Page:United States Statutes at Large Volume 100 Part 3.djvu/576

 100 STAT. 2384

PUBLIC LAW 99-514—OCT. 22, 1986 "(L) BAD DEBT LOSSES OF COMMERCIAL BANKS.—In the case of any bank (as defined in section 585(a)(2)), the portion of the net operating loss for any taxable year beginning after December 31, 1986, and before January 1, 1994, which is attributable to the deduction allowed under section 166(a) shall be a net operating loss carryback to each of the 10 taxable years preceding the taxable year of the loss and a net operating loss carryover to each of the 5 taxable years following the taxable year of such loss. "(M) LOSSES OF THRIFT INSTITUTIONS.—In the case of an organization to which section 593 applies, in lieu of applying subparagraph (F), a net operating loss for any taxable year beginning after December 31, 1981, and before January 1, 1986, shall be a net operating loss carryback to each of the 10 taxable years preceding the taxable year of such loss and shall be a net operating loss carryover to each of the 8 taxable years following the taxable year of such loss." (2) TECHNICAL AMENDMENTS.—

(A) Subparagraph (A) of section 172(b)(1) is amended by striking out "and (K)" and inserting in lieu thereof "(K), (L), and (M)". (B) Subparagraph (B) of section 1720t>Xl) is amended by striking out "and (J)" and inserting in lieu thereof "(J), (L), and (M)". (C) Section 172 is amended by redesignating subsection (1) as subsection (m) and by inserting after subsection (k) the following new subsection: "(1)

RULES RELATING TO BAD DEBT

LOSSES OF COMMERCIAL

BANKS.—For purposes of this section— "(1) PORTION ATTRIBUTABLE TO DEDUCTION FOR BAD DEBTS.—

The portion of the net operating loss for any taxable year which is attributable to the deduction allowed under section 166(a) shall be the excess of— "(i) the net operating loss for such taxable year, over "(ii) the net operating loss for such taxable year determined without regard to the amount allowed as a deduction under section 166(a) for such taxable year. "(2) COORDINATION WITH SUBSECTION (b)(2).—In applying paragraph (2) of subsection (b), the portion of the net operating loss for any taxable year which is attributable to the deduction allowed under section 166(a) shall be treated in a manner similar to the manner in which a foreign expropriation loss is treated." (c) EFFECTIVE DATE.—

(1) IN GENERAL.—Except as provided in paragraph (2), the amendments made by this section shall apply to losses incurred in taxable years beginning after December 31, 1986. (2) ADDITIONAL CARRYFORWARD PERIOD FOR LOSSES OF THRIFT

INSTITUTIONS.—Subparagraph (M) of section 1720))(1) of the Internal Revenue Code of 1986 (as added by this section) shall apply to losses incurred in taxable years beginning after December 31, 1981.

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