Page:United States Statutes at Large Volume 101 Part 2.djvu/1197

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101 STAT. 1330-403
101 STAT. 1330-403
PUBLIC LAW 100-000—MMMM. DD, 1987

PUBLIC LAW 100-203—DEC. 22, 1987 .

101 STAT. 1330-403

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, "Sec. 280H. Limitation on certain amounts paid to owner-employees by personal service corporations electing alternative taxable years." (d) EFFECTIVE DATES.—

26 USC 444 note.

(1) IN GENERAL.—Except as provided in this subsection, the amendments made by this section shall apply to taxable years beginning after December 31, 1986. (2) REQUIRED PAYMENTS.—The amendments made by subsection (b) shall apply to applicable election years beginning after December 31, 1986. (3) ELECTIONS.—Any election under section 444 of the Internal Revenue Code of 1986 (as added by subsection (a)) for an entity's 1st taxable year beginning after December 31, 1986, shall not be required to be made before the 90th day after the date of the enactment of this Act.

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(4) SPECIAL RULE FOR EXISTING ENTITIES ELECTING S CORPORA-

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TION STATUS.—If a C corporation (within the meaning of section 1361(a)(2) "2 of the Internal Revenue Code of 1986) with a taxable year other than the calendar year— (A) made an election after September 18, 1986, and before »,, January 1, 1988, under section 1362 of such Code to be treated as an S corporation, and (B) elected to have the calendar year as the taxable year of the S corporation, then section 444(b)(2)(B) of such Code shall be applied by taking into account the deferral period of the last taxable year of the C corporation rather than the deferral period of the taxable year being changed.

PART II—PARTNERSHIP PROVISIONS SEC. 10211. CERTAIN PUBLICLY TRADED PARTNERSHIPS TREATED AS CORPORATIONS.

(a) GENERAL RULE.—Chapter 79 (relating to definitions) is amended by adding at the end thereoif the following new section: "SEC. 7704. CERTAIN PUBLICLY TRADED PARTNERSHIPS TREATED AS 26 USC 7704. CORPORATIONS. "(a) GENERAL RULE.—For purposes of this title, except as provided in subsection (c), a publicly traded partnership shall be treated as a corporation. "(b) PUBLICLY TRADED PARTNERSHIP.—For purposes of this section, the term 'publicly traded partnership' means any partnership if— "(1) interests in such partnership are traded on an established securities market, or "(2) interests in such partnership are readily tradable on a secondary market (or the substantial equivalent thereof). "(c) EXCEPTION FOR PARTNERSHIPS WITH PASSIVE-TYPE INCOME.—

"(1) IN GENERAL.—Subsection (a) shall not apply to any pub.VI licly traded partnership for any taxable year if such partnership f met the gross income requirements of paragraph (2) for such taxable year and each preceding taxable year beginning after December 31, 1987, during which the partnership (or any predecessor) was in existence. ,.. "(2) GROSS INCOME REQUIREMENTS.—A partnership meets the gross income requirements of this paragraph for any taxable " * Copy read "1361(a)(2))".