Page:United States Statutes at Large Volume 100 Part 3.djvu/1013

 PUBLIC LAW 99-514—OCT. 22, 1986

100 STAT. 2821

(b)(3) or (f)(2)(C), the transferee shall be treated as having made the same election (or its equivalent)." (2) TREATMENT OF TERMINATIONS OF PARTNERSHIPS.—Subpara-

graph (B) of section 168(f)(10) is amended by adding at the end thereof the following new sentence: "Clause (i) shall not apply in the case of the termination of a partnership under section 708(b)(1)(B)." (3) EFFECTIVE DATE.—The amendments made by this subsection shall apply to property placed in service by the transferee after December 31, 1985, in taxable years ending after such date. (c) AMENDMENT RELATED TO SECTION 112 OF THE ACT.—Paragraph

(2) of section 453(i) (defining recapture income) is amended by striking out "section 1245 or 1250' and inserting in lieu thereof "section 1245 or 1250 (or so much of section 751 as relates to section 1245 or 1250)". (d) AMENDMENTS RELATED TO SECTION 113 OF THE ACT.— (1) TREATMENT OF FILMS, VIDEO TAPES, AND SOUND RECORD-

INGS.—Except with respect to property placed in service by the taxpayer on or before March 28, 1985, subsection (c) of section 167 (relating to limitations on use of certain methods and rates) is amended by adding at the end thereof the following new sentence: "Paragraphs (2), (3), and (4) of subsection (h) shall not apply to any motion picture film, video tape, or sound recording." (2) CLERICAL AMENDMENT.—Subsection (q) of section 48 is amended by redesignating the paragraph relating to special rule for qualified films as paragraph (7). (e) AMENDMENTS RELATED TO SECTION 114 OF THE ACT.—

(1) Paragraph (1) of section 48(b) (defining new section 38 property) is amended by adding at the end thereof the following new sentence: "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." (2) Paragraph (2) of section 480t)) (relating to special rule for sale-leasebacks) is amended— (A) by striking out "paragraph (1)" and inserting in lieu thereof "the first sentence of paragraph (1)", (B) by striking out "used under the lease" and inserting in lieu thereof "used under the leaseback (or lease) referred to in subparagraph (B)", (C) by adding at the end thereof the following new sentence: "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.", and (D) by striking out "3 months o f in subparagraph (B) and inserting in lieu thereof "3 months after". SEC. 1810. AMENDMENTS RELATED TO FOREIGN PROVISIONS. (a) AMENDMENTS RELATED TO SECTION 121 OF THE ACT.— (1) TREATMENT OF CERTAIN DOMESTICORPORATIONS.—

(A) IN GENERAL.—Subsection (g) of section 904 (relating to source rules in the case of United States-owned foreign corporations) is amended by redesignating paragraph (9) as

