178
(e) AMOUNT OF TAX ELIGIBLE FOR 4 PERCENT IN-
TEREST RATE ON EXTENSION OF TIME FOR PAYMENT OF
ESTATE TAX ON CLOSELY HELD BUSINESS.—
(1) Subparagraph (A) of section 6601(j)(2) is
amended by striking ‘‘$345,800’’ and inserting ‘‘the
applicable limitation amount’’.
(2) Subsection (j) of section 6601 is amended
by redesignating paragraph (3) as paragraph (4)
and by inserting after paragraph (2) the following
new paragraph:
‘‘(3) APPLICABLE LIMITATION AMOUNT.—
‘‘(A) IN GENERAL.—For purposes of para-
graph (2), the applicable limitation amount is
the amount of the tentative tax which would be
determined under the rate schedule set forth in
section 2001(c) if the amount with respect to
which such tentative tax is to be computed were
$1,000,000.
‘‘(B) INFLATION
ADJUSTMENT.—In the
case of estates of decedents dying in a calendar
year after 1998, the $1,000,000 amount con-
tained in subparagraph (A) shall be increased
by an amount equal to—
‘‘(i) $1,000,000, multiplied by
179
‘‘(ii) the cost-of-living adjustment de-
termined under section 1(f)(3) for such
calendar year by substituting ‘calendar
year 1997’ for ‘calendar year 1992’ in sub-
paragraph (B) thereof.
If any amount as adjusted under the preceding
sentence is not a multiple of $10,000, such
amount shall be rounded to the nearest multiple
of $10,000.’’
SEC. 6352. INCREASE IN EXPENSE TREATMENT FOR SMALL
BUSINESSES.
(a) GENERAL RULE.—Paragraph (1) of section
179(b) (relating to dollar limitation) is amended to read
as follows:
‘‘(1) DOLLAR LIMITATION.—The aggregate cost
which may be taken into account under subsection
(a) for any taxable year shall not exceed the follow-
ing applicable amount:
‘‘If the taxable year
The applicable
begins in:
amount is:
1996 .......................................................................
$22,500
1997 .......................................................................
27,500
1998 .......................................................................
32,500
1999 or thereafter .................................................
35,000.’’
(b) EFFECTIVE DATE.—The amendment made by
subsection (a) shall apply to taxable years beginning after
December 31, 1995.
180
SEC. 6353. CLARIFICATION OF TREATMENT OF HOME OF-
FICE USE FOR ADMINISTRATIVE AND MAN-
AGEMENT ACTIVITIES.
(a) IN GENERAL.—Paragraph (1) of section 280A(c)
is amended by adding at the end the following new sen-
tence: ‘‘For purposes of subparagraph (A), the term ‘prin-
cipal place of business’ includes a place of business which
is used by the taxpayer for the administrative or manage-
ment activities of any trade or business of the taxpayer
if there is no other fixed location of such trade or business
where the taxpayer conducts substantial administrative or
management activities of such trade or business.’’
(b) EFFECTIVE DATE.—The amendment made by
subsection (a) shall apply to taxable years beginning after
December 31, 1995.
SEC. 6354. TREATMENT OF STORAGE OF PRODUCT SAM-
PLES.
(a) IN GENERAL.—Paragraph (2) of section 280A(c)
is amended by striking ‘‘inventory’’ and inserting ‘‘inven-
tory or product samples’’.
(b) EFFECTIVE DATE.—The amendment made by
subsection (a) shall apply to taxable years beginning after
December 31, 1995.
181
Subtitle D—Family Reinforcement
SEC. 6401. CREDIT FOR ADOPTION EXPENSES.
(a) IN GENERAL.—Subpart A of part IV of sub-
chapter A of chapter 1 is amended by inserting after sec-
tion 25 the following new section:
‘‘SEC. 25A. ADOPTION EXPENSES.
‘‘(a) ALLOWANCE OF CREDIT.—In the case of an in-
dividual, there shall be allowed as a credit against the tax
imposed by this chapter for the taxable year the amount
of the qualified adoption expenses paid or incurred by the
taxpayer during such taxable year.
‘‘(b) LIMITATIONS.—
‘‘(1) DOLLAR
LIMITATION.—The aggregate
amount of qualified adoption expenses which may be
taken into account under subsection (a) with respect
to the adoption of a child shall not exceed $5,000.
‘‘(2) INCOME LIMITATION.—The amount allow-
able as a credit under subsection (a) for any taxable
year shall be reduced (but not below zero) by an
amount which bears the same ratio to the amount
so allowable (determined without regard to this
paragraph but with regard to paragraph (1)) as—
‘‘(A) the amount (if any) by which the tax-
payer’s adjusted gross income (determined
182
without regard to sections 911, 931, and 933)
exceeds $60,000, bears to
‘‘(B) $40,000.
‘‘(3) DENIAL OF DOUBLE BENEFIT.—
‘‘(A) IN GENERAL.—No credit shall be al-
lowed under subsection (a) for any expense for
which a deduction or credit is allowable under
any other provision of this chapter.
‘‘(B) GRANTS.—No credit shall be allowed
under subsection (a) for any expense to the ex-
tent that funds for such expense are received
under any Federal, State, or local program.
The preceding sentence shall not apply to ex-
penses for the adoption of a child with special
needs.
‘‘(c) DEFINITIONS.—For purposes of this section—
‘‘(1) QUALIFIED ADOPTION EXPENSES.—
‘‘(A) IN
GENERAL.—The term ‘qualified
adoption expenses’ means reasonable and nec-
essary adoption fees, court costs, attorney fees,
and other expenses—
‘‘(i) which are directly related to, and
the principal purpose of which is for, the
legal adoption of an eligible child by the
taxpayer, and
183
‘‘(ii) which are not incurred in viola-
tion of State or Federal law or in carrying
out any surrogate parenting arrangement.
‘‘(B) 
EXPENSES
FOR
ADOPTION
OF
SPOUSE’S
CHILD
NOT
ELIGIBLE.—The term
‘qualified adoption expenses’ shall not include
any expenses in connection with the adoption by
an individual of a child who is the child of such
individual’s spouse.
‘‘(2) ELIGIBLE
CHILD.—The term ‘eligible
child’ means any individual—
‘‘(A) who has not attained age 18 as of the
time of the adoption, or
‘‘(B) who is physically or mentally incapa-
ble of caring for himself.
‘‘(3) CHILD WITH SPECIAL NEEDS.—The term
‘child with special needs’ means any child if—
‘‘(A) a State has determined that the child
cannot or should not be returned to the home
of his parents, and
‘‘(B) such State has determined that there
exists with respect to the child a specific factor
or condition (such as his ethnic background,
age, or membership in a minority or sibling
group, or the presence of factors such as medi-
184
cal conditions or physical, mental, or emotional
handicaps) because of which it is reasonable to
conclude that such child cannot be placed with
adoptive parents without providing adoption as-
sistance.
‘‘(d) MARRIED COUPLES MUST FILE JOINT RE-
TURNS, ETC.—Rules similar to the rules of paragraphs
(2), (3), and (4) of section 21(e) shall apply for purposes
of this section.’’
(b) CONFORMING AMENDMENT.—The table of sec-
tions for subpart A of part IV of subchapter A of chapter
1 is amended by inserting after the item relating to section
25 the following new item:
‘‘Sec. 25A. Adoption expenses.’’.
(c) EFFECTIVE DATE.—The amendments made by
this section shall apply to taxable years beginning after
December 31, 1995.
SEC. 6402. CREDIT FOR TAXPAYERS WITH CERTAIN PER-
SONS REQUIRING CUSTODIAL CARE IN THEIR
HOUSEHOLDS.
