Page:United States Statutes at Large Volume 100 Part 3.djvu/519

 PUBLIC LAW 99-514—OCT. 22, 1986

100 STAT. 2327

"(A) the adjusted net book income of the corporation, exceeds "(B) the alternative minimum taxable income for the taxable year (determined without regard to this subsection and the alternative tax net operating loss deduction). "(2) ADJUSTED NET BOOK INCOME.—For purposes of this subsection— "(A) IN GENERAL.—The term 'adjusted net book income' means the net income or loss of the taxpayer set forth on the taxpayer's applicable financial statement, adjusted as provided in this paragraph. "(B) ADJUSTMENTS FOR CERTAIN TAXES.—The amount determined under subparagraph (A) shall be appropriately adjusted to disregard any Federal income taxes, or income, war profits, or excess profits taxes imposed by any foreign country or possession of the United States, which are directly or indirectly taken into account on the taxpayer's applicable financial statement. The preceding sentence shall not apply to any such taxes imposed by a foreign country or possession of the United States if the taxpayer does not choose to take, to any extent, the benefits of section 901. "(C) SPECIAL RULES FOR RELATED CORPORATIONS.— "(i) CONSOLIDATED RETURNS.—If the taxpayer

files a consolidated return for any taxable year, adjusted net book income for such taxable year shall take into account items on the taxpayer's applicable financial statement which are properly allocable to members of such group included on such return. "(ii) TREATMENT OF DIVIDENDS.—In the case of any corporation which is not included on a consolidated return with the taxpayer, adjusted net book income shall take into account the earnings of such other corporation only to the extent of the sum of the dividends received from such other corporation and other amounts required to be included in gross income under this chapter in respect of the earnings of such other corporation.

"(D) STATEMENTS COVERING DIFFERENT PERIODS.—Appro-

priate adjustments shall be made in adjusted net book income in any case in which an applicable financial statement covers a period other than the taxable year. "(E) SPECIAL RULE FOR COOPERATIVES.—In the case of a cooperative to which section 1381 applies, the amount determined under subparagraph (A) shall be reduced by the amounts referred to in section 1382(b) (relating to patronage dividends and per-unit retain allocations) to the extent such amounts were not otherwise taken into account in determining adjusted net book income. "(F) TREATMENT OF DIVIDENDS FROM 936 CORPORATIONS.—

"(i) IN GENERAL.—In determining the amount of adjusted net book income, any dividend received from a corporation eligible for the credit provided by section 936 shall be increased by the amount of any withholding tax paid to a possession of the United States with respect to such dividend, "(ii) TREATMENT AS FOREIGN TAXES.—

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