Page:United States Statutes at Large Volume 102 Part 4.djvu/381

 PUBLIC LAW 100-647—NOV. 10, 1988

102 STAT. 3351

(C) The following provisions of the 1986 Code are each amended by striking out "(F) or (J)" each place it appears and inserting in lieu thereof "(F), (J), or (M)": (i) Section 3121(b)(19). (ii) Section 3231(e)(l). (iii) Section 3306(c)(19). (D) Clause (i)(1) of section 7701(b)(5)(D) of the 1986 Code is amended by striking out "subparagraph (F)" and inserting in lieu thereof "subparagraph (F) or (M)". (E) Section 210(a)(19) of the Social Security Act is amended by 42 USC 410. striking out "(F) or (J)" each place it appears and inserting in lieu thereof "(F), (J), or (M)". (e) AMENDMENT RELATED TO SECTION 131 OF THE REFORM ACT.—

Subsection (f) of section 86 of the 1986 Code is amended by inserting "and" at the end of paragraph (3), by striking out paragraph (4), and by redesignating paragraph (5) as paragraph (4). (f) AMENDMENTS RELATED TO SECTION 132 OF THE REFORM ACT.—

(1) Section 67 of the 1986 Code is amended by adding at the end thereof the following new subsection: "(f) COORDINATION WITH OTHER LIMITATION.—This section shall be applied before the application of the dollar limitation of the last sentence of section 162(a) (relating to trade or business expenses)." (2) Paragraph (4) of section 67(b) of the 1986 Code is amended— (A) by striking out "deduction" and inserting in lieu thereof "deductions", and (B) by inserting before the comma at the end thereof "and section 642(c) (relating to deduction for amounts paid or permanently set aside for a charitable purpose)". (3) Subsection (e) of section 67 of the 1986 (Dode is amended to read as follows: "(e) DETERMINATION OF ADJUSTED GROSS INCOME IN CASE OF ESTATES AND TRUSTS.—For purposes of this section, the adjusted gross

income of an estate or trust shall be computed in the same manner as in the case of an individual, except that— "(1) the deductions for costs which are paid or incurred in connection with the administration of the estate or trust and which would not have been incurred if the property were not held in such trust or estate, and "(2) the deductions allowable under sections 642(b), 651, and 661, shall be treated as allowable in arriving at adjusted gross income. Under regulations, appropriate adjustments shall be made in the application of part I of subchapter J of this chapter to take into account the provisions of this section." (4) Subsection (c) of section 67 of the 1986 Code is amended by striking out the last sentence and inserting in lieu thereof the following: "The preceding sentence shall not apply— "(1) with respect to cooperatives and real estate investment trusts, and "(2) except as provided in regulations, with respect to estates and trusts. (g) AMENDMENTS RELATED TO SECTION 142 OF THE REFORM ACT.—

(1) Subparagraph (A) of section 274(n)(2) of the 1986 Code is amended to read as follows: "(A) such expense is described in paragraph (2), (3), (4), (7), (8), or (9) of subsection (e),".

