Page:United States Statutes at Large Volume 92 Part 3.djvu/296

 92 STAT. 2928

PUBLIC LAW 95-600—NOV. 6, 1978 under paragraph (1) of subsection (c), for purposes of subsection (d),". (C) Paragraph (3) of section 1023(f) (defining Federal and State estate taxes) is amended to read as follows:

26 USC 1023.

"(3) FEDERAL AND STATE ESTATE TAXES.—For purposes of subsec-

26 USC 2001, 2101-

tion (c)— "(A) FEDERAL ESTATE TAXES.—The term 'Federal estate taxes' means the tax imposed by section 2001 or 2101, reduced by the credits against such tax. "(B) STATE ESTATE TAXES.—The term 'State estate taxes' means any estate, inheritance, legacy, or succession taxes, for which the estate is liable, actually paid by the estate to any State or the District of Columbia.'' (7) CLARIFICATION OP INCREASE IN BASIS FOR CERTAIN STATE

26 USC 1023.

SUCCESSION TAXES.—Paragraph (2) of section 1023(e) (relating to further increase in basis for certain State succession tax paid by transferee of property) is amended by striking out "for which the estate is not liable". (8) CLARIFICATION OF APPLICATION OF FRESH START.—Para-

graphs (1) and (2)(A) of section 1023(h) (relating to adjustment to basis for December 31, 1976, fair market value) are each amended by striking out "for purposes of determining gain" and inserting in lieu thereof "for purposes of determining gain and applying this section". (9) TECHNICAL AMENDMENT WITH RESPECT TO CERTAIN TERM

26 USC 1001. 26 USC 1014, 1015 1015 1023 26 USC 1014 jjQ^g 26 USC 1 note.

INTERESTS.—Paragraph (1) of section 1001(e) (relating to certain term interests) is amended by striking out "section 1014 or 1015" and inserting in lieu thereof "section 1014, 1015, or 1023". ^^^^ EFFECTIVE DATE.—The amendments made by this subsec^^^^ shall take effect as if included in the amendments and additions made by, and the appropriate provisions of the Tax Reform Act of 1976. (d) AMENDMENTS RELATING TO VALUATION OF CERTAIN FARM, ETC., REAL PROPERTY.— (1) CLARIFICATION THAT SPECIAL VALUATION APPLIES ONLY TO INTERESTS PASSING TO QUALIFIED HEIRS.—Paragraph (1) of section

26 USC 2032A.

2032A(b) (defining qualified real property) is amended by striking out "real property located in the United States" and inserting in lieu thereof "real property located in the United States which was acquired from or passed from the decedent to a qualified heir of the decedent and". (2)

26 USC 1014.

PROPERTY

RECEIVED

IN SATISFACTION

OF PECUNIARY

BEQUEST.—Subsection (e) of section 2032A (relating to definitions and special rules for farm valuation property) is amended by adding at the end thereof the following new paragraph: "(9) PROPERTY ACQUIRED FROM DECEDENT.—Property shall be considered to have been acquired from or to have passed from the decedent if— "(A) such property is so considered under section 10140t>) (relating to basis of property acquired from a decedent), "(B) such property is acquired by any person from the estate in satisfaction of the right of such person to a pecuniary bequest, or "(C) such property is acquired by any person from a trust in satisfaction of a right (which such person has by reason of the death of the decedent) to receive from the trust a specific

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