Page:United States Statutes at Large Volume 85.djvu/580

 550

PUBLIC LAW 92-178-DEC. 10, 1971

[85 STAT.

one corporation, the limitation provided by subsection (a)(1) shall be applied with respect to the aggregate of such dividends." ofi'^rlnQo^o^^* 26 USC 922.

Ante, p. 535.

(^) WESTER]sr

Ante, p. 544.

Ante, p. 547. 84 Stat. 1836.

74 Stat. 998.

Ante, p, 538, Ante, p. 544, 68A Stat. 732; 78 Stat. 843.

TRADE

CORPORATIONS.—Section

922

(relating to special deduction for Western Hemisphere Trade Corporations) is amended by adding at the end thereof the following: "No deduction shall be allowed under this section to a corporation for a taxable year for which it is a D I S C or in which it owns at any time stock in a D I S C or former D I S C (as defined in section 992(a))." (d)

jAs^^^iool^

HEMISPHERE

INCOME FROM SOURCES W I T H I N POSSESSIONS or THE UNITED

STATES.—Section 931(a) (relating to the general rule applicable to income from sources within possessions of the United States) is amended by adding at the end thereof the following: "This section shall not apply in the case of a corporation for a taxable year for which it is a D I S C or in which it owns at any time stock in a D I S C or former D I S C (as defined in section 992(a)")." ^®^ INCLUDIBLE CORPORATIONS.—Section 1504(b) (relating to definition of "includible corporations") is amended by adding at the end thereof the following new paragraph: " (7) A D I S C or former D I S C (as defined in section 992(a))." (f) BASIS or D I S C STOCK ACQUIRED FROM DECEDENT.—Section 1014 (relating to basis of property acquired from a decedent) is amended by adding at the end thereof the following new subsection: " (d) SPECIAL RULE W I T H RESPECT TO D I S C STOCK.—If stock owned by a decedent in a D I S C or former D I S C (as defined in section 992 (a)) acquires a new basis under subsection (a), such basis (determined before the application of this subsection) shall be reduced by the amount (if any) which would have been included in gross income under section 995(c) as a dividend if the decedent had lived and sold the stock at its fair market value on the estate tax valuation date. I n computing the gain the decedent would have had if he had lived and sold the stock, his basis shall be determined without regard to the last Sentence of section 996(e)(2) (relating to reductions of basis of D I S C stock). For purposes of this subsection, the estate tax valuation date is the date of the decedent's death or, in the case of an election nuder section 2032, the applicable valuation date prescribed by that section." SEC. 503. SOURCE OF INCOME. Section 861(a)(2) (relating to dividends) is amended— (1) by deleting the period at the end of subparagraph (C) and inserting in lieu thereof ", or"; and (2) by inserting the following new subparagraph (D) immediately after subparagraph (C) as amended: " (D) from a DISC or former D I S C (as defined in section 992(a)) except to the extent attributable (as determined under regulations prescribed by the Secretary or his delegate) to Qualified export receipts described in section 993(a)(1) (otlicr thau lutercst and gains described in section 995(b) (1))." SEC. 504. PROCEDURE AND ADMINISTRATION. (a) RETURNS.—Section 6011 (relating to general requirement of return, statement, or list) is amended by redesignating subsection (e) as subsection (f) and by adding a new subsection (e) which reads as follows: "(e) RETURNS, ETC., or D I S C S AND FORMER DISCS.— "(1) RECORDS AND INFORMATION.—A D I S C or former D I S C shall for the taxable year— " (A) furnish such information to persons who were shareholders at any time during such taxable year, and to the Secretary or his delegate, and

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