(a) IN GENERAL.—Subpart A of part IV of sub-
chapter A of chapter 1 is amended by inserting after sec-
tion 25A the following new section:
185
‘‘SEC. 25B. CREDIT FOR TAXPAYERS WITH CERTAIN PER-
SONS REQUIRING CUSTODIAL CARE IN THEIR
HOUSEHOLDS.
‘‘(a) ALLOWANCE OF CREDIT.—In the case of an in-
dividual who maintains a household which includes as a
member one or more qualified persons, there shall be al-
lowed as a credit against the tax imposed by this chapter
for the taxable year an amount equal to $500 for each
such person.
‘‘(b) QUALIFIED PERSON.—For purposes of this sec-
tion, the term ‘qualified person’ means any individual—
‘‘(1) who is a father or mother of the taxpayer,
his spouse, or his former spouse or who is an ances-
tor of such a father or mother,
‘‘(2) who is physically or mentally incapable of
caring for himself,
‘‘(3) who has as his principal place of abode for
more than half of the taxable year the home of the
taxpayer, and
‘‘(4) whose name and TIN are included on the
taxpayer’s return for the taxable year.
For purposes of paragraph (1), a stepfather or stepmother
shall be treated as a father or mother.
‘‘(c) SPECIAL RULES.—For purposes of this section,
rules similar to the rules of paragraphs (1), (2), (3), and
(4) of section 21(e) shall apply.’’
186
(b) CLERICAL AMENDMENT.—The table of sections
for subpart A of part IV of subchapter A of chapter 1
is amended by inserting after the item relating to section
25A the following new item:
‘‘Sec. 25B. Credit for taxpayers with certain persons requiring
custodial care in their households.’’
(c) EFFECTIVE DATE.—The amendments made by
this section shall apply to taxable years beginning after
December 31, 1995.
Subtitle E—Social Security
Earnings Test
SEC. 6501. ADJUSTMENTS IN MONTHLY EXEMPT AMOUNT
FOR PURPOSES OF THE SOCIAL SECURITY
EARNINGS TEST.
(a) INCREASE IN MONTHLY EXEMPT AMOUNT FOR
INDIVIDUALS
WHO
HAVE
ATTAINED
RETIREMENT
AGE.—Section 203(f)(8)(D) of the Social Security Act (42
U.S.C. 403(f)(8)(D)) is amended to read as follows:
‘‘(D)(i) Notwithstanding any other provision of
this subsection, the exempt amount which is applica-
ble to an individual who has attained retirement age
(as defined in section 216(1)) before the close of the
taxable year involved shall be—
‘‘(I) for the taxable year beginning after
1995 and before 1997, $1,250.00,
187
‘‘(II) for the taxable year beginning after
1996 and before 1998, $1,583.331⁄3,
‘‘(III) for the taxable year beginning after
1997 and before 1999, $1,916.662⁄3,
‘‘(IV) for the taxable year beginning after
1998 and before 2000, $2,250.00, and
‘‘(V) for the taxable year beginning after
1999 and before 2001, $2,500.00.
‘‘(ii) For purposes of subparagraph (B)(ii)(II),
the increase in the exempt amount provided under
clause (i)(V) shall be deemed to have resulted from
a determination which shall be deemed to have been
made under subparagraph (A) in 1999.’’.
(b) CONFORMING AMENDMENT.—The second sen-
tence of section 223(d)(4) of such Act (42 U.S.C.
423(d)(4)) is amended by striking ‘‘the exempt amount
under section 203(f)(8) which is applicable to individuals
described in subparagraph (D) thereof’’ and inserting the
following: ‘‘an amount equal to the exempt amount which
would have been applicable under section 203(f)(8), to in-
dividuals described in subparagraph (D) thereof, if section
6501 of the Contract With America Tax Relief Act of
1995 had not been enacted’’.
188
(c) EFFECTIVE DATE.—The amendments made by
this section shall apply with respect to taxable years begin-
ning after 1995.
Subtitle F—Technical Corrections
SEC. 6601. COORDINATION WITH OTHER SUBTITLES.
For purposes of applying the amendments made by
any subtitle of this title other than this subtitle, the provi-
sions of this subtitle shall be treated as having been en-
acted immediately before the provisions of such other sub-
titles.
SEC. 6602. AMENDMENTS RELATED TO REVENUE REC-
ONCILIATION ACT OF 1990.
(a) AMENDMENTS RELATED TO SUBTITLE A.—
(1) Subparagraph (B) of section 59(j)(3) is
amended by striking ‘‘section 1(i)(3)(B)’’ and insert-
ing ‘‘section 1(g)(3)(B)’’.
(2) Clause (i) of section 151(d)(3)(C) is amend-
ed by striking ‘‘joint of a return’’ and inserting
‘‘joint return’’.
(b) AMENDMENTS RELATED TO SUBTITLE B.—
(1) Paragraph (1) of section 11212(e) of the
Revenue Reconciliation Act of 1990 is amended by
striking ‘‘Paragraph (1) of section 6724(d)’’ and in-
serting ‘‘Subparagraph (B) of section 6724(d)(1)’’.
189
(2)(A) Subparagraph (B) of section 4093(c)(2),
as in effect before the amendments made by the
Revenue Reconciliation Act of 1993, is amended by
inserting before the period ‘‘unless such fuel is sold
for exclusive use by a State or any political subdivi-
sion thereof’’.
(B) Paragraph (4) of section 6427(l), as in ef-
fect before the amendments made by the Revenue
Reconciliation Act of 1993, is amended by inserting
before the period ‘‘unless such fuel was used by a
State or any political subdivision thereof’’.
(3) Paragraph (1) of section 6416(b) is amend-
ed by striking ‘‘chapter 32 or by section 4051’’ and
inserting ‘‘chapter 31 or 32’’.
(4) Section 7012 is amended—
(A) by striking ‘‘production or importation
of gasoline’’ in paragraph (3) and inserting
‘‘taxes on gasoline and diesel fuel’’, and
(B) by striking paragraph (4) and redesig-
nating paragraphs (5) and (6) as paragraphs
(4) and (5), respectively.
(5) Subsection (c) of section 5041 is amended
by striking paragraph (6) and by inserting the fol-
lowing new paragraphs:
‘‘(6) CREDIT FOR TRANSFEREE IN BOND.—If—
190
‘‘(A) wine produced by any person would
be eligible for any credit under paragraph (1)
if removed by such person during the calendar
year,
‘‘(B) wine produced by such person is re-
moved during such calendar year by any other
person (hereafter in this paragraph referred to
as the ‘transferee’) to whom such wine was
transferred in bond and who is liable for the tax
imposed by this section with respect to such
wine, and
‘‘(C) such producer holds title to such wine
at the time of its removal and provides to the
transferee such information as is necessary to
properly determine the transferee’s credit under
this paragraph,
then, the transferee (and not the producer) shall be
allowed the credit under paragraph (1) which would
be allowed to the producer if the wine removed by
the transferee had been removed by the producer on
that date.
‘‘(7) REGULATIONS.—The Secretary may pre-
scribe such regulations as may be necessary to carry
out the purposes of this subsection, including regula-
tions—
191
‘‘(A) to prevent the credit provided in this
subsection from benefiting any person who pro-
duces more than 250,000 wine gallons during a
calendar year, and
‘‘(B) to assure proper reduction of such
credit for persons producing more than 150,000
wine gallons of wine during a calendar year.’’
(6) Paragraph (3) of section 5061(b) is amend-
ed to read as follows:
‘‘(3) section 5041(f),’’.
(7) Section 5354 is amended by inserting ‘‘(tak-
ing into account the appropriate amount of credit
with respect to such wine under section 5041(c))’’
after ‘‘any one time’’.
(c) AMENDMENTS RELATED TO SUBTITLE C.—
(1) Paragraph (4) of section 56(g) is amended
by redesignating subparagraphs (I) and (J) as sub-
paragraphs (H) and (I), respectively.
