80 STAT.]
PUBLIC LAW 89-809-NOV. 13, 1966
1547
such subparagraph, the income which shall be treated as attributable to an office or other fixed place of business within the United States shall not exceed the income which would be derived from sources within the United States if the sale were made in the United States." (e)
EFFECTIVE DATES.—
(1) The amendments made by subsections (a), (c), and (d) shall apply with respect to taxable years beginning after December 31, 1966; except that in applying section 864(c)(4)(B) (iii) of the Internal Revenue Code of 1954 (as added by subsection (d)) with respect to a binding contract entered into on or before February 24, 1966, activities in the United States on or before such date in negotiating or carrying out such contract shall not be taken into account. (2) The amendments made by subsection (b) shall apply with respect to amounts received after December 31, 1966. SEC. 103. NONRESIDENT ALIEN INDIVIDUALS. (a)
TAX ON NoNREsmENT A L I E N INDIVIDUALS.—
(1) Section 871 (relating to tax on nonresident alien individuals) is amended to read as follows: "SEC. 871. TAX ON NONRESIDENT ALIEN INDIVIDUALS. " (a) INCOME NOT CONNECTED W I T H UNITED STATES BUSINESS— 30 PERCENT T A X. — "(1) INCOME OTHER THAN CAPITAL GAINS.—There is hereby
imposed for each taxable year a tax of 30 percent of the amount received from sources within the United States by a nonresident alien individual as— " (A) interest, dividends, rents, salaries, wages, premiums, annuities, compensations, remunerations, emoluments, and other fixed or determinable annual or periodical gains, profits, and income, " (B) gains described in section 402(a)(2), 403(a)(2), or 631 (b) or (c), and gains on transfers described in section 1235 made on or before October 4, 1966, " (C) in the case of bonds or other evidences of indebtedness issued after September 28, 1965, amounts which under section 1232 are considered as ^ains from the sale or exchange of property which is not a capital asset, and " (D) gains from the sale or exchange after October 4, 1966, of patents, copyrights, secret processes and formulas, good will, trademarks, trade brands, franchises, and other like property, or of any interest in any such property, to the extent such gains are from payments which are contingent on the productivity, use, or disposition of the property or interest sold or exchanged, or from payments which are treated as being so contingent under subsection (e), but only to the extent the amount so received is not effectively connected with the conduct of a trade or business within the United States. " (2) C A P I T A L GAINS OF ALIENS PRESENT I N THE UNITED STATES 18 3 DAYS OR MORE.—In the case of a nonresident alien individual pres-
ent in the United States for a period or periods aggregating 183 days or more during the taxable year, there is hereby imposed for such year a tax of 30 percent of the amount by which his gains, derived from sources within the United States, from the sale or exchange at any time during such year of capital assets exceed his losses, allocable to sources within the United States, from the sale or exchange at any time during such year of capital assets. For purposes of this paragraph, gains and losses shall be taken
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