Page:United States Statutes at Large Volume 100 Part 3.djvu/308

 100 STAT. 2116

PUBLIC LAW 99-514—OCT. 22, 1986

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"(i) paragraph (1) (other than subparagraph (C) thereof) shall be applied separately with respect to each spouse, but "(ii) paragraph (1)(C) shall be applied with respect to their combined adjusted gross income. "(C) DETERMINATION OF MARITAL STATUS.—For purposes of

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^j^-g subsection, marital status shall be determined under section 7703(a). "(D) JOINT RETURN.—For purposes of this subsection, the term 'joint return' means the joint return of a husband and wife made under section 6013."

(c) MOVING EXPENSE DEDUCTION NOT ALLOWABLE IN COMPUTING ADJUSTED GROSS INCOME.—Subsection (a) of section 62 (as amended

by subsection (b)) is amended by striking out paragraph (8). (d) CLERICAL AMENDMENT.—The table of sections for part I of subchapter B of chapter 1 is amended by adding at the end thereof the following new item: "Sec. 67. 2-percent floor on miscellaneous itemized deductions." SEC. 133. MEDICAL EXPENSE DEDUCTION LIMITATION INCREASED.

Subsection (a) of section 213 (relating to deduction for medical, dental, etc., expenses) is amended by striking out "5 percent" and inserting in lieu thereof "7.5 percent". SEC. 134. REPEAL OF DEDUCTION FOR STATE AND LOCAL SALES TAXES.

(a) GENERAL RULE.—Subsection (a) of section 164 (relating to deduction for taxes) is amended— (1) by striking out paragraph (4) and by redesignating paragraph (5) as paragraph (4), and (2) by adding at the end thereof the following new sentence: "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." (b) CONFORMING AMENDMENTS.—Subsection (b) of section 164 is

amended— (1) by striking out paragraphs (2) and (5), and (2) by redesignating paragraphs (3) and (4) as paragraphs (2) and (3), respectively. SEC. 135. REPEAL OF DEDUCTION FOR ADOPTION EXPENSES.

(a) GENERAL RULE.—Section 222 (relating to deduction for adoption expenses) is hereby repealed. (b) CONFORMING AMENDMENTS.—

(1) Section 223 is redesignated as section 220. (2) The table of sections for part VII of subchapter B of chapter 1 is amended by striking out the items relating to sections 222 and 223 and inserting in lieu thereof the following: "Sec. 220. Cross references."

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