Page:United States Statutes at Large Volume 95.djvu/300

 95 STAT. 274

Ante, pp. 267, 2'70.

PUBLIC LAW 97-34—AUG. 13, 1981 "(A) gross income does not include the net capital gain, "(B) gross income and aggregate interest received shall each be reduced by so much of the deduction allowable by section 163 for the taxable year (other than for interest on mortgages on real property owned by the real estate investment trust) as does not exceed aggregate interest received by the taxable jrear, and "(C) gross income shall be reduced by the sum of the taxes imposed by paragraphs (4), (5), and (6) of section 857(b). "(4) AGGREGATE INTEREST RECEIVED.—For purposes of this subsection, the term 'aggregate interest received means only interest described in section 128(c)(l). "(5) N O T I C E TO SHAREHOLDERS.—The a m o u n t of any distribu-

tion by a real estate investment trust which may be taken into account as interest for purposes of the exclusion under section 128 shall not exceed the amount so designated by the trust in a written notice to its shareholders mailed not later than 45 days after the close of its taxable year." (d) EFFECTIVE DATES.—

26 USC 128 "°*®26 USC 116 "°t^

(1) IN GENERAL.—The amendments made by subsections (a) and (c) shall apply to taxable years beginning after December 31, 1984. (2) DIVIDEND EXCLUSION.—The amendment made by subsection (b)(2) shall apply to tsixable years beginning after December 31, 1981.

Subtitle B—Retirement Savings Provisions 26 USC 219.

SEC. 311. RETIREMENT SAVINGS. (a) GENERAL RULE.—Section 219 (relating to deduction for retirement savings) is amended to read as follows: "SEC. 219. RETIREMENT SAVINGS. "(a) ALLOWANCE OF DEDUCTION.—In the case of an individual, there shall be allowed as a deduction an amount equal to the qualified retirement contributions of the individual for the taxable year. "(b) MAXIMUM AMOUNT OF DEDUCTION.—

"(1) IN GENERAL.—The amount allowable as a deduction under subsection (a) to any individual for any taxable year shall not exceed the lesser of^ "(A) $2,000, or "(B) an amount equal to the compensation includible in the individual's gross income for such taxable year. "(2) SPECIAL RULES FOR EMPLOYER CONTRIBUTIONS UNDER SIMPLIFIED EMPLOYEE PENSIONS.—

"(A) LIMITATION.—If there is an employer contribution on behalf of the employee to a simplified employee pension, an employee shall be allowed as a deduction under subsection (a) (in addition to the amount allowable under paragraph (1) an amount equal to the lesser of— "(i) 15 percent of the compensation from such employer includible in the employee's gross income for the taxable year (determined without regard to the employer contribution to the simplified employee pension), or "(ii) the amount contributed by such employer to the simplified employee pension and included in gross income (but not in excess of $7,500).

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