Page:United States Statutes at Large Volume 111 Part 1.djvu/969

 PUBLIC LAW 105-34—AUG. 5, 1997 111 STAT. 945 "(II) in the case of a carryback of taxes paid or accrued to foreign countries or possessions of the United States, the taxable year in which such taxes were in fact paid or accrued (or, with respect to any portion of such carryback from a taxable year attributable to a net operating loss carryback or a capital loss carryback from a subsequent taxable year, such subsequent taxable year), and". (C) Subclause (III) of section 6611(f)(4)(B)(ii) (as so redesignated) is amended by inserting "(as defined in paragraph (3)(B))" after "credit carryback" the first place it. appears. (D) Section 6611 is amended by striking subsection (g) and by redesignating subsections (h) and (i) as subsections (g) and (h), respectively. (c) EFFECTIVE DATE.—The amendments made by this section 26 USC 660i shall apply to foreign tax credit carrybacks arising in taxable years note, beginning after the date of the enactment of this Act. SEC. 1056. CLARIFICATION OF PERIOD OF LIMITATIONS ON CLAIM FOR CREDIT OR REFUND ATTRIBUTABLE TO FOREIGN TAX CREDIT CARRYFORWARD. (a) IN GENERAL. —Subparagraph (A) of section 6511(d)(3) is amended by striking "for the year with respect to which the claim is made" and inserting "for the year in which such taxes were actually paid or accrued". (b) EFFECTIVE DATE. —The amendment made by subsection (a) 26 USC 65ii shall apply to tsixes paid or accrued in taxable years beginning note. after the date of the enactment of this Act. SEC. 1057. REPEAL OF EXCEPTION TO ALTERNATIVE MINIMUM FOR- EIGN TAX CREDIT LIMIT. (a) IN GENERAL.—Section 59(a)(2) (relating to limitation to 90 percent of tax) is amended by striking subparagraph (C). (b) EFFECTIVE DATE.—The amendment made by this section 26 USC 59 note, shall apply to taxable years beginning after the date of the enactment of this Act. Subtitle G—Partnership Provisions SEC. 1061. ALLOCATION OF BASIS AMONG PROPERTIES DISTRIBUTED BY PARTNERSHIP. (a) IN GENERAL.— Subsection (c) of section 732 is amended to read as follows: "(c) ALLOCATION OF BASIS. — "(1) IN GENERAL.— The basis of distributed properties to which subsection (a)(2) or (b) is applicable shall be allocated— "(A)(i) first to any unrealized receivables (as defined in section 751(c)) and inventory items (as defined in section 751(d)(2)) in an amount equal to the adjusted basis of each such property to the partnership, and "(ii) if the basis to be allocated is less than the sum of the adjusted bases of such properties to the partnership, then, to the extent any decrease is required in order to have the adjusted bases of such properties equal the basis to be allocated, in the manner provided in paragraph (3), and

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