 1559(a)(1)(A), (2)(A), substituted “Survivors annuity fund” for “Salary deductions” in heading, inserted par. (1) designation and heading “Salary deductions” before existing text, realigned margin of text and substituted “3.5 percent” for “3 percent”, and added par. (2). - § 7448(d): Pub. L. 99–514, § 1559(a)(1)(B), substituted “3.5 percent” for second reference to “3 percent”. - § 7448(g): Pub. L. 99–514, § 1559(c), struck out “of service” after “Termination” in heading and inserted “or if any judge ceases to be married after making the election under subsection (b) and revokes (in a writing filed as provided in subsection (b)) such election” in text. - § 7448(h): Pub. L. 99–514, § 1559(a)(2)(B), substituted “subsection (c)(1)” for “subsection (c)” in introductory provisions. - § 7448(h): Pub. L. 99–514, § 1559(b)(1)(B), substituted “or such surviving spouse’s remarriage before attaining age 55” for “or remarriage” in second sentence. - § 7448(h)(2): Pub. L. 99–514, § 1559(b)(2)(A), substituted “the lesser of— - § 7448(h)(3): Pub. L. 99–514, § 1559(b)(2)(B), substituted “the lesser of— - § 7448(m): Pub. L. 99–514, § 1559(b)(1)(A), substituted “1.5 percent” for “1¼ percent” and “except that such annuity shall not exceed an amount equal to 50 percent of such average annual salary, nor be less than an amount equal to 25 percent of such average annual salary, and shall be further reduced in accordance with subsection (d) (if applicable)” for “but such annuity shall not exceed 40 percent of such average annual salary and shall be further reduced in accordance with subsection (d), if applicable”. - § 7448(m): Pub. L. 99–514, § 1557(c), inserted last sentence. ## § 7456: Administration of oaths and procurement of testimony - § 7456(c): Pub. L. 99–514, § 1556(b)(1), redesignated subsec. (e) as (c). Former subsec. (c), which provided for the appointment of special trial judges, was struck out. - § 7456(c): Pub. L. 99–514, § 1555(a), inserted last sentence. - § 7456: Pub. L. 99–514, § 1556(b)(1), struck out subsec. (d) which set out proceedings which could be assigned to special trial judges appointed under former subsec. (c). - § 7456: Pub. L. 99–514, § 1556(b)(1), redesignated subsec. (e) as (c). ## § 7471: Employees - § 7471(c): Pub. L. 99–514 substituted “subsections (d) and (e) of section 7443A” for “section 7456(c)”. ## § 7472: Expenditures - § 7472: Pub. L. 99–514 substituted “Except as provided in section 7475, all” for “All” in second sentence. ## § 7473: Disposition of fees - § 7473: Pub. L. 99–514 substituted “Except as provided in section 7475, all” for “All”. ## § 7475: Practice fee - Enacted 26 U.S.C. § 7475. ## § 7476: Declaratory judgments relating to qualification of certain retirement plans - § 7476(c): Pub. L. 99–514 substituted “plan, or” for “plan,, or”. ## § 7482: Courts of review - § 7482(a): Pub. L. 99–514, § 1558(a), (b), inserted par. (1) designation and heading “In general” before existing text and realigned its margin, and added par. (2). - § 7482(b)(1): Pub. L. 99–514, § 1810(g)(2), substituted “section 7428 or 7476” for “section 7428, 7476, or 7477” in last sentence. - § 7482(b)(1)(E): Pub. L. 99–514, § 1899A(60), substituted “partnership.” for “partnership,”. ## § 7502: Timely mailing treated as timely filing and paying - § 7502(e)(3): Pub. L. 99–514 substituted “any tax” for “the tax”. ## § 7508: Time for performing certain acts postponed by reason of service in combat zone or contingency operation - § 7508(b): Pub. L. 99–514 amended last sentence generally. Prior to amendment, last sentence read as follows: “The preceding sentence shall not cause this section to apply to any spouse for any taxable year beginning— ## § 7518: Tax incentives relating to merchant marine capital construction funds - Enacted 26 U.S.C. § 7518. ## § 7603: Service of summons - § 7603: Pub. L. 99–514, as amended by Pub. L. 100–647, § 1017(c)(12), substituted “6427(j)(2)” for “6427(i)(2)”. ## § 7604: Enforcement of summons - § 7604(b), § 7604(c)(2): Pub. L. 99–514, as amended by Pub. L. 100–647, § 1017(c)(12), substituted “6427(j)(2)” for “6427(i)(2)”. ## § 7605: Time and place of examination - § 7605(a): Pub. L. 99–514, as amended by Pub. L. 100–647, § 1017(c)(12), substituted “6427(j)(2)” for “6427(i)(2)” in two places. ## § 7609: Special procedures for third-party summonses - § 7609(a)(3): Pub. L. 99–514, § 656(a), added subpar. (H). - § 7609(c)(1): Pub. L. 99–514, § 1703(e)(2)(G), as amended by Pub. L. 100–647, § 1017(c)(12), substituted “6427(j)(2)” for “6427(i)(2)”. - § 7609(e): Pub. L. 99–514, § 