PUBLIC LAW 104-188—AUG. 20, 1996 110 STAT. 1861 "(2) the excess inclusion (if any) under section 860E(a)(l) for such taxable year. "(b) COORDINATION WITH SECTION 172. — Any increase in the taxable income of any holder of the ownership interest or a highyield interest in a FASIT for any taxable year by reason of subsection (a) shall be disregarded— "(1) in determining under section 172 the amount of any net operating loss for such taxable year, and "(2) in determining taxable income for such taxable year for purposes of the second sentence of section 172(b)(2). "(c) COORDINATION WITH MINIMUM TAX.— For purposes of part VI of subchapter A of this chapter— "(1) the reference in section 55(b)(2) to taxable income shall be treated as a reference to taxable income determined without regard to this section, "(2) the alternative minimum taxable income of any holder of the ownership interest or a high-yield interest in a FASIT for any taxable year shall in no event be less than such holder's taxable income determined solely with respect to such interests, and "(3) any increase in taxable income under this section shall be disregarded for purposes of computing the alternative tax net operating loss deduction. "(d) AFFILIATED GROUPS. —A ll members of an affiliated group filing a consolidated return shall be treated as one taxpayer for purposes of this section. "SEC. 860K. TREATMENT OF TRANSFERS OF HIGH-YIELD INTERESTS TO DISQUALIFIED HOLDERS. "(a) GENERAL RULE. —In the case of any high-yield interest which is held by a disqualified holder— "(1) the gross income of such holder shall not include any income (other than gain) attributable to such interest, and "(2) amounts not includible in the gross income of such holder by reason of paragraph (1) shall be included (at the time otherwise includible under paragraph (1)) in the gross income of the most recent holder of such interest which is not a disqualified holder. "(b) EXCEPTIONS.— Rules similar to the rules of paragraphs (4) and (7) of section 860E(e) shall apply to the tax imposed by reason of the inclusion in gross income under subsection (a). "(c) DISQUALIFIED HOLDER. — For purposes of this section, the term 'disqualified holder' means any holder other than— "(1) an eligible corporation (as defined in section 860L(a)(2)), or "(2) a FASIT. "(d) TREATMENT OF INTERESTS HELD BY SECURITIES DEALERS.— "(1) IN GENERAL.— Subsection (a) shall not apply to any high-jdeld interest held by a disqualified holder if such holder is a dealer in securities who acquired such interest exclusively for sale to customers in the ordinary course of business (and not for investment). "(2) CHANGE IN DEALER STATUS. — "(A) IN GENERAL.—In the case of a dealer in securities which is not an eligible corporation (as defined in section 860L(a)(2)), if—
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