Page:United States Statutes at Large Volume 112 Part 1.djvu/830

 112 STAT. 804 PUBLIC LAW 105-206^JULY 22, 1998 Applicability. Applicability. Applicability. "(13) SPECIAL RULES FOR PERIODS DURING 1997. — "(A) DETERMINATION OF 28-PERCENT RATE GAIN. —In applying paragraph (5)— "(i) the amount determined under subclause (I) of paragraph (5)(A)(i) shall include long-term capital gain (not otherwise described in paragraph (5)(A)(i)) which is properly taken into account for the portion of the taxable year before May 7, 1997; "(ii) the amounts determined under subclause (I) of paragraph (5)(A)(ii) shall include long-term capital loss (not otherwise described in paragraph (5)(A)(ii)) which is properly taken into account for the portion of the taxable year before May 7, 1997; and "(iii) clauses (i)(I) and (ii)(I) of paragraph (5)(A) shall be applied by not taking into account any gain and loss on property held for more than 1 year but not more than 18 months which is properly taken into account for the portion of the taxable year after May 6, 1997, and before July 29, 1997. " (B) OTHER SPECIAL RULES.— " (i) DETERMINATION OF UNRECAPTURED SECTION 1250 GAIN NOT TO INCLUDE PRE-MAY 7, 1997 GAIN.— The amount determined under paragraph (7)(A)(i) shall not include gain properly taken into account for the portion of the taxable year before May 7, 1997. "(ii) OTHER TRANSITIONAL RULES FOR I8-MONTH HOLDING PERIOD. —Paragraphs (6)(A) and (7)(A)(i)(II) shall be applied by substituting *1 year' for '18 months' with respect to gain properly taken into account for the portion of the taxable year after May 6, 1997, and before July 29, 1997. "(C) SPECIAL RULES FOR PASS-THRU ENTITIES. —In applying this paragraph with respect to any pass-thru entity, the determination of when gains and loss are properly taken into account shall be made at the entity level.". (2) Paragraph (3) of section 55(b) of the 1986 Code is amended to read as follows: "(3) MAXIMUM RATE OF TAX ON NET CAPITAL GAIN OF NON- CORPORATE TAXPAYERS.— The amount determined under the first sentence of paragraph (l)(A)(i) shall not exceed the sum of— "(A) the amount determined under such first sentence computed at the rates and in the same manner as if this paragraph had not been enacted on the taxable excess reduced by the lesser of— "(i) the net capital gain; or "(ii) the sum of— "(I) the adjusted net capital gain, plus "(II) the unrecaptured section 1250 gain, plus "(B) 10 percent of so much of the adjusted net capital gain (or, if less, taxable excess) as does not exceed the amount on which a tax is determined under section 1(h)(1)(B), plus "(C) 20 percent of the adjusted net capital gain (or, if less, taxable excess) in excess of the amount on which tax is determined under subparagraph (B), plus

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