(85) SALE OF PATENTS.—Subsection (a) of sec-
tion 1249 is amended by striking ‘‘after December 
31, 1962,’’. 
(86) GAIN FROM DISPOSITION OF FARMLAND.— 
Paragraph (1) of section 1252(a) is amended— 
(A) by striking ‘‘after December 31, 1969’’ 
the first place it appears, and 
(B) by striking ‘‘after December 31, 
1969,’’ in subparagraph (A). 
(87) TREATMENT OF AMOUNTS RECEIVED ON 
RETIREMENT OR SALE OR EXCHANGE OF DEBT IN-
STRUMENTS.—Subsection (c) of section 1271 is 
amended to read as follows: 
‘‘(c) SPECIAL RULE
FOR CERTAIN OBLIGATIONS 
WITH RESPECT TO WHICH ORIGINAL ISSUE DISCOUNT 
NOT CURRENTLY INCLUDIBLE.— 
‘‘(1) IN GENERAL.—On the sale or exchange of 
debt instruments issued by a government or political 
subdivision thereof after December 31, 1954, and 
before July 2, 1982, or by a corporation after De-
cember 31, 1954, and on or before May 27, 1969, 
any gain realized which does not exceed— 
‘‘(A) an amount equal to the original issue 
discount, or 
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‘‘(B) if at the time of original issue there 
was no intention to call the debt instrument be-
fore maturity, an amount which bears the same 
ratio to the original issue discount as the num-
ber of complete months that the debt instru-
ment was held by the taxpayer bears to the 
number of complete months from the date of 
original issue to the date of maturity, shall be 
considered as ordinary income. 
‘‘(2) SUBSECTION (a)(2)(A) NOT TO APPLY.— 
Subsection (a)(2)(A) shall not apply to any debt in-
strument referred to in paragraph (1) of this sub-
section. 
‘‘(3) CROSS
REFERENCE.—For current inclu-
sion of original issue discount, see section 1272.’’. 
(88) AMOUNT
AND
METHOD
OF
ADJUST-
MENT.—Section 1314 is amended by striking sub-
section (d) and by redesignating subsection (e) as 
subsection (d). 
(89) ELECTION; REVOCATION; TERMINATION.— 
Clause (iii) of section 1362(d)(3)(A) is amended by 
striking ‘‘unless’’ and all that follows and inserting 
‘‘unless the corporation was an S corporation for 
such taxable year.’’. 
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(90) OLD-AGE, SURVIVORS, AND DISABILITY IN-
SURANCE.—Subsection (a) of section 1401 is amend-
ed by striking ‘‘the following percent’’ and all that 
follows and inserting ‘‘12.4 percent of the amount of 
the self-employment income for such taxable year.’’. 
(91) HOSPITAL INSURANCE.—Paragraph (1) of 
section 1401(b) is amended by striking: ‘‘the fol-
lowing percent’’ and all that follows and inserting 
‘‘2.9 percent of the amount of the self-employment 
income for such taxable year.’’. 
(92) MINISTERS, MEMBERS OF RELIGIOUS OR-
DERS, AND CHRISTIAN SCIENCE PRACTITIONERS.— 
Paragraph (3) of section 1402(e) is amended— 
(A) by striking ‘‘whichever of the following 
dates is later: (A)’’, and 
(B) by striking ‘‘;or (B)’ ’’ and all that fol-
lows and inserting a period. 
(93) WITHHOLDING OF TAX ON NONRESIDENT 
ALIENS.—The first sentence of subsection (b) of sec-
tion 1441 and the first sentence of paragraph (5) of 
section 1441(c) are each amended by striking ‘‘gains 
subject to tax’’ and all that follows through ‘‘Octo-
ber 4, 1966’’ and inserting ‘‘and gains subject to tax 
under section 871(a)(1)(D)’’. 
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(94) AFFILIATED GROUP DEFINED.—Subpara-
graph (A) of section 1504(a)(3) is amended by strik-
ing ‘‘for a taxable year which includes any period 
after December 31, 1984’’ in clause (i) and by strik-
ing ‘‘in a taxable year beginning after December 31, 
1984’’ in clause (ii). 
(95) DISALLOWANCE
OF
THE
BENEFITS
OF 
THE GRADUATED CORPORATE RATES AND ACCUMU-
LATED EARNINGS CREDIT.— 
(A) Subsection (a) of section 1551 is 
amended— 
(i) by striking paragraph (1) and by 
redesignating paragraphs (2) and (3) as 
paragraphs (1) and (2), respectively, and 
(ii) by striking ‘‘after June 12, 1963,’’ 
each place it appears. 
