Page:United States Statutes at Large Volume 98 Part 1.djvu/1044

 98 STAT. 996

Ante, p. 986.

PUBLIC LAW 98-369—JULY 18, 1984 "(D) distributions from a FSC (or former FSC) out of earnings and profits attributable to foreign trade income (within the meaning of section 923(b)), and "(E) income other than income described in subparagraph (A),(B),(C),or(D).",and (C) by striking out the heading and inserting in lieu thereof: "(d) SEPARATE APPLICATION OF SECTION WITH RESPECT TO CERTAIN INTEREST INCOME AND INCOME FROM DISC, FORMER DISC, FSC, OR

FORMER FSC.—".

26 USC 906.

26 USC 951.

(3) Subsection (b) of section 906 (relating to special rules) is amended by adding at the end thereof the following new paragraph: "(5) No credit shall be allowed under this section for any income, war profits, and excess profits taxes paid or accrued with respect to the foreign trade income (within the meaning of section 923(b)) of a FSC". (4) Section 951 (relating to amounts included in gross income of shareholders) is amended by adding at the end thereof the following new subsection: "(e) FOREIGN TRADE INCOME NOT TAKEN INTO ACCOUNT.—

Ante, p. 985.

Ante, p. 986. Ante, p. 991. 26 USC 275.

26 USC 1248.

"(1) IN GENERAL.—The foreign trade income of a FSC and any deductions which are apportioned or allocated to such income shall not be taken into account under this subpart. For purposes of the preceding sentence, income described in paragraph (2) or (3) of section 921(d) shall be treated as derived from sources within the United States. "(2) FOREIGN TRADE INCOME.—For purposes of this subsection, the term 'foreign trade income' has the meaning given such term by section 923(b), but does not include section 923(a)(2) nonexempt income (within the meaning of section 927(d)(6)).". (5) Paragraph (4) of section 275(a) (relating to disallowance of deduction for certain taxes) is amended to read as follows: "(4) Income, war profits, and excess profits taxes imposed by the authority of any foreign country or possession of the United States if— "(A) the taxpayer chooses to take to any extent the benefits of section 901, or "(B) such taxes are paid or accrued with respect to foreign trade income (within the meaning of section 923(b)) of a FSC". (6) Subsection (d) of section 1248 (relating to exclusions from earnings and profits) is amended by adding at the end thereof the following new paragraph: "(6) FOREIGN TRADE INCOME.—Earnings and profits of

Ante, p. 986. 26 USC 934.

26 USC 956.

the

foreign corporation attributable to foreign trade income (within the meaning of section 923(b)) of a FSC". (7) Section 934 (relating to limitation on reduction in income tax liability incurred to the Virgin Islands) is amended by adding at the end thereof the following new subsection: "(f) FSC—Subsection (a) shall not apply in the case of a Virgin Islands corporation which is a FSC". (8) Paragraph (2) of section 956(b) (defining United States property) is amended by striking out "and" at the end of subparagraph (G), by striking out the period at the end of subparagraph (H) and inserting in lieu thereof a semicolon and

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