Page:United States Statutes at Large Volume 85.djvu/587

 85 STAT. ]

PUBLIC LAW 92-178-DEC. 10, 1971

557

" (B) if the taxpayer is an estate or trust, is a grantor, beneficiary, or fiduciary of the estate or trust, or is an individual who bears any of the relationships described in paragraphs (1) through (8) of section 152(a) to a grantor, 26'us*c\'5'2^' beneficiary, or fiduciary of the estate or trust, or " (C) is a dependent (described in section 152(a)(9)_) of 72 Stat. 1607. the taxpayer, or, if the taxpayer is a corporation, of an individual described in subparagraph (A), or, if the taxpayer is an estate or trust, of a grantor, beneficiary, or fiduciary of the estate or trust. •*(d) SUBCHAPTER S CORPORATIONS.—In case of an electing small business corporation (as defined in section 1371)— 78^stat^\*i2^^°' "(1) the work incentive program expenses for each taxable year shall be apportioned pro rata among the persons who are shareholders of such corporation on the last day of such taxable year, and "(2) any person to whom any expenses have been apportioned under paragraph (1) shall be treated (for purposes of this subpart) as the taxpayer with respect to such expenses. "(e) ESTATES AND TRUSTS.—In the case of an estate or trust— " (1) the work incentive program expenses for any taxable year shall be apportioned between the estate or trust and the beneficiaries on the basis of the income of the estate or trust allocable to each, "(2) any beneficiary to whom any expenses have been apportioned under paragraph (1) shall be treated (for purposes of this subpart) as the taxpayer with respect to such expenses, and "(3) the $25,000 amount specified under subparagraphs (A) and (B) of section 50A(a)(2) applicable to such estate or trust shall ^"'^' ^' ^^'** be reduced to an amount which bears the same ratio to $25,000 as the amount of the expenses allocated to the trust under paragraph ^1) bears to the entire amount of such expenses. " (i) LIMITATIONS W I T H RESPECT TO CERTAIN PERSONS.—In the case of— " (1) an organization to which section 593 applies, 83^3181^6*20!^' "(2) a regulated investment company or a real estate investment trust subject to taxation under subchapter M (section 851 ga^sut!*?!*?.^^^' and following), and 76 Stat. 1045. " (3) a cooperative organization described in section 1381(a), rules similar to the rules provided in section 46(d) shall apply under Ante, p. 507. regulations prescribed by the Secretary or his delegate. " (g) CROSS REFERENCE.—

"For application of this subpart to certain acquiring corporations, see section 381(c) (24)." (c) TECHNICAL AND CLERICAL AMENDMENTS.—

(1) The table of subparts for part IV of subchapter A of chapter 1 is amended by adding at the end thereof the following: "Subpart C. Rules for computing credit for expenses of work incentive programs." (2) The table of sections of subpart A of part IV of subchapter A of chapter 1 is amended by striking out the last item and inserting in lieu thereof the following: "Sec. 40. Expenses of work incentive programs. "Sec. 41. Contributions to candidates for public office. "Sec. 42. Overpayments of tax.

(3) Section 381(c) (relating to items taken into account in certain ^!^ ^*^^' ^^4; corporate acquisitions) is amended by adding at the end thereof the ^^ *^*' ^''^' following new paragraph:

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