Page:United States Statutes at Large Volume 100 Part 3.djvu/475

 PUBLIC LAW 99-514—OCT. 22, 1986

100 STAT. 2283

provided in such regulations, furnish to the Secretary the following information: "(1) The amount of the consideration received for the assets which is allocated to goodwill or going concern value. "(2) Any modification of the amount described in paragraph (1). "(3) Any other information with respect to other assets transferred in such acquisition as the Secretary may find necessary to carry out the provisions of this section. "(c) APPLICABLE ASSET ACQUISITION.—For purposes of this section, the term 'applicable asset acquisition' means any transfer (whether directly or indirectly)— "(1) of assets which constitute a trade or business, and ,^ "(2) with respect to which the transferee's basis in such assets is determined wholly by reference to the consideration paid for such assets. A transfer shall not be treated as failing to be an applicable asset acquisition merely because section 1031 applies to a portion of the assets transferred." (b) CONFORMING AMENDMENT.—The table of sections for part IV of subchapter O of chapter 1 is amended by striking out the item relating to section 1060 and inserting in lieu thereof the following new items: "Sec. 1060. Special allocation rules for certain asset acquisitions. "Sec. 1061. Cross references." EFFECTIVE DATE.—The amendments made by this section

(c) shall apply to any acquisition of assets after May 6, 1986, unless such acquisition is pursuant to a binding contract which was in effect on May 6, 1986, and at all times thereafter. SEC. 642. MODIFICATION OF DEFINITION OF RELATED PARTY. (a) DEFINITIONS OF RELATED PARTY FOR PURPOSES OF CERTAIN SALES.— (1) SALE OF DEPRECIABLE PROPERTY BETWEEN CERTAIN RELATED TAXPAYERS.—

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(A) IN GENERAL.—Paragraph (1) of section 1239(b) (defining related persons) is amended by striking out "80-percent owned entities" and inserting in lieu thereof "controlled entities". (B) CONTROLLED ENTITY DEFINED.—

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(i) IN GENERAL.—Section 1239(c)(1) (defining 80-percent owned entity) is amended— (I) by striking out "80-percent owned entity" and inserting in lieu thereof "controlled entity", (II) by striking out "80 percent or more in value" in subparagraph (A) and inserting in lieu thereof "more than 50 percent of the value", (III) by striking out "80 percent or more" in subparagraph (B) and inserting in lieu thereof "more than 50 percent", and (IV) by striking out "and" at the end of subparagraph (A), by striking out the period at the end of subparagraph (B) and inserting ", and", and by adding at the end thereof the following new paragraph: "(C) any entity which is a related person to such person under paragraph (3), (10), (11), or (12) of section 267(b)."

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