Page:United States Statutes at Large Volume 102 Part 4.djvu/566

 102 STAT. 3536

PUBLIC LAW 100-647—NOV. 10, 1988

"(1) any amount deemed distributed to such shareholder under subsection (b), "(2) any actual distribution to such shareholder which under section 996 is treated as out of accumulated DISC income, and "(3) any gain which is treated as a dividend under subsection (0, shall be treated as derived from the conduct of an unrelated trade or business (and the modifications of section 512(b) shall not apply). The rules of the preceding sentence shall apply also for purposes of determining any such shareholder's DISC-related deferred tax liability under subsection (f)." 26 USC 995 note. (B) The amendment made by subparagraph (A) shall apply to taxable years beginning after December 31, 1987. (7) TREATMENT OP CERTAIN AMOUNTS PREVIOUSLY TAXED UNDER SECTION 1248.—

26 USC 959 note.

(A) IN GENERAL.—Subsection (e) of section 959 of the 1986 Code is amended by striking out "such person under" and inserting in lieu thereof "such person (or, in any case to which section 1248(e) applies, of the domestic corporation referred to in section 1248(e)(2)) under". (B) EFFECTIVE DATE.—The amendment made by subparagraph (A) shall apply in the case of transactions to which section 1248(e) of the 1986 Code applies and which occur after December 31, 1986. (8) TREATMENT OF SHARED FSC'S.—

(A) IN GENERAL.—Section 927 of the 1986 Code is amended by adding at the end thereof the following new subsection: "(g) TREATMENT OF SHARED FSC's.— "(1) IN GENERAL.—Except as provided in paragraph (2), each separate account referred to in paragraph (3) maintained by a shared FSC shall be treated as a separate corporation for purposes of this subpart. "(2) CERTAIN REQUIREMENTS APPLIED AT SHARED FSC LEVEL.—

26 USC 927 note.

Paragraph (1) shall not apply— "(A) for purposes of— "(i) subparagraphs (A), (B), (D), and (E) of section 922(a)(l), "(ii) paragraph (2) of section 922(a), "(iii) subsections (b), (c), and (e) of section 924, and "(iv) subsection (f) of this section, and "(B) for such other purposes as the Secretary may by regulations prescribed. "(3) SHARED FSC.—For purposes of this subsection, the term 'shared FSC' means any corporation if— "(A) such corporation maintains a separate account for transactions with each shareholder (and persons related to such shareholder), "(3) distributions to each shareholder are based on the amounts in the separate account maintained with respect to such shareholder, and "(C) such corporation meets such other requirements as the Secretary may by regulations prescribe." (B) The amendment made by subparagraph (A) shall apply as if included in the provision of the Tax Reform Act of 1984 to which it relates.

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