(2) Subparagraph (B) of section 6724(d)(1) is
amended—
(A) by striking ‘‘or’’ at the end of clause
(xii), and
(B) by striking the period at the end of
clause (xiii) and inserting ‘‘, or’’.
192
(3) Subsection (g) of section 6302 is amended
by inserting ‘‘, 22,’’ after ‘‘chapters 21’’.
(4) The earnings and profits of any insurance
company to which section 11305(c)(3) of the Reve-
nue Reconciliation Act of 1990 applies shall be de-
termined without regard to any deduction allowed
under such section; except that, for purposes of ap-
plying sections 56 and 902, and subpart F of part
III of subchapter N of chapter 1 of the Internal
Revenue Code of 1986, such deduction shall be
taken into account.
(5) Subparagraph (D) of section 6038A(e)(4) is
amended—
(A) by striking ‘‘any transaction to which
the summons relates’’ and inserting ‘‘any af-
fected taxable year’’, and
(B) by adding at the end thereof the fol-
lowing new sentence: ‘‘For purposes of this sub-
paragraph, the term ‘affected taxable year’
means any taxable year if the determination of
the amount of tax imposed for such taxable
year is affected by the treatment of the trans-
action to which the summons relates.’’.
193
(6) Subparagraph (A) of section 6621(c)(2) is
amended by adding at the end thereof the following
new flush sentence:
‘‘The preceding sentence shall be applied with-
out regard to any such letter or notice which is
withdrawn by the Secretary.’’.
(7) Clause (i) of section 6621(c)(2)(B) is
amended by striking ‘‘this subtitle’’ and inserting
‘‘this title’’.
(d) AMENDMENTS RELATED TO SUBTITLE D.—
(1) Notwithstanding section 11402(c) of the
Revenue Reconciliation Act of 1990, the amendment
made by section 11402(b)(1) of such Act shall apply
to taxable years ending after December 31, 1989.
(2) Clause (ii) of section 143(m)(4)(C) is
amended—
(A) by striking ‘‘any month of the 10-year
period’’ and inserting ‘‘any year of the 4-year
period’’,
(B) by striking ‘‘succeeding months’’ and
inserting ‘‘succeeding years’’, and
(C) by striking ‘‘over the remainder of
such period (or, if lesser, 5 years)’’ and insert-
ing ‘‘to zero over the succeeding 5 years’’.
(e) AMENDMENTS RELATED TO SUBTITLE E.—
194
(1)(A) Clause (ii) of section 56(d)(1)(B) is
amended to read as follows:
‘‘(ii) appropriate adjustments in the
application of section 172(b)(2) shall be
made to take into account the limitation of
subparagraph (A).’’
(B) For purposes of applying sections 56(g)(1)
and 56(g)(3) of the Internal Revenue Code of 1986
with respect to taxable years beginning in 1991 and
1992, the reference in such sections to the alter-
native tax net operating loss deduction shall be
treated as including a reference to the deduction
under section 56(h) of such Code as in effect before
the amendments made by section 1915 of the En-
ergy Policy Act of 1992.
(2) Clause (i) of section 613A(c)(3)(A) is
amended by striking ‘‘the table contained in’’.
(3) Section 6501 is amended—
(A) by striking subsection (m) (relating to
deficiency attributable to election under section
44B) and by redesignating subsections (n) and
(o) as subsections (m) and (n), respectively, and
(B) by striking ‘‘section 40(f) or 51(j)’’ in
subsection (m) (as redesignated by subpara-
195
graph (A)) and inserting ‘‘section 40(f), 43, or
51(j)’’.
(4) Subparagraph (C) of section 38(c)(2) (as in
effect on the day before the date of the enactment
of the Revenue Reconciliation Act of 1990) is
amended by inserting before the period at the end
of the first sentence the following: ‘‘and without re-
gard to the deduction under section 56(h)’’.
(5) 
The 
amendment 
made 
by 
section
1913(b)(2)(C)(i) of the Energy Policy Act of 1992
shall apply to taxable years beginning after Decem-
ber 31, 1990.
(f) AMENDMENTS RELATED TO SUBTITLE F.—
(1)(A) Section 2701(a)(3) is amended by add-
ing at the end thereof the following new subpara-
graph:
‘‘(C) VALUATION OF QUALIFIED PAYMENTS
WHERE NO LIQUIDATION, ETC. RIGHTS.—In the
case of an applicable retained interest which is
described in subparagraph (B)(i) but not sub-
paragraph (B)(ii), the value of the distribution
right shall be determined without regard to this
section.’’
197
(C) Section 2704(c)(3) is amended by striking
‘‘section 2701(e)(3)(A)’’ and inserting ‘‘section
2701(e)(3)’’.
(4) Clause (i) of section 2701(c)(1)(B) is
amended to read as follows:
‘‘(i) a right to distributions with re-
spect to any interest which is junior to the
rights of the transferred interest,’’.
(5)(A) Clause (i) of section 2701(c)(3)(C) is
amended to read as follows:
‘‘(i) IN
GENERAL.—Payments under
any interest held by a transferor which
(without regard to this subparagraph) are
qualified payments shall be treated as
qualified payments unless the transferor
elects not to treat such payments as quali-
fied payments. Payments described in the
preceding sentence which are held by an
applicable family member shall be treated
as qualified payments only if such member
elects to treat such payments as qualified
payments.’’
(B) 
The 
first 
sentence 
of 
section
2701(c)(3)(C)(ii) is amended to read as follows: ‘‘A
transferor or applicable family member holding any
198
distribution right which (without regard to this sub-
paragraph) is not a qualified payment may elect to
treat such right as a qualified payment, to be paid
in the amounts and at the times specified in such
election.’’.
(C) The time for making an election under the
second sentence of section 2701(c)(3)(C)(i) of the
Internal Revenue Code of 1986 (as amended by sub-
paragraph (A)) shall not expire before the due date
(including extensions) for filing the transferor’s re-
turn of the tax imposed by section 2501 of such
Code for the first calendar year ending after the
date of enactment.
(6) Section 2701(d)(3)(A)(iii) is amended by
striking ‘‘the period ending on the date of’’.
(7) Subclause (I) of section 2701(d)(3)(B)(ii) is
amended by inserting ‘‘or the exclusion under sec-
tion 2503(b),’’ after ‘‘section 2523,’’.
(8) Section 2701(e)(5) is amended—
(A) by striking ‘‘such contribution to cap-
ital or such redemption, recapitalization, or
other change’’ in subparagraph (A) and insert-
ing ‘‘such transaction’’, and
(B) by striking ‘‘the transfer’’ in subpara-
graph (B) and inserting ‘‘such transaction’’.
199
(9) Section 2701(d)(4) is amended by adding at
the end thereof the following new subparagraph:
‘‘(C) TRANSFER
TO
TRANSFERORS.—In
the case of a taxable event described in para-
graph (3)(A)(ii) involving a transfer of an ap-
plicable retained interest from an applicable
family member to a transferor, this subsection
shall continue to apply to the transferor during
any period the transferor holds such interest.’’
(10) Section 2701(e)(6) is amended by insert-
ing ‘‘or to reflect the application of subsection (d)’’
before the period at the end thereof.
(11)(A) Section 2702(a)(3)(A) is amended—
(i) by striking ‘‘to the extent’’ and insert-
ing ‘‘if’’ in clause (i),
(ii) by striking ‘‘or’’ at the end of clause
(i),
(iii) by striking the period at the end of
clause (ii) and inserting ‘‘, or’’, and
(iv) by adding at the end thereof the fol-
lowing new clause:
‘‘(iii) to the extent that regulations
provide that such transfer is not inconsist-
ent with the purposes of this section.’’
200
(B)(i) Section 2702(a)(3) is amended by strik-
ing ‘‘incomplete transfer’’ each place it appears and
inserting ‘‘incomplete gift’’.
