1.Short title; amendment of
1986 Code; table of contents
(a)This Act may be cited
as the Tax Extenders Act of
2009
.
(b)Except as otherwise expressly provided, whenever in
this Act an amendment or repeal is expressed in terms of an amendment to, or
repeal of, a section or other provision, the reference shall be considered to
be made to a section or other provision of the Internal Revenue Code of
1986.
(c)The table of contents for this Act is as follows:
Sec. 1. Short title; amendment of 1986 Code; table of
contents.
Title I—General provisions
Subtitle A—Individual tax relief
Sec. 101. Deduction of State and local sales taxes.
Sec. 102. Additional standard deduction for State and local
real property taxes.
Sec. 103. Above-the-line deduction for qualified tuition and
related expenses.
Sec. 104. Deduction for certain expenses of elementary and
secondary school teachers.
Subtitle B—Business tax relief
Sec. 111. Research credit.
Sec. 112. Exceptions for active financing income.
Sec. 113. Look-thru treatment of payments between related
controlled foreign corporations under foreign personal holding company
rules.
Sec. 114. 15-year straight-line cost recovery for qualified
leasehold improvements, qualified restaurant buildings and improvements, and
qualified retail improvements.
Sec. 115. 7-year recovery period for motorsports entertainment
complexes.
Sec. 116. Railroad track maintenance credit.
Sec. 117. Special expensing rules for certain film and
television productions.
Sec. 118. Expensing of environmental remediation
costs.
Sec. 119. Mine rescue team training credit.
Sec. 120. Election to expense advanced mine safety
equipment.
Sec. 121. Employer wage credit for employees who are active
duty members of the uniformed services.
Sec. 122. 5-year depreciation for farming business machinery
and equipment.
Sec. 123. Treatment of certain dividends and assets of
regulated investment companies.
Sec. 124. Look-thru of certain regulated investment company
stock in determining gross estate of nonresidents.
Sec. 125. RIC qualified investment entity treatment under
FIRPTA.
Sec. 126. Suspension of limitation on percentage depletion for
oil and gas from marginal wells.
Subtitle C—Charitable provisions
Sec. 131. Contributions of capital gain real property made for
conservation purposes.
Sec. 132. Enhanced charitable deduction for contributions of
food inventory.
Sec. 133. Enhanced charitable deduction for contributions of
book inventories to public schools.
Sec. 134. Enhanced charitable deduction for corporate
contributions of computer technology and equipment for educational
purposes.
Sec. 135. Tax-free distributions from individual retirement
plans for charitable purposes.
Sec. 136. Modification of tax treatment of certain payments to
controlling exempt organizations.
Sec. 137. Exclusion of gain or loss on sale or exchange of
certain brownfield sites from unrelated business taxable income.
Sec. 138. Basis adjustment to stock of S corporations making
charitable contributions of property.
Subtitle D—Miscellaneous provisions
Sec. 141. Indian employment tax credit.
Sec. 142. Accelerated depreciation for business property on an
Indian reservation.
Sec. 143. Deduction allowable with respect to income
attributable to domestic production activities in Puerto Rico.
Sec. 144. Temporary increase in limit on cover over of rum
excise taxes to Puerto Rico and the Virgin Islands.
Sec. 145. American Samoa economic development
credit.
Title II—Community assistance provisions
Sec. 201. Empowerment zone tax incentives.
Sec. 202. Renewal community tax incentives.
Sec. 203. New markets tax credit.
Sec. 204. Tax incentives for investment in the District of
Columbia.
Sec. 205. Tax incentives for New York Liberty Zone.
Sec. 206. Tax incentives for the Gulf Opportunity
Zone.
Sec. 207. Election for refundable low-income housing credit for
2010.
Title III—Disaster relief provisions
Sec. 301. Deductibility of personal casualty losses
attributable to federally declared disasters.
Sec. 302. Expensing of certain qualified disaster
expenses.
Sec. 303. 5-year carryback of net operating losses attributable
to Federally declared disasters.
Sec. 304. Waiver of certain mortgage revenue bond requirements
for residences located in Federally declared disaster areas.
Sec. 305. Expensing and special depreciation allowance for
qualified disaster assistance property.
Title IV—Energy provisions
Sec. 401. Incentives for biodiesel and renewable
diesel.
Sec. 402. Alternative motor vehicle credit for heavy
hybrids.
Sec. 403. Alternative fuel credit for natural gas and liquified
petroleum gas.
Sec. 404. Special rule for sales or dispositions to implement
FERC or State electric restructuring policy for qualified electric
utilities.
Title V—Foreign account tax compliance
Subtitle A—Increased disclosure of beneficial owners
Sec. 501. Reporting on certain foreign accounts.
Sec. 502. Repeal of certain foreign exceptions to registered
bond requirements.
Subtitle B—Under reporting with respect to foreign
assets
Sec. 511. Disclosure of information with respect to foreign
financial assets.
Sec. 512. Penalties for underpayments attributable to
undisclosed foreign financial assets.
Sec. 513. Modification of statute of limitations for
significant omission of income in connection with foreign assets.
Subtitle C—Other disclosure provisions
Sec. 521. Reporting of activities with respect to passive
foreign investment companies.
Sec. 522. Secretary permitted to require financial institutions
to file certain returns related to withholding on foreign transfers
electronically.
Subtitle D—Provisions related to foreign trusts
Sec. 531. Clarifications with respect to foreign trusts which
are treated as having a United States beneficiary.
Sec. 532. Presumption that foreign trust has United States
beneficiary.
Sec. 533. Uncompensated use of trust property.
Sec. 534. Reporting requirement of United States owners of
foreign trusts.
Sec. 535. Minimum penalty with respect to failure to report on
certain foreign trusts.
Subtitle E—Substitute dividends and dividend equivalent
payments received by foreign persons treated as dividends
Sec. 541. Substitute dividends and dividend equivalent payments
received by foreign persons treated as dividends.
Title VI—Other revenue provisions
Subtitle A—Partnership interests held by partners providing
services
Sec. 601. Partnership interests transferred in connection with
performance of services.
Sec. 602. Income of partners for performing investment
management services treated as ordinary income received for performance of
services.
Subtitle B—Time for payment of corporate estimated
taxes
Sec. 611. Time for payment of corporate estimated
taxes.
Subtitle C—Tax Expenditure Study
Sec. 621. Findings.
Sec. 622. Study of extended tax expenditures.
<enum>I</enum><header>General
provisions</header>
<subtitle id="H07585EC197A74E6B849A0D7805BC73ED"><enum>A</enum><header>Individual tax
relief</header>
<section id="H1711D601DDB3472F84CA6DAFDF373643"><enum>101.</enum><header>Deduction of
State and local sales taxes</header>
<subsection id="H51DE140FA3604B998F9239E233667EFD"><enum>(a)</enum><header>In
general</header><text>Subparagraph (I) of section 164(b)(5) is amended by
striking <quote>January 1, 2010</quote> and inserting <quote>January 1,
2011</quote>.</text>
</subsection><subsection id="H5761C186653A4E7CB2A8D9AF5A1895F7"><enum>(b)</enum><header>Effective
date</header><text>The amendment made by this section shall apply to taxable
years beginning after December 31, 2009.</text>
</subsection></section><section display-inline="no-display-inline" id="H1E8B7D7D4AE644969377226311851DA8" section-type="subsequent-section"><enum>102.</enum><header>Additional standard
deduction for State and local real property taxes</header>
<subsection id="H43753D38DDAA419EA1322E88DCFAEFC1"><enum>(a)</enum><header>In
general</header><text>Subparagraph (C) of section 63(c)(1) is amended by
striking <quote>or 2009</quote> and inserting <quote>, 2009, or
2010</quote>.</text>
</subsection><subsection id="HD506E7915D4D46C4997E7BCCF50A0445"><enum>(b)</enum><header>Effective
date</header><text>The amendment made by this section shall apply to taxable
years beginning after December 31, 2009.</text>
</subsection></section><section commented="no" display-inline="no-display-inline" id="HE23332862FC241A48B7A3A1900FCDA7F" section-type="subsequent-section"><enum>103.</enum><header>Above-the-line
deduction for qualified tuition and related expenses</header>
<subsection id="H3C2AE009DC924529A4165FDAA814EBE4"><enum>(a)</enum><header>In
general</header><text>Subsection (e) of section 222 is amended by striking
<quote>December 31, 2009</quote> and inserting <quote>December 31,
2010</quote>.</text>
</subsection><subsection commented="no" display-inline="no-display-inline" id="H39A18C2D3FB646CC88421A4EDFF4E0F9"><enum>(b)</enum><header>Effective
date</header><text>The amendment made by this section shall apply to taxable
years beginning after December 31, 2009.</text>
</subsection></section><section display-inline="no-display-inline" id="H0C6CD877608146C2A921A09B723390E4" section-type="subsequent-section"><enum>104.</enum><header>Deduction for
certain expenses of elementary and secondary school teachers</header>
<subsection id="H494A3E3F05434FC691F6E46C5265C5C6"><enum>(a)</enum><header>In
general</header><text>Subparagraph (D) of section 62(a)(2) is amended by
striking <quote>or 2009</quote> and inserting <quote>2009, or
2010</quote>.</text>
</subsection><subsection id="H4113200ECC904979A762F5710F9739EE"><enum>(b)</enum><header>Effective
date</header><text>The amendment made by this section shall apply to taxable
years beginning after December 31, 2009.</text>
</subsection></section></subtitle><subtitle id="HB73DD0133BA645AC93F8658B43833249"><enum>B</enum><header>Business tax
relief</header>
<section id="H1B926582EB3E4D8F9552524C288A6EE7"><enum>111.</enum><header>Research
credit</header>
<subsection id="H385111EC46EA4B52A9DC991BEDD0E41B"><enum>(a)</enum><header>In
general</header><text>Subparagraph (B) of section 41(h)(1) is amended by
striking <quote>December 31, 2009</quote> and inserting <quote>December 31,
2010</quote>.</text>
</subsection><subsection id="H622E221EA98F47D1936F4AA307A1FBB6"><enum>(b)</enum><header>Conforming
amendment</header><text display-inline="yes-display-inline">Subparagraph (D) of
section 45C(b)(1) is amended by striking <quote>December 31, 2009</quote> and
inserting <quote>December 31, 2010</quote>.</text>
</subsection><subsection id="H6E21C60F835C4BC3BDEEFB14CE0F9798"><enum>(c)</enum><header>Effective
date</header><text>The amendment made by this section shall apply to amounts
paid or incurred after December 31, 2009.</text>
</subsection></section><section display-inline="no-display-inline" id="H3C14DC9EE23444F5B13058B0D064F6B5" section-type="subsequent-section"><enum>112.</enum><header>Exceptions for
active financing income</header>
<subsection id="H027F6A41F2494A17AF2ECB5E5F81864A"><enum>(a)</enum><header>In
general</header><text>Sections 953(e)(10) and 954(h)(9) are each amended by
striking <quote>January 1, 2010</quote> and inserting <quote>January 1,
2011</quote>.</text>
</subsection><subsection id="H1F0ACEC2BAFD441E9CC5D9C40F46BF3A"><enum>(b)</enum><header>Conforming
amendment</header><text>Section 953(e)(10) is amended by striking
<quote>December 31, 2009</quote> and inserting <quote>December 31,
2010</quote>.</text>
</subsection><subsection commented="no" display-inline="no-display-inline" id="H9485A32C2CAA492AB982C3FF3701BAB0"><enum>(c)</enum><header>Effective
date</header><text>The amendments made by this section shall apply to taxable
years of foreign corporations beginning after December 31, 2009, and to taxable
years of United States shareholders with or within which any such taxable year
of such foreign corporation ends.</text>
</subsection></section><section commented="no" display-inline="no-display-inline" id="HFA648141D42C475A943EC9C262FC5BEE" section-type="subsequent-section"><enum>113.</enum><header>Look-thru treatment
of payments between related controlled foreign corporations under foreign
personal holding company rules</header>
<subsection commented="no" display-inline="no-display-inline" id="H9EF275C7102C473685A12298A98A8D8C"><enum>(a)</enum><header>In
general</header><text>Subparagraph (C) of section 954(c)(6) is amended by
striking <quote>January 1, 2010</quote> and inserting <quote>January 1,
2011</quote>.</text>
</subsection><subsection commented="no" display-inline="no-display-inline" id="H36ACB75EB742410C8DDD9CB7CF8DB214"><enum>(b)</enum><header>Effective
date</header><text display-inline="yes-display-inline">The amendment made by
this section shall apply to taxable years of foreign corporations beginning
after December 31, 2009, and to taxable years of United States shareholders
with or within which any such taxable year of such foreign corporation
ends.</text>
</subsection></section><section display-inline="no-display-inline" id="HBB315993C39841E8B2DB8E19062F21EF" section-type="subsequent-section"><enum>114.</enum><header>15-year
straight-line cost recovery for qualified leasehold improvements, qualified
restaurant buildings and improvements, and qualified retail
improvements</header>
<subsection id="H576FB819786E4FBAABED8D0B68C3433F"><enum>(a)</enum><header>In
general</header><text>Clauses (iv), (v), and (ix) of section 168(e)(3)(E) are
each amended by striking <quote>January 1, 2010</quote> and inserting
<quote>January 1, 2011</quote>.</text>
</subsection><subsection id="H5DE37E6C40A54ADEBF6E307120EE8E30"><enum>(b)</enum><header>Effective
date</header><text>The amendments made by this section shall apply to property
placed in service after December 31, 2009.</text>
</subsection></section><section display-inline="no-display-inline" id="HB2EA56A8E9DE42A1A2814BAF6C7A6101" section-type="subsequent-section"><enum>115.</enum><header>7-year recovery
period for motorsports entertainment complexes</header>
<subsection id="H3DE6AE75B5F443D9AC42CEE04C18CA53"><enum>(a)</enum><header>In
general</header><text>Subparagraph (D) of section 168(i)(15) is amended by
striking <quote>December 31, 2009</quote> and inserting <quote>December 31,
2010</quote>.</text>
</subsection><subsection id="H1D992C182826496D95F5A570EECC6A3B"><enum>(b)</enum><header>Effective
date</header><text>The amendment made by this section shall apply to property
placed in service after December 31, 2009.</text>
</subsection></section><section display-inline="no-display-inline" id="HE3680D4E4ACD4064B4693707887EA829" section-type="subsequent-section"><enum>116.</enum><header>Railroad track
maintenance credit</header>
<subsection id="H0C3DCCADB61848A7ADD36CA70D984E8E"><enum>(a)</enum><header>In
general</header><text>Subsection (f) of section 45G is amended by striking
<quote>January 1, 2010</quote> and inserting <quote>January 1,
2011</quote>.</text>
</subsection><subsection id="H938EC590F99243D9ACB90317609E6D78"><enum>(b)</enum><header>Effective
date</header><text>The amendment made by this section shall apply to
expenditures paid or incurred in taxable years beginning after December 31,
2009.</text>
</subsection></section><section commented="no" display-inline="no-display-inline" id="HEE9564BB6DF443B8949AD3144D2162BE" section-type="subsequent-section"><enum>117.</enum><header>Special expensing
rules for certain film and television productions</header>
<subsection id="H27F85EC328C6451B87E0CCD8DB3EE5AF"><enum>(a)</enum><header>In
general</header><text>Subsection (f) of section 181 is amended by striking
<quote>December 31, 2009</quote> and inserting <quote>December 31,
2010</quote>.</text>
</subsection><subsection commented="no" display-inline="no-display-inline" id="H7ACEA561775049718A0604D047CCEB41"><enum>(b)</enum><header>Effective
date</header><text>The amendment made by this section shall apply to
productions commencing after December 31, 2009.</text>
</subsection></section><section commented="no" display-inline="no-display-inline" id="H47C76D8BCE9F481C80432961E3DCD0B9" section-type="subsequent-section"><enum>118.</enum><header>Expensing of
environmental remediation costs</header>
<subsection id="HCF15AD5F9FFA45B0837764CB7FC17910"><enum>(a)</enum><header>In
general</header><text>Subsection (h) of section 198 is amended by striking
<quote>December 31, 2009</quote> and inserting <quote>December 31,
2010</quote>.</text>
</subsection><subsection commented="no" display-inline="no-display-inline" id="H291DA04956B148FC9365A3D29BDDAB52"><enum>(b)</enum><header>Effective
date</header><text>The amendment made by this section shall apply to
expenditures paid or incurred after December 31, 2009.</text>
</subsection></section><section display-inline="no-display-inline" id="HC2CA3F72B00A4D86B44847F7C93A2851" section-type="subsequent-section"><enum>119.</enum><header>Mine rescue team
training credit</header>
<subsection id="HAF1514DEB53747D4A3C57C10F86DDD99"><enum>(a)</enum><header>In
general</header><text>Subsection (e) of section 45N is amended by striking
<quote>December 31, 2009</quote> and inserting <quote>December 31,
2010</quote>.</text>
</subsection><subsection id="HE936D455F0584DACA56F4554A8A71B4C"><enum>(b)</enum><header>Effective