(B) Section 1551(b) is amended— 
(i) by striking ‘‘or (2)’’ in paragraph 
(1), and 
(ii) by striking ‘‘(a)(3)’’ in paragraph 
(2) and inserting ‘‘(a)(2)’’. 
(96) CREDIT FOR STATE DEATH TAXES.— 
(A)(i) Part II of subchapter A of chapter 
11 is amended by striking section 2011 (and by 
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striking the item relating to such section in the 
table of sections for such subpart). 
(ii) Section 2106(a)(4) is amended by 
striking 
‘‘section 
2011(a)’’ 
and 
inserting 
‘‘2058(a)’’. 
(B)(i) Subchapter A of chapter 13 is 
amended by striking section 2604 (and by strik-
ing the item relating to such section in the 
table of sections for such subpart). 
(ii) Clause (ii) of section 164(b)(4)(A) is 
amended by inserting ‘‘(as in effect before its 
repeal)’’ after ‘‘section 2604’’. 
(iii) Section 2654(a)(1) is amended by 
striking ‘‘(computed without regard to section 
2604)’’. 
(97) GROSS ESTATE.—Subsection (c) of section 
2031 is amended by striking paragraph (3) and by 
amending paragraph (1)(B) to read as follows: 
‘‘(II) $500,000.’’. 
(98)(A) Part IV of subchapter A of chapter 11 
is amended by striking section 2057 (and by striking 
the item relating to such section in the table of sec-
tions for such subpart). 
(B) Paragraph (10) of section 2031(c) is 
amended by inserting ‘‘(as in effect before its re-
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peal)’’ immediately before the period at the end 
thereof. 
(99) 
PROPERTY
WITHIN
THE
UNITED 
STATES.—Subsection (c) of section 2104 is amended 
by striking ‘‘With respect to estates of decedents 
dying after December 31, 1969, deposits’’ and in-
serting ‘‘Deposits’’. 
(100) FICA TAXES.— 
(A) Subsection (a) of section 3101 is 
amended by striking ‘‘the following percent-
ages’’ and all that follows and inserting ‘‘6.2 
percent of the wages (as defined in section 
3121(a)) received by the individual with respect 
to employment (as defined in section 3121(b))’’. 
(B)(i) Subsection (a) of section 3111 is 
amended by striking ‘‘the following percent-
ages’’ and all that follows and inserting ‘‘6.2 
percent of the wages (as defined in section 
3121(a)) paid by the employer with respect to 
employment (as defined in section 3121(b)).’’. 
(ii) Subsection (b) of section 3111 is 
amended by striking ‘‘the following percent-
ages’’ and all that follows and inserting ‘‘1.45 
percent of the wages (as defined in section 
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3121(a)) paid by the employer with respect to 
employment (as defined in section 3121(b)).’’. 
(C)(i) Section 3121(b) is amended by 
striking paragraph (17). 
(ii) Section 210(a) of the Social Security 
Act is amended by striking paragraph (17). 
(101) RAILROAD RETIREMENT.— 
(A) Subsection (b) of section 3201 is 
amended to read as follows: 
‘‘(b) TIER 2 TAX.—In addition to other taxes, there 
is hereby imposed on the income of each employee a tax 
equal to the percentage determined under section 3241 for 
any calendar year of the compensation received during 
such calendar year by such employee for services rendered 
by such employee.’’. 
(B) Subsection (b) of section 3211 is 
amended to read as follows: 
‘‘(b) TIER 2 TAX.—In addition to other taxes, there 
is hereby imposed on the income of each employee rep-
resentative a tax equal to the percentage determined under 
section 3241 for any calendar year of the compensation 
received during such calendar year by such employee rep-
resentative for services rendered by such employee rep-
resentative.’’. 
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(C) Subsection (b) of section 3221 is 
amended to read as follows: 
‘‘(b) TIER 2 TAX.—In addition to other taxes, there 
is hereby imposed on every employer an excise tax, with 
respect to having individuals in his employ, equal to the 
percentage determined under section 3241 for any cal-
endar year of the compensation paid during such calendar 
year by such employer for services rendered to such em-
ployer.’’. 
(D) Subsection (b) of section 3231 is 
amended— 
(i) by striking ‘‘compensation; except’’ 
and all that follows in the first sentence 
and inserting ‘‘compensation.’’, and 
(ii) by striking the second sentence. 