(ii) The heading for section 2702(a)(3)(B) is
amended by striking ‘‘INCOMPLETE TRANSFER’’ and
inserting ‘‘INCOMPLETE GIFT’’.
(g) AMENDMENTS RELATED TO SUBTITLE G.—
(1)(A) Subsection (a) of section 1248 is
amended—
(i) by striking ‘‘, or if a United States per-
son receives a distribution from a foreign cor-
poration which, under section 302 or 331, is
treated as an exchange of stock’’ in paragraph
(1), and
(ii) by adding at the end thereof the follow-
ing new sentence: ‘‘For purposes of this section,
a United States person shall be treated as hav-
ing sold or exchanged any stock if, under any
provision of this subtitle, such person is treated
as realizing gain from the sale or exchange of
such stock.’’.
(B) Paragraph (1) of section 1248(e) is amend-
ed by striking ‘‘, or receives a distribution from a
domestic corporation which, under section 302 or
331, is treated as an exchange of stock’’.
201
(C) Subparagraph (B) of section 1248(f)(1) is
amended by striking ‘‘or 361(c)(1)’’ and inserting
‘‘355(c)(1), or 361(c)(1)’’.
(D) Paragraph (1) of section 1248(i) is amend-
ed to read as follows:
‘‘(1) IN GENERAL.—If any shareholder of a 10-
percent corporate shareholder of a foreign corpora-
tion exchanges stock of the 10-percent corporate
shareholder for stock of the foreign corporation,
such 10-percent corporate shareholder shall recog-
nize gain in the same manner as if the stock of the
foreign corporation received in such exchange had
been—
‘‘(A) issued to the 10-percent corporate
shareholder, and
‘‘(B) then distributed by the 10-percent
corporate shareholder to such shareholder in re-
demption or liquidation (whichever is appro-
priate).
The amount of gain recognized by such 10-percent
corporate shareholder under the preceding sentence
shall not exceed the amount treated as a dividend
under this section.’’
(2) Section 897 is amended by striking sub-
section (f).
202
(3) Paragraph (13) of section 4975(d) is
amended by striking ‘‘section 408(b)’’ and inserting
‘‘section 408(b)(12)’’.
(4) Clause (iii) of section 56(g)(4)(D) is amend-
ed by inserting ‘‘, but only with respect to taxable
years beginning after December 31, 1989’’ before
the period at the end thereof.
(5)(A) Paragraph (11) of section 11701(a) of
the Revenue Reconciliation Act of 1990 (and the
amendment made by such paragraph) are hereby re-
pealed, and section 7108(r)(2) of the Revenue Rec-
onciliation Act of 1989 shall be applied as if such
paragraph (and amendment) had never been en-
acted.
(B) Subparagraph (A) shall not apply to any
building if the owner of such building establishes to
the satisfaction of the Secretary of the Treasury or
his delegate that such owner reasonably relied on the
amendment made by such paragraph (11).
(h) AMENDMENTS RELATED TO SUBTITLE H.—
(1)(A) Clause (vi) of section 168(e)(3)(B) is
amended by striking ‘‘or’’ at the end of subclause
(I), by striking the period at the end of subclause
(II) and inserting ‘‘, or’’, and by adding at the end
thereof the following new subclause:
203
‘‘(III) is described in section
48(l)(3)(A)(ix) (as in effect on the
day before the date of the enactment
of the Revenue Reconciliation Act of
1990).’’
(B) Subparagraph (K) of section 168(g)(4) is
amended by striking ‘‘section 48(a)(3)(A)(iii)’’ and
inserting ‘‘section 48(l)(3)(A)(ix) (as in effect on the
day before the date of the enactment of the Revenue
Reconciliation Act of 1990)’’.
(2) Clause (ii) of section 172(b)(1)(E) is
amended by striking ‘‘subsection (m)’’ and inserting
‘‘subsection (h)’’.
(3) Sections 805(a)(4)(E), 832(b)(5)(C)(ii)(II),
and 832(b)(5)(D)(ii)(II) are each amended by strik-
ing ‘‘243(b)(5)’’ and inserting ‘‘243(b)(2)’’.
(4) Subparagraph (A) of section 243(b)(3) is
amended by inserting ‘‘of’’ after ‘‘In the case’’.
(5) The subsection heading for subsection (a) of
section 280F is amended by striking ‘‘INVESTMENT
TAX CREDIT AND’’.
(6) Clause (i) of section 1504(c)(2)(B) is
amended by inserting ‘‘section’’ before ‘‘243(b)(2)’’.
204
(7) Paragraph (3) of section 341(f) is amended
by striking ‘‘351, 361, 371(a), or 374(a)’’ and in-
serting ‘‘351, or 361’’.
(8) Paragraph (2) of section 243(b) is amended
to read as follows:
‘‘(2) AFFILIATED GROUP.—For purposes of this
subsection:
‘‘(A) IN
GENERAL.—The term ‘affiliated
group’ has the meaning given such term by sec-
tion 1504(b), except that for such purposes sec-
tions 1504(b)(2), 1504(b)(4), and 1504(c) shall
not apply.
‘‘(B) GROUP
MUST
BE
CONSISTENT
IN
FOREIGN TAX TREATMENT.—The requirements
of paragraph (1)(A) shall not be treated as
being met with respect to any dividend received
by a corporation if, for any taxable year which
includes the day on which such dividend is re-
ceived—
‘‘(i) 1 or more members of the affili-
ated group referred to in paragraph (1)(A)
choose to any extent to take the benefits of
section 901, and
‘‘(ii) 1 or more other members of such
group claim to any extent a deduction for
205
taxes otherwise creditable under section
901.’’
(9) 
The 
amendment 
made 
by 
section
11813(b)(17) of the Revenue Reconciliation Act of
1990 shall be applied as if the material stricken by
such amendment included the closing parenthesis
after ‘‘section 48(a)(5)’’.
(10) Paragraph (1) of section 179(d) is amend-
ed—
(A) by striking ‘‘in a trade or business’’
and inserting ‘‘a trade or business’’, and
(B) by adding at the end thereof the fol-
lowing new sentence: ‘‘Such term shall not in-
clude any property described in section 50(b)
and shall not include air conditioning or heating
units and horses.’’
(11) Subparagraph (E) of section 50(a)(2) is
amended by striking ‘‘section 48(a)(5)(A)’’ and in-
serting ‘‘section 48(a)(5)’’.
(12) 
The 
amendment 
made 
by 
section
11801(c)(9)(G)(ii) of the Revenue Reconciliation Act
of 1990 shall be applied as if it struck ‘‘Section
422A(c)(2)’’ and inserted ‘‘Section 422(c)(2)’’.
(13) Subparagraph (B) of section 424(c)(3) is
amended by striking ‘‘a qualified stock option, an in-
206
centive stock option, an option granted under an em-
ployee stock purchase plan, or a restricted stock op-
tion’’ and inserting ‘‘an incentive stock option or an
option granted under an employee stock purchase
plan’’.
(14) Subparagraph (E) of section 1367(a)(2) is
amended by striking ‘‘section 613A(c)(13)(B)’’ and
inserting ‘‘section 613A(c)(11)(B)’’.
(15) Subparagraph (B) of section 460(e)(6) is
amended by striking ‘‘section 167(k)’’ and inserting
‘‘section 168(e)(2)(A)(ii)’’.
(16) Subparagraph (C) of section 172(h)(4) is
amended by striking ‘‘subsection (b)(1)(M)’’ and in-
serting ‘‘subsection (b)(1)(E)’’.
(17) Section 6503 is amended—
(A) by redesignating the subsection relat-
ing to extension in case of certain summonses
as subsection (j), and
(B) by redesignating the subsection relat-
ing to cross references as subsection (k).
