Page:United States Statutes at Large Volume 96 Part 2.djvu/329

 PUBLIC LAW 97-354—OCT. 19, 1982

96 STAT. 1691

(4) Subsection (d) of section 31 (as amended by section 302 of the Tax Equity and Fiscal Responsibility Act of 1982) is Ante, p. 585. amended to read as follows: "(d) YEAR FOR WHICH CREDIT ALLOWED.—Any credit allowed by

this section shall be allowed for the taxable year beginning in the calendar year in which the amount was withheld (or, in the case of subsection (c), in which the wages were received). If more than 1 taxable year begins in a calendar year, such amount shall be allowed as a credit for the last taxable year so beginning." SEC. 4. TAX TREATMENT OF SUBCHAPTER S ITEMS.

(a) GENERAL RULE.—Chapter 63 (relating to assessment) is amended by adding at the end thereof the following new subchapter:

"Subchapter D—Tax Treatment of Subchapter S Items "Sec. 6241. Tax treatment determined at corporate level. "Sec. 6242. Shareholder's return must be consistent with corporate return or Secretary notified of inconsistency. "Sec. 6243. All shareholders to be notified of proceedings and given opportunity to participate. "Sec. 6244. Certain partnership provisions made applicable. "Sec. 6245. Subchapter S item defined.

"SEC. 6241. TAX TREATMENT DETERMINED AT CORPORATE LEVEL. "Except as otherwise provided in regulations prescribed by the Secretary, the tax treatment of any subchapter S item shall be determined at the corporate level. "SEC. 6242. SHAREHOLDER'S RETURN MUST BE CONSISTENT WITH CORPORATE RETURN OR SECRETARY NOTIFIED OF INCONSISTENCY.

26 USC 6 4 21

26 USC 6242

"A shareholder of an S corporation shall, on such shareholder's return, treat a subchapter S item in a manner which is consistent with the treatment of such item on the corporate return unless the shareholder notifies the Secretary (at the time and in the manner prescribed by regulations) of the inconsistency. "SEC. 6243. ALL SHAREHOLDERS TO BE NOTIFIED OF PROCEEDINGS AND GIVEN OPPORTUNITY TO PARTICIPATE.

26 USC 6243

"In the manner and at the time prescribed in regulations, each shareholder in a corporation shall be given notice of, and the right to participate in, any administrative or judicial proceeding for the determination at the corporate level of any subchapter S item. "SEC. 6244. CERTAIN PARTNERSHIP PROVISIONS MADE APPLICABLE.

"The provisions of— "(1) subchapter C which relate to— "(A) assessing deficiencies, and filing claims for credit or refund, with respect to partnership items, and "(B) judicial determination of partnership items, and "(2) so much of the other provisions of this subtitle as relate to partnership items, are (except to the extent modified or made inapplicable in regulations) hereby extended to and made applicable to subchapter S items.

26 USC 6244.

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