Page:United States Statutes at Large Volume 110 Part 3.djvu/137

 PUBLIC LAW 104-188—AUG. 20, 1996 110 STAT. 1867 (2) Paragraph (6) of section 56(g) is amended by striking "or REMIC" and inserting "REMIC, or FASIT". (3) Clause (ii) of section 382(1)(4)(B) is amended by striking "or a REMIC to which part IV of subchapter M appHes" and inserting "a REMIC to which part IV of subchapter M apphes, or a FASIT to which part V of subchapter M appHes". (4) Paragraph (1) of section 582(c) is amended by inserting ", and any regular interest in a FASIT," after "REMIC". (5) Subparagraph (E) of section 856(c)(6) is amended by adding at the end the following new sentence: "The principles of the preceding provisions of this subparagraph shall apply to regular interests in a FASIT.". (6) Paragraph (3) of section 860G(a) is amended by striking "and" at the end of subparagraph (B), by striking the period at the end of subparagraph (C) and inserting ", and", and by inserting after subparagraph (C) the following new subparagraph: "(D) any regular interest in a FASIT which is transferred to, or purchased by, the REMIC as described in clauses (i) and (ii) of subparagraph (A) but only if 95 percent or more of the value of the assets of such FASIT is at all times attributable to obligations described in subparagraph (A) (without regard to such clauses).". (7) Subparagraph (C) of section 1202(e)(4) is amended by striking "or REMIC" and inserting "REMIC, or FASIT". (8) Clause (xi) of section 7701(a)(19)(C) is amended to read as follows: "(xi) any regular or residual interest in a REMIC, and any regular interest in a FASIT, but only in the proportion which the assets of such REMIC or FASIT consist of property described in any of the preceding clauses of this subparagraph; except that if 95 percent or more of the assets of such REMIC or FASIT are assets described in clauses (i) through (x), the entire interest in the REMIC or FASIT shall quahfy.". (9) Subparagraph (A) of section 7701(i)(2) is amended by inserting "or a FASIT" after "a REMIC". (c) CLERICAL AMENDMENT. —The table of parts for subchapter M of chapter 1 is amended by adding at the end the following new item: "Part V. Financial asset securitization investment trusts.". (d) EFFECTIVE DATE. —The amendments made by this section 26 USC 26 note, shall take effect on September 1, 1997. (e) TREATMENT OF EXISTING SECURITIZATION ENTITIES.— 26 USC 860i (1) IN GENERAL.—In the case of the holder of the ownership note. interest in a pre-effective date FASIT— (A) gain shall not be recognized under section 860L(d)(2) of the Internal Revenue Code of 1986 on property deemed contributed to the FASIT, and (B) gain shall not be recognized under section 8601 of such Code on property contributed to such FASIT, until such property (or portion thereof) ceases to be properly allocable to a pre-FASIT interest. (2) ALLOCATION OF PROPERTY TO PRE-FASIT INTEREST.— For purposes of paragraph (1), property shall be allocated to a pre-FASIT interest in such manner as the Secretary of the Treasury may prescribe, except that all property in a FASIT

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