Page:United States Statutes at Large Volume 98 Part 1.djvu/604

 98 STAT. 556

PUBLIC LAW 98-369—JULY 18, 1984 time for filing) shall pay a penalty equal to 1 percent of the aggregate issue price of such issue, unless it is shown that such failure is due to reasonable cause and not willful neglect. The amount of the penalty imposed under the preceding sentence with respect to any issue of debt instruments shall not exceed $50,000 for such issue. "(c) DEFICIENCY PROCEDURES NOT TO APPLY.—Subchapter B of

26 USC 6211.

chapter 63 (relating to deficiency procedures for income, estate, gift, and certain excise taxes) shall not apply in respect of the assessment or collection of any penalty imposed by this section." (2) CLERICAL AMENDMENT.—The table of sections for subchapter B of chapter 68 is amended by adding at the end thereof the following new item: "Sec. 6706. Original issue discount information requirements." SEC. 42. TECHNICAL AND CONFORMING AMENDMENTS RELATED TO ORIGINAL ISSUE DISCOUNT CHANGES. (a) IN GENERAL.—

Repeals. 26 USC 1232, 1232A, 1232B. 26 USC 103A. 26 USC 163. Post, p. 654.

(1) Sections 1232, 1232A, and 1232B are hereby repealed. (2) Clause (i) of section 103A(i)(2)(C) (defining yield on the issue) is amended by striking out "section 1232(b)(2)" and inserting in lieu thereof "sections 1273(b) and 1274". (3) Subsection (e) of section 163 (relating to original issue discount) is amended to read as follows: "(e) ORIGINAL ISSUE DISCOUNT.—

Ante, p. 540.

Ante, p. 533. Ante, p. 536.

'<; te-' *^ ' Ante, p. 553. Ante, p. 540.

26 USC 165.

"(1) IN GENERAL.—In the case of any debt instrument issued after July 1, 1982, the portion of the original issue discount with respect to such debt instrument which is allowable as a deduction to the issuer for any taxable year shall be equal to the aggregate daily portions of the original issue discount for days during such taxable year. "(2) DEFINITIONS AND SPECIAL RULES.—For purposes of this subsection— "(A) DEBT INSTRUMENT.—The term 'debt instrument' has the meaning given such term by section 1275(a)(1). "(B) DAILY PORTIONS.—The daily portion of the original issue discount for any day shall be determined under section 1272(a) (without regard to paragraph (6) thereof and without regard to section 1273(a)(3)). "(3) EXCEPTIONS.—This subsection shall not apply to any debt instrument described in— "(A) subparagraph (D) of section 1272(a)(2) (relating to obligations issued by natural persons before March 2, 1984), and "(B) subparagraph (E) of section 1272(a)(2) (relating to loans between natural persons). "(4) CROSS REFERENCES.— "For provision relating to deduction of original issue discount on taxexempt obligation, see section 1288. "For special rules in the case of the borrower under certain loans for personal use, see section 1275(b)."

(4) Paragraph (3) of section 165(j) (relating to denial of deductions for losses on certain obligations not in registered form) is amended by striking out "subsection (d) of section 1232" and inserting in lieu thereof "section 1287".

