Page:United States Statutes at Large Volume 90 Part 2.djvu/156

 90 STAT. 1624

PUBLIC LAW 94-455—OCT. 4, 1976 in a possession of the United States in taxable years beginning before January 1, 1979, the provisions of section 904(f) of such Code shall be applied with respect to such losses under the principles of section 904(a)(1) of such Code as in effect before the enactment of this Act.

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(4) CARRYBACKS AND CARRYOVERS I N THE CASE OF M I N I N G OPERA-

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ff*'



26 USC 904.

TioNS AND INCOME FROM A POSSESSION.—In the casc of a taxpayer to whom paragraph (2) or (3) of this subsection applies, section 904(e) of such Code shall apply except that " January 1, 1979" shall be substituted for " January 1, 1976" each place it appears therein. I f such a taxpayer elects the overall limitation for a taxable year beginning before January 1, 1979, such section 904(e) shall be applied by substituting "the January 1, of the last year for which such taxpayer is on the per-country limitation" for " January 1, 1976" each place it appears therein. SEC. 1032. RECAPTURE OF FOREIGN LOSSES. (a) IN GENERAL.—Section 904 (as amended by section 1031 of this Act) is amended by redesignating subsection (f) as subsection (g) and by inserting after subsection (e) the following new subsection: " (f) RECAPTURE o r OVERALL FOREIGN Loss.— " (1) GENERAL RULE. — For purposes of

Post, p. 1643.

this

subpart

and

section 936, in the case of any taxpayer who sustains an overall foreign loss for any taxable year, that portion of the taxpayer's taxable income from sources without the United States for each succeeding taxable year which is equal to the lesser of— " (A) the amount of such loss (to the extent not used under this paragraph in prior taxable year s), or "(13) 50 percent (or such larger percent as the taxpayer may choose) of the taxpayer's taxable income from sources without the United States for such succeeding taxable year, shall be treated as income from sources within the United States (and not as income from sources without the United States).



"(2)

OVERALL FOREIGN LOSS DEFINED.—For purposes of

this

subsection, the term 'overall foreign loss' means the amount by which the gross income for the taxable year from sources without the United States (whether or not the taxpayer chooses the benefits of this subpart for such taxable year) for such year is exceeded by the sum of the deductions properly apportioned or allocated thereto, except that there shall not be taken into account— " (A) any net operating loss deduction allowable for such year under section 172(a) or any capital loss carrybacks and carryovers to such year under section 1212, and " (B) any— " (i) foreign expropriation loss for such year, as defined in section 172(k)(1), or " ( i i) loss for such year which arises from fire, storm, shipwreck, or other casualty, or from theft, to the extent such loss is not compensated for by insurance or otherwise. " (3) DISPOSITIONS.—

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" (A) IN GENERAL.—For purposes of this chapter, if property which has been used predominantly without the United States in a trade or business is disposed of during any taxable year— " (i) the taxpayer, notwithstanding any other provision of this chapter (other than paragraph (1)), shall be deemed to have received and recognized taxable income

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