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ciation for any taxable year, there is hereby
imposed on such corporation, trust, or asso-
ciation a tax in an amount equal to the
greater of—
‘‘(I) $50,000, or
‘‘(II) 
the 
amount 
determined
(pursuant to regulations promulgated
by the Secretary) by multiplying the
net income generated by the assets de-
scribed in the schedule specified in sub-
paragraph (A)(i) for the period speci-
fied in clause (ii) by the highest rate of
tax specified in section 11.
‘‘(ii) PERIOD.—For purposes of clause
(i)(II), the period described in this clause is
the period beginning on the first date that
the failure to satisfy the requirements of
such paragraph (4) occurs as a result of the
ownership of such assets and ending on the
earlier of the date on which the trust dis-
poses of such assets or the end of the first
quarter when there is no longer a failure to
satisfy such paragraph (4).
‘‘(iii) ADMINISTRATIVE PROVISIONS.—
For purposes of subtitle F, the taxes im-
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posed by this subparagraph shall be treated
as excise taxes with respect to which the de-
ficiency procedures of such subtitle apply.’’.
(2) Subsection (m) of section 856 is amended by
adding at the end the following new paragraph:
‘‘(6) TRANSITION RULE.—
‘‘(A) IN GENERAL.—Notwithstanding para-
graph (2)(C), securities held by a trust shall not
be considered securities held by the trust for pur-
poses of subsection (c)(4)(B)(iii)(III) during any
period beginning on or before October 22, 2004,
if such securities—
‘‘(i) are held by such trust continu-
ously during such period, and
‘‘(ii) would not be taken into account
for purposes of such subsection by reason of
paragraph (7)(C) of subsection (c) (as in ef-
fect on October 22, 2004) if the amendments
made by section 243 of the American Jobs
Creation Act of 2004 had never been en-
acted.
‘‘(B) RULE NOT TO APPLY TO SECURITIES
HELD
AFTER
MATURITY
DATE.—Subparagraph
(A) shall not apply with respect to any security
after the later of October 22, 2004, or the latest
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maturity date under the contract (as in effect on
October 22, 2004) taking into account any re-
newal or extension permitted under the contract
if such renewal or extension does not signifi-
cantly modify any other terms of the contract.
‘‘(C) SUCCESSORS.—If the successor of a
trust to which this paragraph applies acquires
securities in a transaction to which section 381
applies, such trusts shall be treated as a single
entity for purposes of determining the holding
period of such securities under subparagraph
(A).’’.
(3) Subparagraph (E) of section 857(b)(2) is
amended by striking ‘‘section 856(c)(7)(B)(iii), and
section 
856(g)(1).’’ 
and 
inserting 
‘‘section
856(c)(7)(C), and section 856(g)(5)’’.
(4) Subsection (g) of section 243 of the American
Jobs Creation Act of 2004 is amended to read as fol-
lows:
‘‘(g) EFFECTIVE DATES.—
‘‘(1) SUBSECTIONS (a) AND (b).—The amend-
ments made by subsections (a) and (b) shall apply to
taxable years beginning after December 31, 2000.
‘‘(2) SUBSECTIONS (c) AND (e).—The amend-
ments made by subsections (c) and (e) shall apply to
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taxable years beginning after the date of the enact-
ment of this Act.
‘‘(3) SUBSECTION (d).—The amendment made
by subsection (d) shall apply to transactions entered
into after December 31, 2004.
‘‘(4) SUBSECTION (f).—
‘‘(A) The amendment made by paragraph
(1) of subsection (f) shall apply to failures with
respect to which the requirements of subpara-
graph (A) or (B) of section 856(c)(7) of the In-
ternal Revenue Code of 1986 (as added by such
paragraph) are satisfied after the date of the en-
actment of this Act.
‘‘(B) The amendment made by paragraph
(2) of subsection (f) shall apply to failures with
respect to which the requirements of paragraph
(6) of section 856(c) of the Internal Revenue
Code of 1986 (as amended by such paragraph)
are satisfied after the date of the enactment of
this Act.
‘‘(C) The amendments made by paragraph
(3) of subsection (f) shall apply to failures with
respect to which the requirements of paragraph
(5) of section 856(g) of the Internal Revenue
Code of 1986 (as added by such paragraph) are
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satisfied after the date of the enactment of this
Act.
‘‘(D) The amendment made by paragraph
(4) of subsection (f) shall apply to taxable years
ending after the date of the enactment of this
Act.
‘‘(E) The amendments made by paragraph
(5) of subsection (f) shall apply to statements
filed after the date of the enactment of this Act.’’.
(e) AMENDMENTS RELATED TO SECTION 244 OF THE
ACT.—
(1) Paragraph (2) of section 181(d) is amended
by striking the last sentence in subparagraph (A), by
redesignating subparagraph (B) as subparagraph (C),
and by inserting after subparagraph (A) the following
new subparagraph:
‘‘(B) SPECIAL RULES FOR TELEVISION SE-
RIES.—In the case of a television series—
‘‘(i) each episode of such series shall be
treated as a separate production, and
‘‘(ii) only the first 44 episodes of such
series shall be taken into account.’’.
(2) Subparagraph (C) of section 1245(a)(2) is
amended by inserting ‘‘181,’’ after ‘‘179B,’’.