Page:United States Statutes at Large Volume 96 Part 1.djvu/639

 PUBLIC LAW 97-248—SEPT. 3, 1982

96 STAT. 597

"(iii) has a m a t u r i t y (at issue) of not more than 1 year, or "(iv) is described in subparagraph (B). "(B) CERTAIN OBLIGATIONS NOT INCLUDED.—An obligation

is described in this subparagraph if— "(i) the r e a r e a r r a n g e m e n t s reasonably designed to e n s u r e that such obligation will be sold (or resold in connection with the original issue) only to a person who is not a United States person, and "(ii) in the case of an obligation not in registered form— "(I) interest on such obligation is payable only outside the United States and its possessions, and "(II) on the face of such obligation the r e is a statement that any United States person who holds such obligation will be subject to limitations under the United States income tax laws. "(C) AUTHORITY TO INCLUDE OTHER OBLIGATIONS.—Clauses

(ii) and (iii) of subparagraph (A), and subparagraph (B), shall not apply to any obligation if— "(i) such obligation is of a type which the Secretary has determined by regulations to be used frequently in avoiding Federal taxes, and "(ii) such obligation is issued after the date on which the regulations referred to in clause (i) t a k e effect. "(3) BOOK ENTRIES PERMITTED, ETC.—For purposes of this sub-

section, rules similar to the rules of section apply."

103(j)(3) shall

95 Stat. 350.

(3) D E N I A L OF EARNINGS AND PROFITS ADJUSTMENT FOR INTEREST O N REGISTRATION-REQUIRED OBLIGATIONS NOT IN REGISTERED

FORM.—Section 312 (relating to e a r n i n g s and profits) is amended by adding at the end thereof the following new subsection: "(m) N o ADJUSTMENT FOR INTEREST P A I D ON CERTAIN REGISTRATION-REQUIRED OBLIGATIONS N O T IN REGISTERED FOR M. — The e a r n -

ings and profits of any corporation shall not be decreased by any interest with respect to which a deduction is not or would not be allowable by reason of section 163(f), unless at the time of issuance the issuer is a foreign corporation that is not a controlled foreign corporation (within the m e a n i n g of section 957), a foreign investment company (within the m e a n i n g of section 1246(b)), or a foreign personal holding company (within the m e a n i n g of section 552) and the issuance did not have as a purpose the avoidance of section 163(f) of this subsection". (4) EXCISE TAX ON ISSUERS OF REGISTRATION-REQUIRED OBLIGATIONS WHICH ARE NOT IN REGISTERED FORM.—

(A) IN GENERAL.—Subtitle D (relating to miscellaneous excise taxes) is amended by adding after chapter 38 the following new chapter:

"CHAPTER 39—REGISTRATION-REQUIRED OBLIGATIONS "Sec. 4701. T a x on issuer of refjistration-required obligation not in registered form.

26 USC 312.

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