Page:United States Statutes at Large Volume 98 Part 1.djvu/633

 PUBLIC LAW 98-369—JULY 18, 1984

98 STAT. 585

SEC. 66. PHASE-OUT OF GRADUATED RATES FOR LARGE CORPORATIONS. (a) IN GENERAL.—Subsection (b) of section 11 (relating to amount 26 USC li. of tax imposed on corporations) is amended by adding at the end thereof the following new flush sentence: "In the case of a corporation with taxable income in excess of $1,000,000 for any taxable year, the amount of tax determined under the preceding sentence for such taxable year shall be increased by the lesser of (A) 5 percent of such excess, or (B) $20,250." (b) C!oNFORMiNG AMENDMENT.—Section 1561(a) (relating to limita- 26 USC 1561. tions on certain multiple tax benefits in the case of certain control corporations) is amended by adding at the end thereof the following new sentence: "Notwithstanding paragraph (1), in applying the last sentence of section 11(b) to such component members, the taxable income of all such component members shall be taken into account and any increase in tax under such last sentence shall be divided among such component members in the same manner as amounts under paragraph (1)." (c) EFFECTIVE DATE.— 26 USC ii note. (1) IN GENERAL.—The amendments made by this section shall apply to taxable years beginning after December 31, 1983. (2) AMENDMENTS NOT TREATED AS CHANGED IN RATE OF TAX.—

The amendments made by this subsection shall not be treated as a change in a rate of tax for purposes of section 21 of the Internal Revenue Code of 1954. Post, p. 830. SEC. 67. RESTRICTIONS ON GOLDEN PARACHUTE PAYMENTS. (a) DENIAL OF DEDUCTION.—Part IX of subchapter B of chapter 1 (relating to items not deductible) is amended by adding after section 280F the following new section: "SEC. 280G. GOLDEN PARACHUTE PAYMENTS. "(a) GENERAL RULE.—No deduction shall be allowed under this chapter for any excess parachute payment. "(b) EXCESS PARACHUTE PAYMENT.—For purposes of this section— "(1) IN GENERAL.—The term 'excess parachute payment' means an amount equal to the excess of any parachute payment over the portion of the base amount allocated to such payment. "(2) PARACHUTE PAYMENT DEFINED.—

"(A) IN GENERAL.—The term 'parachute payment' means any payment in the nature of compensation to (or for the benefit of) a disqualified individual if— "(i) such payment is contingent on a change— "(I) in the ownership or effective control of the corporation, or "(II) in the ownership of a substantial portion of bmulBmthe assets of the corporation, and "(ii) the aggregate present value of the payments in i • ! the nature of compensation to (or for the benefit of) such individual which are contingent on such change equals or exceeds an amount equal to 3 times the base amount. a "(B) AGREEMENTS.—The term 'parachute payment' shall also include any payment in the nature of compensation to (or for the benefit of) a disqualified individual if such payment is pursuant to an agreement which violates any .&uli securities laws or regulations.

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26 USC 280G.

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