(18) Paragraph (4) of section 1250(e) is hereby
repealed.
(i) EFFECTIVE DATE.—Except as otherwise expressly
provided—
207
(1) the amendments made by this section shall
be treated as amendments to the Internal Revenue
Code of 1986 as amended by the Revenue Reconcili-
ation Act of 1993; and
(2) any amendment made by this section shall
apply to periods before the date of the enactment of
this section in the same manner as if it had been in-
cluded in the provision of the Revenue Reconciliation
Act of 1990 to which such amendment relates.
SEC. 6603. AMENDMENTS RELATED TO REVENUE REC-
ONCILIATION ACT OF 1993.
(a) AMENDMENT RELATED TO SECTION 13114.—
Paragraph (2) of section 1044(c) is amended to read as
follows:
‘‘(2) PURCHASE.—The taxpayer shall be consid-
ered to have purchased any property if, but for sub-
section (d), the unadjusted basis of such property
would be its cost within the meaning of section
1012.’’
(b) AMENDMENTS RELATED TO SECTION 13142.—
(1) Subparagraph (B) of section 13142(b)(6) of
the Revenue Reconciliation Act of 1993 is amended
to read as follows:
‘‘(B) FULL-TIME STUDENTS, WAIVER AU-
THORITY, AND PROHIBITED DISCRIMINATION.—
208
The amendments made by paragraphs (2), (3),
and (4) shall take effect on the date of the en-
actment of this Act.’’
(2) Subparagraph (C) of section 13142(b)(6) of
such Act is amended by striking ‘‘paragraph (2)’’
and inserting ‘‘paragraph (5)’’.
(c) AMENDMENT RELATED TO SECTION 13161.—
(1) IN
GENERAL.—Subsection (e) of section
4001 (relating to inflation adjustment) is amended
to read as follows:
‘‘(e) INFLATION ADJUSTMENT.—
‘‘(1) IN
GENERAL.—The $30,000 amount in
subsection (a) and section 4003(a) shall be increased
by an amount equal to—
‘‘(A) $30,000, multiplied by
‘‘(B) the cost-of-living adjustment under
section 1(f)(3) for the calendar year in which
the vehicle is sold, determined by substituting
‘calendar year 1990’ for ‘calendar year 1992’ in
subparagraph (B) thereof.
‘‘(2) ROUNDING.—If any amount as adjusted
under paragraph (1) is not a multiple of $2,000,
such amount shall be rounded to the next lowest
multiple of $2,000.’’
209
(2) EFFECTIVE DATE.—The amendment made
by paragraph (1) shall take effect on the date of the
enactment of this Act.
(d) AMENDMENT RELATED TO SECTION 13201.—
Clause (ii) of section 135(b)(2)(B) is amended by insert-
ing before the period at the end thereof the following: ‘‘,
determined by substituting ‘calendar year 1989’ for ‘cal-
endar year 1992’ in subparagraph (B) thereof’’.
(e) AMENDMENTS RELATED TO SECTION 13203.—
Subsection (a) of section 59 is amended—
(1) by striking ‘‘the amount determined under
section 55(b)(1)(A)’’ in paragraph (1)(A) and
(2)(A)(i) and inserting ‘‘the pre-credit tentative min-
imum tax’’,
(2) 
by 
striking 
‘‘specified 
in 
section
55(b)(1)(A)’’ in paragraph (1)(C) and inserting
‘‘specified in subparagraph (A)(i) or (B)(i) of section
55(b)(1) (whichever applies)’’,
(3) by striking ‘‘which would be determined
under section 55(b)(1)(A)’’ in paragraph (2)(A)(ii)
and inserting ‘‘which would be the pre-credit ten-
tative minimum tax’’, and
(4) by adding at the end thereof the following
new paragraph:
210
‘‘(3) PRE-CREDIT TENTATIVE MINIMUM TAX.—
For purposes of this subsection, the term ‘pre-credit
tentative minimum tax’ means—
‘‘(A) in the case of a taxpayer other than
a corporation, the amount determined under the
first sentence of section 55(b)(1)(A)(i), or
‘‘(B) in the case of a corporation, the
amount 
determined 
under 
section
55(b)(1)(B)(i).’’
(f) AMENDMENT RELATED TO SECTION 13221.—
Sections 1201(a) and 1561(a) are each amended by strik-
ing ‘‘last sentence’’ each place it appears and inserting
‘‘last 2 sentences’’.
(g) AMENDMENTS RELATED TO SECTION 13222.—
(1) Subparagraph (B) of section 6033(e)(1) is
amended by adding at the end thereof the following
new clause:
‘‘(iii) COORDINATION
WITH
SECTION
527(f).—This subsection shall not apply to
any amount on which tax is imposed by
reason of section 527(f).’’.
(2) Clause (i) of section 6033(e)(1)(B) is
amended by striking ‘‘this subtitle’’ and inserting
‘‘section 501’’.
211
(h) AMENDMENT RELATED TO SECTION 13225.—
Paragraph (3) of section 6655(g) is amended by striking
all that follows ‘‘ ‘3rd month’ ’’ in the sentence following
subparagraph (C) and inserting ‘‘, subsection (e)(2)(A)
shall be applied by substituting ‘2 months’ for ‘3 months’
in clause (i)(I), the election under clause (i) of subsection
(e)(2)(C) may be made separately for each installment,
and clause (ii) of subsection (e)(2)(C) shall not apply.’’.
(i) AMENDMENTS RELATED TO SECTION 13231.—
(1) Subparagraph (G) of section 904(d)(3) is
amended by striking ‘‘section 951(a)(1)(B)’’ and in-
serting ‘‘subparagraph (B) or (C) of section
951(a)(1)’’.
(2) Paragraph (1) of section 956A(b) is amend-
ed to read as follows:
‘‘(1) the amount (not including a deficit) re-
ferred to in section 316(a)(1) to the extent such
amount was accumulated in prior taxable years be-
ginning after September 30, 1993, and’’.
(3) Subsection (f) of section 956A is amended
by inserting before the period at the end thereof:
‘‘and regulations coordinating the provisions of sub-
sections (c)(3)(A) and (d)’’.
212
(4) Subsection (b) of section 958 is amended by
striking ‘‘956(b)(2)’’ each place it appears and in-
serting ‘‘956(c)(2)’’.
(5)(A) Subparagraph (A) of section 1297(d)(2)
is amended by striking ‘‘The adjusted basis of any
asset’’ and inserting ‘‘The amount taken into ac-
count under section 1296(a)(2) with respect to any
asset’’.
(B) The paragraph heading of paragraph (2) of
section 1297(d) is amended to read as follows:
‘‘(2) AMOUNT TAKEN INTO ACCOUNT.—’’.
(6) Subsection (e) of section 1297 is amended
by inserting ‘‘For purposes of this part—’’ after the
subsection heading.
(j) AMENDMENT RELATED TO SECTION 13241.—
Subparagraph (B) of section 40(e)(1) is amended to read
as follows:
‘‘(B) for any period before January 1,
2001, during which the rates of tax under sec-
tion 4081(a)(2)(A) are 4.3 cents per gallon.’’
(k) AMENDMENT RELATED TO SECTION 13261.—
Clause (iii) of section 13261(g)(2)(A) of the Revenue Rec-
onciliation Act of 1993 is amended by striking ‘‘by the
taxpayer’’ and inserting ‘‘by the taxpayer or a related
person’’.
213
(l) AMENDMENT RELATED TO SECTION 13301.—
Subparagraph (B) of section 1397B(d)(5) is amended by
striking ‘‘preceding’’.
(m) CLERICAL AMENDMENTS.—
(1) Subsection (d) of section 39 is amended—
(A) by striking ‘‘45’’ in the heading of
paragraph (5) and inserting ‘‘45A’’, and
(B) by striking ‘‘45’’ in the heading of
paragraph (6) and inserting ‘‘45B’’.