1561(a), amended subsec. (e) generally, designating existing provisions as par. (1), inserting heading, and adding par. (2). - § 7609(i)(4): Pub. L. 99–514, § 1561(b), added par. (4). ## § 7610: Fees and costs for witnesses - § 7610(c): Pub. L. 99–514, as amended by Pub. L. 100–647, § 1017(c)(12), substituted “6427(j)(2)” for “6427(i)(2)”. ## § 7611: Restrictions on church tax inquiries and examinations - § 7611(a)(1)(B): Pub. L. 99–514, § 1899A(62), reenacted subpar. (B) without change. - § 7611(i): Pub. L. 99–514, § 1899A(61), redesignated pars. (A) to (E) as (1) to (5), in par. (3), substituted “etc.)” for “etc)”, and in par. (5), substituted “the title” for “the title”. ## § 7651: Administration and collection of taxes in possessions - § 7651: Pub. L. 99–514 amended subpar. (B) generally. Prior to amendment, subpar. (B) read as follows: “For purposes of this title (other than section 881(b)(1) or subpart C of part III of subchapter N of chapter 1), section 28(a) of the Revised Organic Act of the Virgin Islands shall be effective as if such section had been enacted subsequent to the enactment of this title.” ## § 7652: Shipments to the United States - § 7652(g): Pub. L. 99–514 added subsec. (g). ## § 7654: Coordination of United States and certain possession individual income taxes - § 7654: Pub. L. 99–514 amended section generally, substituting provisions relating to coordination of United States and certain possession individual income taxes for provisions relating to coordination of United States and Guam individual income taxes. ## § 7655: Cross references - § 7655(b): Pub. L. 99–514 added par. (1) and redesignated former pars. (1) and (2) as (2) and (3), respectively. ## § 7701: Definitions - § 7701(a)(17): Pub. L. 99–514, § 1842(d), inserted reference to section 2516. - § 7701(a)(19)(C)(xi): Pub. L. 99–514, § 671(b)(3), added cl. (xi). - § 7701(a)(20): Pub. L. 99–514, § 1166(a), inserted reference to section 125. - § 7701(a)(46): Pub. L. 99–514, § 1137, inserted last sentence. - § 7701(b)(1)(A): Pub. L. 99–514, § 1810(l)(2), substituted “the requirements of clause (i), (ii), or (iii)” for “the requirements of clause (i) or (ii)” in introductory provisions and added cl. (iii). - § 7701(b)(2)(A)(iv): Pub. L. 99–514, § 1810(l)(3), added cl. (iv). - § 7701(b)(4): Pub. L. 99–514, § 1810(l)(4), added par. (4). Former par. (4) redesignated (5). - § 7701(b)(5): Pub. L. 99–514, § 1810(l)(4), redesignated par. (4) as (5). Former par. (5) redesignated (6). - § 7701(b)(5)(A)(iv): Pub. L. 99–514, § 1810(l)(5)(A), which directed that cl. (iv) be added to subpar. (4)(A), was executed by adding cl. (iv) to subpar. (5)(A) to reflect the probable intent of Congress and the intervening redesignation of par. (4) as (5) by section 1810(l)(4) of Pub. L. 99–514. - § 7701(b)(5)(E)(i): Pub. L. 99–514, § 1810(l)(1), inserted last sentence. - § 7701(b)(5)(E)(i): Pub. L. 99–514, § 1899A(63), substituted “preceding” for “preceeding”. - § 7701(b)(6), § 7701(b)(7), § 7701(b)(8), § 7701(b)(9), § 7701(b)(10), § 7701(b)(11): Pub. L. 99–514, § 1810(l)(4), redesignated pars. (5) to (10) as pars. (6) to (11), respectively. - § 7701(e)(4)(A): Pub. L. 99–514, § 201(d)(14)(A), substituted “section 168(h)” for “section 168(j)”. - § 7701(e)(4)(A): Pub. L. 99–514, § 1802(a)(9)(C), inserted at end “For purposes of this paragraph, the term ‘related entity’ has the same meaning as when used in section 168(j).” - § 7701(e)(5): Pub. L. 99–514, § 201(d)(14)(B), as amended by Pub. L. 100–647, § 1002(a)(2), substituted “property described in clause (i), (ii), (iii), or (iv) of section 1250(a)(1)(B) (relating to low-income housing)” for “low-income housing (within the meaning of section 168(c)(2)(F))”. - § 7701(e)(5): Pub. L. 99–514, § 1899A(64), substituted “section 168(c)(2)(F))” for “section 168(C)(2)(F))”. - § 7701(h): Pub. L. 99–514, § 201(c), added subsec. (h). Former subsec. (h), relating to cross references, was successively redesignated as (i), (j), and (k). - § 7701(i): Pub. L. 99–514, § 673, added subsec. (i). Former subsec. (i), relating to cross references, as previously redesignated, was successively redesignated as (j) and (k). - § 7701(j): Pub. L. 99–514, § 1147(a), added subsec. (j). Former subsec. (j), relating to cross references, as previously redesignated, was redesignated as (k). - § 7701(k): Pub. L. 99–514, §§ 201(c), 673, 1147(a), successively redesignated subsec. (h), relating to cross references, as subsecs. (i), (j), and (k). ## § 7702: Life insurance contract defined - § 7702(b)(2)(C): Pub. L. 99–514, § 