Page:United States Statutes at Large Volume 96 Part 1.djvu/567

 PUBLIC LAW 97-248—SEPT. 3, 1982

96 STAT. 525

sions of this section" and inserting in lieu thereof "Subject to the limitation of subsection (g), notwithstanding any other provision of this section". (c) EFFECTIVE DATE.—The amendments made by this section shall 26 USC 2039 apply to the estates of decedents dying after December 31, 1982. "o*®SEC. 246. ORGANIZATIONS PERFORMING MANAGEMENT FUNCTIONS.

(a) GENERAL RULE.—Subsection (m) of section 414 (relating to employees of an affiliated service group) is amended by redesignating paragraphs (5) and (6) as paragraphs (6) and (7), respectively, and by inserting after paragraph (4) the following new paragraph:

26 USC 414.

"(5) CERTAIN ORGANIZATIONS PERFORMING MANAGEMENT FUNC-

TIONS.—For purposes of this subsection, the term 'affiliated service group' also includes a group consisting of— "(A) an organization the principal business of which is performing, on a regular and continuing basis, management functions for 1 organization (or for 1 organization and other organizations related to such 1 organization), and "(B) the organization (and related organizations) for which such functions are so performed by the organization described in subparagraph (A). For purposes of this paragraph, the term 'related organizations' has the same meaning as the term 'related persons' when used in section 103(b)(6)(C)." (b) EFFECTIVE DATE.—The amendments made by subsection (a) 26 USC 414 note, shall apply to taxable years beginning after December 31, 1983. SEC. 247. EXISTING PERSONAL SERVICE CORPORATIONS MAY LIQUIDATE UNDER SECTION 333 DURING 1983 OR 1984.

(a) IN GENERAL.—In the case of a complete liquidation of a per- 26 USC 333 note. sonal service corporation (within the meaning of section 535(c)(2)(B) of the Internal Revenue Code of 1954) during 1983 or 1984, the following rules shall apply with respect to any shareholder other than a corporation: (1) 'The determination of whether section 333 of such Code applies shall be made without regard to whether the corporation is a collapsible corporation to which section 341(a) of such Code applies. (2) No gain or loss shall be recognized by the liquidating corporation on the distribution of any unrealized receivable in such liquidation. (3)(A) Except as provided in subparagraph (C), any disposition by a shareholder of any unrealized receivable received in the liquidation shall be treated as a sale at fair market value of such receivable and any gain or loss shall be treated as ordinary gain or loss. (B) For purposes of subparagraph (A), the term "disposition" includes— (i) failing to hold the property in the trade or business which generated the receivables, and (ii) failing to hold a continuing interest in such trade or business. (C) For purposes of subparagraph (A), the term "disposition" does not include transmission at death to the estate of the decedent or transfer to a person pursuant to the right of such person to receive such property by reason of the death of the

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