(2) Subparagraph (A) of section 108(d)(9) is
amended by striking ‘‘paragraph (3)(B)’’ and insert-
ing ‘‘paragraph (3)(C)’’.
(3) Subparagraph (C) of section 143(d)(2) is
amended by striking the period at the end thereof
and inserting a comma.
(4) Clause (ii) of section 163(j)(6)(E) is amend-
ed by striking ‘‘which is a’’ and inserting ‘‘which is’’.
(5) Subparagraph (A) of section 1017(b)(4) is
amended by striking ‘‘subsection (b)(2)(D)’’ and in-
serting ‘‘subsection (b)(2)(E)’’.
(6) So much of section 1245(a)(3) as precedes
subparagraph (A) thereof is amended to read as
follows:
‘‘(3) SECTION 1245 PROPERTY.—For purposes
of this section, the term ‘section 1245 property’
214
means any property which is or has been property
of a character subject to the allowance for deprecia-
tion provided in section 167 and is either—’’.
(7) Paragraph (2) of section 1394(e) is amend-
ed—
(A) by striking ‘‘(i)’’ and inserting ‘‘(A)’’,
and
(B) by striking ‘‘(ii)’’ and inserting ‘‘(B)’’.
(8) Subsection (m) of section 6501 (as redesig-
nated by section 6602) is amended by striking ‘‘or
51(j)’’ and inserting ‘‘45B, or 51(j)’’.
(9)(A) The section 6714 added by section
13242(b)(1) of the Revenue Reconciliation Act of
1993 is hereby redesignated as section 6715.
(B) The table of sections for part I of sub-
chapter B of chapter 68 is amended by striking
‘‘6714’’ in the item added by such section
13242(b)(2) of such Act and inserting ‘‘6715’’.
(10) Paragraph (2) of section 9502(b) is
amended by inserting ‘‘and before’’ after ‘‘1982,’’.
(11) Subsection (a)(3) of section 13206 of the
Revenue Reconciliation Act of 1993 is amended by
striking ‘‘this section’’ and inserting ‘‘this sub-
section’’.
216
(b) TREATMENT
OF CERTAIN AMOUNTS UNDER
HEDGE BOND RULES.—
(1) Clause (iii) of section 149(g)(3)(B) is
amended to read as follows:
‘‘(iii) AMOUNTS HELD PENDING REIN-
VESTMENT
OR
REDEMPTION.—Amounts
held for not more than 30 days pending re-
investment or bond redemption shall be
treated as invested in bonds described in
clause (i).’’
(2) The amendment made by paragraph (1)
shall take effect as if included in the amendments
made by section 7651 of the Omnibus Budget Rec-
onciliation Act of 1989.
(c) 
TREATMENT
OF
CERTAIN
DISTRIBUTIONS
UNDER SECTION 1445.—
(1) IN
GENERAL.—Paragraph (3) of section
1445(e) is amended by adding at the end thereof
the following new sentence: ‘‘Rules similar to the
rules of the preceding provisions of this paragraph
shall apply in the case of any distribution to which
section 301 applies and which is not made out of the
earnings and profits of such a domestic corpora-
tion.’’
217
(2) EFFECTIVE DATE.—The amendment made
by paragraph (1) shall apply to distributions after
the date of the enactment of this Act.
(d) TREATMENT OF CERTAIN CREDITS UNDER SEC-
TION 469.—
(1) IN GENERAL.—Subparagraph (B) of section
469(c)(3) is amended by adding at the end thereof
the following new sentence: ‘‘If the preceding sen-
tence applies to the net income from any property
for any taxable year, any credits allowable under
subpart B (other than section 27(a)) or D of part
IV of subchapter A for such taxable year which are
attributable to such property shall be treated as
credits not from a passive activity to the extent the
amount of such credits does not exceed the regular
tax liability of the taxpayer for the taxable year
which is allocable to such net income.’’
(2) EFFECTIVE DATE.—The amendment made
by paragraph (1) shall apply to taxable years begin-
ning after December 31, 1986.
(e) TREATMENT OF DISPOSITIONS UNDER PASSIVE
LOSS RULES.—
(1) IN GENERAL.—Subparagraph (A) of section
469(g)(1) is amended to read as follows:
218
‘‘(A) IN GENERAL.—If all gain or loss real-
ized on such disposition is recognized, the ex-
cess of—
‘‘(i) any loss from such activity for
such taxable year (determined after the ap-
plication of subsection (b)), over
‘‘(ii) any net income or gain for such
taxable year from all other passive activi-
ties (determined after the application of
subsection (b)),
shall be treated as a loss which is not from a
passive activity.’’
(2) EFFECTIVE DATE.—The amendment made
by paragraph (1) shall apply to taxable years begin-
ning after December 31, 1986.
(f) MISCELLANEOUS AMENDMENTS
TO FOREIGN
PROVISIONS.—
(1) COORDINATION OF UNIFIED ESTATE TAX
CREDIT WITH TREATIES.—Subparagraph (A) of sec-
tion 2102(c)(3) is amended by adding at the end
thereof the following new sentence: ‘‘For purposes
of the preceding sentence, property shall not be
treated as situated in the United States if such
property is exempt from the tax imposed by this
219
subchapter under any treaty obligation of the United
States.’’
(2) TREATMENT OF CERTAIN INTEREST PAID
TO RELATED PERSON.—
(A) IN
GENERAL.—Subparagraph (B) of
section 163(j)(1) is amended by inserting before
the period at the end thereof the following:
‘‘(and clause (ii) of paragraph (2)(A) shall not
apply for purposes of applying this subsection
to the amount so treated)’’.
(B) EFFECTIVE
DATE.—The amendment
made by subparagraph (A) shall apply as if in-
cluded in the amendments made by section
7210(a) of the Revenue Reconciliation Act of
1989.
(3) TREATMENT OF INTEREST ALLOCABLE TO
EFFECTIVELY CONNECTED INCOME.—
(A) IN GENERAL.—
(i) Subparagraph (B) of section
884(f)(1) is amended by striking ‘‘to the
extent’’ and all that follows down through
‘‘subparagraph (A)’’ and inserting ‘‘to the
extent that the allocable interest exceeds
the interest described in subparagraph
(A)’’.
220
(ii) The second sentence of section
884(f)(1) is amended by striking ‘‘reason-
ably expected’’ and all that follows down
through the period at the end thereof and
inserting ‘‘reasonably expected to be alloca-
ble interest.’’
(iii) Paragraph (2) of section 884(f) is
amended to read as follows:
‘‘(2) ALLOCABLE INTEREST.—For purposes of
this subsection, the term ‘allocable interest’ means
any interest which is allocable to income which is ef-
fectively connected (or treated as effectively con-
nected) with the conduct of a trade or business in
the United States.’’
(B) EFFECTIVE DATE.—The amendments
made by subparagraph (A) shall take effect as
if included in the amendments made by section
1241(a) of the Tax Reform Act of 1986.
(4) CLARIFICATION OF SOURCE RULE.—
(A) IN GENERAL.—Paragraph (2) of sec-
tion 865(b) is amended by striking ‘‘863(b)’’
and inserting ‘‘863’’.
(B) EFFECTIVE
DATE.—The amendment
made by subparagraph (A) shall take effect as
221
if included in the amendments made by section
1211 of the Tax Reform Act of 1986.
(5) REPEAL OF OBSOLETE PROVISIONS.—
(A) Paragraph (1) of section 6038(a) is
amended by striking ‘‘, and’’ at the end of sub-
paragraph (E) and inserting a period, and by
striking subparagraph (F).
(B) Subsection (b) of section 6038A is
amended by adding ‘‘and’’ at the end of para-
graph (2), by striking ‘‘, and’’ at the end of
paragraph (3) and inserting a period, and by
striking paragraph (4).
