Page:United States Statutes at Large Volume 95.djvu/381

 PUBLIC LAW 97-34—AUG. 13, 1981

95 STAT. 355

would have been reduced if section 897(d) had not been appHcable, and "(2) for purposes of this title, such shareholder shall be deemed to have paid, on the last day prescribed by law for the payment of the tax imposed by this subtitle on such shareholder for such taxable year, an amount of tax equal to the amount of the increase described in paragraph (1)." (h) TREATY.—Paragraph (2)(B) of section 1125 of the Foreign Investment Real Property Tax Act of 1980 is amended to read as follows: "(B) the new treaty is signed on or after January 1, 1981, and before January 1, 1985, then paragraph (1) shall be applied with respect to obligations under the old treaty by substituting for 'December 31, 1984' the date (not later than 2 years after the new treaty was signed) specified in the new treaty (or accompanying exchange of notes)." (i) EFFECTIVE DATES.—The amendments made by this section shall apply to dispositions after June 18, 1980, in taxable years ending after such date. SEC.

832.

MODIFICATION PROVISIONS.

OF

FOREIGN

INVESTMENT

26 USC 897 ^°^-

26 USC 897 "°*®

COMPANY

(a) IN GENERAL.—Paragraph (2) of section 1246(a) (defining ratable 26 USC 1246. share) is amended by striking out subparagraph (B) and inserting in lieu thereof the following: "(B) excluding such earnings and profits attributable to— "(i) any amount previously included in the gross income of such taxpayer under section 951 (but only to the extent the inclusion of such amount did not result in an exclusion of any other amount from gross income under section 959), or "(ii) any taxable year during which such corporation was not a foreign investment company but only if— "(I) such corporation was not a foreign investment company at any time before such taxable year, and "(II) such corporation was treated as a foreign investment company solely by reason of subsection (b)(2)."

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