Page:United States Statutes at Large Volume 111 Part 1.djvu/919

 PUBLIC LAW 105-34—AUG. 5, 1997 111 STAT. 895 (B) by striking "or" at the end of clause (i) of subparagraph (B), by striking the period at the end of clause (ii) of subparagraph (B) and inserting ", or", and by adding at the end of subparagraph (B) the following new clause: "(iii) owners of timeshare rights to use, or timeshare ownership interests in, association property in the case of a timeshare association,", and (C) by inserting "and, in the case of a timeshare association, for activities provided to or on behalf of members of the association" before the comma at the end of subparagraph (C). (2) TIMESHARE ASSOCIATION DEFINED. —Subsection (c) of section 528 is amended by redesignating paragraph (4) as paragraph (5) and by inserting after paragraph (3) the following new paragraph: "(4) TIMESHARE ASSOCIATION. —The term 'timeshare association' means any organization (other than a condominium management association) meeting the requirement of subparagraph (A) of paragraph (1) if any member thereof holds a timeshare right to use, or a timeshare ownership interest in, real property constituting association property.". (b) EXEMPT FUNCTION INCOME. —Paragraph (3) of section 528(d) is amended by striking "or" at the end of subparagraph (A), by striking the period at the end of subparagraph (B) and inserting ", or", and by adding at the end the following new subparagraph: "(C) owners of timeshare rights to use, or timeshare ownership interests in, real property in the case of a timeshare association.". (c) ASSOCIATION PROPERTY. — Paragraph (5) of section 528(c), as redesignated by subsection (a)(2), is amended by adding at the end the following new flush sentence: "In the case of a timeshare association, such term includes property in which the timeshare association, or members of the association, have rights arising out of recorded easements, covenants, or other recorded instruments to use property related to the timeshare project.". (d) RATE OF TAX.—Subsection (b) of section 528 (relating to certain homeowners associations) is amended by inserting before the period "(32 percent of such income in the case of a timeshare association)". (e) EFFECTIVE DATE.— The amendments made by this section 26 USC 528 note. shall apply to taxable years beginning after December 31, 1996. SEC. 967. ADDITIONAL ADVANCE REFUNDING OF CERTAIN VIRGIN ISLAND BONDS. Subclause (I) of section 149(d)(3)(A)(i) of the Internal Revenue Code of 1986 shall not apply to the second advance refunding of any issue of the Virgin Islands which was first advance refunded before June 9, 1997, if the debt provisions of the refunding bonds are changed to repeal the priority first lien requirement of the refunded bonds. SEC. 968. NONRECOGNITION OF GAIN ON SALE OF STOCK TO CERTAIN FARMERS' COOPERATIVES. (a) IN GENERAL. —Section 1042 (relating to sales of stock to employee stock ownership plans or certain cooperatives) is amended by adding at the end the following new subsection:

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