Page:United States Statutes at Large Volume 95.djvu/217

 PUBLIC LAW 97-34—AUG. 13, 1981

95 STAT. 191

"In the case of taxable years beginning in: The annual rate is: 1984 $85,000 1985 90,000 1986 and thereafter 95,000. "(B) ATTRIBUTION TO YEAR IN WHICH SERVICES ARE PER-

FORMED.—For purposes of applying subparagraph (A), amounts received shall be considered received in the taxable year in which the services to which the amounts are attributable are performed. "(C) TREATMENT OF COMMUNITY INCOME.—In applying subparagraph (A) with respect to amounts received from services performed by a husband or wife which are community income under community property laws applicable to such income, the aggregate amount which may be excludable from the gross income of such husband and wife under subsection (a)(1) for any taxable year shall equal the amount which would be so excludable if such amounts did not constitute community income. "(c) HOUSING COST AMOUNT.—For purposes of this section— "(1) IN GENERAL.—The term housing cost amount' means an amount equal to the excess of— "(A) the housing expenses of an individual for the taxable year, over "(B) an amount equal to the product of— "(i) 16 percent of the salary (computed on a daily basis) of an employee of the United States who is compensated at a rate equal to the annual rate paid for step 1 of grade GS-14, multiplied by "(ii) the number of days of such taxable year within the applicable period described in subparagraph (A) or (B) of subsection (d)(D. "(2) HOUSING EXPENSES.—

"(A) IN GENERAL.—The term 'housing expenses* means the reasonable expenses paid or incurred during the taxable year by or on behalf of an individu^ for housing for the indiviaual (and, if they reside with him, for his spouse and dependents) in a foreign country. The term— "(i) includes expenses attributable to the housing (such as utilities and insurance), but "(ii) does not include interest and taxes of the kind deductible under section 168 or 164 or any amount 26 USC 163,164. allowable as a deduction under section 216(a). Housing expenses shall not be treated as reasonable to the extent such expenses are lavish or extravagant under the circumstances. "(B) SECOND FOREIGN HOUSEHOLD.—

"(i) IN GENERAL.—Except as provided in clause (ii), only housing expenses incurred with respect to that abode which bears the closest relationship to the t ^ home of the individual shall be taken into account under paragraph (1). "(ii) SEPARATE HOUSEHOLD FOR SPOUSE AND DEPEND-

ENTS.—If an individual maintains a separate abode outside the United States for his spouse and dependents and they do not reside with him because of living conditions which are dangerous, unhealthful, or otherwise adverse, then—

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