[Congressional Bills 105th Congress]
[From the U.S. Government Publishing Office]
[H.R. 4640 Introduced in House (IH)]







105th CONGRESS
  2d Session
                                H. R. 4640

To amend the Internal Revenue Code of 1986 to provide that disposition 
  of property produced by a qualified family-owned business does not 
                     trigger additional estate tax.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                           September 25, 1998

Mr. Smith of Michigan introduced the following bill; which was referred 
                   to the Committee on Ways and Means

_______________________________________________________________________

                                 A BILL


 
To amend the Internal Revenue Code of 1986 to provide that disposition 
  of property produced by a qualified family-owned business does not 
                     trigger additional estate tax.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SALE OR EXCHANGE OF PROPERTY PRODUCED ON REAL ESTATE IN 
              ORDINARY COURSE OF BUSINESS BY QUALIFIED FAMILY-OWNED 
              BUSINESS.

    (a) In General.--Subsection (c) of section 2057 of the Internal 
Revenue Code of 1986 (relating to tax treatment of dispositions and 
failures to use for qualified use) is amended by adding at the end the 
following new paragraph:
            ``(8) Sale or exchange of property produced in the ordinary 
        course of business.--Paragraph (1) shall not apply to the sale 
        or exchange of property produced through the qualified use of 
        qualified real property.''.
    (b) Effective Date.--The amendment made by subsection (a) shall 
apply to estates of decedents dying after the date of the enactment of 
this Act.

SEC. 2. INTEREST ON ADDITIONAL ESTATE TAX.

    (a) In General.--Subparagraph (A) of section 2057(f)(2) (relating 
to additional estate tax) is amended to read as follows:
                    ``(A) In general.--The amount of additional estate 
                tax imposed by paragraph (1) shall be equal to the 
                applicable percentage of the adjusted tax difference 
                attributable to the qualified family-owned business 
                interests.''.
    (b) Effective Date.--The amendment made by subsection (a) shall 
apply to estates of decedents dying after the date of the enactment of 
this Act.
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