Page:United States Statutes at Large Volume 98 Part 1.djvu/706

 98 STAT. 658

PUBLIC LAW 98-369—JULY 18, 1984 "(e) SPECIAL RULES RELATING TO DISTRIBUTIONS, ETC., BY CORPORATIONS, PARTNERSHIPS, TRUSTS, OR ESTATES.— "(1) CERTAIN DOMESTIC PARTNERSHIPS, TRUSTS, AND ESTATES.—

A domestic partnership, the trustee of a domestic trust, or the executor of a domestic estate shall be required to deduct and withhold under subsection (a) a tax equal to 10 percent of any amount of which such partnership, trustee, or executor has custody which is— "(A) attributable to the disposition of a United States real property interest (as defined in section 897(c), other than a disposition described in paragraph (4) or (5)), and "(B) either— "(i) includible in the distributive share of a partner of the partnership who is a foreign person, "(ii) includible in the income of a beneficiary of the trust or estate who is a foreign person, or "(iii) includible in the income of a foreign person under the provisions of section 671. "(2) CERTAIN DISTRIBUTIONS BY FOREIGN CORPORATIONS.—In the

case of any distribution by a foreign corporation on which gain is recognized under subsection (d) or (e) of section 897, the foreign corporation shall deduct and withhold under subsection (a) a tax equal to 28 percent of the amount of gain recognized on such distribution under such subsection. "(3)

26 USC 331.

DISTRIBUTIONS BY CERTAIN DOMESTICORPORATIONS TO

FOREIGN SHAREHOLDERS.—If a domestic corporation which is or has been a United States real property holding corporation (as defined in section 897(c)(2)) during the applicable period specified in section 897(c)(l)(A)(ii) distributes property to a foreign person in a transaction to which section 302 or part II of subchapter C applies, such corporation shall deduct and withhold under subsection (a) a tax equal to 10 percent of the amount realized by the foreign shareholder. "(4) TAXABLE DISTRIBUTIONS BY DOMESTIC OR FOREIGN PARTNERSHIPS, TRUSTS, OR ESTATES.—A domestic or foreign partnership,

the trustee of a domestic or foreign trust, or the executor of a domestic or foreign estate shall be required to deduct and withhold under subsection (a) a tax equal to 10 percent of the fair market value (as of the time of the taxable distribution) of any United States real property interest distributed to a partner of the partnership or a beneficiary of the trust or estate, as the case may be, who is a foreign person in a transaction which would constitute a taxable distribution under the regulations promulgated by the Secretary pursuant to section 897(g). "(5) RULES RELATING TO DISPOSITIONS OF INTEREST IN PARTNER-

SHIPS, TRUSTS, OR ESTATES.—To the extent provided in regulations, the transferee of a partnership interest or of a beneficial interest in a trust or estate shall be required to deduct and withhold under subsection (a) a tax equal to 10 percent of the amount realized on the disposition. "(6) REGULATIONS.—The Secretary shall prescribe such regulations as may be necessary to carry out the purposes of this subsection, including regulations providing for exceptions from provisions of this subsection. "(f) DEFINITIONS.—For purposes of this section— "(1) TRANSFEROR.—The term 'transferor' means the person disposing of the United States real property interest.

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