98 STAT. 618
PUBLIC LAW 98-369—JULY 18, 1984 "(iii) such stock was not held by the taxpayer for 30 days or more after the closing of such options. For purposes of the preceding sentence, the rules of paragraphs (3) (other than subparagraph (B) thereof) and (4) of section 246(c) shall apply in determining the period for which the taxpayer holds the stock. "(F) STRIKE PRICE.—For purposes of this paragraph, the term 'strike price' means the price at which the option is exercisable.
Ante, p. 567.
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"(G) APPLICABLE STOCK PRICE.—For purposes of subpara-
graph (D), the term 'applicable stock price' means, with respect to any stock for which an option has been granted— "(i) the closing price of such stock on the most recent day on which such stock was traded before the date on which such option was granted, or "(ii) the opening price of such stock on the day on which such option was granted, but only if such price is greater than 110 percent of the price determined under clause (i). "(H) REGULATIONS.—The Secretary shall prescribe such regulations as may be necessary or appropriate to carry out the purposes of this paragraph. Such regulations may include modifications to the provisions of this paragraph which are appropriate to take account of changes in the practices of option exchanges or to prevent the use of options for tax avoidance purposes." (b) REPEAL OF EXCEPTION FOR STOCK.—
26 USC 1092.
(1) IN GENERAL.—Paragraph (1) of section 1092(d) (defining personal property) is amended by striking out "(other than stock)". (2) EXCEPTION WHERE STRADDLE CONSISTS OF HOLDING STOCK.—
Subsection (d) of section 1092 is amended by redesignating paragraphs (3), (4), and (5) as paragraphs (4), (5), and (6), respectively, and by inserting after paragraph (2) the following new paragraph: "(3) SPECIAL RULES FOR STOCK.—For purposes of paragraph
(D"(A) IN GENERAL.—Except as provided in subparagraph (B), the term 'personal property' does not include stock. "(B) EXCEPTIONS.—The term 'personal property' includes— "(i) any stock which is part of a straddle at least 1 of the offsetting positions of which is— "(I) an option with respect to such stock or substantially identical stock or securities, or "(II) under regulations, a position with respect to substantially similar or related property (other than stock), and "(ii) any stock of a corporation formed or availed of to take positions in personal property which offset positions taken by any shareholder. "(C) SPECIAL RULES.—
"(i) For purposes of subparagraph (B), subsection (c) and paragraph (4) shall be applied as if stock described in clause (i) or (ii) of subparagraph (B) were personal property.
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