(g) TREATMENT OF ASSIGNMENT OF INTEREST IN
CERTAIN BOND-FINANCED FACILITIES.—
(1) IN GENERAL.—Subparagraph (A) of section
1317(3) of the Tax Reform Act of 1986 is amended
by adding at the end thereof the following new sen-
tence: ‘‘A facility shall not fail to be treated as de-
scribed in this subparagraph by reason of an assign-
ment (or an agreement to an assignment) by the
governmental unit on whose behalf the bonds are is-
sued of any part of its interest in the property fi-
nanced by such bonds to another governmental
unit.’’
222
(2) EFFECTIVE DATE.—The amendment made
by paragraph (1) shall take effect as if included in
such section 1317 on the date of the enactment of
the Tax Reform Act of 1986.
(h) CLARIFICATION OF TREATMENT OF MEDICARE
ENTITLEMENT UNDER COBRA PROVISIONS.—
(1) IN GENERAL.—
(A) 
Subclause 
(V) 
of 
section
4980B(f)(2)(B)(i) is amended to read as
follows:
‘‘(V) MEDICARE
ENTITLEMENT
FOLLOWED BY QUALIFYING EVENT.—
In the case of a qualifying event de-
scribed in paragraph (3)(B) that oc-
curs less than 18 months after the
date the covered employee became en-
titled to benefits under title XVIII of
the Social Security Act, the period of
coverage for qualified beneficiaries
other than the covered employee shall
not terminate under this clause before
the close of the 36-month period be-
ginning on the date the covered em-
ployee became so entitled.’’
223
(B) Clause (v) of section 602(2)(A) of the
Employee Retirement Income Security Act of
1974 is amended to read as follows:
‘‘(v) MEDICARE
ENTITLEMENT
FOL-
LOWED
BY
QUALIFYING
EVENT.—In the
case of a qualifying event described in sec-
tion 603(2) that occurs less than 18
months after the date the covered em-
ployee became entitled to benefits under
title XVIII of the Social Security Act, the
period of coverage for qualified bene-
ficiaries other than the covered employee
shall not terminate under this subpara-
graph before the close of the 36-month pe-
riod beginning on the date the covered em-
ployee became so entitled.’’
(C) Clause (iv) of section 2202(2)(A) of
the Public Health Service Act is amended to
read as follows:
‘‘(iv) MEDICARE ENTITLEMENT FOL-
LOWED
BY
QUALIFYING
EVENT.—In the
case of a qualifying event described in sec-
tion 2203(2) that occurs less than 18
months after the date the covered em-
ployee became entitled to benefits under
224
title XVIII of the Social Security Act, the
period of coverage for qualified bene-
ficiaries other than the covered employee
shall not terminate under this subpara-
graph before the close of the 36-month pe-
riod beginning on the date the covered em-
ployee became so entitled.’’
(2) EFFECTIVE DATE.—The amendments made
by this subsection shall apply to plan years begin-
ning after December 31, 1989.
(i) TREATMENT OF CERTAIN REMIC INCLUSIONS.—
(1) IN
GENERAL.—Subsection (a) of section
860E is amended by adding at the end thereof the
following new paragraph:
‘‘(6) COORDINATION WITH MINIMUM TAX.—For
purposes of part VI of subchapter A of this
chapter—
‘‘(A) the reference in section 55(b)(2) to
taxable income shall be treated as a reference
to taxable income determined without regard to
this subsection,
‘‘(B) the alternative minimum taxable in-
come of any holder of a residual interest in a
REMIC for any taxable year shall in no event
225
be less than the excess inclusion for such tax-
able year, and
‘‘(C) any excess inclusion shall be dis-
regarded for purposes of computing the alter-
native tax net operating loss deduction.
The preceding sentence shall not apply to any orga-
nization to which section 593 applies, except to the
extent provided in regulations prescribed by the Sec-
retary under paragraph (2).’’
(2) EFFECTIVE DATE.—The amendment made
by paragraph (1) shall take effect as if included in
the amendments made by section 671 of the Tax Re-
form Act of 1986 unless the taxpayer elects to apply
such amendment only to taxable years beginning
after the date of the enactment of this Act.
(j) EXEMPTION FROM HARBOR MAINTENANCE TAX
FOR CERTAIN PASSENGERS.—
(1) IN GENERAL.—Subparagraph (D) of section
4462(b)(1) (relating to special rule for Alaska, Ha-
waii, and possessions) is amended by inserting be-
fore the period the following: ‘‘, or passengers trans-
ported on United States flag vessels operating solely
within the State waters of Alaska or Hawaii and ad-
jacent international waters’’.
226
(2) EFFECTIVE DATE.—The amendment made
by paragraph (1) shall take effect as if included in
the amendments made by section 1402(a) of the
Harbor Maintenance Revenue Act of 1986.
(k) AMENDMENTS RELATED TO REVENUE PROVI-
SIONS OF ENERGY POLICY ACT OF 1992.—
(1) Effective with respect to taxable years be-
ginning after December 31, 1990, subclause (II) of
section 53(d)(1)(B)(iv) is amended to read as
follows:
‘‘(II) the adjusted net minimum
tax for any taxable year is the amount
of the net minimum tax for such year
increased in the manner provided in
clause (iii).’’
(2) Subsection (g) of section 179A is redesig-
nated as subsection (f).
(3) Subparagraph (E) of section 6724(d)(3) is
amended by striking ‘‘section 6109(f)’’ and inserting
‘‘section 6109(h)’’.
(4)(A) Subsection (d) of section 30 is amend-
ed—
(i) by inserting ‘‘(determined without re-
gard to subsection (b)(3))’’ before the period at
the end of paragraph (1) thereof, and
227
(ii) by adding at the end thereof the follow-
ing new paragraph:
‘‘(4) ELECTION
TO
NOT
TAKE
CREDIT.—No
credit shall be allowed under subsection (a) for any
vehicle if the taxpayer elects to not have this section
apply to such vehicle.’’
(B) Subsection (m) of section 6501 (as redesig-
nated by section 6602) is amended by striking ‘‘sec-
tion 40(f)’’ and inserting ‘‘section 30(d)(4), 40(f)’’.
(5) Subclause (III) of section 501(c)(21)(D)(ii)
is amended by striking ‘‘section 101(6)’’ and insert-
ing ‘‘section 101(7)’’ and by striking ‘‘1752(6)’’ and
inserting ‘‘1752(7)’’.
(6) Paragraph (1) of section 1917(b) of the En-
ergy Policy Act of 1992 shall be applied as if ‘‘at a
rate’’ appeared instead of ‘‘at the rate’’ in the mate-
rial proposed to be stricken.
(7) Paragraph (2) of section 1921(b) of the En-
ergy Policy Act of 1992 shall be applied as if a
comma appeared after ‘‘(2)’’ in the material pro-
posed to be stricken.
(8) Subsection (a) of section 1937 of the En-
ergy Policy Act of 1992 shall be applied as if ‘‘Sub-
part B’’ appeared instead of ‘‘Subpart C’’.
228
(l) TREATMENT OF QUALIFIED FOOTBALL COACHES
PLAN.—
(1) IN GENERAL.—Section 1022 of title II of
the Employee Retirement Income Security Act of
1974 is amended by adding at the end thereof the
following new subsection:
‘‘(l) QUALIFIED FOOTBALL COACHES PLAN.—For
purposes of determining the qualified plan status of a
qualified football coaches plan, section 3(37)(F) shall be
treated as part of this title and a qualified football coaches
plan shall be treated as a multiemployer collectively bar-
gained plan for purposes of the Internal Revenue Code
of 1986.’’
(2) EFFECTIVE DATE.—The amendment made
by paragraph (1) shall apply to years beginning
after the date of the enactment of Public Law 100–
202.
