Page:United States Statutes at Large Volume 102 Part 4.djvu/445

 PUBLIC LAW 100-647—NOV. 10, 1988

102 STAT. 3415

(A) by striking out "in December" and inserting in lieu thereof "in October, November, or December", (B) by striking out "in such month" and inserting in lieu thereof "in such a month", (C) by striking out "on such date" in subparagraphs (A) and (B) and inserting in lieu thereof "on December 31 of such calendar year", and (D) by striking out "before February 1" and inserting in lieu thereof "during January". (10) Paragraph (1) of section 852(e) of the 1986 Code is amended by striking out "subsection (a)(3)" and inserting in lieu thereof "subsection (a)(2)". (m) AMENDMENTS RELATED TO SECTION 652 OF THE REFORM ACT.—

(1) Paragraph (1) of section 851(a) of the 1986 Code is amended to read as follows: "(1) which, at all times during the taxable year— "(A) is registered under the Investment Company Act of 1940, as amended (15 U.S.C. 80a-l to 80b-2) as a management company or unit investment trust, or "(B) has in effect an election under such Act to be treated as a business development company, or". (2) Paragraph (1) of section 851(e) of the 1986 Code is amended by striking out "a registered management company or registered business development company" and inserting in lieu thereof "a management company or a business development company described in subsection (a)(D". (n) AMENDMENTS RELATED TO SECTION 653 OF THE REFORM ACT.—

(1) Subsection (b) of section 851 of the 1986 Code is amended by adding at the end thereof the following new sentence: "Income derived from a partnership or trust shall be treated as described in paragraph (2) only to the extent such income is attributable to items of income of the partnership or trust (as the case may be) which would be described in paragraph (2) if realized by the regulated investment company in the same manner as realized by the partnership or trust." (2)(A) Paragraph (3) of section 851(b) of the 1986 Code is amended to read as follows: "(3) less than 30 percent of its gross income is derived from the sale or disposition of any of the following which was held for less than 3 months: "(A) stock or securities (as defined in section 2(a)(36) of the Investment Company Act of 1940, as amended), "(B) options, futures, or forward contracts (other than options, futures, or forward contracts on foreign currencies), or "(C) foreign currencies (or options, futures, or forward contracts on foreign currencies) but only if such currencies (or options, futures, or forward contracts) are not directly related to the company's principal business of investing in stock or securities (or options and futures with respect to stocks or securities), and '. (B) Subsection (b) of section 851 of the 1986 Code is amended by striking out "which are not ancillary" in the material following paragraph (4), and inserting in lieu thereof "which are not directly related". (C) Subparagraph (C) of section 851(b)(3) of the 1986 Code (as 26 USC 851 note. amended by subparagraph (A)), and the amendment made by

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