Page:United States Statutes at Large Volume 124.djvu/3564

 124 STAT. 3538 PUBLIC LAW 111–325—DEC. 22, 2010 Sec. 402. Deferral of certain gains and losses of regulated investment companies for excise tax purposes. Sec. 403. Distributed amount for excise tax purposes determined on basis of taxes paid by regulated investment company. Sec. 404. Increase in required distribution of capital gain net income. TITLE V—OTHER PROVISIONS Sec. 501. Repeal of assessable penalty with respect to liability for tax of regulated investment companies. Sec. 502. Modification of sales load basis deferral rule for regulated investment companies. TITLE I—CAPITAL LOSS CARRYOVERS OF REGULATED INVESTMENT COMPA- NIES SEC. 101. CAPITAL LOSS CARRYOVERS OF REGULATED INVESTMENT COMPANIES. (a) IN GENERAL.—Subsection (a) of section 1212 is amended by redesignating paragraph (3) as paragraph (4) and by inserting after paragraph (2) the following new paragraph: ‘‘(3) REGULATED INVESTMENT COMPANIES.— ‘‘(A) IN GENERAL.—If a regulated investment company has a net capital loss for any taxable year— ‘‘(i) paragraph (1) shall not apply to such loss, ‘‘(ii) the excess of the net short-term capital loss over the net long-term capital gain for such year shall be a short-term capital loss arising on the first day of the next taxable year, and ‘‘(iii) the excess of the net long-term capital loss over the net short-term capital gain for such year shall be a long-term capital loss arising on the first day of the next taxable year. ‘‘(B) COORDINATION WITH GENERAL RULE.—If a net cap- ital loss to which paragraph (1) applies is carried over to a taxable year of a regulated investment company— ‘‘(i) LOSSES TO WHICH THIS PARAGRAPH APPLIES.— Clauses (ii) and (iii) of subparagraph (A) shall be applied without regard to any amount treated as a short-term capital loss under paragraph (1). ‘‘(ii) LOSSES TO WHICH GENERAL RULE APPLIES.— Paragraph (1) shall be applied by substituting ‘net capital loss for the loss year or any taxable year there- after (other than a net capital loss to which paragraph (3)(A) applies)’ for ‘net capital loss for the loss year or any taxable year thereafter’.’’. (b) CONFORMING AMENDMENTS.— (1) Subparagraph (C) of section 1212(a)(1) is amended to read as follows: ‘‘(C) a capital loss carryover to each of the 10 taxable years succeeding the loss year, but only to the extent such loss is attributable to a foreign expropriation loss,’’. (2) Paragraph (10) of section 1222 is amended by striking ‘‘section 1212’’ and inserting ‘‘section 1212(a)(1)’’. (c) EFFECTIVE DATE.— (1) IN GENERAL.—Except as provided in paragraph (2), the amendments made by this section shall apply to net capital 26 USC 1212 note. Applicability. 26 USC 1212.