PUBLIC LAW 105-34—AUG. 5, 1997 111 STAT. 957 "(vi) amounts received as a pension or annuity, and any distributions or pa3mients received from an individual retirement plan, by the taxpayer during the taxable year to the extent not included in gross income.", and (4) by adding at the end the following new sentence: "Clause (vi) shall not include any amount which is not includible in gross income by reason of section 402(c), 403(a)(4), 403(b), 408(d)(3), (4), or (5), or 457(e)(10).". (e) EFFECTIVE DATES.— 26 USC 32 note. (1) The amendments made by subsection (a) shall apply to taxable years beginning after December 31, 1996. (2) The amendments made by subsections (b), (c), and (d) shall apply to taxable years beginning after December 31, 1997. SEC. 1086. LIMITATION ON PROPERTY FOR WHICH INCOME FORECAST METHOD MAY BE USED. (a) LIMITATION. —Subsection (g) of section 167 is amended by adding at the end the following new paragraph: "(6) LIMITATION ON PROPERTY FOR WHICH INCOME FORECAST METHOD MAY BE USED.—The depreciation deduction allowable under this section may be determined under the income forecast method or any similar method only with respect to— "(A) property described in paragraph (3) or (4) of section 168(f), "(B) copyrights, "(C) books, "(D) patents, and "(E) other property specified in regulations. Such methods may not be used with respect to any amortizable section 197 intangible (as defined in section 197(c)).". (b) DEPRECIATION PERIOD FOR RENT-TO-OWN PROPERTY.— (1) IN GENERAL. — Subparagraph (A) of section 168(e)(3) (relating to 3-year property) is amended by striking "and" at the end of clause (i), by striking the period at the end of clause (ii) and inserting ", and", and by adding at the end the following new clause: "(iii) any qualified rent-to-own property.". (2) 4-YEAR CLASS LIFE.— The table contained in section 168(g)(3)(B) is amended by inserting before the first item the following new item: "(AKiii) 4". (3) DEFINITION OF QUALIFIED RENT-TO-OWN PROPERTY. — Subsection (i) of section 168 is amended by adding at the end the following new paragraph: "(14) QUALIFIED RENT-TO-OWN PROPERTY. — "(A) IN GENERAL. —The term 'quaUfied rent-to-own property* means property held by a rent-to-own dealer for purposes of being subject to a rent-to-own contract. "(B) RENT-TO-OWN DEALER.— The term 'rent-to-own dealer' means a person that, in the ordinary course of business, regularly enters into rent-to-own contracts with customers for the use of consumer property, if a substantial portion of those contracts terminate and the property is returned to such person before the receipt of all payments
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