Page:United States Statutes at Large Volume 83.djvu/682

 654

PUBLIC LAW 91-172-DEC. 30, 1969

78 Stat. 104. 26 USC 1250

[83 STAT.

(B) by striking out paragraph (2) thereof and inserting in lieu thereof the following: "(2)

ORDINARY INCOME ATTRIBUTABLE TO AN ELEMENT.—For

purposes of paragraph (1), the amount taken into account for any element shall be the sum of— •'(A) the amount (if any) determined by multiplying— " (i) the amount which bears the same ratio to the lower of the amounts specified in subparagraph (A) or (B) of subsection (a)(1) for the section 1250 property as the additional depreciation for such element attributable to periods after December 31, 1969, bears to the sum of the additional depreciation for all elements attributable to periods after December 31, 1969, by "(ii) the applicable percentage for such element, and " (B) the amount (if any) determined by multiplying— " (i) the amount which bears the same ratio to the lower of the amounts specified in subsection (a)(2)(A) (i) or (ii) for the section 1250 property as the additional depreciation for such element attributable to periods before January 1, 1970, bears to the sum of the additional depreciation for all elements attributable to periods before January 1, 1970, by "(ii) the applicable percentage for such element. For purposes of this paragraph, determinations with respect to any element shall be made as if it were a separate property." (f) 68A Stat. 126.

CARRYOVERS I N CERTAIN

381(c)(6) (relating to method of computing depreciation allowance) is amended to read as follows: "(6)

Ante, pp. 625,

649

CORPORATE ACQUISITIONS.—Section

METHOD OF COMPUTING DEPRECIATION ALLOWANCE.—The

acquiring corporation shall be treated as the distributor or transferor corporation for purposes of computing the depreciation allowance under subsections (b), (j), and (k) of section 167 on ' property acquired in a distribution or transfer with respect to so much of the basis in the hands of the acquiring corporation as does not exceed the adjusted basis in the hands of the distributor or transferor corporation." (g) ErFECTiVE DATE.—The amendments made by this section shall apply with respect to taxable years ending after July 24, 1969. Subtitle D—Subchapter S Corporations

8o^stft''\"i3^^°' 26 USC 13 711378.

SEC. 531. QUALIFIED PENSION, ETC., PLANS OF SMALL BUSINESS CORPORATIONS. (a) IN GENERAL.—Subchapter S of chapter 1 (relating to election of certain small business corporations as to taxable status) is amended by adding at the end thereof the following new section: "SEC. 1379. CERTAIN QUALIFIED PENSION, ETC., PLANS. " (a) ADDITIONAL REQUIREMENT FOR QUALIFICATION or STOCK BONUS OR PROFIT-SHARING PLANS.—A trust forming part of a stock bonus or

profit-sharing plan which provides contributions or benefits for employees some or all of whom are shareholder-employees shall not constitute a qualified trust under section 401 (relating to qualified pension, profit-sharing, and stock bonus plans) unless the plan of which such trust is a part provides that forfeitures attributable to contributions deductible under section 404(a)(3) for any taxable year (beginning after December 31, 1970) of the employer with respect to which

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