Page:United States Statutes at Large Volume 111 Part 1.djvu/983

 PUBLIC LAW 105-34—AUG. 5, 1997 111 STAT. 959 SEC. 1087. EXPANSION OF REQUIREMENT THAT INVOLUNTARILY CON- VERTED PROPERTY BE REPLACED WITH PROPERTY ACQUIRED FROM AN UNRELATED PERSON. (a) IN GENERAL. —Subsection (i) of section 1033 is amended to read as follows: "(i) REPLACEMENT PROPERTY MUST BE ACQUIRED FROM UNRE- LATED PERSON IN CERTAIN CASES. — "(1) IN GENERAL.— If the property which is involuntarily converted is held by a tsixpayer to which this subsection applies, subsection (a) shall not apply if the replacement property or stock is acquired from a related person. The preceding sentence shall not apply to the extent that the related person acquired the replacement property or stock from an unrelated person during the period applicable under subsection (a)(2)(B). "(2) TAXPAYERS TO WHICH SUBSECTION APPLIES.— This subsection shall apply to— "(A) a C corporation, "(B) a partnership in which 1 or more C corporations own, directly or indirectly (determined in accordance with section 707(b)(3)), more than 50 percent of the capital interest, or profits interest, in such partnership at the time of the involuntary conversion, gmd "(C) any other taxpayer if, with respect to property which is involuntarily converted during the taxable year, the aggregate of the amount of realized gain on such property on which there is realized gain exceeds $100,000. In the case of a partnership, subparagraph (C) shall apply Applicability, with respect to the partnership and with respect to each partner. A similar rule shall apply in the case of an S corporation and its shareholders. "(3) RELATED PERSON.— For purposes of this subsection, a person is related to another person if the person bears a relationship to the other person described in section 267(b) or 707(b)(1).". (b) EFFECTIVE DATE. —The amendment made by this section 26 USC 1003 shall apply to involuntary conversions occurring after June 8, 1997. note. SEC. 1088. TREATMENT OF EXCEPTION FROM INSTALLMENT SALES RULES FOR SALES OF PROPERTY BY A MANUFACTURER TO A DEALER. (a) IN GENERAL. — Paragraph (2) of section 811(c) of the Tax Reform Act of 1986 is hereby repealed. 26 USC 453C (b) EFFECTIVE DATE. — note. (1) IN GENERAL.— The amendment made by this section 26 USC 453C shall apply to taxable years beginning more than 1 year after note. the date of the enactment of this Act. (2) COORDINATION WITH SECTION 481.— In the case of any taxpayer required by this section to chemge its method of accounting for any taxable year— (A) such changes shall be treated as initiated by the taxpayer, (B) such changes shall be treated as made with the consent of the Secretary of the Treasury, and (C) the net amount of the adjustments required to be taken into account under section 481(a) of the Internal Revenue Code of 1986 shall be taken into account ratably over the 4 taxable year period beginning with the first

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