(102) CREDITS AGAINST FEDERAL UNEMPLOY-
MENT TAX.— 
(A) Paragraph (4) of section 3302(f) is 
amended— 
(i) by striking ‘‘subsection—’’ and all 
that follows through ‘‘(A) IN GENERAL.— 
The’’ and inserting ‘‘subsection, the’’, 
(ii) by striking subparagraph (B), 
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(iii) by redesignating clauses (i) and 
(ii) as subparagraphs (A) and (B), respec-
tively, and 
(iv) by moving the text of such sub-
paragraphs (as so redesignated) 2 ems to 
the left. 
(B) Paragraph (5) of section 3302(f) is 
amended by striking subparagraph (D) and by 
redesignating subparagraph (E) as subpara-
graph (D). 
(103) 
DOMESTIC
SERVICE
EMPLOYMENT 
TAXES.—Section 3510(b) is amended by striking 
paragraph (4). 
(104) LUXURY PASSENGER AUTOMOBILES.— 
(A) Chapter 31 is amended by striking 
subchapter A (and by striking the item relating 
to such subchapter in the table of subchapters 
for such chapter). 
(B)(i) Section 4221 is amended— 
(I) in subsections (a) and (d)(1), by 
striking ‘‘subchapter A or’’ and inserting 
‘‘subchapter’’, 
(II) in subsection (a), by striking ‘‘In 
the case of taxes imposed by subchapter A 
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of chapter 31, paragraphs (1), (3), (4), 
and (5) shall not apply.’’, and 
(III) in subsection (c), by striking 
‘‘4001(c), 4001(d), or’’. 
(ii) Section 4222 is amended by striking 
‘‘4001(c), 4001(d),’’. 
(iii) Section 4293 is amended by striking 
‘‘subchapter A of chapter 31,’’. 
(105) TAX
ON
FUEL
USED
IN
COMMERCIAL 
TRANSPORTATION ON INLAND WATERWAYS.—Section 
4042(b)(2)(A) is amended to read as follows: 
‘‘(I) The Inland Waterways Trust Fund fi-
nancing rate is 20 cents per gallon.’’. 
(106) 
TRANSPORTATION
BY
AIR.—Section 
4261(e) is amended— 
(A) in paragraph (1), by striking subpara-
graph (C), and 
(B) by striking paragraph (5). 
(107) TAXES ON FAILURE TO DISTRIBUTE IN-
COME.— 
(A) Subsection (g) of section 4942 is 
amended by striking ‘‘For all taxable years be-
ginning on or after January 1, 1975, subject’’ 
in paragraph (2)(A) and inserting ‘‘Subject’’. 
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(B) Section 4942(i)(2) is amended by 
striking ‘‘beginning after December 31, 1969, 
and’’. 
(108) TAXES ON TAXABLE EXPENDITURES.— 
Section 4945(f) is amended by striking ‘‘(excluding 
therefrom any preceding taxable year which begins 
before January 1, 1970)’’. 
(109) DEFINITIONS AND SPECIAL RULES.—Sec-
tion 4682(h) is amended— 
(A) by striking paragraph (1) and redesig-
nating paragraphs (2), (3), and (4) as para-
graphs (1), (2), and (3), respectively, and 
(B) in paragraph (1) (as so redesig-
nated)— 
(i) by striking the heading and insert-
ing ‘‘IN GENERAL’’, and 
(ii) by striking ‘‘after 1991’’ in sub-
paragraph (C). 
(110) RETURNS.—Subsection (a) of section 
6039D is amended by striking ‘‘beginning after De-
cember 31, 1984,’’. 
(111) INFORMATION RETURNS.—Subsection (c) 
of section 6060 is amended by striking ‘‘ ‘year’ ’’ and 
all that follows and inserting ‘‘year.’’. 
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(112) COLLECTION.—Section 6302 is amend-
ed— 
(A) in subsection (e)(2), by striking ‘‘im-
posed by’’ and all that follows through ‘‘with re-
spect to’’ and inserting ‘‘imposed by sections 
4251, 4261, or 4271 with respect to’’, 
(B) by striking the last sentence of sub-
section (f)(1), and 
(C) in subsection (h)— 
(i) by striking paragraph (2) and re-
designating paragraphs (3) and (4) as 
paragraphs (2) and (3), respectively, and 
(ii) by amending paragraph (3) (as so 
redesignated) to read as follows: 
‘‘(3) COORDINATION WITH OTHER ELECTRONIC 
FUND
TRANSFER
REQUIREMENTS.—Under regula-
tions, any tax required to be paid by electronic fund 
transfer under section 5061(e) or 5703(b) shall be 
paid in such a manner as to ensure that the require-
ments of the second sentence of paragraph (1)(A) of 
this subsection are satisfied.’’. 
(113) 
ABATEMENTS.—Section 
6404(f) 
is 
amended by striking paragraph (3). 