date</header><text>The amendment made by this section shall apply to taxable
years beginning after December 31, 2009.</text>
</subsection></section><section commented="no" display-inline="no-display-inline" id="HD4C35EF7798A4357AA8668CE7FA56280" section-type="subsequent-section"><enum>120.</enum><header>Election to expense
advanced mine safety equipment</header>
<subsection id="HF555EAF7D46C4B7EAC34658579F1115A"><enum>(a)</enum><header>In
general</header><text>Subsection (g) of section 179E is amended by striking
<quote>December 31, 2009</quote> and inserting <quote>December 31,
2010</quote>.</text>
</subsection><subsection commented="no" display-inline="no-display-inline" id="HB584CCE6515F40D7B1BF6BC8DEFA2D6B"><enum>(b)</enum><header>Effective
date</header><text>The amendment made by this section shall apply to property
placed in service after December 31, 2009.</text>
</subsection></section><section display-inline="no-display-inline" id="HC5267C85813D497195AA74C307B60FD3" section-type="subsequent-section"><enum>121.</enum><header>Employer wage credit
for employees who are active duty members of the uniformed services</header>
<subsection id="HCD0D89C3A7464FE0857E5587AF07A64B"><enum>(a)</enum><header>In
general</header><text>Subsection (f) of section 45P is amended by striking
<quote>December 31, 2009</quote> and inserting <quote>December 31,
2010</quote>.</text>
</subsection><subsection commented="no" display-inline="no-display-inline" id="H46A53D9E9F4348BA9F08327C3E72CA9B"><enum>(b)</enum><header>Effective
date</header><text>The amendment made by this section shall apply to payments
made after December 31, 2009.</text>
</subsection></section><section display-inline="no-display-inline" id="HBB89A068434D4BF0BDAEFAFEE298FF49" section-type="subsequent-section"><enum>122.</enum><header>5-year depreciation
for farming business machinery and equipment</header>
<subsection id="H4B929F1D3B9F4192A284F7DF8C5B185A"><enum>(a)</enum><header>In
general</header><text>Clause (vii) of section 168(e)(3)(B) is amended by
striking <quote>January 1, 2010</quote> and inserting <quote>January 1,
2011</quote>.</text>
</subsection><subsection id="HF50B4351768748058E0B3B4B4AC3DCF0"><enum>(b)</enum><header>Effective
date</header><text>The amendment made by this section shall apply to property
placed in service after December 31, 2009.</text>
</subsection></section><section display-inline="no-display-inline" id="H4CB9E5D1122C4AC5B47A0E19E1F5A110" section-type="subsequent-section"><enum>123.</enum><header>Treatment of certain
dividends and assets of regulated investment companies</header>
<subsection id="HC571F8CAB78C452EBA14F5935F86C2A1"><enum>(a)</enum><header>In
general</header><text>Paragraphs (1)(C) and (2)(C) of section 871(k) are each
amended by striking <quote>December 31, 2009</quote> and inserting
<quote>December 31, 2010</quote>.</text>
</subsection><subsection commented="no" display-inline="no-display-inline" id="H8BC78CC692C743CCB2A2119606E301CE"><enum>(b)</enum><header>Effective
date</header><text>The amendments made by this section shall apply to taxable
years beginning after December 31, 2009.</text>
</subsection></section><section display-inline="no-display-inline" id="HCB9142588D8B4768819CE94BEDFA1C58" section-type="subsequent-section"><enum>124.</enum><header>Look-thru of certain
regulated investment company stock in determining gross estate of
nonresidents</header>
<subsection id="H8063402C86884866A10A429B8FCE05DC"><enum>(a)</enum><header>In
general</header><text>Paragraph (3) of section 2105(d) is amended by striking
<quote>December 31, 2009</quote> and inserting <quote>December 31,
2010</quote>.</text>
</subsection><subsection commented="no" display-inline="no-display-inline" id="HB54BB8B0CCDD433CBBC690D13752B208"><enum>(b)</enum><header>Effective
date</header><text>The amendment made by this section shall apply to estates of
decedents dying after December 31, 2009.</text>
</subsection></section><section commented="no" display-inline="no-display-inline" id="HDD027E4984E74380ADA9036AD5E02A76" section-type="subsequent-section"><enum>125.</enum><header>RIC qualified
investment entity treatment under FIRPTA</header>
<subsection id="HBE0F5A45ACA342CF83F40D8D6E5C17B2"><enum>(a)</enum><header>In
general</header><text>Clause (ii) of section 897(h)(4)(A) is amended by
striking <quote>December 31, 2009</quote> and inserting <quote>December 31,
2010</quote>.</text>
</subsection><subsection commented="no" display-inline="no-display-inline" id="H8A4D89DFA8F842C49F2C436AADFC5487"><enum>(b)</enum><header>Effective
date</header><text>The amendment made by this section shall apply to
distributions made after December 31, 2009.</text>
</subsection></section><section id="HBCB9BD71240F4C108933CF874BAAC463"><enum>126.</enum><header>Suspension of
limitation on percentage depletion for oil and gas from marginal wells</header>
<subsection id="H229B973DB1E049109BD603BB7EA9DB44"><enum>(a)</enum><header>In
general</header><text>Clause (ii) of section 613A(c)(6)(H) is amended by
striking <quote>January 1, 2010</quote> and inserting <quote>January 1,
2011</quote>.</text>
</subsection><subsection commented="no" display-inline="no-display-inline" id="H50576A2A386F4EEF862C27C042F52253"><enum>(b)</enum><header>Effective
date</header><text>The amendment made by this section shall apply to taxable
years beginning after December 31, 2009.</text>
</subsection></section></subtitle><subtitle id="H01A7CD6CBFDE4577A843F6B80BDA4668"><enum>C</enum><header>Charitable
provisions</header>
<section id="H3827D86F2A7C410FB166DBFDCDE35896"><enum>131.</enum><header>Contributions
of capital gain real property made for conservation purposes</header>
<subsection id="HD903215FEB0B426F918ACAFEDB0AA54E"><enum>(a)</enum><header>In
general</header><text>Clause (vi) of section 170(b)(1)(E) is amended by
striking <quote>December 31, 2009</quote> and inserting <quote>December 31,
2010</quote>.</text>
</subsection><subsection id="H48EC41D7C1D74D3CB3C6C4D4C1D669FE"><enum>(b)</enum><header>Contributions by
certain corporate farmers and ranchers</header><text>Clause (iii) of section
170(b)(2)(B) is amended by striking <quote>December 31, 2009</quote> and
inserting <quote>December 31, 2010</quote>.</text>
</subsection><subsection id="HAE169742B4D24DC6B30A1E28A5447477"><enum>(c)</enum><header>Effective
date</header><text>The amendments made by this section shall apply to
contributions made in taxable years beginning after December 31, 2009.</text>
</subsection></section><section display-inline="no-display-inline" id="HE39462E9ADA8441984CAEB0B50912B92" section-type="subsequent-section"><enum>132.</enum><header>Enhanced charitable
deduction for contributions of food inventory</header>
<subsection id="H12EE8E397FF742B594B14D900DB690C3"><enum>(a)</enum><header>In
general</header><text>Clause (iv) of section 170(e)(3)(C) is amended by
striking <quote>December 31, 2009</quote> and inserting <quote>December 31,
2010</quote>.</text>
</subsection><subsection id="H2A95A7529BEC4F97BAE882446FAEAB65"><enum>(b)</enum><header>Effective
date</header><text>The amendment made by this section shall apply to
contributions made after December 31, 2009.</text>
</subsection></section><section display-inline="no-display-inline" id="H6D4C477F26584BA2AB87943D9EE3DAF4" section-type="subsequent-section"><enum>133.</enum><header>Enhanced charitable
deduction for contributions of book inventories to public schools</header>
<subsection id="H4F63A42FB8584C929F3BCCA2532F54A6"><enum>(a)</enum><header>In
general</header><text>Clause (iv) of section 170(e)(3)(D) is amended by
striking <quote>December 31, 2009</quote> and inserting <quote>December 31,
2010</quote>.</text>
</subsection><subsection commented="no" display-inline="no-display-inline" id="H5FCE4ABE91B54F978D5FD917236E407A"><enum>(b)</enum><header>Effective
date</header><text>The amendment made by this section shall apply to
contributions made after December 31, 2009.</text>
</subsection></section><section commented="no" display-inline="no-display-inline" id="H9D7AF3DEC1384B74BEFF36D51B5E2A38" section-type="subsequent-section"><enum>134.</enum><header>Enhanced charitable
deduction for corporate contributions of computer technology and equipment for
educational purposes</header>
<subsection id="H7B18B20FCBD24046AE34F23A9F6DD1E4"><enum>(a)</enum><header>In
general</header><text>Subparagraph (G) of section 170(e)(6) is amended by
striking <quote>December 31, 2009</quote> and inserting <quote>December 31,
2010</quote>.</text>
</subsection><subsection commented="no" display-inline="no-display-inline" id="HFB3D5A1773AC411CAAF08B63767E11DD"><enum>(b)</enum><header>Effective
date</header><text>The amendment made by this section shall apply to
contributions made in taxable years beginning after December 31, 2009.</text>
</subsection></section><section display-inline="no-display-inline" id="HE4891AAF7F6643FEB796130DA1C0F25F" section-type="subsequent-section"><enum>135.</enum><header>Tax-free
distributions from individual retirement plans for charitable purposes</header>
<subsection id="HFFF4E08125844BAA9B765ECCED6EB643"><enum>(a)</enum><header>In
general</header><text>Subparagraph (F) of section 408(d)(8) is amended by
striking <quote>December 31, 2009</quote> and inserting <quote>December 31,
2010</quote>.</text>
</subsection><subsection commented="no" display-inline="no-display-inline" id="H2CA5AA7BD2A144AC9F7CE2F2C55602A1"><enum>(b)</enum><header>Effective
date</header><text>The amendment made by this section shall apply to
distributions made in taxable years beginning after December 31, 2009.</text>
</subsection></section><section display-inline="no-display-inline" id="H72417D13C8334DEFAF22F92EB1824A61" section-type="subsequent-section"><enum>136.</enum><header>Modification of tax
treatment of certain payments to controlling exempt organizations</header>
<subsection id="H1198BFE279FD4A56A84C92B04F55CFA5"><enum>(a)</enum><header>In
general</header><text>Clause (iv) of section 512(b)(13)(E) is amended by
striking <quote>December 31, 2009</quote> and inserting <quote>December 31,
2010</quote>.</text>
</subsection><subsection commented="no" display-inline="no-display-inline" id="HD9B1ED9F39004AB8A4FE97DBC964BCB0"><enum>(b)</enum><header>Effective
date</header><text>The amendment made by this section shall apply to payments
received or accrued after December 31, 2009.</text>
</subsection></section><section commented="no" display-inline="no-display-inline" id="H0E4AE7411306490C8D06BC4EE0C49EDD" section-type="subsequent-section"><enum>137.</enum><header>Exclusion of gain or
loss on sale or exchange of certain brownfield sites from unrelated business
taxable income</header>
<subsection id="HAA7F4CDC9A5545D38B869F2BE500E7C0"><enum>(a)</enum><header>In
general</header><text>Subparagraph (K) of section 512(b)(19) is amended by
striking <quote>December 31, 2009</quote> and inserting <quote>December 31,
2010</quote>.</text>
</subsection><subsection commented="no" display-inline="no-display-inline" id="H8A3E758AA59D4180B5BB7F89113B973E"><enum>(b)</enum><header>Effective
date</header><text>The amendment made by this section shall apply to property
acquired after December 31, 2009.</text>
</subsection></section><section display-inline="no-display-inline" id="H4606139CB6DD4B3C9C76A5D53C159C5E" section-type="subsequent-section"><enum>138.</enum><header>Basis adjustment to
stock of S corporations making charitable contributions of property</header>
<subsection id="H96DE09160034469F98D0E584C2FB505E"><enum>(a)</enum><header>In
general</header><text>Paragraph (2) of section 1367(a) is amended by striking
<quote>December 31, 2009</quote> and inserting <quote>December 31,
2010</quote>.</text>
</subsection><subsection commented="no" display-inline="no-display-inline" id="HCE5EAA516C4844A9973DAA883C5D8164"><enum>(b)</enum><header>Effective
date</header><text>The amendment made by this section shall apply to
contributions made in taxable years beginning after December 31, 2009.</text>
</subsection></section></subtitle><subtitle id="HE01BCD05B7E647529404E083276947EC"><enum>D</enum><header>Miscellaneous
provisions</header>
<section display-inline="no-display-inline" id="H2A86104D19E048F7895CFCA4132A34C2" section-type="subsequent-section"><enum>141.</enum><header>Indian employment
tax credit</header>
<subsection id="H8B3B2BA9CFE74AA2B969172EB0B3A071"><enum>(a)</enum><header>In
general</header><text>Subsection (f) of section 45A is amended by striking
<quote>December 31, 2009</quote> and inserting <quote>December 31,
2010</quote>.</text>
</subsection><subsection id="H4464A574B18A4F1A99159C06E2A02185"><enum>(b)</enum><header>Effective
date</header><text>The amendment made by this section shall apply to taxable
years beginning after December 31, 2009.</text>
</subsection></section><section display-inline="no-display-inline" id="H5346B0DAC7EE4FB0911C558A02AC07A3" section-type="subsequent-section"><enum>142.</enum><header>Accelerated
depreciation for business property on an Indian reservation</header>
<subsection id="H052ABC32084B4E85B169FE012627C3F1"><enum>(a)</enum><header>In
general</header><text display-inline="yes-display-inline">Paragraph (8) of
section 168(j) is amended by striking <quote>December 31, 2009</quote> and
inserting <quote>December 31, 2010</quote>.</text>
</subsection><subsection id="HF25CFF124B7D4D3D885866ED4FBB38EA"><enum>(b)</enum><header>Effective
date</header><text>The amendment made by this section shall apply to property
placed in service after December 31, 2009.</text>
</subsection></section><section display-inline="no-display-inline" id="H02B0647266A54EDEB16EA4A43B950908" section-type="subsequent-section"><enum>143.</enum><header>Deduction allowable
with respect to income attributable to domestic production activities in Puerto
Rico</header>
<subsection id="H56ECB41EFE8A4EE1BB23EC183F797E09"><enum>(a)</enum><header>In
general</header><text>Subparagraph (C) of section 199(d)(8) is amended—</text>
<paragraph id="H073BA1C07DC14B1483E2C14AF360C0A7"><enum>(1)</enum><text>by striking
<quote>first 4 taxable years</quote> and inserting <quote>first 5 taxable
years</quote>, and</text>
</paragraph><paragraph id="HDFEFC0147FE746FD82FF69123AEE8AA9"><enum>(2)</enum><text>by striking
<quote>January 1, 2010</quote> and inserting <quote>January 1,
2011</quote>.</text>
</paragraph></subsection><subsection commented="no" display-inline="no-display-inline" id="H3FC4EC7523D14A1C887F186283DA60FC"><enum>(b)</enum><header>Effective
date</header><text>The amendments made by this section shall apply to taxable
years beginning after December 31, 2009.</text>
</subsection></section><section display-inline="no-display-inline" id="H7B621CD204D54B32B19468E58031A2D2" section-type="subsequent-section"><enum>144.</enum><header>Temporary increase
in limit on cover over of rum excise taxes to Puerto Rico and the Virgin
Islands</header>
<subsection id="H318115C9BF544009B345D9247A6FE9F0"><enum>(a)</enum><header>In
general</header><text>Paragraph (1) of section 7652(f) is amended by striking
<quote>January 1, 2010</quote> and inserting <quote>January 1,
2011</quote>.</text>
</subsection><subsection commented="no" display-inline="no-display-inline" id="H5EE6AC0543B84077A1D264A7FC077E48"><enum>(b)</enum><header>Effective
date</header><text>The amendment made by this section shall apply to distilled
spirits brought into the United States after December 31, 2009.</text>
</subsection></section><section commented="no" display-inline="no-display-inline" id="HD823CCAAEFDF4ABDBE9520A54EAB143B" section-type="subsequent-section"><enum>145.</enum><header>American Samoa
economic development credit</header>
<subsection id="HE394ACF8F0734E6B82AB8E94D390EF38"><enum>(a)</enum><header>In
general</header><text display-inline="yes-display-inline">Subsection (d) of
section 119 of division A of the Tax Relief and Health Care Act of 2006 is
amended—</text>
<paragraph id="HCC9A8F6A0D8F4C418F9C8FE510A8B3BA"><enum>(1)</enum><text>by striking
<quote>first 4 taxable years</quote> and inserting <quote>first 5 taxable
years</quote>, and</text>
</paragraph><paragraph id="H1453DCCEB23A487587719F12ADA14436"><enum>(2)</enum><text>by striking
<quote>January 1, 2010</quote> and inserting <quote>January 1,
2011</quote>.</text>
</paragraph></subsection><subsection commented="no" display-inline="no-display-inline" id="H01C986AA39AA4EACB329530AE533183F"><enum>(b)</enum><header>Effective
date</header><text>The amendments made by this section shall apply to taxable
years beginning after December 31, 2009.</text>
</subsection></section></subtitle><enum>II</enum><header>Community
assistance provisions</header>
<section commented="no" id="HA8325C3A2CD24422A9BEEED67DADB92C"><enum>201.</enum><header>Empowerment
zone tax incentives</header>
<subsection commented="no" id="H1CF7D3C248A8499E900EF3D3805CBB20"><enum>(a)</enum><header>In
general</header><text>Clause (i) of section 1391(d)(1)(A) is amended by
striking <quote>December 31, 2009</quote> and inserting <quote>December 31,
2010</quote>.</text>
</subsection><subsection commented="no" id="H83FE6897DC374FDFA6AAC12149A274AD"><enum>(b)</enum><header>Increased
