Page:United States Statutes at Large Volume 119.djvu/2644

 119 STAT. 2626 Applicability.

26 USC 954.

26 USC 857 note.

VerDate 14-DEC-2004

07:21 Oct 30, 2006

PUBLIC LAW 109–135—DEC. 21, 2005

‘‘(d) TRANSITION RULE.—If the taxpayer elects (at such time and in such form and manner as the Secretary of the Treasury may prescribe) to have the rules of this subsection apply— ‘‘(1) the amendments made by this section shall not apply to taxable years beginning after December 31, 2002, and before January 1, 2005, and ‘‘(2) in the case of taxable years beginning after December 31, 2004, clause (iv) of section 904(d)(4)(C) of the Internal Revenue Code of 1986 (as amended by this section) shall be applied by substituting ‘January 1, 2005’ for ‘January 1, 2003’ both places it appears.’’. (m) AMENDMENT RELATED TO SECTION 412 OF THE ACT.— Subparagraph (B) of section 954(c)(4) is amended by adding at the end the following: ‘‘If a controlled foreign corporation is treated as owning a capital or profits interest in a partnership under constructive ownership rules similar to the rules of section 958(b), the controlled foreign corporation shall be treated as owning such interest directly for purposes of this subparagraph.’’. (n) AMENDMENTS RELATED TO SECTION 413 OF THE ACT.— (1) Subsection (b) of section 532 is amended by striking paragraph (2) and redesignating paragraphs (3) and (4) as paragraphs (2) and (3), respectively. (2) Subsection (b) of section 535 is amended by adding at the end the following new paragraph: ‘‘(10) CONTROLLED FOREIGN CORPORATIONS.—There shall be allowed as a deduction the amount of the corporation’s income for the taxable year which is included in the gross income of a United States shareholder under section 951(a). In the case of any corporation the accumulated taxable income of which would (but for this sentence) be determined without allowance of any deductions, the deduction under this paragraph shall be allowed and shall be appropriately adjusted to take into account any deductions which reduced such inclusion.’’. (3)(A) Section 6683 is repealed. (B) The table of sections for part I of subchapter B of chapter 68 is amended by striking the item relating to section 6683. (o) AMENDMENT RELATED TO SECTION 415 OF THE ACT.— Subparagraph (D) of section 904(d)(2) is amended by inserting ‘‘as in effect before its repeal’’ after ‘‘section 954(f)’’. (p) AMENDMENTS RELATED TO SECTION 418 OF THE ACT.— (1) The second sentence of section 897(h)(1) is amended— (A) by striking ‘‘any distribution’’ and all that follows through ‘‘any class of stock’’ and inserting ‘‘any distribution by a real estate investment trust with respect to any class of stock’’, and (B) by striking ‘‘the taxable year’’ and inserting ‘‘the 1-year period ending on the date of the distribution’’. (2) Subsection (c) of section 418 of the American Jobs Creation Act of 2004 is amended to read as follows: ‘‘(c) EFFECTIVE DATE.—The amendments made by this section shall apply to— ‘‘(1) any distribution by a real estate investment trust which is treated as a deduction for a taxable year of such trust beginning after the date of the enactment of this Act, and

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