‘‘(c) RESTRICTIONS APPLICABLE TO DIVIDENDS RE-
CEIVED FROM REAL ESTATE INVESTMENT TRUSTS.—
‘‘(1) SECTION 243.—For purposes of section 243 
(relating to deductions for dividends received by cor-
porations), a dividend received from a real estate in-
vestment trust which meets the requirements of this 
part shall not be considered a dividend. 
‘‘(2) SECTION 1(h)(11).—For purposes of section 
1(h)(11) (relating to maximum rate of tax on divi-
dends), rules similar to the rules of section 
854(b)(1)(B) shall apply to dividends received from a 
real estate trust which meets the requirements of this 
part.’’
(e) CONFORMING AMENDMENTS.—
(1) Paragraph (3) of section 1(h), as redesig-
nated by section 301, is amended to read as follows: 
‘‘(3) ADJUSTED NET CAPITAL GAIN.—For pur-
poses of this subsection, the term ‘adjusted net capital 
gain’ means the sum of—
‘‘(A) net capital gain (determined without 
regard to paragraph (11)) reduced (but not 
below zero) by the sum of—
‘‘(i) unrecaptured section 1250 gain, 
and 
‘‘(ii) 28-percent rate gain, plus
‘‘(B) qualified dividend income (as defined 
in paragraph (11)).’’
(2) Subsection (f) of section 301 is amended add-
ing at the end the following new paragraph: 
‘‘(4) For taxation of dividends received by indi-
viduals at capital gain rates, see section 1(h)(11).’’
(3) Paragraph (1) of section 306(a) is amended 
by adding at the end the following new subparagraph: 
‘‘(D) TREATMENT AS DIVIDEND.—For pur-
poses of section l(h)(11), any amount treated as 
ordinary income under this paragraph shall be
treated as a dividend received from the corpora-
tion.’’
(4)(A) Subpart C of part II of subchapter C of 
chapter 1 (relating to collapsible corporations) is re-
pealed. 
(B)(i) Section 338(h) is amended by striking 
paragraph (14). 
(ii) Sections 467(c)(5)(C), 1255(b)(2), and 
1257(d) are each amended by striking ‘‘, 341(e)(12),’’. 
(iii) The table of subparts for part II of sub-
chapter C of chapter 1 is amended by striking the 
item related to subpart C.
(5) Section 531 is amended by striking ‘‘equal 
to’’ and all that follows and inserting ‘‘equal to 15 
percent of the accumulated taxable income.’’
(6) Section 541 is amended by striking ‘‘equal 
to’’ and all that follows and inserting ‘‘equal to 15 
percent of the undistributed personal holding com-
pany income.’’
(7) Section 584(c) is amended by adding at the 
end the following new flush sentence: 
‘‘The proportionate share of each participant in the amount 
of dividends received by the common trust fund and to 
which section 1(h)(11) applies shall be considered for pur-
poses of such paragraph as having been received by such 
participant.’’
(8) Paragraph (5) of section 702(a) is amended 
to read as follows: 
‘‘(5) dividends with respect to which section 
1(h)(11) or part VII of subchapter B applies,’’. 
(f) EFFECTIVE DATE.—The amendments made by this 
section shall apply to taxable years beginning after Decem-
ber 31, 2002. 
SEC. 303. SUNSET OF TITLE. 
All provisions of, and amendments made by, this title 
shall not apply to taxable years beginning after December 
31, 2012, and the Internal Revenue Code of 1986 shall be
applied and administered to such years as if such provi-
sions and amendments had never been enacted. 
TITLE 
IV—CORPORATE 
ESTI-
MATED TAX PAYMENTS FOR 
2003
SEC. 401. TIME FOR PAYMENT OF CORPORATE ESTIMATED 
TAXES. 
Notwithstanding section 6655 of the Internal Revenue 
Code of 1986, 52 percent of the amount of any required 
installment of corporate estimated tax which is otherwise 
due in September 2003 shall not be due until October 1, 
2003.
Amend the title so as to read: ‘‘A bill to provide for 
reconciliation pursuant to section 201 of the concurrent 
resolution on the budget for fiscal year 2004.’’.
Union Calendar No. 49
108TH CONGRESS 
1ST SESSION 
H. R. 2
[Report No. 108–94] 
A BILL 
To amend the Internal Revenue Code of 1986 to 
provide additional tax incentives to encourage 
economic growth. 
MAY 8, 2003
Reported with amendments, committed to the Committee 
of the Whole House on the State of the Union, and or-
dered to be printed