Page:United States Statutes at Large Volume 100 Part 3.djvu/305

 PUBLIC LAW 99-514-OCT. 22, 1986

100 STAT. 2113

cation (below the graduate level) at such organization (or another organization described in section 170(b)(l)(A)(ii)) of— "(A) such employee, or "(B) any person treated as an employee (or whose use is treated as an employee use) under the rules of section 132(f). "(3) REDUCTION MUST NOT DISCRIMINATE IN FAVOR OF HIGHLY

COMPENSATED, ETC.—Paragraph (1) shall apply with respect to any qualified tuition reduction provided with respect to any officer, owner, or highly compensated employee only if such reduction is available on substantially the same terms to each member of a group of employees which is defined under a reasonable classification set up by the employer which does not discriminate in favor of officers, owners, or highlv compensated employees (within the meaning of section 414(q)).' (b) TECHNICAL AMENDMENTS.—

(1) Subsection (a) of section 74 is amended by striking out "(relating to scholarship and fellowship grants)" and inserting in lieu thereof "(relating to qualified scholarships)". (2) The second sentence of section 1441(b) (relating to income items) is amended to 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 amounts which are received by a nonresident alien individual who is temporarily present in the United States as a nonimmigrant under subparagraph (F) or (J) of section 101(a)(15) of the Immigration and Nationality Act and which are incident to a qualified scholarship to which section 117(a) applies, but only to the extent such amounts are includible in gross income." (3) Paragraph (6) of section 7871(a) (relating to Indian tribal governments treated as States for certain purposes), as amended by section 112, is amended by striking out subparagraph (B) and by redesignating subparagraphs (C), (D), and (E) as subparagraphs (B), (C), and (D), respectively. (4) The table of sections for part III of subchapter B of chapter 1 is amended by striking out the item relating to section 117 and inserting in lieu thereof the following new item: "Sec. 117. Qualified scholarships."

Subtitle D—Provisions Related to Deductions SEC. 131. REPEAL OF DEDUCTION FOR 2-EARNER MARRIED COUPLES.

(a) GENERAL RULE.—Section 221 (relating to deduction for 2-earner married couples) is hereby repealed. (b) CONFORMING AMENDMENTS.—

(1) Section 62 is amended by striking out paragraph (16). (2) Subparagraph (A) of section 86(b)(2) is amended by striking out "sections 221," and inserting in lieu thereof "sections. (3) The table of sections for part VII of subchapter B of chapter 1 is amended by striking out the item relating to section 221. SEC. 132. 2-PERCENT FLOOR ON MISCELLANEOUS ITEMIZED DEDUCTIONS.

(a) GENERAL RULE.—Part I of subchapter B of chapter 1 (defining gross income, adjusted gross income, etc.) is amended by adding at the end thereof the following new section:

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