Page:United States Statutes at Large Volume 98 Part 1.djvu/1074

 98 STAT. 1026

PUBLIC LAW 98-369—JULY 18, 1984 included in determining the gross estate of the decedent, shall be treated for purposes of subparagraph (A) as a disposition of (or a withdrawal with respect to) the stock qualifying under subsection (a)(1). "(F) CHANGES IN INTEREST IN BUSINESS COMPANY.—If any

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stock in a holding company is treated as stock in a business company by reason of subsection (b)(8)(A)— "(i) any disposition of any interest in such stock in the business company by such holding company, or "(ii) any withdrawal of any money or other property from such business company attributable to such stock by such holding company owning such stock, shall be treated for purposes of subparagraph (A) as a disposition of (or a withdrawal with respect to) the stock qualifying under subsection (a)(1)." (d) UNDISTRIBUTED INCOME OF ESTATE.—Paragraph (2) of section

26 USC 6166.

26 USC 6166

note.

6166(g) (relating to undistributed income of estate) is amended by adding at the end thereof the following new subparagraph: "(C) For purposes of this paragraph, if any stock in a corporation is treated as stock in another corporation by reason of subsection (b)(8)(A), any dividends paid by such other corporation to the corporation shall be treated as paid to the estate of the decedent to the extent attributable to the stock qualifying under subsection (a)(1)." (e) EFFECTIVE DATE.—

(1) I^f GENERAL.—The amendments made by this section shall apply with respect to estates of decedents dying after the date of the enactment of this Act. (2) SPECIAL RULE.—

(A) IN GENERAL.—At the election of the executor, if— (i) a corporation has 15 or fewer shareholders on June 22, 1984, and at all times thereafter before the date of the decedent's death, and (ii) stock of such corporation is included in the gross estate of the decedent, then all other corporations all of the stock of which is owned directly or indirectly by the corporation described in clauses (i) and (ii) shall be treated as one corporation for purposes of section 6166 of the Internal Revenue Code of 1954. (B) EFFECT OF ELECTION.—Any executor who elects the

Ante, p. 1024.

26 USC 2055.

application of this paragraph shall be treated as having made the election under paragraph (8) of section 6166(b) of such Code. SEC. 1022. PERMANENT RULES FOR REFORMING GOVERNING INSTRUMENTS CREATING CHARITABLE REMAINDER TRUSTS AND OTHER CHARITABLE INTERESTS. (a) GENERAL RuLE.—Paragraph (3) of section 2055(e) (relating to disallowance of deductions in certain cases) is amended to read as follows: "(3) REFORMATIONS TO COMPLY WITH PARAGRAPH (2).—

"(A) IN GENERAL.—A deduction shall be allowed under subsection (a) in respect of any qualified reformation. "(B) QUALIFIED REFORMATION.—For purposes of this paragraph, the term 'qualified reformation' means a change of a

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