Page:United States Statutes at Large Volume 96 Part 2.djvu/336

 96 STAT. 1698

PUBLIC LAW 97-354—OCT. 19, 1982

26 USC 1371. 26 USC 831.

(ii) subchapter S (as in effect on July 1, 1982) of chapter 1 of the Internal Revenue Code of 1954 and part III of subchapter L of chapter 1 of such Code shall apply. (B) QUALIFIED CASUALTY INSURANCE ELECTING SMALL

Ante, p. 1669.

BUSINESS CORPORATION.—The term "qualified casualty insurance electing small business corporation" means any corporation described in section 831(a) of the Internal Revenue Code of 1954 if— (i) as of July 12, 1982, such corporation was an electing small business corporation and was described in section 831(a) of such Code, (ii) such corporation was formed before April 1, 1982, and proposed (through a written private offering first circulated to investors before such date) to elect to be taxed as a subchapter S corporation and to be operated on an established insurance exchange, or (iii) such corporation is approved for membership on an established insurance exchange pursuant to a written agreement entered into before December 31, 1982, and such corporation is described in section 831(a) of such Code as of December 31, 1984. A corporation shall not be treated as a qualified casualty insurance electing small business corporation unless an election under subchapter S of chapter 1 of such Code is in effect for its first taxable year beginning after December 31, 1984. (3) CERTAIN CORPORATIONS WITH OIL AND GAS PRODUCTION.—

(A) IN GENERAL.—In the case of any qualified oil corporation— (i) the amendments made by this Act shall not apply, and (ii) subchapter S (as in effect on July 1, 1982) of chapter 1 of the Internal Revenue Code of 1954 shall apply. (B) QUALIFIED OIL CORPORATION.—For purposes of this paragraph, the term "qualified oil corporation" means any corporation if— (i) as of September 28, 1982, such corporation— (I) was an electing small business corporation, or (II) was a small business corporation which made an election under section 1372(a) after December 31, 1981, and before September 28, 1982, (ii) for calendar year 1982, the combined average daily production of domestic crude oil or natural gas of such corporation and any one of its substantial shareholders exceeds 1,000 barrels, and (iii) such corporation makes an election under this subparagraph at such time and in such manner as the Secretary of the Treasury or his delegate shall prescribe. (C) AVERAGE DAILY PRODUCTION.—For purposes of subpar-

agraph (B), the average daily production of domestic crude oil or domestic natural gas shall be determined under section 613A(c)(2) of such Code without regard to the last sentence thereof.

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