Page:United States Statutes at Large Volume 102 Part 4.djvu/560

 102 STAT. 3530

PUBLIC LAW 100-647—NOV. 10, 1988 market under section 1256 if held on the last day of the taxable year." (7) Subparagraph (B) of section 988(a)(3) of the 1986 Code is amended by adding at the end thereof the following new clause: "(iii) SPECIAL RULE FOR PARTNERSHIPS.—To the extent provided in regulations, in the case of a partnership, the determination of residence shall be made at the partner level." (8) Clause (i) of section 988(a)(3)(B) of the 1986 Code is amended by adding at the end thereof the following new sentence: "If an individual does not have a tax home (as so defined), the residence of such individual shall be the United States if such individual is a United States citizen or a resident alien and shall be a country other than the United States if such individual is not a United States citizen or a resident alien." (9) Section 903 of the 1986 Code is amended by striking out "this subpart" and inserting in lieu thereof "this part". (w) AMENDMENTS RELATED TO SECTION 1274 OF THE REFORM ACT.—

(1) Subsection (e) of section 932 of the 1986 Code is amended to read as follows: "(e) SPECIAL RULE FOR APPLYING SECTION TO TAX IMPOSED IN VIRGIN ISLANDS.—In applying this section for purposes of determin-

ing income tax liability incurred to the Virgin Islands, the provisions of this section shall not be affected by the provisions of Federal law referred to in section 934(a)." (2) Paragraph (4) of section 932(c) of the 1986 Code is amended to read as follows: "(4) RESIDENTS OF THE VIRGIN ISLANDS.—In the case of an individual— "(A) who is a bona fide resident of the Virgin Islands at the close of the taxable year, "(B) who, on his return of income tax to the Virgin Islands, reports income from all sources and identifies the source of each item shown on such return, and "(C) who fully pays his tax liability referred to in section 934(a) to the Virgin Islands with respect to such income, for purposes of calculating income tax liability to the United States, gross income shall not include any amount included in gross income on such return, and allocable deductions and credits shall not be taken into account." (3) Paragraph (2) of section 932(c) of the 1986 Code is amended by striking out "his income tax return" and inserting in lieu thereof "an income tax return". 26 USC 932 note. (4) Subsection (c) of section 1274 of the Reform Act is amended by striking out "this title" and inserting in lieu thereof "the Internal Revenue Code of 1986". (x) AMENDMENT RELATED TO SECTION 1275 OF THE REFORM ACT.—

Section 1444 of the 1986 Code is amended by striking out "(as modified by section 934A)". (y) AMENDMENT RELATED TO SECTION 1276 OF THE REFORM ACT.—

Subsection (a) of section 7654 of the 1986 Code is amended by striking out "an individual to which" and inserting in lieu thereof "an individual to whom". (z) AMENDMENT RELATED TO SECTION 1277 OF THE REFORM ACT.—

26 USC 931 note.

(1) Section 1277 of the Reform Act is amended by adding at the end thereof the following new subsection:

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