exclusion of gain on stock of empowerment zone
businesses</header><text>Subparagraph (C) of section 1202(a)(2) is
amended—</text>
<paragraph commented="no" id="H97FB5F6424564D5880D16125557171A1"><enum>(1)</enum><text>by striking
<quote>December 31, 2014</quote> and inserting <quote>December 31,
2015</quote>, and</text>
</paragraph><paragraph commented="no" id="H9C8FB4AF45DF4410AD0E88CC8A261AEC"><enum>(2)</enum><text>by striking
<quote><header-in-text level="subparagraph" style="OLC">2014</header-in-text></quote> in the heading and inserting
<quote><header-in-text level="subparagraph" style="OLC">2015</header-in-text></quote>.</text>
</paragraph></subsection><subsection commented="no" display-inline="no-display-inline" id="H8F3D5D33D9694CA485F7134A88BE1C9D"><enum>(c)</enum><header>Effective
date</header><text display-inline="yes-display-inline">The amendments made by
this section shall apply to periods after December 31, 2009.</text>
</subsection></section><section commented="no" display-inline="no-display-inline" id="HC4974A6761EF4040859BA07EBA48A260" section-type="subsequent-section"><enum>202.</enum><header>Renewal community
tax incentives</header>
<subsection id="HC17E18BA86F04B83818E740C0B75A57F"><enum>(a)</enum><header>In
general</header><text display-inline="yes-display-inline">Subsection (b) of
section 1400E is amended—</text>
<paragraph id="H4958EF68A5C04D848FE5405CBCA3F56A"><enum>(1)</enum><text>by striking
<quote>December 31, 2009</quote> in paragraphs (1)(A) and (3) and inserting
<quote>December 31, 2010</quote>, and</text>
</paragraph><paragraph id="HC5A8A6F57E7347D7AB167D1D073E8011"><enum>(2)</enum><text>by striking
<quote>January 1, 2010</quote> in paragraph (3) and inserting <quote>January 1,
2011</quote>.</text>
</paragraph></subsection><subsection commented="no" display-inline="no-display-inline" id="H17822EF32ADD469CBF783E1E91956013"><enum>(b)</enum><header>Zero-Percent
capital gains rate</header>
<paragraph id="HF460A32088FD4FFD960126CC9048B8A2"><enum>(1)</enum><header>Acquisition
dates</header><text>Paragraphs (2)(A)(i), (3)(A), (4)(A)(i), and (4)(B)(i) of
section 1400F(b) are each amended by striking <quote>January 1, 2010</quote>
and inserting <quote>January 1, 2011</quote>.</text>
</paragraph><paragraph commented="no" id="H097636FA983B4D93B846DE5ED38F841B"><enum>(2)</enum><header>Limitation on
period of gains</header><text>Paragraph (2) of section 1400F(c) is
amended—</text>
<subparagraph commented="no" id="H2FF8B5D139294A7FA41BD8F35D94A16B"><enum>(A)</enum><text>by striking
<quote>December 31, 2014</quote> and inserting <quote>December 31,
2015</quote>, and</text>
</subparagraph><subparagraph commented="no" id="HADA49852D41C4063A344FAF3D616DE07"><enum>(B)</enum><text>by striking
<quote><header-in-text level="paragraph" style="OLC">2014</header-in-text></quote> in the heading and inserting
<quote><header-in-text level="paragraph" style="OLC">2015</header-in-text></quote>.</text>
</subparagraph></paragraph><paragraph id="H49A96D4E709E43D3ADB80176757D5035"><enum>(3)</enum><header>Clerical
amendment</header><text>Subsection (d) of section 1400F is amended by striking
<quote>and <quote>December 31, 2014</quote> for <quote>December 31,
2014</quote></quote>.</text>
</paragraph></subsection><subsection commented="no" id="H24B1634B4B0C4E19B1574BCE9920F3CF"><enum>(c)</enum><header>Commercial
revitalization deduction</header><text display-inline="yes-display-inline">Subsection (g) of section 1400I is amended
by striking <quote>December 31, 2009</quote> and inserting <quote>December 31,
2010</quote>.</text>
</subsection><subsection commented="no" id="H65EAE4E5684F4FA5B4D6944E2A69D56E"><enum>(d)</enum><header>Increased
expensing under section 179</header><text display-inline="yes-display-inline">Subparagraph (A) of section 1400J(b)(1) is
amended by striking <quote>January 1, 2010</quote> and inserting <quote>January
1, 2011</quote>.</text>
</subsection><subsection commented="no" id="H33847D00E3AA496F90C3C49D92F4CCA1"><enum>(e)</enum><header>Effective
dates</header>
<paragraph commented="no" id="HDDAE0A582D524FD588CA07752E7F6B06"><enum>(1)</enum><header>In
general</header><text display-inline="yes-display-inline">Except as otherwise
provided in this subsection, the amendments made by this section shall apply to
periods after December 31, 2009.</text>
</paragraph><paragraph id="HADCCFD8590FE473EBAE3AE6313427BCA"><enum>(2)</enum><header>Acquisitions</header><text>The
amendments made by subsection (b)(1) and (d) shall apply to acquisitions after
December 31, 2009.</text>
</paragraph><paragraph commented="no" id="H3E1EFD16669345E993F2F1DDA07CB38D"><enum>(3)</enum><header>Commercial
revitalization deduction</header><text>The amendment made by subsection (c)
shall apply to building placed in service after December 31, 2009.</text>
</paragraph></subsection></section><section display-inline="no-display-inline" id="HAEEFDE788A104E69B56EA4768BEBF798" section-type="subsequent-section"><enum>203.</enum><header>New markets tax
credit</header>
<subsection id="HC716378F10C94E818150F9442294E60C"><enum>(a)</enum><header>In
general</header><text>Subparagraph (F) of section 45D(f)(1) is amended by
inserting <quote>and 2010</quote> after <quote>2009</quote>.</text>
</subsection><subsection id="HF5B3D8317B5441F09F611AF9044B6EA5"><enum>(b)</enum><header>Carryover of
unused limitation</header><text>Paragraph (3) of section 45D(f) is amended by
striking <quote>2014</quote> and inserting <quote>2015</quote>.</text>
</subsection><subsection id="H36996624824E42D7B049B94BF1C9363A"><enum>(c)</enum><header>Effective
date</header><text>The amendments made by this section shall apply to calendar
years beginning after 2009.</text>
</subsection></section><section commented="no" display-inline="no-display-inline" id="HA1E33D84DDAC4F70B1DBDA81E0D8DAB9" section-type="subsequent-section"><enum>204.</enum><header>Tax incentives for
investment in the District of Columbia</header>
<subsection commented="no" display-inline="no-display-inline" id="H350DB48A9BED41C9AC9E207C60394BDF"><enum>(a)</enum><header>In
general</header><text>Subsection (f) of section 1400 is amended by striking
<quote>December 31, 2009</quote> each place it appears and inserting
<quote>December 31, 2010</quote>.</text>
</subsection><subsection commented="no" display-inline="no-display-inline" id="H69928AEE21F54E8AAB5C1C77DD947936"><enum>(b)</enum><header>Tax-Exempt DC
empowerment zone bonds</header><text>Subsection (b) of section 1400A is amended
by striking <quote>December 31, 2009</quote> and inserting <quote>December 31,
2010</quote>.</text>
</subsection><subsection commented="no" display-inline="no-display-inline" id="H6AEDA41F6EE84F8BA70BD3D8765143CD"><enum>(c)</enum><header>Zero-Percent
capital gains rate</header>
<paragraph id="HA70BE3EDB4204FF39A4AACE7F1C55DEA"><enum>(1)</enum><header>Acquisition
dates</header><text>Paragraphs (2)(A)(i), (3)(A), (4)(A)(i), and (4)(B)(i)(I)
of section 1400B(b) are each amended by striking <quote>January 1, 2010</quote>
and inserting <quote>January 1, 2011</quote>.</text>
</paragraph><paragraph commented="no" id="HBE5B4DCB56EC49D6ABC88434CF286DD8"><enum>(2)</enum><header>Limitation on
period of zero-percent capital gains</header>
<subparagraph commented="no" id="H1BA750ADCD71483A8A95193A57EB70EF"><enum>(A)</enum><header>In
general</header><text display-inline="yes-display-inline">Paragraph (2) of
section 1400B(e) is amended—</text>
<clause commented="no" id="HE1A0D17792B14FD28E858BC51B3F3A22"><enum>(i)</enum><text>by striking
<quote>December 31, 2014</quote> and inserting <quote>December 31,
2015</quote>, and</text>
</clause><clause commented="no" id="HA9622CAD12014C6E886CD158514FDBFD"><enum>(ii)</enum><text>by striking
<quote><header-in-text level="paragraph" style="OLC">2014</header-in-text></quote> in the heading and inserting
<quote><header-in-text level="paragraph" style="OLC">2015</header-in-text></quote>.</text>
</clause></subparagraph><subparagraph commented="no" id="H4471B908E8E34913BD65B062842A84EF"><enum>(B)</enum><header>Interests in
partnership and s corporations</header><text>Paragraph (2) of section 1400B(g)
is amended by striking <quote>December 31, 2014</quote> and inserting
<quote>December 31, 2015</quote>.</text>
</subparagraph></paragraph></subsection><subsection commented="no" display-inline="no-display-inline" id="HFBBAB43CAD8C479290F22EB7C965BF76"><enum>(d)</enum><header>First-Time
homebuyer credit</header><text>Subsection (i) of section 1400C is amended by
striking <quote>January 1, 2010</quote> and inserting <quote>January 1,
2011</quote>.</text>
</subsection><subsection commented="no" display-inline="no-display-inline" id="H7466EDAA9F1F4CB8B4A5E38A1C5E8355"><enum>(e)</enum><header>Effective
dates</header>
<paragraph commented="no" display-inline="no-display-inline" id="H30BEA98810F64124AF4D78CF455A6E6F"><enum>(1)</enum><header>In
general</header><text>Except as otherwise provided in this subsection, the
amendments made by this section shall apply to periods after December 31,
2009.</text>
</paragraph><paragraph id="HA14D1343AE5C4201840E86D1F3B3187E"><enum>(2)</enum><header>Tax-exempt DC
empowerment zone bonds</header><text>The amendment made by subsection (b) shall
apply to bonds issued after December 31, 2009.</text>
</paragraph><paragraph id="HDA60C6DE846944398313C19B4C6C2933"><enum>(3)</enum><header>Acquisition
dates for zero-percent capital gains rate</header><text>The amendments made by
subsection (c)(1) shall apply to property acquired or substantially improved
after December 31, 2009.</text>
</paragraph><paragraph commented="no" display-inline="no-display-inline" id="H6EA08B24BD534F77B80737428BD4CBB2"><enum>(4)</enum><header>First-time
homebuyer credit</header><text>The amendment made by subsection (d) shall apply
to property purchased after December 31, 2009.</text>
</paragraph></subsection></section><section id="HCAAD945601594874807E8396106AB2B5"><enum>205.</enum><header>Tax incentives
for New York Liberty Zone</header>
<subsection id="H8551EF080AAE40F0A397ECF5CA20B344"><enum>(a)</enum><header>Bonus
depreciation for nonresidential real property and residential rental
property</header><text display-inline="yes-display-inline">Subparagraph (A) of
section 1400L(b)(2) is amended by striking <quote>December 31, 2009</quote> in
the last sentence and inserting <quote>December 31, 2010</quote>.</text>
</subsection><subsection id="H4D4613B44F1E4124A2D513D9347E64D1"><enum>(b)</enum><header>Tax-Exempt bond
financing</header><text>Subparagraph (D) of section 1400L(d)(2) is amended by
striking <quote>January 1, 2010</quote> and inserting <quote>January 1,
2011</quote>.</text>
</subsection><subsection id="HF62701F6874843EFB11B25C3C5C5252C"><enum>(c)</enum><header>Effective
dates</header>
<paragraph id="H05B165527EEB440F8F460E8C8BE59090"><enum>(1)</enum><header>Bonus
depreciation</header><text>The amendment made by subsection (a) shall apply to
property placed in service after December 31, 2009.</text>
</paragraph><paragraph id="HBA8744D3F8364DF59E38463BA143E30E"><enum>(2)</enum><header>Tax-exempt bond
financing</header><text>The amendment made by subsection (b) shall apply to
bonds issued after December 31, 2009.</text>
</paragraph></subsection></section><section id="H54DE322955A94E0891477C938384CD06"><enum>206.</enum><header>Tax incentives
for the Gulf Opportunity Zone</header>
<subsection id="HDC3C492491B046E08C0033AB8DA5BC07"><enum>(a)</enum><header>Work opportunity
tax credit for core disaster area</header><text display-inline="yes-display-inline">Paragraph (1) of section 201(b) of the
Katrina Emergency Tax Relief Act of 2005 is amended by striking
<quote>4-year</quote> and inserting <quote>5-year</quote> .</text>
</subsection><subsection id="H7D0F661B2E0C4A9698CC4FDB2A74FE5C"><enum>(b)</enum><header>Increase in
rehabilitation credit</header><text>Subsection (h) of section 1400N is amended
by striking <quote>December 31, 2009</quote> and inserting <quote>December 31,
2010</quote>.</text>
</subsection><subsection id="H4526AB8C51044FA593FB5D0D97907F75"><enum>(c)</enum><header>Effective
dates</header>
<paragraph id="H462E95D53579435DA17AE78F2423165E"><enum>(1)</enum><header>Work opportunity
tax credit</header><text>The amendment made by subsection (a) shall apply to
individuals hired on or after August 28, 2009.</text>
</paragraph><paragraph id="H5421E3E6B6EC453D869B6CBEC76F625A"><enum>(2)</enum><header>Rehabilitation
credit</header><text>The amendment made by subsection (b) shall apply to
amounts paid or incurred after December 31, 2009.</text>
</paragraph></subsection></section><section id="HACD3FB20451E42FCA8A1ACFF796702BF"><enum>207.</enum><header>Election for
refundable low-income housing credit for 2010</header>
<subsection id="H9744F04D69DA40F087DB9E4C7930C58D"><enum>(a)</enum><header>In
general</header><text>Section 42 is amended by redesignating subsection (n) as
subsection (o) and by inserting after subsection (m) the following new
subsection:</text>
<quoted-block display-inline="no-display-inline" id="HA8B1DCE10BBB42E084DE35A40A875D41" style="OLC">
<subsection id="HC52BFAFC3247448ABC336B3C4A42F3BE"><enum>(n)</enum><header>Election for
refundable credits</header>
<paragraph id="H2E28723567D746D1AFD548247AB46A18"><enum>(1)</enum><header>In
general</header><text display-inline="yes-display-inline">The housing credit
agency of each State shall be allowed a credit in an amount equal to such
State’s 2010 low-income housing refundable credit election amount which shall
be payable by the Secretary as provided in paragraph (5).</text>
</paragraph><paragraph id="H09D51ED2A6FE4CB492A713A48B2B3ACC"><enum>(2)</enum><header>2010 low-income
housing refundable credit election amount</header><text>For purposes of this
subsection, the term <quote>2010 low-income housing refundable credit election
amount</quote> means, with respect to any State, such amount as the State may
elect which does not exceed 85 percent of the product of—</text>
<subparagraph id="H9179CC67223942BDBA5071E1A7DB3A1A"><enum>(A)</enum><text>the sum of—</text>
<clause id="HCFC7B903D1A545E3B97B012FA2FDC71E"><enum>(i)</enum><text>100 percent of the
State housing credit ceiling for 2010 which is attributable to amounts
described in clauses (i) and (iii) of subsection (h)(3)(C), and</text>
</clause><clause id="H39C8E0C76173417289B626DE4930914A"><enum>(ii)</enum><text>40 percent of the
State housing credit ceiling for 2010 which is attributable to amounts
described in clauses (ii) and (iv) of such subsection, multiplied by</text>
</clause></subparagraph><subparagraph id="H55070D50E2B842B38641C98F97358452"><enum>(B)</enum><text>10.</text>
</subparagraph></paragraph><paragraph id="HF3CDCC1245EE4AC0A3089E1A27D38EE9"><enum>(3)</enum><header>Coordination
with non-refundable credit</header><text display-inline="yes-display-inline">For purposes of this section, the amounts
described in clauses (i) through (iv) of subsection (h)(3)(C) with respect to
any State for 2010 shall each be reduced by so much of such amount as is taken
into account in determining the amount of the credit allowed with respect to
such State under paragraph (1).</text>
</paragraph><paragraph id="H8F39E722DF094A5DB27A409749E43B59"><enum>(4)</enum><header>Special rule for
basis</header><text>Basis of a qualified low-income building shall not be
reduced by the amount of any payment made under this subsection.</text>
</paragraph><paragraph id="H1DFD1628C72645A1B55799562E06A14A"><enum>(5)</enum><header>Payment of
credit; use to finance low-income buildings</header><text display-inline="yes-display-inline">The Secretary shall pay to the housing
credit agency of each State an amount equal to the credit allowed under
paragraph (1). Rules similar to the rules of subsections (c) and (d) of section
1602 of the American Recovery and Reinvestment Tax Act of 2009 shall apply with
respect to any payment made under this paragraph, except that such subsection
(d) shall be applied by substituting <quote>January 1, 2012</quote> for
<quote>January 1,
2011</quote>.</text>
</paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="H060BF0F30B8B4B96A73F94EB14767B14"><enum>(b)</enum><header>Conforming
amendment</header><text display-inline="yes-display-inline">Section 1324(b)(2)
of title 31, United States Code, is amended by inserting <quote>42(n),</quote>
after <quote>36A,</quote>.</text>
</subsection></section><enum>III</enum><header>Disaster relief
provisions</header>
<section commented="no" id="H2B7010C8892E402DB097E52B83EF25E4"><enum>301.</enum><header>Deductibility
of personal casualty losses attributable to federally declared
disasters</header>
<subsection commented="no" id="H7CC6C25693DB45A38DB4703492CB1F31"><enum>(a)</enum><header>In
general</header><text>Subclause (I) of section 165(h)(3)(B)(i) is amended by
striking <quote>January 1, 2010</quote> and inserting <quote>January 1,
2011</quote>.</text>
</subsection><subsection id="H88B64C1CA65A47B285510D087D8A06C8"><enum>(b)</enum><header>Extension of
$500 limitation</header><text>Paragraph (1) of section 165(h) is amended by
striking <quote>December 31, 2009</quote> and inserting <quote>December 31,
