Par. 9. Sections 1.56A-0 through 1.56A-27 are added to read as follows:
(a) Overview. This section provides rules under section 56A(c)(8) of the Code for adjusting the AFSI of Alaska Native Corporations. Paragraph (b) of this section provides definitions that apply for purposes of this section. Paragraph (c) of this section provides rules for adjusting AFSI for cost recovery and depletion with respect to certain property held by an Alaska Native Corporation. Paragraph (d) of this section provides rules for adjusting AFSI for certain payments made by an Alaska Native Corporation. Paragraph (e) of this section provides the applicability date of this section.
(b) Definitions. For purposes of this section:
(1) Alaska Native Corporation. The term Alaska Native Corporation has the meaning provided in section 3 of the Alaska Native Claims Settlement Act (43 U.S.C. 1602(m)).
(2) ANCSA property. The term ANCSA property means property the basis of which is determined under 43 U.S.C. 1620(c).
(3) Specified payments. The term specified payments means amounts payable made pursuant to 43 U.S.C. 1606(i) or (j).
(c) Cost recovery and depletion. The AFSI of an Alaska Native Corporation is—
(1) Reduced by cost recovery and depletion attributable to ANCSA property (including cost recovery that occurs as part of the computation of gain or loss) upon the disposition of ANCSA property) to the extent of the amount recovered for regular tax purposes for the taxable year; and
(2) Adjusted to disregard any cost recovery and depletion attributable to ANCSA property (including cost recovery that occurs as part of the computation of gain or loss upon the disposition of ANCSA property) reflected in the FSI of the Alaska Native Corporation.
(d) Deduction for specified payments. The AFSI of an Alaska Native Corporation is—
(1) Reduced by deductions for specified payments to the extent of the amount allowed as deduction for regular tax purposes for the taxable year; and
(2) Adjusted to disregard expenses or other FSI reductions reflected in the Alaska Native Corporation's FSI with respect to specified payments.
(e) Applicability date. This section applies to taxable years ending after September 13, 2024.