Page:United States Statutes at Large Volume 89.djvu/122

 89 STAT. 62

PUBLIC LAW 94-12—MAR. 29, 1975 "(g)

Infra.

INCREASE I N QUALIFIED INVESTMENTS I N FOREIGN B A S E C O M -

PANY S H I P P I N G OpEPtATioNS.—For purposes of subsection (b)(2), the increase for any taxable year in qualified investments in foreign base company shipping operations of any controlled foreign corporation is the amount by which— " (1) the qualified investments in foreign base company shipping operations (as defined in section 9 5 5 (b)) of the controlled foreign corporation at the close of the taxable year, exceed " (2) the qualified investments in foreign base company shipp i n g operations (as so defined) of the controlled foreign corporation at the close of the preceding taxable year." (2) A M O U N T S INCLUDED I N GROSS INCOME or SHAREHOLDERS.

Ante, p. 58.

UNITED STATES

(A) Subparagraph (A) of section 951(a)(1) is amended by striking out " and " at the end of clause (i), by striking out the semicolon at the end of clause (ii) and inserting in lieu thereof a comma, and by adding at the end thereof the following new clause: " ( i i i) his pro r a t a share (determined under section 955(a)(3)) of the corporation's previously excluded subpart F income withdrawn from foreign base company shipping operations for such year; and". (B) Section 951(a) is amended by inserting after paragraph (2) the following new paragraph: " (3) L I M I T A T I O N ON PRO RATA SHARE or PREVIOUSLY EXCLUDED SUBPART F INCOME WITHDRAWN FROM INVESTMENT. For p u r p O S e S

of paragraph (l)(A) ( i i i), the pro rata share of any United States shareholder of the previously excluded subpart F income of a controlled foreign corporation withdrawn from investment in foreign base company shipping operations shall not exceed an amount— " (A) which bears the same ratio to his p r o rata share of such income withdrawn (as determined under section 955(a) (3)) for the taxable year, as " (B) the part of such year during which the corporation is a controlled foreign corporation bears to the entire year." (3) WITHDRAWAL OF PREVIOUSLY EXCLUDED SUBPART F INCOME FROM QUAIiiriED INVESTMENT.

26 USC 955.

(A) Subpart F of part III of subchapter N of chapter 1 is amended by inserting after section 954 the following new section: "SEC. 955. WITHDRAWAL OF PREVIOUSLY EXCLUDED SUBPART F INC03IE FROM QUALIFIED INVESTMENT. "(a)

Ante, p. 61.

GENERAL

RULES.—

" (1) A M O U N T WITHDRAWN.—For purposes of this subpart, the amount of previously excluded subpart F income of any controlled foreign corporation withdrawn from investment in foreign base company shipping operations for any taxable year is an amount equal to the decrease in the amount of qualified investments in foreign base company shipping operations of the controlled foreign corporation for such year, but only to the extent that the amount of such decrease does not exceed an amount equal to— " (A) the sum of the amounts excluded under section 954 (b)(2) from the foreign base company income of such corporation for all prior taxable years, reduced by " (B) the sum of the amounts of previously excluded subpart F income withdrawn from investment in foreign base

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