2010</quote>.</text>
</subsection><subsection commented="no" id="HA65319A6EFF149A6A6CE6ABE472F075B"><enum>(c)</enum><header>Effective
date</header>
<paragraph id="H37B2C96A6E88497C8B3317C0AFCBA800"><enum>(1)</enum><header>In
general</header><text>Except as otherwise provided in this subsection, the
amendments made by this section shall apply to losses attributable to disasters
occurring after December 31, 2009.</text>
</paragraph><paragraph id="H0187A1B5F61F4AF0AB9F85BBF8FCC7C8"><enum>(2)</enum><header>Extension of
$500 limitation</header><text display-inline="yes-display-inline">The amendment
made by subsection (b) shall apply to taxable years beginning after December
31, 2009.</text>
</paragraph></subsection></section><section display-inline="no-display-inline" id="H9A119C29DDE1436C801B8CFBCE92FA1D" section-type="subsequent-section"><enum>302.</enum><header>Expensing of certain
qualified disaster expenses</header>
<subsection id="HF6CA55A799034345B5A04ECE3C81F15B"><enum>(a)</enum><header>In
general</header><text>Subparagraph (A) of section 198A(b)(2) is amended by
striking <quote>January 1, 2010</quote> and inserting <quote>January 1,
2011</quote>.</text>
</subsection><subsection id="HCEDB31EE5144406E84FCA8748BE55139"><enum>(b)</enum><header>Effective
date</header><text>The amendment made by this section shall apply to
expenditures on account of disasters occurring after December 31, 2009.</text>
</subsection></section><section display-inline="no-display-inline" id="HA2C308B5FFBB477391E547DB88E482C4" section-type="subsequent-section"><enum>303.</enum><header>5-year carryback of
net operating losses attributable to Federally declared disasters</header>
<subsection id="HE00FFB9CD2D2466292B440B55E4A8D42"><enum>(a)</enum><header>In
general</header><text>Subclause (I) of section 172(j)(1)(A)(i) is amended by
striking <quote>January 1, 2010</quote> and inserting <quote>January 1,
2011</quote>.</text>
</subsection><subsection id="H64A79BE636D940B98DF8F1FA18275E5E"><enum>(b)</enum><header>Effective
date</header><text>The amendment made by this section shall apply to losses
attributable to disasters occurring after December 31, 2009.</text>
</subsection></section><section display-inline="no-display-inline" id="H3CFA7AECB5D643D8877C10CC800A3DFA" section-type="subsequent-section"><enum>304.</enum><header>Waiver of certain
mortgage revenue bond requirements for residences located in Federally declared
disaster areas</header>
<subsection id="H79A3B7F7A6394C57898C753FF56EBCC6"><enum>(a)</enum><header>In
general</header><text>Paragraph (11) of section 143(k) is amended by striking
<quote>January 1, 2010</quote> and inserting <quote>January 1,
2011</quote>.</text>
</subsection><subsection id="H263384171123422684BE9C15703179A9"><enum>(b)</enum><header>Special rule for
residences destroyed in Federally declared disaster
areas</header><text>Paragraph (13) of section 143(k), as redesignated under
subsection (c), is amended by striking <quote>January 1, 2010</quote> in
subparagraphs (A)(i) and (B)(i) and inserting <quote>January 1,
2011</quote>.</text>
</subsection><subsection id="H671F43C124264B1F90473232CAA5D1E8"><enum>(c)</enum><header>Technical
amendment</header><text display-inline="yes-display-inline">Subsection (k) of
section 143 is amended by redesignating the second paragraph (12) (relating to
special rules for residences destroyed in Federally declared disasters) as
paragraph (13).</text>
</subsection><subsection id="HA7B4E9A873374859AF3548AF631CEDEC"><enum>(d)</enum><header>Effective
dates</header>
<paragraph id="H74A78CFA507C42B3889C4AD6CC9E9F20"><enum>(1)</enum><header>In
general</header><text>Except as otherwise provided in this subsection, the
amendments made by this section shall apply to bonds issued after December 31,
2009.</text>
</paragraph><paragraph id="H96ECB66CF20B4B058A31B429726440F1"><enum>(2)</enum><header>Residences
destroyed in Federally declared disaster areas</header><text>The amendments
made by subsection (b) shall apply with respect to disasters occurring after
December 31, 2009.</text>
</paragraph><paragraph id="HED1B34E1BDA74F5ABA4C93CF634C4F0F"><enum>(3)</enum><header>Technical
amendment</header><text>The amendment made by subsection (c) shall take effect
as if included in section 709 of the Tax Extenders and Alternative Minimum Tax
Relief Act of 2008.</text>
</paragraph></subsection></section><section display-inline="no-display-inline" id="H5B140C886A154D38B7EE7C77324194F5" section-type="subsequent-section"><enum>305.</enum><header>Expensing and
special depreciation allowance for qualified disaster assistance
property</header>
<subsection id="HEE2908FFDA7B472393A3351ACD89858F"><enum>(a)</enum><header>In
general</header><text>Subclause (I) of section 168(n)(2)(A)(ii) is amended by
striking <quote>January 1, 2010</quote> and inserting <quote>January 1,
2011</quote>.</text>
</subsection><subsection id="H8E36B380464244268B1980627F4D0F9D"><enum>(b)</enum><header>Effective
date</header><text>The amendment made by this section shall apply to disasters
occurring after December 31, 2009.</text>
</subsection></section><enum>IV</enum><header>Energy
provisions</header>
<section id="H74B6400E511A4ABA89598696E8713161"><enum>401.</enum><header>Incentives for
biodiesel and renewable diesel</header>
<subsection id="HA9D403FEC8ED4FAA86633AFD5631BA33"><enum>(a)</enum><header>Credits for
biodiesel and renewable diesel used as fuel</header><text>Subsection (g) of
section 40A is amended by striking <quote>December 31, 2009</quote> and
inserting <quote>December 31, 2010</quote>.</text>
</subsection><subsection id="H135787E38F224641ADD0D5516CDB9AF1"><enum>(b)</enum><header>Excise tax
credits and payments for biodiesel and renewable diesel fuel mixtures</header>
<paragraph id="H860E6FBBF29745F984517FC89D339FC0"><enum>(1)</enum><text>Paragraph (6) of
section 6426(c) is amended by striking <quote>December 31, 2009</quote> and
inserting <quote>December 31, 2010</quote>.</text>
</paragraph><paragraph id="H8EFDA4BD47FB4A00BA194F611199A42E"><enum>(2)</enum><text>Subparagraph (B)
of section 6427(e)(6) is amended by striking <quote>December 31, 2009</quote>
and inserting <quote>December 31, 2010</quote>.</text>
</paragraph></subsection><subsection commented="no" display-inline="no-display-inline" id="H31FFF07A576946B3A803B63810C8AE28"><enum>(c)</enum><header>Effective
date</header><text>The amendments made by this section shall apply to sales and
uses after December 31, 2009.</text>
</subsection></section><section id="HF34BA977CD8F45E4910B906C90453CC0"><enum>402.</enum><header>Alternative
motor vehicle credit for heavy hybrids</header>
<subsection id="H658CA9CE0D9642F4A9B8BF5E1AA8BC54"><enum>(a)</enum><header>In
general</header><text display-inline="yes-display-inline">Paragraph (3) of
section 30B(k) is amended by striking <quote>December 31, 2009</quote> and
inserting <quote>December 31, 2010</quote>.</text>
</subsection><subsection id="HB76DF5B53898482DA34F1BDFA204376A"><enum>(b)</enum><header>Effective
date</header><text>The amendment made by this section shall apply to property
purchased after December 31, 2009.</text>
</subsection></section><section id="HCF1DF15ACAB84408A2548F64C8AB2C79"><enum>403.</enum><header>Alternative
fuel credit for natural gas and liquified petroleum gas</header>
<subsection id="HFCCA083E989342549C64FE00BED59654"><enum>(a)</enum><header>In
general</header><text display-inline="yes-display-inline">Paragraph (5) of
section 6426(d) is amended by striking <quote>after December 31, 2009</quote>
and all that follows and inserting</text>
<quoted-block display-inline="yes-display-inline" id="H3B068FAD755648698D8FB2519DEC9F4D" style="OLC">
<text>after—</text><subparagraph id="H8570BC971C0A48EABF39CF0E91CFE474"><enum>(A)</enum><text>September 30,
2014, in the case of liquefied hydrogen,</text>
</subparagraph><subparagraph id="H8052B75CC9744B89A6566B6DE4867495"><enum>(B)</enum><text>December 31, 2010,
in the case of—</text>
<clause id="HE6E6BE2875AC4AD78E33E6683DEBBEC3"><enum>(i)</enum><text>compressed or
liquified natural gas, and</text>
</clause><clause id="H086CC9FAB40D4D969D29C43CB903CD21"><enum>(ii)</enum><text>liquified
petroleum gas (other than for use as fuel in a forklift), and</text>
</clause></subparagraph><subparagraph id="H973061209A4C4DF794DD8EF030071EA5"><enum>(C)</enum><text>December 31, 2009,
in any other
case.</text>
</subparagraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="HA6C66ED55454427195960207F9F588F8"><enum>(b)</enum><header>Payment
authority</header><text>Paragraph (6) of section 6427(e) is amended by striking
<quote>and</quote> at the end of subparagraph (C), by striking the period at
the end of subparagraph (D) and inserting a comma and by adding at the end the
following new subparagraphs:</text>
<quoted-block display-inline="no-display-inline" id="H59C30BF58E2F4FA49A2C58E26B2ACD0F" style="OLC">
<subparagraph id="H40F16E76B4FD42ECA803A1177B7484C2"><enum>(E)</enum><text display-inline="yes-display-inline">any alternative fuel (as so defined)
involving compressed or liquified natural gas sold or used after December 31,
2010, and</text>
</subparagraph><subparagraph id="H064E12CB25804757BAB2751585607988"><enum>(F)</enum><text>any alternative
fuel (as so defined) involving liquified petroleum gas (other than for use as
fuel in a forklift) sold or used after December 31,
2010.</text>
</subparagraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="HA34E26DE1DE344519301B31BB2DC7E10"><enum>(c)</enum><header>Conforming
amendment</header><text>Subparagraph (C) of section 6427(e)(6) is amended by
inserting <quote>(E), or (F)</quote> after <quote>subparagraph
(D)</quote>.</text>
</subsection><subsection id="H36C7B932F4F248E6AEED9859C11FE49C"><enum>(d)</enum><header>Effective
date</header><text>The amendments made by this section shall apply to fuel sold
or used after December 31, 2009.</text>
</subsection></section><section display-inline="no-display-inline" id="H8B5444EA01344509B9D3D887762E58D7" section-type="subsequent-section"><enum>404.</enum><header>Special rule for
sales or dispositions to implement FERC or State electric restructuring policy
for qualified electric utilities</header>
<subsection id="H445CFDB4FA5544D2AED5614D656FC13F"><enum>(a)</enum><header>In
general</header><text>Paragraph (3) of section 451(i) is amended by striking
<quote>January 1, 2010</quote> and inserting <quote>January 1,
2011</quote>.</text>
</subsection><subsection commented="no" display-inline="no-display-inline" id="H1A867259A9A2417B84C766F291926302"><enum>(b)</enum><header>Effective
date</header><text>The amendment made by this section shall apply to
dispositions after December 31, 2009.</text>
</subsection></section><enum>V</enum><header>Foreign account
tax compliance</header>
<subtitle id="H003E25E2500E4186ACF2ABEB1F2C2674"><enum>A</enum><header>Increased
disclosure of beneficial owners </header>
<section id="H0992532C6CB94BB7B63977B6F79DAFEE"><enum>501.</enum><header>Reporting on
certain foreign accounts</header>
<subsection id="HC196CD07087A4531901E0D73FA637E13"><enum>(a)</enum><header>In
general</header><text display-inline="yes-display-inline">The Internal Revenue
Code of 1986 is amended by inserting after chapter 3 the following new
chapter:</text>
<quoted-block display-inline="no-display-inline" id="H678101AE04A942E997B7C3D8AAFD6809" style="OLC">
<chapter id="H388E69027CF7488CBC9C19F1DC5629AD"><enum>4</enum><header>Taxes To enforce
reporting on certain foreign accounts</header>
<toc container-level="chapter-container" idref="H388E69027CF7488CBC9C19F1DC5629AD" lowest-bolded-level="division-lowest-bolded" lowest-level="section" quoted-block="no-quoted-block" regeneration="yes-regeneration">
<toc-entry idref="H03CB28179BE54381B8F6AE1B5A7CE542" level="section">Sec. 1471. Withholdable payments to foreign financial
institutions.</toc-entry>
<toc-entry idref="H762856BB9DA445C9BFF3C4F1D237BD86" level="section">Sec. 1472. Withholdable payments to other foreign
entities.</toc-entry>
<toc-entry idref="H24B86027916D4C4BB451DD8115EA27F5" level="section">Sec. 1473. Definitions.</toc-entry>
<toc-entry idref="H4B3CDAFD35EF4A8BB1754255177AD7E0" level="section">Sec. 1474. Special rules.</toc-entry>
</toc>
<section id="H03CB28179BE54381B8F6AE1B5A7CE542"><enum>1471.</enum><header>Withholdable
payments to foreign financial institutions</header>
<subsection id="H87C64E2D13164575907FD8E2E6367D2B"><enum>(a)</enum><header>In
general</header><text display-inline="yes-display-inline">In the case of any
withholdable payment to a foreign financial institution which does not meet the
requirements of subsection (b), the withholding agent with respect to such
payment shall deduct and withhold from such payment a tax equal to 30 percent
of the amount of such payment.</text>
</subsection><subsection id="H0853A8B2D2B9481B8E0517EADFCD68C4"><enum>(b)</enum><header>Reporting
requirements, etc</header>
<paragraph id="H25CD838DE00A4C6CB43EC51B63C30A35"><enum>(1)</enum><header>In
general</header><text>The requirements of this subsection are met with respect
to any foreign financial institution if an agreement is in effect between such
institution and the Secretary under which such institution agrees—</text>
<subparagraph id="H6C8566899890470FA667C026BF56DC8F"><enum>(A)</enum><text>to obtain such
information regarding each holder of each account maintained by such
institution as is necessary to determine which (if any) of such accounts are
United States accounts,</text>
</subparagraph><subparagraph id="HAB8AFF5E5B7945AAB55BE5F8E75706D8"><enum>(B)</enum><text>to comply with
such verification and due diligence procedures as the Secretary may require
with respect to the identification of United States accounts,</text>
</subparagraph><subparagraph id="H4374920175344455A2046731CC039211"><enum>(C)</enum><text>in the case of any
United States account maintained by such institution, to report on an annual
basis the information described in subsection (c) with respect to such
account,</text>
</subparagraph><subparagraph id="H177CD4C74D59475A9EE507425E4DEAF1"><enum>(D)</enum><text display-inline="yes-display-inline">to deduct and withhold a tax equal to 30
percent of—</text>
<clause id="H0BBFE9CF7425466299F03A5DEFAC51B6"><enum>(i)</enum><text>any passthru
payment which is made by such institution to a recalcitrant account holder or
another foreign financial institution which does not meet the requirements of
this subsection, and</text>
</clause><clause id="HDA78B44BBCF44FBF8EB7A59170CA0F83"><enum>(ii)</enum><text>in the case of
any passthru payment which is made by such institution to a foreign financial
institution which has in effect an election under paragraph (3) with respect to
such payment, so much of such payment as is allocable to accounts held by
recalcitrant account holders or foreign financial institutions which do not
meet the requirements of this subsection,</text>
</clause></subparagraph><subparagraph id="HFCC79B8FF69443ECBEBAB0A63530EC21"><enum>(E)</enum><text>to comply with
requests by the Secretary for additional information with respect to any United
States account maintained by such institution, and</text>
</subparagraph><subparagraph id="H936F773F79F3404CAE5D2FD098507513"><enum>(F)</enum><text>in any case in
which any foreign law would (but for a waiver described in clause (i)) prevent
the reporting of any information referred to in this subsection or subsection
(c) with respect to any United States account maintained by such
institution—</text>
<clause id="HF03B6747F4D14095A9D17D7AC95EC65D"><enum>(i)</enum><text>to
attempt to obtain a valid and effective waiver of such law from each holder of
such account, and</text>
</clause><clause id="HE0DA6EF2D6384A04B94B55D6FD54E063"><enum>(ii)</enum><text>if a waiver
described in clause (i) is not obtained from each such holder within a
reasonable period of time, to close such account.</text>
</clause></subparagraph><continuation-text continuation-text-level="paragraph">Any
agreement entered into under this subsection may be terminated by the Secretary
upon a determination by the Secretary that the foreign financial institution is
out of compliance with such agreement.</continuation-text></paragraph><paragraph display-inline="no-display-inline" id="H4362C72656B14892AA5828286E61197E"><enum>(2)</enum><header>Financial
institutions deemed to meet requirements in certain cases</header><text>A
foreign financial institution may be treated by the Secretary as meeting the
requirements of this subsection if—</text>
<subparagraph id="H80A41FF37CFA4701BD877F6DA2C07645"><enum>(A)</enum><text>such
institution—</text>
<clause id="HA1F7C03268CC410597FBEC37465FD848"><enum>(i)</enum><text>complies with such
procedures as the Secretary may prescribe to ensure that such institution does
not maintain United States accounts, and</text>
</clause><clause id="H486D099DC4944C5B947A68ED3C676D2E"><enum>(ii)</enum><text>meets such other
requirements as the Secretary may prescribe with respect to accounts of other
foreign financial institutions maintained by such institution, or</text>
</clause></subparagraph><subparagraph id="H7FFB3CA9A79A45F1898FC156933EC4A6"><enum>(B)</enum><text>such institution
