Page:United States Statutes at Large Volume 88 Part 2.djvu/798

 2114

PUBLIC LAW 93-625-JAN. 3, 1975

26 USC 856.

Ante,

p. 2112.

26 USC 857. 26 USC 561.

26 USC 857.

26 USC 856 note. 26 USC 8 5 6.

'H

[88 STAT.

(d) TECHNICAL AMENDMENTS.—

(1) Paragraphs (2) and (3) of section 856(c) (relating to limitations) are each amended by striking out "and" at the end of subparagraph (D), by adding "and" at the end of subparagraph (E), and by adding at the end thereof the following new subparagraph: " (F) income and gain derived from foreclosure property (as defined in subsection (e)); ". ^2) Section 857(a)(1) (relating to requirements applicable to real estate investment trusts) is amended to read as follows: "(1) the deduction for dividends paid during the taxable year ^^g defined in section 561, but determined without regard to capital gains dividends) equals or exceeds the sum of— " (A) 90 percent of the real estate investment trust taxable income for the taxable year (determined without regard to the deduction for dividends paid (as defined in section 561)); and " (B) 90 percent of the excess of (i) the net income from foreclosure property over (ii) the tax imposed on such income by subsection (b)(4)(A), and". ^3^ Section 857(b)(2) (defining real estate investment trust taxable income) is amended by adding at the end thereof the following new subparagraph: " (F) There shall be excluded an amount equal to the net income from foreclosure property." (4) Section 857(b)(2)(C) is amended by inserting before the the period at the end thereof "and shall be computed without regard to that portion of such deduction which is attributable to the amount excluded under subparagraph (F) ". (e) EFFECTIVE DATE.—The amendments made by this section apply to foreclosure property acquired after December 31, 1973. Notwithstanding the provisions of section 856(e)(5) of the Internal Revenue Code of 1954 (as added by subsection (a) of this section) any taxpayer required to make an election with respect to foreclosure property sooner than 90 days after the date of enactment of this Act, may make that election at any time before the 91st day after the date of enactment of this Act. SEC. 7. INCREASE IN INTEREST CHARGED AND PAID IN CONNECTION WITH DEFICIENCIES, ETC. (a) INCREASE I N INTEREST RATE.—

(1) Chapter 67 (relating to interest) is amended by adding at the end thereof the following new subchapter:

"Subchapter C—Determination of interest rate 26 USC 6621,

6602 ""^eiiTsh 7426*. ' '

"SEC. 6621. Determination of rate of interest. "SEC. 6621. DETERMINATION OF RATE OF INTEREST.

" (a) IN GENERAL.—The rate of interest under sections 6601(a), ^^^^' 6611 (a), 6332(c)(1), and 7426 (g) of this title, and under section 2411(a) of title 28 is 9 percent per annum, or such adjusted rate as is established by the Secretary or his delegate under subsection (b). " (b) ADJUSTMENT OF INTEREST RATE.—The Secretary or his delegate shall establish an adjusted rate of interest for the purpose of subsection (a) not later than October 15 of any year if the adjusted prime rate charged by banks during September of that year, rounded to the nearest full percent, is at least a full percentage point more or less than the interest rate which is then in effect. Any such adjusted rate of interest shall be equal to the adjusted prime rate charged by banks, rounded to the nearest full percent, and shall become effective

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