(m) DETERMINATION
OF UNRECOVERED INVEST-
MENT IN ANNUITY CONTRACT.—
(1) IN GENERAL.—Subparagraph (A) of section
72(b)(4) is amended by inserting ‘‘(determined with-
out regard to subsection (c)(2))’’ after ‘‘contract’’.
(2) EFFECTIVE DATE.—The amendment made
by paragraph (1) shall take effect as if included in
229
the amendments made by section 1122(c) of the Tax
Reform Act of 1986.
(n) MODIFICATIONS
TO ELECTION TO INCLUDE
CHILD’S INCOME ON PARENT’S RETURN.—
(1) ELIGIBILITY FOR ELECTION.—Clause (ii) of
section 1(g)(7)(A) (relating to election to include
certain unearned income of child on parent’s return)
is amended to read as follows:
‘‘(ii) such gross income is more than
the 
amount 
described 
in 
paragraph
(4)(A)(ii)(I) and less than 10 times the
amount so described,’’.
(2) COMPUTATION OF TAX.—Subparagraph (B)
of section 1(g)(7) (relating to income included on
parent’s return) is amended—
(A) by striking ‘‘$1,000’’ in clause (i) and
inserting ‘‘twice the amount described in para-
graph (4)(A)(ii)(I)’’, and
(B) by amending subclause (II) of clause
(ii) to read as follows:
‘‘(II) for each such child, 15 per-
cent of the lesser of the amount de-
scribed in paragraph (4)(A)(ii)(I) or
the excess of the gross income of such
230
child over the amount so described,
and’’.
(3) MINIMUM TAX.—Subparagraph (B) of sec-
tion 59(j)(1) is amended by striking ‘‘$1,000’’ and
inserting ‘‘twice the amount in effect for the taxable
year under section 63(c)(5)(A)’’.
(4) EFFECTIVE DATE.—The amendments made
by this subsection shall apply to taxable years begin-
ning after December 31, 1994.
(o) MISCELLANEOUS CLERICAL AMENDMENTS.—
(1) Subclause (II) of section 56(g)(4)(C)(ii) is
amended by striking ‘‘of the subclause’’ and insert-
ing ‘‘of subclause’’.
(2) Paragraph (2) of section 72(m) is amended
by inserting ‘‘and’’ at the end of subparagraph (A),
by striking subparagraph (B), and by redesignating
subparagraph (C) as subparagraph (B).
(3) Paragraph (2) of section 86(b) is amended
by striking ‘‘adusted’’ and inserting ‘‘adjusted’’.
(4)(A) The heading for section 112 is amended
by striking ‘‘COMBAT PAY’’ and inserting ‘‘COM-
BAT ZONE COMPENSATION’’.
(B) The item relating to section 112 in the
table of sections for part III of subchapter B of
231
chapter 1 is amended by striking ‘‘combat pay’’ and
inserting ‘‘combat zone compensation’’.
(C) Paragraph (1) of section 3401(a) is amend-
ed by striking ‘‘combat pay’’ and inserting ‘‘combat
zone compensation’’.
(5) Clause (i) of section 172(h)(3)(B) is amend-
ed by striking the comma at the end thereof and in-
serting a period.
(6) Clause (ii) of section 543(a)(2)(B) is
amended by striking ‘‘section 563(c)’’ and inserting
‘‘section 563(d)’’.
(7) Paragraph (1) of section 958(a) is amended
by striking ‘‘sections 955(b)(1) (A) and (B),
955(c)(2)(A)(ii), and 960(a)(1)’’ and inserting ‘‘sec-
tion 960(a)(1)’’.
(8) Subsection (g) of section 642 is amended by
striking ‘‘under 2621(a)(2)’’ and inserting ‘‘under
section 2621(a)(2)’’.
(9) Section 1463 is amended by striking ‘‘this
subsection’’ and inserting ‘‘this section’’.
(10) Subsection (k) of section 3306 is amended
by inserting a period at the end thereof.
(11) The item relating to section 4472 in the
table of sections for subchapter B of chapter 36 is
amended by striking ‘‘and special rules’’.
232
(12) Paragraph (2) of section 4978(b) is
amended by striking the period at the end of sub-
paragraph (A) and inserting a comma, and by strik-
ing the period and quotation marks at the end of
subparagraph (B) and inserting a comma.
(13) Paragraph (3) of section 5134(c) is
amended by striking ‘‘section 6662(a)’’ and inserting
‘‘section 6665(a)’’.
(14) Paragraph (2) of section 5206(f) is
amended by striking ‘‘section 5(e)’’ and inserting
‘‘section 105(e)’’.
(15) Paragraph (1) of section 6050B(c) is
amended by striking ‘‘section 85(c)’’ and inserting
‘‘section 85(b)’’.
(16) Subsection (k) of section 6166 is amended
by striking paragraph (6).
(17) Subsection (e) of section 6214 is amended
to read as follows:
‘‘(e) CROSS REFERENCE.—
‘‘For provision giving Tax Court jurisdiction to
order a refund of an overpayment and to award
sanctions, see section 6512(b)(2).’’
(18) The section heading for section 6043 is
amended by striking the semicolon and inserting a
comma.
(19) The item relating to section 6043 in the
table of sections for subpart B of part III of sub-
233
chapter A of chapter 61 is amended by striking the
semicolon and inserting a comma.
(20) The table of sections for part I of sub-
chapter A of chapter 68 is amended by striking the
item relating to section 6662.
(21)(A) Section 7232 is amended—
(i) by striking ‘‘LUBRICATING OIL,’’ in
the heading, and
(ii) by striking ‘‘lubricating oil,’’ in the
text.
(B) The table of sections for part II of sub-
chapter A of chapter 75 is amended by striking ‘‘lu-
bricating oil,’’ in the item relating to section 7232.
(22) Paragraph (1) of section 6701(a) of the
Omnibus Budget Reconciliation Act of 1989 is
amended by striking ‘‘subclause (IV)’’ and inserting
‘‘subclause (V)’’.
(23) Clause (ii) of section 7304(a)(2)(D) of
such Act is amended by striking ‘‘subsection (c)(2)’’
and inserting ‘‘subsection (c)’’.
(24) Paragraph (1) of section 7646(b) of such
Act is amended by striking ‘‘section 6050H(b)(1)’’
and inserting ‘‘section 6050H(b)(2)’’.
(25) Paragraph (10) of section 7721(c) of
such 
Act 
is 
amended 
by 
striking 
‘‘section
234
6662(b)(2)(C)(ii)’’ 
and 
inserting 
‘‘section
6661(b)(2)(C)(ii)’’.
(26) Subparagraph (A) of section 7811(i)(3) of
such Act is amended by inserting ‘‘the first place it
appears’’ before ‘‘in clause (i)’’.
(27) Paragraph (10) of section 7841(d) of
such Act is amended by striking ‘‘section 381(a)’’
and inserting ‘‘section 381(c)’’.
(28) Paragraph (2) of section 7861(c) of such
Act is amended by inserting ‘‘the second place it ap-
pears’’ before ‘‘and inserting’’.
(29) Paragraph (1) of section 460(b) is amend-
ed by striking ‘‘the look-back method of paragraph
(3)’’ and inserting ‘‘the look-back method of para-
graph (2)’’.
(30) Subparagraph (C) of section 50(a)(2) is
amended by striking ‘‘subsection (c)(4)’’ and insert-
ing ‘‘subsection (d)(5)’’.
(31) Subparagraph (B) of section 172(h)(4) is
amended by striking the material following the head-
ing and preceding clause (i) and inserting ‘‘For pur-
poses of subsection (b)(2)—’’.
(32) Subparagraph (A) of section 355(d)(7) is
amended by inserting ‘‘section’’ before ‘‘267(b)’’.