1825(a)(2), substituted “subparagraphs (A) and (D)” for “subparagraphs (A) and (C)”. - § 7702(e)(1): Pub. L. 99–514, § 1825(a)(3), inserted “(other than subsection (d))” after “section”. - § 7702(e)(1)(B): Pub. L. 99–514, § 1825(a)(1)(A), substituted “shall be deemed to be no earlier than” for “shall be no earlier than”. - § 7702(e)(1)(C): Pub. L. 99–514, § 1821(a)(1)(C), added subpar. (C). Former subpar. (C) redesignated (D). - § 7702(e)(1)(D): Pub. L. 99–514, § 1821(a)(1)(C), (D), redesignated subpar. (C) as (D) and substituted “the maturity date determined by taking into account subparagraph (B)” for “the maturity date described in subparagraph (B)”. - § 7702(e)(2)(C): Pub. L. 99–514, § 1825(a)(4), added subpar. (C). - § 7702(f)(1)(A): Pub. L. 99–514, § 1825(b)(2), substituted “less any excess premiums with respect to which there is a distribution described in subparagraph (B) or (E) of paragraph (7) and any other amounts received” for “less any other amounts received”. - § 7702(f)(7): Pub. L. 99–514, § 1825(b)(1), amended par. (7) generally. Prior to amendment, par. (7)(A), in general, read as follows: “In the event of a change in the future benefits or any qualified additional benefit (or in any other terms) under the contract which was not reflected in any previous determination made under this section, under regulations prescribed by the Secretary, there shall be proper adjustments in future determinations made under this section.”, and par. (7)(B), certain changes treated as exchange, read as follows: “In the case of any change which reduces the future benefits under the contract, such change shall be treated as an exchange of the contract for another contract.” - § 7702(g)(1)(B)(ii): Pub. L. 99–514, § 1825(c), amended cl. (ii) generally. Prior to amendment, cl. (ii) read as follows: “the amount of premiums paid under the contract during the taxable year reduced by any policyholder dividends received during such taxable year.” ## § 7703: Determination of marital status - Enacted 26 U.S.C. § 7703. ## § 7851: Applicability of revenue laws - § 7851(a)(7), § 7851(e): Pub. L. 99–514 substituted “Internal Revenue Code of 1986” for “Internal Revenue Code of 1954”. ## § 7871: Indian tribal governments treated as States for certain purposes - § 7871(a)(4): Pub. L. 99–514, § 1301(j)(6), substituted “(relating to State and local bonds)” for “(relating to interest on certain governmental obligations)”. - § 7871(a)(6): Pub. L. 99–514, § 123(b)(3), redesignated subpars. (C) to (E), as previously redesignated by section 112(b)(4) of Pub. L. 99–514, as (B) to (D), respectively, and struck out previously redesignated subpar. (B), which read as follows: “section 117(b)(2)(A) (relating to scholarships and fellowship grants),”. - § 7871(a)(6): Pub. L. 99–514, § 112(b)(4), redesignated subpars. (B) to (F) as (A) to (E), respectively, and struck out former subpar. (A) which read as follows: “section 24(c)(4) (defining State for purposes of credit for contribution to candidates for public offices),”. - § 7871(a)(6): Pub. L. 99–514, § 1878(i), made technical amendment to directory language of Pub. L. 98–369, § 1065(b). See 1984 Amendment note below. - § 7871(a)(6): Pub. L. 99–514, § 1899A(65), substituted “; and” for period at end. - § 7871(c)(2): Pub. L. 99–514, § 1301(j)(7), amended par. (2) generally. Prior to amendment, par. (2) read as follows: “Subsection (a) of section 103 shall not apply to any of the following issued by an Indian tribal government (or subdivision thereof): ## § 7872: Treatment of loans with below-market interest rates - § 7872(d)(1)(E)(i): Pub. L. 99–514, § 511(d)(1), substituted “section 163(d)(4)” for “section 163(d)(3)”. - § 7872(f)(2)(B): Pub. L. 99–514, § 1812(b)(4), inserted “, compounded semiannually” before the period at end. - § 7872(f)(5): Pub. L. 99–514, § 1812(b)(3), amended par. (5) generally. Prior to amendment, par. (5) read as follows: “The term ‘demand loan’ means any loan which is payable in full at any time on the demand of the lender. Such term also includes (for purposes other than determining the applicable Federal rate under paragraph (2)) any loan which is not transferable and the benefits of the interest arrangements of which is conditioned on the future performance of substantial services by an individual.” - § 7872(f)(9): Pub. L. 99–514, § 1812(b)(2), amended par. (9) generally, inserting the subpar. (A) designation and adding subpar. (B). - § 7872(f)(11): Pub. L. 99–514, § 1854(c)(2)(B), added par. (11) relating to special rule for certain employer security loans.