is a member of a class of institutions with respect to which the Secretary has
determined that the application of this section is not necessary to carry out
the purposes of this section.</text>
</subparagraph></paragraph><paragraph id="H7C20F72E18F34531848D11AD4BCBED51"><enum>(3)</enum><header>Election to be
withheld upon rather than withhold on payments to recalcitrant account holders
and nonparticipating foreign financial institutions</header><text>In the case
of a foreign financial institution which meets the requirements of this
subsection and such other requirements as the Secretary may provide and which
elects the application of this paragraph—</text>
<subparagraph id="HE2A9EAB915E24655BCEEC3436A6CD34B"><enum>(A)</enum><text>the requirements
of paragraph (1)(D) shall not apply,</text>
</subparagraph><subparagraph id="HC81484ED772A402FB9B79410CAA1AD0B"><enum>(B)</enum><text display-inline="yes-display-inline">the withholding tax imposed under
subsection (a) shall apply with respect to any withholdable payment to such
institution to the extent such payment is allocable to accounts held by
recalcitrant account holders or foreign financial institutions which do not
meet the requirements of this subsection, and</text>
</subparagraph><subparagraph id="HC0C67E5E6C2E422BB87E5AC6B7FDA821"><enum>(C)</enum><text>the agreement
described in paragraph (1) shall—</text>
<clause id="HD0FD3A6DB97147669A9B615E3E5EA2DA"><enum>(i)</enum><text>require such
institution to notify the withholding agent with respect to each such payment
of the institution’s election under this paragraph and such other information
as may be necessary for the withholding agent to determine the appropriate
amount to deduct and withhold from such payment, and</text>
</clause><clause id="H2E203B4A64A340479196732D674E96B9"><enum>(ii)</enum><text>include a waiver
of any right under any treaty of the United States with respect to any amount
deducted and withheld pursuant to an election under this paragraph.</text>
</clause></subparagraph><continuation-text continuation-text-level="paragraph">To the
extent provided by the Secretary, the election under this paragraph may be made
with respect to certain classes or types of accounts of the foreign financial
institution.</continuation-text></paragraph></subsection><subsection id="HCB1B3E53159F44578491E434A1AD79FA"><enum>(c)</enum><header>Information
required To be reported on United States accounts</header>
<paragraph id="H4B126C63CF1D45FA912B2B15353FBB07"><enum>(1)</enum><header>In
general</header><text>The agreement described in subsection (b) shall require
the foreign financial institution to report the following with respect to each
United States account maintained by such institution:</text>
<subparagraph id="HC5607194F7FA45B69460DF8B023190AB"><enum>(A)</enum><text>The name, address,
and TIN of each account holder which is a specified United States person and,
in the case of any account holder which is a United States owned foreign
entity, the name, address, and TIN of each substantial United States owner of
such entity.</text>
</subparagraph><subparagraph id="H2641373AFE3D409E83A3A889BF03B282"><enum>(B)</enum><text>The account
number.</text>
</subparagraph><subparagraph id="HEB22B7E3F0A54D0295052573C8BC039E"><enum>(C)</enum><text>The account
balance or value (determined at such time and in such manner as the Secretary
may provide).</text>
</subparagraph><subparagraph id="HEDC7744A3A4743F7A1EC62B9C53743DF"><enum>(D)</enum><text>The gross receipts
and gross withdrawals or payments from the account (determined for such period
and in such manner as the Secretary may provide).</text>
</subparagraph></paragraph><paragraph id="H9CE81490A5434D0293DC90CC3B739978"><enum>(2)</enum><header>Election to be
subject to same reporting as United States financial
institutions</header><text>In the case of a foreign financial institution which
elects the application of this paragraph—</text>
<subparagraph id="HBACFCD5519604A13B655205A8E5F6E03"><enum>(A)</enum><text>subparagraphs (C)
and (D) of paragraph (1) shall not apply, and</text>
</subparagraph><subparagraph id="H0FE3C03835ED42F5B27CB8BC3DF32D6C"><enum>(B)</enum><text>the agreement
described in subsection (b) shall require such foreign financial institution to
report such information with respect to each United States account maintained
by such institution as such institution would be required to report under
sections 6041, 6042, 6045, and 6049 if—</text>
<clause id="HCB230B517F344CF2A12FFAEC6FA331B1"><enum>(i)</enum><text>such institution
were a United States person, and</text>
</clause><clause id="HC974840F5A1048129E39C50FA9768EA4"><enum>(ii)</enum><text>each holder of
such account which is a specified United States person or United States owned
foreign entity were a natural person and citizen of the United States.</text>
</clause><continuation-text continuation-text-level="subparagraph">An
election under this paragraph shall be made at such time, in such manner, and
subject to such conditions as the Secretary may provide.</continuation-text></subparagraph></paragraph><paragraph commented="no" id="HF2ECEAB311474D089A72F9F04C854360"><enum>(3)</enum><header>Separate
requirements for qualified intermediaries</header><text>In the case of a
foreign financial institution which is treated as a qualified intermediary by
the Secretary for purposes of section 1441 and the regulations issued
thereunder, the requirements of this section shall be in addition to any
reporting or other requirements imposed by the Secretary for purposes of such
treatment.</text>
</paragraph></subsection><subsection id="H99C1B699E2834648A4CDF54216AAC1EF"><enum>(d)</enum><header>Definitions</header><text>For
purposes of this section—</text>
<paragraph id="H88DDCE6DC95D4D47B7563FEC94655EF9"><enum>(1)</enum><header>United States
account</header>
<subparagraph id="H5806B61D1B4142F7903AA22BA058A650"><enum>(A)</enum><header>In
general</header><text>The term <quote>United States account</quote> means any
financial account which is held by one or more specified United States persons
or United States owned foreign entities.</text>
</subparagraph><subparagraph id="H0F3B143233EE46D89A50E246CC4DEF20"><enum>(B)</enum><header>Exception for
certain accounts held by individuals</header><text display-inline="yes-display-inline">Unless the foreign financial institution
elects to not have this subparagraph apply, such term shall not include any
depository account maintained by such financial institution if—</text>
<clause id="HC30D22472A934D56BDDAF312DD7DC147"><enum>(i)</enum><text>each holder of
such account is a natural person, and</text>
</clause><clause id="H9786D5CB4A084F0FA499F38EB3510C6B"><enum>(ii)</enum><text>with respect to
each holder of such account, the aggregate value of all depository accounts
held (in whole or in part) by such holder and maintained by the same financial
institution which maintains such account does not exceed $50,000.</text>
</clause><continuation-text continuation-text-level="subparagraph">To the
extent provided by the Secretary, financial institutions which are members of
the same expanded affiliated group shall be treated for purposes of clause (ii)
as a single financial institution.</continuation-text></subparagraph><subparagraph id="HF3D4217AFB8D4BB7AAD309D720A4CF2E"><enum>(C)</enum><header>Elimination of
duplicative reporting requirements</header><text>Such term shall not include
any financial account in a foreign financial institution if—</text>
<clause id="HA8C50007E26C4B6EB9220CBFDC250DD5"><enum>(i)</enum><text>such account is
held by another financial institution which meets the requirements of
subsection (b), or</text>
</clause><clause id="H7E94164321844ABDBBC1F67BF72A53D6"><enum>(ii)</enum><text>the holder of
such account is otherwise subject to information reporting requirements which
the Secretary determines would make the reporting required by this section with
respect to United States accounts duplicative.</text>
</clause></subparagraph></paragraph><paragraph id="H320FFBEF826745759CB5C082D1622B4D"><enum>(2)</enum><header>Financial
account</header><text display-inline="yes-display-inline">The term
<quote>financial account</quote> means, with respect to any financial
institution—</text>
<subparagraph id="H22515D00195748C9875FF2BD1747313C"><enum>(A)</enum><text>any depository
account maintained by such financial institution,</text>
</subparagraph><subparagraph id="H91A5C272B5A84CF5A756CE91DF53EA38"><enum>(B)</enum><text>any custodial
account maintained by such financial institution, and</text>
</subparagraph><subparagraph commented="no" id="H86D09CD3B0C14B2484D6DDFA286C0CF9"><enum>(C)</enum><text>except as
otherwise provided by the Secretary, any equity or debt interest in such
financial institution (other than interests which are regularly traded on an
established securities market).</text>
</subparagraph><continuation-text continuation-text-level="paragraph">Any equity
or debt interest which constitutes a financial account under subparagraph (C)
with respect to any financial institution shall be treated for purposes of this
section as maintained by such financial institution.</continuation-text></paragraph><paragraph id="H5E34654435504463B7F16AB50DC59831"><enum>(3)</enum><header>United States
owned foreign entity</header><text>The term <quote>United States owned foreign
entity</quote> means any foreign entity which has one or more substantial
United States owners.</text>
</paragraph><paragraph id="H981F07930E3B44A69DB323CABD2F13A0"><enum>(4)</enum><header>Foreign
financial institution</header><text display-inline="yes-display-inline">The
term <quote>foreign financial institution</quote> means any financial
institution which is a foreign entity. Except as otherwise provided by the
Secretary, such term shall not include a financial institution which is
organized under the laws of any possession of the United States.</text>
</paragraph><paragraph commented="no" id="H94F33A3EF90440048645628EAB1EF0D6"><enum>(5)</enum><header>Financial
institution</header><text display-inline="yes-display-inline">Except as
otherwise provided by the Secretary, the term <quote>financial
institution</quote> means any entity that—</text>
<subparagraph id="H0398623D81A649BCA144B3173724874E"><enum>(A)</enum><text>accepts deposits
in the ordinary course of a banking or similar business,</text>
</subparagraph><subparagraph id="HC216A353E6354596A7AC2F9BAEA5062C"><enum>(B)</enum><text>is engaged in the
business of holding financial assets for the account of others, or</text>
</subparagraph><subparagraph id="HC3E2254BB3AE4808B8CD569D04B764B8"><enum>(C)</enum><text>is engaged (or
holding itself out as being engaged) primarily in the business of investing,
reinvesting, or trading in securities (as defined in section 475(c)(2) without
regard to the last sentence thereof), partnership interests, commodities (as
defined in section 475(e)(2)), or any interest (including a futures or forward
contract or option) in such securities, partnership interests, or
commodities.</text>
</subparagraph></paragraph><paragraph id="H3AA960165C77460495CF3B0F3349367B"><enum>(6)</enum><header>Recalcitrant
account holder</header><text display-inline="yes-display-inline">The term
<quote>recalcitrant account holder</quote> means any account holder
which—</text>
<subparagraph id="H472829C568794603BA07F492FBBF9E21"><enum>(A)</enum><text>fails to comply
with reasonable requests for the information referred to in subsection
(b)(1)(A) or (c)(1)(A), or</text>
</subparagraph><subparagraph id="H81B31C8B688A4CCCBC27842807661CF4"><enum>(B)</enum><text>fails to provide a
waiver described in subsection (b)(1)(F) upon request.</text>
</subparagraph></paragraph><paragraph id="H9CD086A683CC4FC7B6AF58468F45D61C"><enum>(7)</enum><header>Passthru
payment</header><text>The term <quote>passthru payment</quote> means any
withholdable payment or other payment which is attributable to a withholdable
payment.</text>
</paragraph></subsection><subsection id="H2DDD80A4F8E947C3A53EE8D69F60A549"><enum>(e)</enum><header>Affiliated
groups</header>
<paragraph id="H0D11611640484808B1AB54373EAB153C"><enum>(1)</enum><header>In
general</header><text>The requirements of subsections (b) and (c)(1) shall
apply—</text>
<subparagraph id="H5177CEB628004456BD64F4407915FDB6"><enum>(A)</enum><text>with respect to
United States accounts maintained by the foreign financial institution,
and</text>
</subparagraph><subparagraph id="H012DCD47799A4B038AF37921CD4818FA"><enum>(B)</enum><text>except as
otherwise provided by the Secretary, with respect to United States accounts
maintained by each other foreign financial institution (other than any foreign
financial institution which meets the requirements of subsection (b)) which is
a member of the same expanded affiliated group as such foreign financial
institution.</text>
</subparagraph></paragraph><paragraph display-inline="no-display-inline" id="H3C5034D2C9A84BF8B186BEADEF4CA9F3"><enum>(2)</enum><header>Expanded
affiliated group</header><text display-inline="yes-display-inline">For purposes
of this section, the term <quote>expanded affiliated group</quote> means an
affiliated group as defined in section 1504(a), determined—</text>
<subparagraph id="HB566BFB66AB24CEDBBE49E100BE282AB"><enum>(A)</enum><text>by substituting
<quote>more than 50 percent</quote> for <quote>at least 80 percent</quote> each
place it appears, and</text>
</subparagraph><subparagraph id="H27A91C8D36AD4082AFB847F24B6B33B5"><enum>(B)</enum><text>without regard to
paragraphs (2) and (3) of section 1504(b).</text>
</subparagraph><continuation-text continuation-text-level="paragraph">A
partnership or any other entity (other than a corporation) shall be treated as
a member of an expanded affiliated group if such entity is controlled (within
the meaning of section 954(d)(3)) by members of such group (including any
entity treated as a member of such group by reason of this sentence).</continuation-text></paragraph></subsection><subsection id="HD59CC2C6B8E945438879F4DB31CA0630"><enum>(f)</enum><header>Exception for
certain payments</header><text>Subsection (a) shall not apply to any payment if
the beneficial owner of such payment is—</text>
<paragraph id="H9C0D46FFFACA4911B475620059210120"><enum>(1)</enum><text display-inline="yes-display-inline">any foreign government, any political
subdivision of a foreign government, or any wholly owned agency or
instrumentality of any one or more of the foregoing,</text>
</paragraph><paragraph id="H20B8D59CD8B244EA83C125404E8E02AB"><enum>(2)</enum><text>any international
organization or any wholly owned agency or instrumentality thereof,</text>
</paragraph><paragraph id="H40D26529028046CEB28377E2CD51B125"><enum>(3)</enum><text>any foreign
central bank of issue, or</text>
</paragraph><paragraph id="H68E01D0597C848BD99752C671EB32358"><enum>(4)</enum><text>any other class of
persons identified by the Secretary for purposes of this subsection as posing a
low risk of tax evasion.</text>
</paragraph></subsection></section><section id="H762856BB9DA445C9BFF3C4F1D237BD86"><enum>1472.</enum><header>Withholdable
payments to other foreign entities</header>
<subsection id="H79C5A0FC2E954C189661498539F96418"><enum>(a)</enum><header>In
general</header><text display-inline="yes-display-inline">In the case of any
withholdable payment to a non-financial foreign entity, if—</text>
<paragraph id="H9672B7E130B84F5497AAE46442ED078C"><enum>(1)</enum><text>the beneficial
owner of such payment is such entity or any other non-financial foreign entity,
and</text>
</paragraph><paragraph id="HFFD23D7BFC0B4F7390B25D6C48976469"><enum>(2)</enum><text>the requirements
of subsection (b) are not met with respect to such beneficial owner,</text>
</paragraph><continuation-text continuation-text-level="subsection">then the
withholding agent with respect to such payment shall deduct and withhold from
such payment a tax equal to 30 percent of the amount of such payment.</continuation-text></subsection><subsection id="H3BF9F12C6A444766A825ED0A51D174A9"><enum>(b)</enum><header>Requirements for
waiver of withholding</header><text>The requirements of this subsection are met
with respect to the beneficial owner of a payment if—</text>
<paragraph id="H6353B3BC44F8407681A2EB769315B614"><enum>(1)</enum><text>such beneficial
owner or the payee provides the withholding agent with either—</text>
<subparagraph id="H58F17984948444ADB1C617DCB0BADA48"><enum>(A)</enum><text>a certification
that such beneficial owner does not have any substantial United States owners,
or</text>
</subparagraph><subparagraph id="HE786956B3E5948CFB7220DC51AFBA35D"><enum>(B)</enum><text>the name, address,
and TIN of each substantial United States owner of such beneficial
owner,</text>
</subparagraph></paragraph><paragraph id="HF72858CB44EA43CEB3765F8B829FDCD0"><enum>(2)</enum><text>the withholding
agent does not know, or have reason to know, that any information provided
under paragraph (1) is incorrect, and</text>
</paragraph><paragraph id="HED27B7F3B2544B9FB12A6763AA8B6CD7"><enum>(3)</enum><text>the withholding
agent reports the information provided under paragraph (1)(B) to the Secretary
