Page:United States Statutes at Large Volume 90 Part 2.djvu/464

 PUBLIC LAW 94-455—OCT. 4, 1976

9 0 STAT. 1932

" (3) CERTAIN REGULATED INVESTMENT COMPANIES.—In the case

Ante, p. 1787.

of a regulated investment company which distributes during the taxable year an exempt-interest dividend (including exemptinterest dividends paid after the close of the taxable year as described in section 855), that portion of any amount othervfise allowable as a deduction which the amount of the income of such company wholly exempt from taxes under this subtitle bears to the total of such exempt income and its gross income (excluding from gross income, for this purpose, capital gain net income, as defined in section 1222(9)). " (4) INTEREST RELATED TO EXEMPT-INTEREST DIVIDENDS.—Inter-

26 USC 852 note.

26 USC 584.

26 USC 152. 26 USC 152 note.

26 USC 1033.

est on indebtedness incurred or continued to purchase or carry shares of stock of a regulated investment company which during the taxable year of the holder thereof distributes exempt-interest dividends." (e) EFFECTIVE D A T E. — The amendments made by this section shall apply to taxable years beginning after December 31, 1975. SEC. 2138. COMMON TRUST FUND TREATMENT OF CERTAIN CUSTODIAL ACCOUNTS. (a) IN GENERAL.—Section 584(a)(1) (relating to definition of common trust fund) is amended to read as follows: " (1) exclusively for the collective investment and reinvestment of moneys contributed thereto by the bank in its capacity— " (A) as a trustee, executor, administrator, or guardian, or " (B) as a custodian of accounts— " (i) which the Secretary determines are established pursuant to a State law which is substantially similar to the Uniform Gifts to Minors Act as published by the American Law Institute, and " (ii) with respect to which the bank establishes, to the satisfaction of the Secretary, that it has duties and responsibilities similar to duties and responsibilities of a trustee or g u a r d i a n; and". SEC. 2139. SUPPORT TEST FOR DEPENDENT CHILDREN OF DIVORCED ETC., PARENTS. (a) IN GENERAL.—Section 152 (relating to definition of dependents) is amended by striking the word "all in subsection (e)(2)(B) (i) thereof and inserting in lieu thereof "each". (b) EFFECTIVE D A T E. — The amendment made by this section shall apply to taxable years beginning after the date of the enactment of this Act. SEC. 2140. INVOLUNTARY CONVERSION OF REAL PROPERTY. (a) IN GENERAL.—Section 1033(g) (relating to involuntary conversions), as amended by this Act, is amended by a d d i n g a t the end thereof the following new paragraph: "(4)

26 USC 1033 note.

SPECIAL RULE. — I n the case of a compulsory or involun-

t a r y conversion described in paragraph (1), subsection (a)(3) (B)(i) shall be applied by substituting '3 years' for '2 year s ' ". (b) EFFECTIVE D A T E. — The amendment made by this section shall apply with respect to any disposition of converted property (within the meaning of section 1033(a)(2) of the I n t e r n a l Revenue Code of 1954) after December 31, 1974, unless a condemnation proceeding with respect to such property began before the date of the enactment of this Act.

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