Page:United States Statutes at Large Volume 102 Part 4.djvu/379

 PUBLIC LAW 100-647—NOV. 10, 1988

102 STAT. 3349

TITLE I—TECHNICAL CORRECTIONS TO TAX REFORM ACT OF 1986

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SEC. 1001. AMENDMENTS RELATED TO TITLE I OF THE REFORM ACT. (a) AMENDMENTS RELATED TO SECTION 101 OF THE REFORM ACT.—

(1) Paragraph (2) of section 6867(b) of the 1986 Code is amended by striking out "at a 50-percent rate" and inserting in lieu thereof "at the highest rate of tax specified in section 1". (2)(A) Section 531 of the 1986 Code is amended to read as follows: •SEC. 531. IMPOSITION OF ACCUMULATED EARNINGS TAX.

"In addition to other taxes imposed by this chapter, there is hereby imposed for each taxable year on the accumulated taxable income (as defined in section 535) of each corporation described in section 532, an accumulated earnings tax equal to 28 percent of the accumulated taxable income." OB) The amendment made by subparagraph (A) shall apply to 26 USC 531 note. taxable years beginning after December 31, 1987. Such amendment shall not be treated as a change in a rate of tax for purposes of section 15 of the 1986 Code. (3) The last sentence of section l(g)(2) of the 1986 C!ode is amended by inserting before the period at the end thereof the following: "and subparagraph (B) shall be applied as if a deduction for a personal exemption were allowable under section 151 to such individual for such individual's spouse." (b) AMENDMENTS RELATED TO SECTION 102 OF THE REFORM ACT.—

(1) Paragraph (5) of section 63(c) of the 1986 C ^ e is amended— (A) by striking out "the standard deduction applicable" and inserting in lieu thereof "the basic standard deduction applicable", and (B) by striking out "STANDARD DEDUCTION" in the paragraph heading and inserting in lieu thereof "BASIC STANDARD DEDUCTION".

(2) Subclause a) of section 6012(a)(l)(C)(i) of the 1986 Code is amended to read as follows: "(I) income (other than earned income) in excess of the sum of the amount in effect under section 63(c)(5)(A) plus the additional standard deduction (if any) to which the individual is entitled, or". (3)(A) Subparagraph (A) of section 62(a)(2) of the 1986 Code is amended by adding at the end thereof the following new sentence: "The fact that the reimbursement may be provided by a third party shall not be determinative of whether or not the preceding sentence applies." (B) Paragraph (2) of section 527(e) of the 1986 Code (defining exempt function) is amended by adding at the end thereof the following new sentence: "Such term includes the making of expenditures relating to an office described in the preceding sentence which, if incurred by the individual, would be allowable as a deduction under section 162(a)."

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