in such manner as the Secretary may provide.</text>
</paragraph></subsection><subsection id="HD02FD0B5426344E99B0DE6A0F094809E"><enum>(c)</enum><header>Exceptions</header><text>Subsection
(a) shall not apply to—</text>
<paragraph id="HA6B81D93AD014ABB9147067A530D3269"><enum>(1)</enum><text>except as
otherwise provided by the Secretary, any payment beneficially owned by—</text>
<subparagraph id="H7B91EC8B8D6247668B0FADFDF3DAE75E"><enum>(A)</enum><text>any corporation
the stock of which is regularly traded on an established securities
market,</text>
</subparagraph><subparagraph id="HFD5B469D52984115B514ECAFC1A66639"><enum>(B)</enum><text>any corporation
which is a member of the same expanded affiliated group (as defined in section
1471(e)(2) without regard to the last sentence thereof) as a corporation
described in subparagraph (A),</text>
</subparagraph><subparagraph id="H8DBB21E51D984DC09B1D7CDAC70ADC0D"><enum>(C)</enum><text display-inline="yes-display-inline">any entity which is organized under the
laws of a possession of the United States and which is wholly owned by one or
more bona fide residents (as defined in section 937(a)) of such
possession,</text>
</subparagraph><subparagraph display-inline="no-display-inline" id="H6C8EE30023A041B3A695A60554535044"><enum>(D)</enum><text display-inline="yes-display-inline">any foreign government, any political
subdivision of a foreign government, or any wholly owned agency or
instrumentality of any one or more of the foregoing,</text>
</subparagraph><subparagraph id="H37FEA5DD5754496CB603E7B48EA74D51"><enum>(E)</enum><text>any international
organization or any wholly owned agency or instrumentality thereof,</text>
</subparagraph><subparagraph id="HF1F2AA5D8A0E4A9A80051209E220AAE7"><enum>(F)</enum><text>any foreign
central bank of issue, or</text>
</subparagraph><subparagraph display-inline="no-display-inline" id="H9DD4641031974690A63D8CE45A4588F9"><enum>(G)</enum><text>any other class of
persons identified by the Secretary for purposes of this subsection, and</text>
</subparagraph></paragraph><paragraph id="H9E7E23DF628A4473A515EE1005125ADD"><enum>(2)</enum><text display-inline="yes-display-inline">any class of payments identified by the
Secretary for purposes of this subsection as posing a low risk of tax
evasion.</text>
</paragraph></subsection><subsection id="H0018F8F7F0774165BD88C06F1F30AA62"><enum>(d)</enum><header>Non-Financial
foreign entity</header><text>For purposes of this section, the term
<quote>non-financial foreign entity</quote> means any foreign entity which is
not a financial institution (as defined in section 1471(d)(5)).</text>
</subsection></section><section id="H24B86027916D4C4BB451DD8115EA27F5"><enum>1473.</enum><header>Definitions</header><text display-inline="no-display-inline">For purposes of this chapter—</text>
<paragraph id="H625948865DEA4C759FB28343D9C26D1E"><enum>(1)</enum><header>Withholdable
payment</header><text display-inline="yes-display-inline">Except as otherwise
provided by the Secretary—</text>
<subparagraph id="HD0F263DB637D472887235802EAB843F8"><enum>(A)</enum><header>In
general</header><text>The term <quote>withholdable payment</quote>
means—</text>
<clause id="H892C6DED5181432F8A0C4D878930E6C8"><enum>(i)</enum><text>any payment of
interest (including any original issue discount), dividends, rents, salaries,
wages, premiums, annuities, compensations, remunerations, emoluments, and other
fixed or determinable annual or periodical gains, profits, and income, if such
payment is from sources within the United States, and</text>
</clause><clause id="HB2B72886A71545F88F75911D64AE55A8"><enum>(ii)</enum><text>any gross
proceeds from the sale or other disposition of any property of a type which can
produce interest or dividends from sources within the United States.</text>
</clause></subparagraph><subparagraph id="H495012CD77454E1B927447BA0FC21462"><enum>(B)</enum><header>Exception for
income connected with United States business</header><text>Such term shall not
include any item of income which is taken into account under section 871(b)(1)
or 882(a)(1) for the taxable year.</text>
</subparagraph><subparagraph commented="no" id="H7AD94A0E2F7F444DABC07B5AD8D19FF6"><enum>(C)</enum><header>Special rule for
sourcing interest paid by foreign branches of domestic financial
institutions</header><text>Subparagraph (B) of section 861(a)(1) shall not
apply.</text>
</subparagraph></paragraph><paragraph id="HB8197331980141DCABC9A69B86A0DA4F"><enum>(2)</enum><header>Substantial
United States owner</header>
<subparagraph id="H18FFA8B4B4944791B19DFDE39345B902"><enum>(A)</enum><header>In
general</header><text>The term <quote>substantial United States owner</quote>
means—</text>
<clause id="H8ACFF0A4F56140069F528CD63F07AFE9"><enum>(i)</enum><text>with respect to
any corporation, any specified United States person which owns, directly or
indirectly, more than 10 percent of the stock of such corporation (by vote or
value),</text>
</clause><clause id="H2E8FFFFF38444423807907463C26EDAB"><enum>(ii)</enum><text>with respect to
any partnership, any specified United States person which owns, directly or
indirectly, more than 10 percent of the profits interests or capital interests
in such partnership, and</text>
</clause><clause commented="no" id="H49203DC13CA6460199A444D8E17C9F7B"><enum>(iii)</enum><text>in the case of a
trust—</text>
<subclause id="H088E1843CD6B4DD6BD1DB32DF53FF8A1"><enum>(I)</enum><text>any specified
United States person treated as an owner of any portion of such trust under
subpart E of part I of subchapter J of chapter 1, and</text>
</subclause><subclause id="HD01C81D850654A0D88B90BE29532430B"><enum>(II)</enum><text>to the extent
provided by the Secretary in regulations or other guidance, any specified
United States person which holds, directly or indirectly, more than 10 percent
of the beneficial interests of such trust.</text>
</subclause></clause></subparagraph><subparagraph commented="no" id="H58F5F958752448E1A224308AF541639C"><enum>(B)</enum><header>Special rule for
investment vehicles</header><text display-inline="yes-display-inline">In the
case of any financial institution described in section 1471(d)(5)(C), clauses
(i), (ii), and (iii) of subparagraph (A) shall be applied by substituting
<quote>0 percent</quote> for <quote>10 percent</quote>.</text>
</subparagraph></paragraph><paragraph id="HB3B1F0449EE74472A3F71671F08A181F"><enum>(3)</enum><header>Specified United
States person</header><text>Except as otherwise provided by the Secretary, the
term <quote>specified United States person</quote> means any United States
person other than—</text>
<subparagraph display-inline="no-display-inline" id="HB186D336E9164F0297A0EADD91C0A05E"><enum>(A)</enum><text>any corporation
the stock of which is regularly traded on an established securities
market,</text>
</subparagraph><subparagraph display-inline="no-display-inline" id="H3497A7DF2C004956B877080B827FDC07"><enum>(B)</enum><text>any corporation
which is a member of the same expanded affiliated group (as defined in section
1471(e)(2) without regard to the last sentence thereof) as a corporation the
stock of which is regularly traded on an established securities market,</text>
</subparagraph><subparagraph id="H9F052792A6114A1CB15E4EDAC6546F98"><enum>(C)</enum><text display-inline="yes-display-inline">any organization exempt from taxation under
section 501(a) or an individual retirement plan,</text>
</subparagraph><subparagraph id="H928FF310CF4F43938DEE3CBBE8CB3BA6"><enum>(D)</enum><text>the United States
or any wholly owned agency or instrumentality thereof,</text>
</subparagraph><subparagraph id="HEB8DA859A3014C95A4AF61B03A3C5188"><enum>(E)</enum><text>any State, the
District of Columbia, any possession of the United States, any political
subdivision of any of the foregoing, or any wholly owned agency or
instrumentality of any one or more of the foregoing,</text>
</subparagraph><subparagraph id="H251BB9F1F6364B1B98A622CF72764944"><enum>(F)</enum><text>any bank (as
defined in section 581),</text>
</subparagraph><subparagraph id="HD799A05F755842AA84C03EC561E2124E"><enum>(G)</enum><text>any real estate
investment trust (as defined in section 856),</text>
</subparagraph><subparagraph id="H32940C30A3F1423D9914DF8335A0FE29"><enum>(H)</enum><text>any regulated
investment company (as defined in section 851),</text>
</subparagraph><subparagraph id="H7117BB20C63C470EBD2D07E2A2B1D9F2"><enum>(I)</enum><text>any common trust
fund (as defined in section 584(a)), and</text>
</subparagraph><subparagraph id="H255F8344ED5B45769982B76669F48176"><enum>(J)</enum><text>any trust
which—</text>
<clause id="H388AB7662579491BB4BF91CDC9C13796"><enum>(i)</enum><text>is
exempt from tax under section 664(c), or</text>
</clause><clause id="H346A57E213A64B2BA70D5DC66FA0AC62"><enum>(ii)</enum><text>is described in
section 4947(a)(1).</text>
</clause></subparagraph></paragraph><paragraph id="HD2B46E741A9949C28B44E04812B3475D"><enum>(4)</enum><header>Withholding
agent</header><text>The term <quote>withholding agent</quote> means all
persons, in whatever capacity acting, having the control, receipt, custody,
disposal, or payment of any withholdable payment.</text>
</paragraph><paragraph id="HB7470C26A8694AE588618F9F4F5B8810"><enum>(5)</enum><header>Foreign
entity</header><text>The term <quote>foreign entity</quote> means any entity
which is not a United States person.</text>
</paragraph></section><section id="H4B3CDAFD35EF4A8BB1754255177AD7E0"><enum>1474.</enum><header>Special
rules</header>
<subsection id="HF0CC0879923748C7BAB8CDA2866FF83A"><enum>(a)</enum><header>Liability for
withheld tax</header><text display-inline="yes-display-inline">Every person
required to deduct and withhold any tax under this chapter is hereby made
liable for such tax and is hereby indemnified against the claims and demands of
any person for the amount of any payments made in accordance with the
provisions of this chapter.</text>
</subsection><subsection id="H25FB6C8991134E9C974C241C896DD02C"><enum>(b)</enum><header>Credits and
refunds</header>
<paragraph id="H9CFF794CC7D34F4DB64FFCD317325E0A"><enum>(1)</enum><header>In
general</header><text>Except as provided in paragraph (2), the determination of
whether any tax deducted and withheld under this chapter results in an
overpayment by the beneficial owner of the payment to which such tax is
attributable shall be made as if such tax had been deducted and withheld under
subchapter A of chapter 3.</text>
</paragraph><paragraph id="HEEF868385B82417C99A75FC4D678BBA8"><enum>(2)</enum><header>Special rule
where foreign financial institution is beneficial owner of payment</header>
<subparagraph id="H1B70A2B21F0842D18A49EA644B335DAE"><enum>(A)</enum><header>In
general</header><text>In the case of any tax properly deducted and withheld
under section 1471 from a specified financial institution payment—</text>
<clause id="H0D69C83B00E64A0F8242530F4E591B0E"><enum>(i)</enum><text>if
the foreign financial institution referred to in subparagraph (B) with respect
to such payment is entitled to a reduced rate of tax with respect to such
payment by reason of any treaty obligation of the United States—</text>
<subclause id="HA97C853170A34E4CB940C2638D58746B"><enum>(I)</enum><text>the amount of any
credit or refund with respect to such tax shall not exceed the amount of credit
or refund attributable to such reduction in rate, and</text>
</subclause><subclause id="H05CE2F8503E94527A486347DF1555096"><enum>(II)</enum><text>no interest shall
be allowed or paid with respect to such credit or refund, and</text>
</subclause></clause><clause id="H611BE23D3B664C61BB902E02171A6630"><enum>(ii)</enum><text>if such foreign
financial institution is not so entitled, no credit or refund shall be allowed
or paid with respect to such tax.</text>
</clause></subparagraph><subparagraph id="HA1AB8C89BD60493C9D4F16A7BF002930"><enum>(B)</enum><header>Specified
financial institution payment</header><text>The term <quote>specified financial
institution payment</quote> means any payment if the beneficial owner of such
payment is a foreign financial institution.</text>
</subparagraph></paragraph><paragraph id="H43E002A9A74647C9AF29344FCCF9D28A"><enum>(3)</enum><header>Requirement to
identify substantial United States owners</header><text>No credit or refund
shall be allowed or paid with respect to any tax properly deducted and withheld
under this chapter unless the beneficial owner of the payment provides the
Secretary such information as the Secretary may require to determine whether
such beneficial owner is a United States owned foreign entity (as defined in
section 1471(d)(3)) and the identity of any substantial United States owners of
such entity.</text>
</paragraph></subsection><subsection id="H4AE8CF3038E545D991C47B1716DB7C59"><enum>(c)</enum><header>Confidentiality
of information</header>
<paragraph id="H2CDB0F31BC5C4F26A67A92C534C09445"><enum>(1)</enum><header>In
general</header><text>For purposes of this chapter, rules similar to the rules
of section 3406(f) shall apply.</text>
</paragraph><paragraph id="H9968C7329C2440F09B2D1F556FD74C77"><enum>(2)</enum><header>Disclosure of
list of participating foreign financial institutions
permitted</header><text>The identity of a foreign financial institution which
meets the requirements of section 1471(b) shall not be treated as return
information for purposes of section 6103.</text>
</paragraph></subsection><subsection id="H487BFB7CF8D241DE8BC0ED21EA1A576B"><enum>(d)</enum><header>Coordination
with other withholding provisions</header><text>The Secretary shall provide for
the coordination of this chapter with other withholding provisions under this
title, including providing for the proper crediting of amounts deducted and
withheld under this chapter against amounts required to be deducted and
withheld under such other provisions.</text>
</subsection><subsection id="H604DA94E845A4102B5C4F36D79BA4062"><enum>(e)</enum><header>Treatment of
withholding under agreements</header><text>Any tax deducted and withheld
pursuant to an agreement described in section 1471(b) shall be treated for
purposes of this title as a tax deducted and withheld by a withholding agent
under section 1471(a).</text>
</subsection><subsection display-inline="no-display-inline" id="H0D20912D259148AC81729F4387A45A06"><enum>(f)</enum><header>Regulations</header><text>The
Secretary shall prescribe such regulations or other guidance as may be
necessary or appropriate to carry out the purposes of this
chapter.</text>
</subsection></section></chapter><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="H55AB333BE1F64563866F571CBEC64451"><enum>(b)</enum><header>Special rule for
interest on overpayments</header><text>Subsection (e) of section 6611 is
amended by adding at the end the following new paragraph:</text>
<quoted-block display-inline="no-display-inline" id="H46FE2F88D4894727AF237B6FAABF9F39" style="OLC">
<paragraph id="H9310252454F3464A8C2E1BA448FF8AC1"><enum>(4)</enum><header>Certain
withholding taxes</header><text display-inline="yes-display-inline">In the case
of any overpayment resulting from tax deducted and withheld under chapter 3 or
4, paragraphs (1), (2), and (3) shall be applied by substituting <quote>180
days</quote> for <quote>45 days</quote> each place it appears.</text>
</paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection commented="no" id="H4E8DA4F5F8AF416BA3D7F535A8DC770D"><enum>(c)</enum><header>Conforming
amendments</header>
<paragraph id="H33886C41CB8D4EA684C99523E7B1F596"><enum>(1)</enum><text>Section 6414 is
amended by inserting <quote>or 4</quote> after <quote>chapter 3</quote>.</text>
</paragraph><paragraph id="HCDA1FA699A284581B551069C59DAF677"><enum>(2)</enum><text>Paragraph (1) of
section 6501(b) is amended by inserting <quote>4,</quote> after <quote>chapter
3,</quote>.</text>
</paragraph><paragraph id="H223F30E48BD14DDF9CC3D6847D1C1DE3"><enum>(3)</enum><text>Paragraph (2) of
section 6501(b) is amended—</text>
<subparagraph id="H47AE8F29E7374840A36C3FA5F701FFB7"><enum>(A)</enum><text display-inline="yes-display-inline">by inserting <quote>4,</quote> after
<quote>chapter 3,</quote> in the text thereof, and</text>
</subparagraph><subparagraph id="HE304E088F7EE4AB997EAE4B72F706876"><enum>(B)</enum><text>by striking
<quote><header-in-text level="paragraph" style="OLC">taxes and tax imposed by
chapter 3</header-in-text></quote> in the heading thereof and inserting
<quote><header-in-text level="paragraph" style="OLC">and withholding
taxes</header-in-text></quote>.</text>
</subparagraph></paragraph><paragraph id="H48E48A37E11D4DEBA669728511D6514C"><enum>(4)</enum><text>Paragraph (3) of
section 6513(b) is amended—</text>
<subparagraph id="H6FF08FC9EA39487981086C545F975F3F"><enum>(A)</enum><text>by inserting
<quote>or 4</quote> after <quote>chapter 3</quote>, and</text>
</subparagraph><subparagraph id="HC6D668F8BFB547789C2A6690BFB8994D"><enum>(B)</enum><text>by inserting
<quote>or 1474(b)</quote> after <quote>section 1462</quote>.</text>
</subparagraph></paragraph><paragraph id="H95D2712A0EFA4D2E80AEC7A431ECA396"><enum>(5)</enum><text>Subsection (c) of