(114) 2008 RECOVERY REBATE FOR INDIVID-
UALS.— 
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(A) Subchapter B of chapter 65 is amend-
ed by striking section 6428 (and by striking the 
item relating to such section in the table of sec-
tions for such subchapter). 
(B) 
Subparagraph 
(A) 
of 
section 
6211(b)(4) is amended by striking ‘‘6428,’’. 
(C) Paragraph (2) of section 6213(g), as 
amended by section 14(a)(2) and paragraphs 
(4) and (5)(C) of this subsection, is amended 
by striking subparagraph (Q), by redesignating 
subparagraph (O) as subparagraph (N), by in-
serting ‘‘and’’ at the end of subparagraph (M), 
and by striking the comma at the end of sub-
paragraph (N) (as so redesignated) and insert-
ing a period. 
(D) Paragraph (2) of section 1324(b) of 
title 31, United States Code, is amended by 
striking ‘‘6428, or 6431,’’ and inserting ‘‘or 
6431’’. 
(115) ADVANCE PAYMENT OF PORTION OF IN-
CREASED CHILD CREDIT FOR 2003.—Subchapter B 
of chapter 65 is amended by striking section 6429 
(and by striking the item relating to such section in 
the table of sections for such subchapter). 
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(116) FAILURE BY CORPORATION TO PAY ESTI-
MATED
INCOME
TAX.—Clause 
(i) 
of 
section 
6655(g)(4)(A) is amended by striking ‘‘(or the cor-
responding provisions of prior law)’’. 
(117) RETIREMENT.—Section 7447(i)(3)(B)(ii) 
is amended by striking ‘‘at 4 percent per annum to 
December 31, 1947, and 3 percent per annum there-
after’’, and inserting ‘‘at 3 percent per annum’’. 
(118) ANNUITIES TO SURVIVING SPOUSES AND 
DEPENDENT CHILDREN OF JUDGES.— 
(A) Paragraph (2) of section 7448(a) is 
amended— 
(i) by striking ‘‘or under section 1106 
of the Internal Revenue Code of 1939’’, 
and 
(ii) by striking ‘‘or pursuant to sec-
tion 1106(d) of the Internal Revenue Code 
of 1939’’. 
(B) Subsection (g) of section 7448 is 
amended by striking ‘‘or other than pursuant to 
section 1106 of the Internal Revenue Code of 
1939’’. 
(C) Subsections (g), (j)(1), and (j)(2) of 
section 7448 are each amended by striking ‘‘at 
4 percent per annum to December 31, 1947, 
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and 3 percent per annum thereafter’’ and in-
serting ‘‘at 3 percent per annum’’. 
(119) MERCHANT MARINE CAPITAL CONSTRUC-
TION FUNDS.—Paragraph (4) of section 7518(g) is 
amended by striking ‘‘any nonqualified withdrawal’’ 
and all that follows through ‘‘ ‘shall be determined’’ 
and inserting ‘‘any nonqualified withdrawal shall be 
determined’’. 
(120) VALUATION TABLES.— 
(A) Subsection (c) of section 7520 is 
amended by striking paragraph (2) and redesig-
nating paragraph (3) as paragraph (2). 
(B) Paragraph (2) of section 7520(c) (as 
redesignated by subparagraph (A)) is amend-
ed— 
(i) by striking ‘‘Not later than Decem-
ber 31, 1989, the’’ and inserting ‘‘The’’, 
and 
(ii) by striking ‘‘thereafter’’ in the last 
sentence thereof. 
(121) DEFINITION
OF
EMPLOYEE.—Section 
7701(a)(20) is amended by striking ‘‘chapter 21’’ 
and all that follows and inserting ‘‘chapter 21.’’. 
(b) EFFECTIVE DATE.— 
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(1) GENERAL RULE.—Except as otherwise pro-
vided in subsection (a) or paragraph (2) of this sub-
section, the amendments made by this section shall 
take effect on the date of enactment of this Act. 
(2) SAVINGS PROVISION.—If— 
(A) any provision amended or repealed by 
the amendments made by this section applied 
to— 
(i) any transaction occurring before 
the date of the enactment of this Act, 
(ii) any property acquired before such 
date of enactment, or 
(iii) any item of income, loss, deduc-
tion, or credit taken into account before 
such date of enactment, and 
(B) the treatment of such transaction, 
property, or item under such provision would 
(without regard to the amendments or repeals 
made by this section) affect the liability for tax 
for periods ending after date of enactment, 
nothing in the amendments or repeals made by 
this section shall be construed to affect the 
treatment of such transaction, property, or item 
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for purposes of determining liability for tax for 
periods ending after such date of enactment. 
Æ 
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