‘‘(2) DERIVATIVE
FINANCIAL
INSTRUMENT.— 
The term ‘derivative financial instrument’ includes 
any option, forward contract, futures contract, no-
tional principal contract, or any similar financial in-
strument. 
‘‘(3) SPECIFIED
INDEX.—The term ‘specified 
index’ means any 1 or more of any combination of— 
‘‘(A) a fixed rate, price, or amount, or 
‘‘(B) a variable rate, price, or amount,
which is based on any current objectively deter-
minable information which is not within the control 
of any of the parties to the contract or instrument 
and is not unique to any of the parties’ cir-
cumstances. 
‘‘(4) TREATMENT OF EXCHANGES.— 
‘‘(A) IN GENERAL.—An exchange shall be 
treated as the sale of the property transferred 
and a purchase of the property received by each 
party to the exchange. 
‘‘(B) CERTAIN DEEMED EXCHANGES.—In 
the case of a distribution treated as an ex-
change for stock under section 302 or 331, the 
corporation making such distribution shall be 
treated as having purchased such stock for pur-
poses of this section. 
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‘‘(f) EXCEPTIONS.— 
‘‘(1) EXCEPTION FOR INITIAL ISSUES.—No tax 
shall be imposed under subsection (a) on any cov-
ered transaction with respect to the initial issuance 
of any security described in subparagraph (A), (B), 
or (C) of subsection (e)(1). 
‘‘(2) EXCEPTION FOR CERTAIN TRADED SHORT- 
TERM INDEBTEDNESS.—A note, bond, debenture, or 
other evidence of indebtedness which— 
‘‘(A) is traded on a trading facility located 
in the United States, and 
‘‘(B) has a fixed maturity of not more 
than 100 days, 
shall not be treated as described in subsection 
(e)(1)(C). 
‘‘(3) EXCEPTION FOR SECURITIES LENDING AR-
RANGEMENTS.—No tax shall be imposed under sub-
section (a) on any covered transaction with respect 
to which gain or loss is not recognized by reason of 
section 1058. 
‘‘(g) BY WHOM PAID.— 
‘‘(1) IN GENERAL.—The tax imposed by this 
section shall be paid by— 
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‘‘(A) in the case of a transaction which oc-
curs or is cleared on a facility located in the 
United States, such facility, and 
‘‘(B) in the case of a purchase not de-
scribed in subparagraph (A) which is executed 
by a broker (as defined in section 6045(c)(1)) 
which is a United States person, such broker. 
‘‘(2) SPECIAL
RULES
FOR
DIRECT, 
ETC., 
TRANSACTIONS.—In the case of any transaction to 
which paragraph (1) does not apply, the tax imposed 
by this section shall be paid by— 
‘‘(A) in the case of a transaction described 
in subsection (d)(1)— 
‘‘(i) the purchaser if the purchaser is 
a United States person, and 
‘‘(ii) the seller if the purchaser is not 
a United States person, and 
‘‘(B) in the case of a transaction described 
in subsection (d)(2)— 
‘‘(i) the payor if the payor is a United 
States person, and 
‘‘(ii) the payee if the payor is not a 
United States person. 
‘‘(h) CERTAIN PAYMENTS TREATED AS SEPARATE 
TRANSACTIONS.—Except as otherwise provided by the 
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Secretary, any payment with respect to a security de-
scribed in subparagraph (D), (E), or (F) of subsection 
(e)(1) shall be treated as a separate transaction for pur-
poses of this section, including— 
‘‘(1) any net initial payment, net final or termi-
nating payment, or net periodical payment with re-
spect to a notional principal contract (or similar fi-
nancial instrument), 
‘‘(2) any payment with respect to any forward 
contract (or similar financial instrument), and 
‘‘(3) any premium paid with respect to any op-
tion (or similar financial instrument). 
‘‘(i) ADMINISTRATION.—The Secretary shall carry 
out this section in consultation with the Securities and Ex-
change Commission and the Commodity Futures Trading 
Commission. 
‘‘(j) GUIDANCE; REGULATIONS.—The Secretary 
shall— 
‘‘(1) provide guidance regarding such informa-
tion reporting concerning covered transactions as the 
Secretary deems appropriate, and 
‘‘(2) prescribe such regulations as are necessary 
or appropriate to prevent avoidance of the purposes 
of this section, including the use of non-United 
States persons in such transactions.’’. 
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(b) CLERICAL AMENDMENT.—The table of sub-
chapters for chapter 36 of the Internal Revenue Code of 
1986 is amended by inserting after the item relating to 
subchapter B the following new item: 
‘‘Subchapter C. Tax on trading transactions’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to transactions after December 31, 
2012. 
Æ 
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