section 6513 is amended by inserting <quote>4,</quote> after <quote>chapter
3,</quote>.</text>
</paragraph><paragraph id="H35E957B03F784FDE816025FD611463F8"><enum>(6)</enum><text>Paragraph (1) of
section 6724(d) is amended by inserting <quote>under chapter 4 or</quote> after
<quote>filed with the Secretary</quote> in the last sentence thereof.</text>
</paragraph><paragraph id="HFE305AAC9AE04F0591B917DFA8896CB3"><enum>(7)</enum><text>Paragraph (2) of
section 6724(d) is amended by inserting <quote>or 4</quote> after
<quote>chapter 3</quote>.</text>
</paragraph><paragraph id="HBB1C41F257E542C6816ED22020647C99"><enum>(8)</enum><text>The table of
chapters of the Internal Revenue Code of 1986 is amended by adding at the end
the following new item:</text>
<quoted-block display-inline="no-display-inline" id="H4686F97E94A94DFCAFFE689C0C803B98" style="OLC">
<toc container-level="quoted-block-container" idref="H678101AE04A942E997B7C3D8AAFD6809" lowest-bolded-level="division-lowest-bolded" lowest-level="section" quoted-block="no-quoted-block" regeneration="yes-regeneration">
<toc-entry idref="H388E69027CF7488CBC9C19F1DC5629AD" level="chapter">Chapter 4. Taxes To enforce reporting on certain foreign
accounts.</toc-entry>
</toc>
<after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></subsection><subsection id="H94359A05EC654F03B1CCCB678E256E61"><enum>(d)</enum><header>Effective
date</header>
<paragraph id="HAC590A832AA244C2B9EE4F24145C2A22"><enum>(1)</enum><header>In
general</header><text>Except as otherwise provided in this subsection, the
amendments made by this section shall apply to payments made after December 31,
2012.</text>
</paragraph><paragraph id="HFA4DB68CF5ED42C6B17BDDE9A4618E54"><enum>(2)</enum><header>Grandfathered
treatment of outstanding obligations</header><text>The amendments made by this
section shall not require any amount to be deducted or withheld from any
payment under any obligation outstanding on the date which is 2 years after the
date of the enactment of this Act.</text>
</paragraph><paragraph commented="no" id="H508C4C49CA9D449B964CBBA8B90D6EAD"><enum>(3)</enum><header>Interest on
overpayments</header><text>The amendment made by subsection (b) shall
apply—</text>
<subparagraph id="HFC02A388DB4B4FEBA8FDACC4EE1C2EE8"><enum>(A)</enum><text>in the case of
such amendment’s application to paragraph (1) of section 6611(e) of the
Internal Revenue Code of 1986, to returns the due date for which (determined
without regard to extensions) is after the date of the enactment of this
Act,</text>
</subparagraph><subparagraph id="H746319C19A2E4B4EAFCCD4D2CB0D1436"><enum>(B)</enum><text display-inline="yes-display-inline">in the case of such amendment’s application
to paragraph (2) of such section, to claims for credit or refund of any
overpayment filed after the date of the enactment of this Act (regardless of
the taxable period to which such refund relates), and</text>
</subparagraph><subparagraph id="H143BF6427A27484CB4B527D97BB8A188"><enum>(C)</enum><text display-inline="yes-display-inline">in the case of such amendment’s application
to paragraph (3) of such section, to refunds paid after the date of the
enactment of this Act (regardless of the taxable period to which such refund
relates).</text>
</subparagraph></paragraph></subsection></section><section id="H3502683FF9C04A8385A83D7A4F593DDC"><enum>502.</enum><header>Repeal of
certain foreign exceptions to registered bond requirements</header>
<subsection id="H9306338B0AE7402BA6C3B802DCDFC690"><enum>(a)</enum><header>Repeal of
exception to denial of deduction for interest on non-Registered bonds</header>
<paragraph id="HBA31F51DCA694694AB49E0B0B1DCDAE7"><enum>(1)</enum><header>In
general</header><text display-inline="yes-display-inline">Paragraph (2) of
section 163(f) is amended by striking subparagraph (B) and by redesignating
subparagraph (C) as subparagraph (B).</text>
</paragraph><paragraph id="HEC88567B431246E19C8D71F9995067BC"><enum>(2)</enum><header>Conforming
amendments</header>
<subparagraph id="HAB5FB136934F401EB336A87BE2062218"><enum>(A)</enum><text>Subparagraph (A)
of section 163(f)(2) is amended by inserting <quote>or</quote> at the end of
clause (ii), by striking <quote>, or</quote> at the end of clause (iii) and
inserting a period, and by striking clause (iv).</text>
</subparagraph><subparagraph id="H8B89D38377BC425A8B260E1C4FFF1304"><enum>(B)</enum><text>Subparagraph (B)
of section 163(f)(2), as redesignated by paragraph (1), is amended—</text>
<clause id="HD2FE7C54F6514F058E3D83126F26037A"><enum>(i)</enum><text>by
striking <quote>, and subparagraph (B),</quote> in the matter preceding clause
(i), and</text>
</clause><clause id="HE306425F7CDB4060A2068D76979F5CA2"><enum>(ii)</enum><text>by
amending clause (i) to read as follows:</text>
<quoted-block display-inline="no-display-inline" id="H39947F9505FD4517A98C3E025E1313FA" style="OLC">
<clause id="H19AA0C593902425CAB8AB70E9EC63663"><enum>(i)</enum><text display-inline="yes-display-inline">such obligation is of a type which the
Secretary has determined by regulations to be used frequently in avoiding
Federal taxes,
and</text>
</clause><after-quoted-block>.</after-quoted-block></quoted-block>
</clause></subparagraph><subparagraph id="H554DD1787E0443379EF764DE8DA83614"><enum>(C)</enum><text>Sections
165(j)(2)(A) and 1287(b)(1) are each amended by striking <quote>except that
clause (iv) of subparagraph (A), and subparagraph (B), of such section shall
not apply</quote>.</text>
</subparagraph></paragraph></subsection><subsection id="H4C22E7AFD3154BFFBAA177308234A97D"><enum>(b)</enum><header>Repeal of
treatment as portfolio debt</header>
<paragraph id="H47185FF04FB64F49899CB8B018D912DB"><enum>(1)</enum><header>In
general</header><text>Paragraph (2) of section 871(h) is amended to read as
follows:</text>
<quoted-block display-inline="no-display-inline" id="H0931A17E5C9F4318BF1E7E476556C945" style="OLC">
<paragraph id="H257CA50AEDE44BD383AF4447B1D7A0CE"><enum>(2)</enum><header>Portfolio
interest</header><text display-inline="yes-display-inline">For purposes of this
subsection, the term <quote>portfolio interest</quote> means any interest
(including original issue discount) which—</text>
<subparagraph id="HA63E8FA5D2694899A31298D42520D092"><enum>(A)</enum><text>would be subject
to tax under subsection (a) but for this subsection, and</text>
</subparagraph><subparagraph id="H48CA8735863E4A718B7D8254B6C8CB16"><enum>(B)</enum><text>is paid on an
obligation—</text>
<clause id="H84123F6D8741473D9DD7A1CCD9BF6B77"><enum>(i)</enum><text>which is in
registered form, and</text>
</clause><clause id="H65520E548AEE443D85B39E587B225069"><enum>(ii)</enum><text display-inline="yes-display-inline">with respect to which—</text>
<subclause id="HD8A588FCDA104B5782F041A5B663E8A1"><enum>(I)</enum><text>the United States
person who would otherwise be required to deduct and withhold tax from such
interest under section 1441(a) receives a statement (which meets the
requirements of paragraph (5)) that the beneficial owner of the obligation is
not a United States person, or</text>
</subclause><subclause id="H8ECF28E7AA324B7D8882930E3F4977F6"><enum>(II)</enum><text>the Secretary has
determined that such a statement is not required in order to carry out the
purposes of this
subsection.</text>
</subclause></clause></subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph><paragraph id="H1F89B3A0A2A64596B10E13A87C092730"><enum>(2)</enum><header>Conforming
amendments</header>
<subparagraph id="H7223F9C1CD594D1592186C0E687DC44E"><enum>(A)</enum><text>Section
871(h)(3)(A) is amended by striking <quote>subparagraph (A) or (B)
of</quote>.</text>
</subparagraph><subparagraph id="HB46278509A05460B9B568F45D960A163"><enum>(B)</enum><text>Paragraph (2) of
section 881(c) is amended to read as follows:</text>
<quoted-block display-inline="no-display-inline" id="H5093CF4C18D64B3D840BFEA5546E8CA1" style="OLC">
<paragraph id="H99DD2CBB5C554D4E98E8A99C438B3FC7"><enum>(2)</enum><header>Portfolio
interest</header><text display-inline="yes-display-inline">For purposes of this
subsection, the term <quote>portfolio interest</quote> means any interest
(including original issue discount) which—</text>
<subparagraph id="HF2CFF4D8A8C8494AAEC5E87B6E6B249F"><enum>(A)</enum><text>would be subject
to tax under subsection (a) but for this subsection, and</text>
</subparagraph><subparagraph id="H9765EB03770E4FE38E9A54A84CE4A64A"><enum>(B)</enum><text>is paid on an
obligation—</text>
<clause id="HD48789F76FBB4A409739E80745630902"><enum>(i)</enum><text>which is in
registered form, and</text>
</clause><clause commented="no" id="H8A00B4EAE22842D49EB519362B33E585"><enum>(ii)</enum><text display-inline="yes-display-inline">with respect to which—</text>
<subclause commented="no" id="HA42A99A959BE4B26AB0B84C75765473B"><enum>(I)</enum><text display-inline="yes-display-inline">the person who would otherwise be required
to deduct and withhold tax from such interest under section 1442(a) receives a
statement which meets the requirements of section 871(h)(5) that the beneficial
owner of the obligation is not a United States person, or</text>
</subclause><subclause commented="no" id="H0BCB19D2A3A946E3B58FA8161F01C135"><enum>(II)</enum><text>the Secretary has
determined that such a statement is not required in order to carry out the
purposes of this
subsection.</text>
</subclause></clause></subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subparagraph></paragraph></subsection><subsection id="H672A0BA86AB645729327B038D49851ED"><enum>(c)</enum><header>Dematerialized
book entry systems treated as registered form</header><text display-inline="yes-display-inline">Paragraph (3) of section 163(f) is amended
by inserting <quote>, except that a dematerialized book entry system shall be
treated as a book entry system described in such section</quote> before the
period at the end.</text>
</subsection><subsection id="HD75BD4A32B54419D896DF4B08DF8AC46"><enum>(d)</enum><header>Repeal of
exception to requirement that Treasury obligations be in registered
form</header>
<paragraph id="HC763EA4B55344DA989A96ADFA24B1AE3"><enum>(1)</enum><header>In
general</header><text>Subsection (g) of section 3121 of title 31, United States
Code, is amended by striking paragraph (2) and by redesignating paragraphs (3)
and (4) as paragraphs (2) and (3), respectively.</text>
</paragraph><paragraph id="H0CDFEAC01A744655865B2D9DDA0BA096"><enum>(2)</enum><header>Conforming
amendments</header><text>Paragraph (1) of section 3121(g) of such title is
amended—</text>
<subparagraph id="H65D733B99C3744D2A42CB75BB70EF51D"><enum>(A)</enum><text>by adding
<quote>or</quote> at the end of subparagraph (A),</text>
</subparagraph><subparagraph id="H56427A94F428464B931393E068CCAA92"><enum>(B)</enum><text>by striking
<quote>; or</quote> at the end of subparagraph (B) and inserting a period,
and</text>
</subparagraph><subparagraph id="H89BD18D4E73B4A5496C0518E5B469931"><enum>(C)</enum><text>by striking
subparagraph (C).</text>
</subparagraph></paragraph></subsection><subsection display-inline="no-display-inline" id="H33246AA79B974B9E9CA4CA6AFB080D7C"><enum>(e)</enum><header>Preservation of
exception for excise tax purposes</header><text>Paragraph (1) of section
4701(b) is amended to read as follows:</text>
<quoted-block display-inline="no-display-inline" id="H038C2914E1884813A562AFD0A0CD3408" style="OLC">
<paragraph id="H4D06EB2E77A04C2E8505C20DCE32F482"><enum>(1)</enum><header>Registration-required
obligation</header>
<subparagraph id="H358AD806E3D24FD09CCEFB8DB29918E3"><enum>(A)</enum><header>In
general</header><text display-inline="yes-display-inline">The term
<quote>registration-required obligation</quote> has the same meaning as when
used in section 163(f), except that such term shall not include any obligation
which—</text>
<clause id="H1C661A87D57F4CB3AC1C502C575C04DA"><enum>(i)</enum><text>is
required to be registered under section 149(a), or</text>
</clause><clause id="HB7F6CB01F94442B69A5BFB3FE2ABC3D2"><enum>(ii)</enum><text>is described in
subparagraph (B).</text>
</clause></subparagraph><subparagraph id="HAE4BE756678C495A9B21632997D7F7B1"><enum>(B)</enum><header>Certain
obligations not included</header><text>An obligation is described in this
subparagraph if—</text>
<clause id="H87BACA73DFB648ED8A21671548ADB024"><enum>(i)</enum><text display-inline="yes-display-inline">there are arrangements reasonably designed
to ensure that such obligation will be sold (or resold in connection with the
original issue) only to a person who is not a United States person,</text>
</clause><clause id="H7C0C4A4A07254BE9B926187B0C1EDAF0"><enum>(ii)</enum><text>interest on such
obligation is payable only outside the United States and its possessions,
and</text>
</clause><clause id="H956F0EA4E1764B64A2253801CE433D52"><enum>(iii)</enum><text>on the face of
such obligation there is a statement that any United States person who holds
such obligation will be subject to limitations under the United States income
tax
laws.</text>
</clause></subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="H1974E936AAE943058814F33C4BF5F3FD"><enum>(f)</enum><header>Effective
date</header><text>The amendments made by this section shall apply to
obligations issued after the date which is 2 years after the date of the
enactment of this Act.</text>
</subsection></section></subtitle><subtitle id="HA9495B0A1F0F4B9BA0D05CB41CBC008D"><enum>B</enum><header>Under reporting
with respect to foreign assets</header>
<section id="HAA90464CABE54ABCBF3A4873C053FEA2"><enum>511.</enum><header>Disclosure of
information with respect to foreign financial assets</header>
<subsection id="H692D6829EB5740D0A9D9EB6AAE6C86B7"><enum>(a)</enum><header>In
general</header><text>Subpart A of part III of subchapter A of chapter 61 is
amended by inserting after section 6038C the following new section:</text>
<quoted-block display-inline="no-display-inline" id="H6197468F022A42DF90742DDBEED80E42" style="OLC">
<section id="H9C5F61BD33E94493B3D1840CBF0D23AE"><enum>6038D.</enum><header>Information
with respect to foreign financial assets</header>
<subsection id="HD852F199451B468F93A65C79A390AF3C"><enum>(a)</enum><header>In
general</header><text>Any individual who, during any taxable year, holds any
interest in a specified foreign financial asset shall attach to such person’s
return of tax imposed by subtitle A for such taxable year the information
described in subsection (c) with respect to each such asset if the aggregate
value of all such assets exceeds $50,000 (or such higher dollar amount as the
Secretary may prescribe).</text>
</subsection><subsection id="H1B4EE289D0FC44A294AD3F966DD5311D"><enum>(b)</enum><header>Specified
foreign financial assets</header><text>For purposes of this section, the term
<quote>specified foreign financial asset</quote> means—</text>
<paragraph id="H5868F7ED48C144F78F8704E1998F4BAA"><enum>(1)</enum><text display-inline="yes-display-inline">any financial account (as defined in
section 1471(d)(2)) maintained by a foreign financial institution (as defined
in section 1471(d)(4)), and</text>
</paragraph><paragraph id="HFA11445EAFAE4605AB296C8D96C27F10"><enum>(2)</enum><text>any of the
following assets which are not held in an account maintained by a financial
institution (as defined in section 1471(d)(5))—</text>
<subparagraph id="HDEEB18F1747D460F8F72834AD481EF62"><enum>(A)</enum><text>any stock or
security issued by a person other than a United States person,</text>
</subparagraph><subparagraph id="HCF22D5B5CB7E4AE4B0DD1731AE064625"><enum>(B)</enum><text display-inline="yes-display-inline">any financial instrument or contract held
for investment that has an issuer or counterparty which is other than a United
States person, and</text>
</subparagraph><subparagraph id="H7444234E7D1349F89DA8C9E33EA352A6"><enum>(C)</enum><text display-inline="yes-display-inline">any interest in a foreign entity (as
defined in section 1473).</text>
</subparagraph></paragraph></subsection><subsection id="H14FD26EBC7FA48B880110158CBD20353"><enum>(c)</enum><header>Required
information</header><text>The information described in this subsection with
respect to any asset is:</text>
<paragraph id="HFFC64CE9793F4B6CA121A152495B66A0"><enum>(1)</enum><text>In the case of any
account, the name and address of the financial institution in which such
account is maintained and the number of such account.</text>
</paragraph><paragraph id="HAADA54E74E5A465F99219D0E737A19ED"><enum>(2)</enum><text>In the case of any
stock or security, the name and address of the issuer and such information as
is necessary to identify the class or issue of which such stock or security is
a part.</text>
</paragraph><paragraph id="H05FB1A95821E4F71B9ACF937528D230A"><enum>(3)</enum><text>In the case of any
other instrument, contract, or interest—</text>
<subparagraph id="H4DF95DD121CB4868911A633CD39EA042"><enum>(A)</enum><text>such information
as is necessary to identify such instrument, contract, or interest, and</text>
</subparagraph><subparagraph id="H8CCEC27D8A7447D7BC8A84E6F3D9BB18"><enum>(B)</enum><text>the names and
addresses of all issuers and counterparties with respect to such instrument,
