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Sec. ll601. Basis adjustment to property held by corporation where stock in
corporation is replacement property under involuntary conver-
sion rules.
Subtitle G—Excise Tax on Amounts of Private Excess Benefits
Sec. ll701. Excise taxes for failure by certain charitable organizations to
meet certain qualification requirements.
Sec. ll702. Reporting of certain excise taxes and other information.
Sec. ll703. Increase in penalties on exempt organizations for failure to file
complete and timely annual returns.
Subtitle H—Extension of Certain Taxes
Sec. ll801. Extension of hazardous substance Superfund taxes.
Sec. ll802. Extension of oil spill liability tax.
Sec. ll803. Extension of Federal unemployment tax.
Subtitle I—Provisions Relating To Individuals
Sec. ll851. No rollover or exclusion of gain on sale of principal residence
which is attributable to depreciation deductions.
Sec. ll852. Extension of withholding to certain gambling winnings.
Sec. ll853. Repeal of special rule for rental use of vacation homes, etc., for
less than 15 days.
Subtitle J—Reform of Earned Income Credit
Sec. ll901. Earned income credit denied to individuals not authorized to be
employed in the United States.
Sec. ll902. Rules relating to denial of earned income credit on basis of dis-
qualified income.
Subtitle A—Expatriation
SEC. ll101. REVISION OF TAX RULES ON EXPATRIATION.
(a) IN GENERAL.—Subpart A of part II of sub-
chapter N of chapter 1 is amended by inserting after sec-
tion 877 the following new section:
‘‘SEC. 877A. TAX RESPONSIBILITIES OF EXPATRIATION.
‘‘(a) GENERAL RULES.—For purposes of this sub-
title—
‘‘(1) MARK TO MARKET.—Except as provided in
subsection (f), all property of a covered expatriate to
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which this section applies shall be treated as sold on
the expatriation date for its fair market value.
‘‘(2) RECOGNITION OF GAIN OR LOSS.—In the
case of any sale under paragraph (1)—
‘‘(A) notwithstanding any other provision
of this title, any gain arising from such sale
shall be taken into account for the taxable year
of the sale unless such gain is excluded from
gross income under part III of subchapter B,
and
‘‘(B) any loss arising from such sale shall
be taken into account for the taxable year of
the sale to the extent otherwise provided by this
title, except that section 1091 shall not apply
(and section 1092 shall apply) to any such loss.
‘‘(3) EXCLUSION
FOR
CERTAIN
GAIN.—The
amount which would (but for this paragraph) be in-
cludible in the gross income of any individual by rea-
son of this section shall be reduced (but not below
zero) by $600,000. For purposes of this paragraph,
allocable expatriation gain taken into account under
subsection (f)(2) shall be treated in the same man-
ner as an amount required to be includible in gross
income.
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‘‘(4) ELECTION TO CONTINUE TO BE TAXED AS
UNITED STATES CITIZEN.—
‘‘(A) IN GENERAL.—If an expatriate elects
the application of this paragraph—
‘‘(i) this section (other than this para-
graph) shall not apply to the expatriate,
but
‘‘(ii) the expatriate shall be subject to
tax under this title, with respect to prop-
erty to which this section would apply but
for such election, in the same manner as if
the individual were a United States citizen.
‘‘(B) LIMITATION ON AMOUNT OF ESTATE,
GIFT, AND
GENERATION-SKIPPING
TRANSFER
TAXES.—The aggregate amount of taxes im-
posed under subtitle B with respect to any
transfer of property by reason of an election
under subparagraph (A) shall not exceed the
amount of income tax which would be due if the
property were sold for its fair market value im-
mediately before the time of the transfer or
death (taking into account the rules of para-
graph (2)).
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‘‘(C) REQUIREMENTS.—Subparagraph (A)
shall not apply to an individual unless the indi-
vidual—
‘‘(i) provides security for payment of
tax in such form and manner, and in such
amount, as the Secretary may require,
‘‘(ii) consents to the waiver of any
right of the individual under any treaty of
the United States which would preclude as-
sessment or collection of any tax which
may be imposed by reason of this para-
graph, and
‘‘(iii) complies with such other re-
quirements as the Secretary may prescribe.
‘‘(D) ELECTION.—An election under sub-
paragraph (A) shall apply to all property to
which this section would apply but for the elec-
tion and, once made, shall be irrevocable. Such
election shall also apply to property the basis of
which is determined in whole or in part by ref-
erence to the property with respect to which the
election was made.
‘‘(b) ELECTION TO DEFER TAX.—
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‘‘(1) IN GENERAL.—If the taxpayer elects the
application of this subsection with respect to any
property—
‘‘(A) no amount shall be required to be in-
cluded in gross income under subsection (a)(1)
with respect to the gain from such property for
the taxable year of the sale, but
‘‘(B) the taxpayer’s tax for the taxable
year in which such property is disposed of shall
be increased by the deferred tax amount with
respect to the property.
Except to the extent provided in regulations, sub-
paragraph (B) shall apply to a disposition whether
or not gain or loss is recognized in whole or in part
on the disposition.
‘‘(2) DEFERRED TAX AMOUNT.—
‘‘(A) IN GENERAL.—For purposes of para-
graph (1), the term ‘deferred tax amount’
means, with respect to any property, an amount
equal to the sum of—
‘‘(i) 
the 
difference 
between 
the
amount of tax paid for the taxable year de-
scribed in paragraph (1)(A) and the
amount which would have been paid for
such taxable year if the election under
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paragraph (1) had not applied to such
property, plus
‘‘(ii) an amount of interest on the
amount described in clause (i) determined
for the period—
‘‘(I) beginning on the 91st day
after the expatriation date, and
‘‘(II) ending on the due date for
the taxable year described in para-
graph (1)(B),
by using the rates and method applicable
under section 6621 for underpayments of
tax for such period.
For purposes of clause (ii), the due date is the
date prescribed by law (determined without re-
gard to extension) for filing the return of the
tax imposed by this chapter for the taxable
year.
‘‘(B) ALLOCATION OF LOSSES.—For pur-
poses of subparagraph (A), any losses described
in subsection (a)(2)(B) shall be allocated rat-
ably among the gains described in subsection
(a)(2)(A).
‘‘(3) SECURITY.—