contract, or interest.</text>
</subparagraph></paragraph><paragraph id="H765330DAE40D4C099ADA3B13C08967B5"><enum>(4)</enum><text>The maximum value
of the asset during the taxable year.</text>
</paragraph></subsection><subsection id="H69E6A8927804460B9821267705762596"><enum>(d)</enum><header>Penalty for
failure To disclose</header>
<paragraph id="HBCEC55EEB69D401397240430A2B307A7"><enum>(1)</enum><header>In
general</header><text>If any individual fails to furnish the information
described in subsection (c) with respect to any taxable year at the time and in
the manner described in subsection (a), such person shall pay a penalty of
$10,000.</text>
</paragraph><paragraph id="H6A2AF0C9CB6F491FA79F46730EC9600E"><enum>(2)</enum><header>Increase in
penalty where failure continues after notification</header><text>If any failure
described in paragraph (1) continues for more than 90 days after the day on
which the Secretary mails notice of such failure to the individual, such
individual shall pay a penalty (in addition to the penalties under paragraph
(1)) of $10,000 for each 30-day period (or fraction thereof) during which such
failure continues after the expiration of such 90-day period. The penalty
imposed under this paragraph with respect to any failure shall not exceed
$50,000.</text>
</paragraph></subsection><subsection commented="no" id="H98EE59A493DF4E5BAC8579AEC6A66306"><enum>(e)</enum><header>Presumption that
value of specified foreign financial assets exceeds dollar
threshold</header><text display-inline="yes-display-inline">If—</text>
<paragraph id="H6EA0BDAB86464F1DBAD991D061E7B807"><enum>(1)</enum><text>the Secretary
determines that an individual has an interest in one or more specified foreign
financial assets, and</text>
</paragraph><paragraph id="H7FA1142D69BD42539A63B4D8272CF82A"><enum>(2)</enum><text>such individual
does not provide sufficient information to demonstrate the aggregate value of
such assets,</text>
</paragraph><continuation-text continuation-text-level="subsection">then the
aggregate value of such assets shall be treated as being in excess of $50,000
(or such higher dollar amount as the Secretary prescribes for purposes of
subsection (a)) for purposes of assessing the penalties imposed under this
section.</continuation-text></subsection><subsection id="HB64DB9E0B0FB44F080C92CF225D6D884"><enum>(f)</enum><header>Application to
certain entities</header><text>To the extent provided by the Secretary in
regulations or other guidance, the provisions of this section shall apply to
any domestic entity which is formed or availed of for purposes of holding,
directly or indirectly, specified foreign financial assets, in the same manner
as if such entity were an individual.</text>
</subsection><subsection id="H177D17F2BEF94D45B98869E35A3A4E87"><enum>(g)</enum><header>Reasonable cause
exception</header><text>No penalty shall be imposed by this section on any
failure which is shown to be due to reasonable cause and not due to willful
neglect. The fact that a foreign jurisdiction would impose a civil or criminal
penalty on the taxpayer (or any other person) for disclosing the required
information is not reasonable cause.</text>
</subsection><subsection id="HA872A18EE77547B5B5E53964D72FA900"><enum>(h)</enum><header>Regulations</header><text display-inline="yes-display-inline">The Secretary shall prescribe such
regulations or other guidance as may be necessary or appropriate to carry out
the purposes of this section, including regulations or other guidance which
provide appropriate exceptions from the application of this section in the case
of—</text>
<paragraph id="HC5FA92DCC2504F06A241FB7E9A65EEEB"><enum>(1)</enum><text>classes of assets
identified by the Secretary, including any assets with respect to which the
Secretary determines that disclosure under this section would be duplicative of
other disclosures,</text>
</paragraph><paragraph id="HAF36F05BB4604B768FA61DD29389FA09"><enum>(2)</enum><text>nonresident
aliens, and</text>
</paragraph><paragraph id="H98A1B444EC70406EB3C54A64B3464E1D"><enum>(3)</enum><text display-inline="yes-display-inline">bona fide residents of any possession of
the United
States.</text>
</paragraph></subsection></section><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="H4CAC82077AB743B99863EF243879AE50"><enum>(b)</enum><header>Clerical
amendment</header><text display-inline="yes-display-inline">The table of
sections for subpart A of part III of subchapter A of chapter 61 is amended by
inserting after the item relating to section 6038C the following new
item:</text>
<quoted-block display-inline="no-display-inline" id="H71F29A2EF55E4812818181B840726BEF" style="OLC">
<toc container-level="quoted-block-container" idref="H6197468F022A42DF90742DDBEED80E42" lowest-bolded-level="division-lowest-bolded" lowest-level="section" quoted-block="no-quoted-block" regeneration="yes-regeneration">
<toc-entry idref="H9C5F61BD33E94493B3D1840CBF0D23AE" level="section">Sec. 6038D. Information with respect to foreign financial
assets.</toc-entry>
</toc>
<after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="H4C27983C5B004618A895EDD56053A83E"><enum>(c)</enum><header>Effective
date</header><text display-inline="yes-display-inline">The amendments made by
this section shall apply to taxable years beginning after the date of the
enactment of this Act.</text>
</subsection></section><section display-inline="no-display-inline" id="H2585EEA13538484395E1B30ECF9B5268" section-type="subsequent-section"><enum>512.</enum><header>Penalties for
underpayments attributable to undisclosed foreign financial assets</header>
<subsection id="H3E9F4CA52D3B4907A5E5001302FACE51"><enum>(a)</enum><header>In
general</header><text>Section 6662 is amended—</text>
<paragraph id="HEF0D0C8C3BC6481F9539F599D37B6268"><enum>(1)</enum><text display-inline="yes-display-inline">in subsection (b), by inserting after
paragraph (5) the following new paragraph:</text>
<quoted-block display-inline="no-display-inline" id="H01E9D236C37D4B12BF1239B2D41E0295" style="OLC">
<paragraph id="HD9A49DAC4720460DBEA3C54B12B8AD6E"><enum>(6)</enum><text display-inline="yes-display-inline">Any undisclosed foreign financial asset
understatement.</text>
</paragraph><after-quoted-block>,
and</after-quoted-block></quoted-block>
</paragraph><paragraph id="H1086A9E7F0F744F9A8FED3825BF44D2D"><enum>(2)</enum><text>by adding at the
end the following new subsection:</text>
<quoted-block display-inline="no-display-inline" id="H954D3B766A614AFCA0867B71BB956AAD" style="OLC">
<subsection id="HCA4F46507AC44E4182EB8AC3BA5BFF90"><enum>(i)</enum><header>Undisclosed
foreign financial asset understatement</header>
<paragraph id="H0C0BC301C14D4E9E84C342EB9253B14C"><enum>(1)</enum><header>In
general</header><text display-inline="yes-display-inline">For purposes of this
section, the term <quote>undisclosed foreign financial asset
understatement</quote> means, for any taxable year, the portion of the
understatement for such taxable year which is attributable to any transaction
involving an undisclosed foreign financial asset.</text>
</paragraph><paragraph id="HF371E07EFFB34061B22AEC9A532E5F62"><enum>(2)</enum><header>Undisclosed
foreign financial asset</header><text>For purposes of this subsection, the term
<quote>undisclosed foreign financial asset</quote> means, with respect to any
taxable year, any asset with respect to which information was required to be
provided under section 6038, 6038B, 6038D, 6046A, or 6048 for such taxable year
but was not provided by the taxpayer as required under the provisions of those
sections.</text>
</paragraph><paragraph id="HA895266686B24780BFF1C00A7313E76B"><enum>(3)</enum><header>Increase in
penalty for undisclosed foreign financial asset
understatements</header><text>In the case of any portion of an underpayment
which is attributable to any undisclosed foreign financial asset
understatement, subsection (a) shall be applied with respect to such portion by
substituting <quote>40 percent</quote> for <quote>20
percent</quote>.</text>
</paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></subsection><subsection commented="no" display-inline="no-display-inline" id="H7BCBE760AE284C84B05EDD8BF3150B51"><enum>(b)</enum><header display-inline="yes-display-inline">Effective
Date</header><text display-inline="yes-display-inline">The amendments made by
this section shall apply to taxable years beginning after the date of the
enactment of this Act.</text>
</subsection></section><section id="H00F332B376974B9A937516E3B9C157E9"><enum>513.</enum><header>Modification of
statute of limitations for significant omission of income in connection with
foreign assets</header>
<subsection id="HF8E6F29459B445EFB3C91D1C4B3C31B4"><enum>(a)</enum><header>Extension of
statute of limitations</header>
<paragraph id="HA32E7896795A48A39E5292C2A99BFEBF"><enum>(1)</enum><header>In
general</header><text display-inline="yes-display-inline">Paragraph (1) of
section 6501(e) is amended by redesignating subparagraphs (A) and (B) as
subparagraphs (B) and (C), respectively, and by inserting before subparagraph
(B) (as so redesignated) the following new subparagraph:</text>
<quoted-block display-inline="no-display-inline" id="H3AD88BAA0AEC4FD8BB4BD330ED661435" style="OLC">
<subparagraph id="HB783F186267446F2A79BD1EE3851515F"><enum>(A)</enum><header>General
rule</header><text display-inline="yes-display-inline">If the taxpayer omits
from gross income an amount properly includible therein and—</text>
<clause id="HD1F15BB55CB04EF89362611B2B4E67A5"><enum>(i)</enum><text>such amount is in
excess of 25 percent of the amount of gross income stated in the return,
or</text>
</clause><clause id="H1DD5FE21C9394F37A466CFCC6FC2E3A3"><enum>(ii)</enum><text>such
amount—</text>
<subclause id="HD20CE2AD4D184845925EC4D648123B40"><enum>(I)</enum><text>is attributable to
one or more assets with respect to which information is required to be reported
under section 6038D (or would be so required if such section were applied
without regard to the dollar threshold specified in subsection (a) thereof and
without regard to any exceptions provided pursuant to subsection (h)(1)
thereof), and</text>
</subclause><subclause id="HF9B25977CB024D0298098A7CC51D6838"><enum>(II)</enum><text>is in excess of
$5,000,</text>
</subclause></clause><continuation-text continuation-text-level="subparagraph">the tax
may be assessed, or a proceeding in court for collection of such tax may be
begun without assessment, at any time within 6 years after the return was
filed.</continuation-text></subparagraph><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph><paragraph id="HB2A61E5C505A452D86104B6D5A13188C"><enum>(2)</enum><header>Conforming
amendments</header>
<subparagraph id="HA2ADD97AEDDD4AA4B7E4F7FCC67D9F3F"><enum>(A)</enum><text>Subparagraph (B)
of section 6501(e)(1), as redesignated by paragraph (1), is amended by striking
all that precedes clause (i) and inserting the following:</text>
<quoted-block display-inline="no-display-inline" id="H0298DA60EF2B41CB824E71FAE8D893EF" style="OLC">
<subparagraph id="HD92C9C2DFDB64D768FE7254964692E90"><enum>(B)</enum><header>Determination of
gross income</header><text display-inline="yes-display-inline">For purposes of
subparagraph
(A)—</text>
</subparagraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subparagraph><subparagraph id="HD28A058C13624E36ABC5E374E0CB2115"><enum>(B)</enum><text>Paragraph (2) of
section 6229(c) is amended by striking <quote>which is in excess of 25 percent
of the amount of gross income stated in its return</quote> and inserting
<quote>and such amount is described in clause (i) or (ii) of section
6501(e)(1)(A)</quote>.</text>
</subparagraph></paragraph></subsection><subsection id="HFD2B4E975B8E495183F7BCA9BCE06B0A"><enum>(b)</enum><header>Additional
reports subject to extended period</header><text>Paragraph (8) of section
6501(c) is amended—</text>
<paragraph id="H2FFD2001FFA842339BD95780B432F73B"><enum>(1)</enum><text>by inserting
<quote>pursuant to an election under section 1295(b) or</quote> before
<quote>under section 6038</quote>,</text>
</paragraph><paragraph id="H64F92BD2E4F3440C8FA88245FA4938E3"><enum>(2)</enum><text>by inserting
<quote>1298(f),</quote> before <quote>6038</quote>, and</text>
</paragraph><paragraph id="H92123C4B8CB5412C9F3EF6A9AC7118A5"><enum>(3)</enum><text>by inserting
<quote>6038D,</quote> after <quote>6038B,</quote>.</text>
</paragraph></subsection><subsection id="H0F0C48068F5847BAA9CCAE4269D0D4A9"><enum>(c)</enum><header>Clarifications
related to failure To disclose foreign transfers</header><text display-inline="yes-display-inline">Paragraph (8) of section 6501(c) is amended
by striking <quote>event</quote> and inserting <quote>tax return,
event,</quote>.</text>
</subsection><subsection id="H66C145A8D88B405190D9F2538FA5760D"><enum>(d)</enum><header>Effective
date</header><text display-inline="yes-display-inline">The amendments made by
this section shall apply to—</text>
<paragraph id="H6E638FB1C65D46DCA635C63114F88F0A"><enum>(1)</enum><text>returns filed
after the date of the enactment of this Act; and</text>
</paragraph><paragraph commented="no" display-inline="no-display-inline" id="H171CB1EA0AF046209173B110ECEFC817"><enum>(2)</enum><text>returns filed on
or before such date if the period specified in section 6501 of the Internal
Revenue Code of 1986 (determined without regard to such amendments) for
assessment of such taxes has not expired as of such date.</text>
</paragraph></subsection></section></subtitle><subtitle id="HE1099B341B534219B9ECB484343590D6"><enum>C</enum><header>Other disclosure
provisions </header>
<section id="H79BECA72B3EC46218BA9811DC94E2CCE"><enum>521.</enum><header>Reporting of
activities with respect to passive foreign investment companies</header>
<subsection id="HFFC484D306FC4B819D40936AB0E190FB"><enum>(a)</enum><header>In
general</header><text>Section 1298 is amended by redesignating subsection (f)
as subsection (g) and by inserting after subsection (e) the following new
subsection:</text>
<quoted-block display-inline="no-display-inline" id="H0A7E8425A98443629C138DC6FCDD4CF7" style="OLC">
<subsection id="HD8674AFA2DE94013A6CF2724F9404F17"><enum>(f)</enum><header>Reporting
requirement</header><text>Except as otherwise provided by the Secretary, each
United States person who is a shareholder of a passive foreign investment
company shall file an annual report containing such information as the
Secretary may
require.</text>
</subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="HE0629B1C97924CCFB09FB1BB8245E25C"><enum>(b)</enum><header>Conforming
amendment</header><text>Subsection (e) of section 1291 is amended by striking
<quote>, (d), and (f)</quote> and inserting <quote>and (d)</quote>.</text>
</subsection><subsection id="H9549C759DE414DE4932A0268627C0011"><enum>(c)</enum><header>Effective
date</header><text>The amendments made by this section take effect on the date
of the enactment of this Act.</text>
</subsection></section><section id="H46F01FC114AA47D391BC9ED841EFDF81"><enum>522.</enum><header>Secretary
permitted to require financial institutions to file certain returns related to
withholding on foreign transfers electronically</header>
<subsection id="HDE0574D66A8C4A1FAE5425945973C134"><enum>(a)</enum><header>In
general</header><text display-inline="yes-display-inline">Subsection (e) of
section 6011 is amended by adding at the end the following new
paragraph:</text>
<quoted-block display-inline="no-display-inline" id="HAB7BC632F0C141888A896880489DB7AD" style="OLC">
<paragraph id="HC7D6EF4563A442F08F90FD019938DF09"><enum>(3)</enum><header>Special rule for
returns filed by financial institutions with respect to withholding on foreign
transfers</header><text display-inline="yes-display-inline">Paragraph (2)(A)
shall not apply to any return filed by a financial institution (as defined in
section 1471(d)(5)) with respect to tax for which such institution is made
liable under section 1461 or
1474(a).</text>
</paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="H612CD74A5C0E49CCB13EFAB2E2A6A166"><enum>(b)</enum><header>Conforming
amendment</header><text>Subsection (c) of section 6724 is amended by inserting
<quote>or with respect to a return described in section 6011(e)(3)</quote>.</text>
</subsection><subsection id="H918B61A883BA4D86B5ABA253D480246F"><enum>(c)</enum><header>Effective
date</header><text>The amendment made by this section shall apply to returns
the due date for which (determined without regard to extensions) is after the
date of the enactment of this Act.</text>
</subsection></section></subtitle><subtitle id="H70C1E2D1FB754918B54B859F66D43406"><enum>D</enum><header>Provisions related
to foreign trusts</header>
<section id="H3D0C935A38624A13A8103746BE818EBB"><enum>531.</enum><header>Clarifications
with respect to foreign trusts which are treated as having a United States
beneficiary</header>
<subsection id="HBFCD91CA23954653A3EDD6E8616DD0B1"><enum>(a)</enum><header>In
general</header><text display-inline="yes-display-inline">Paragraph (1) of
section 679(c) is amended by adding at the end the following:</text>
<quoted-block display-inline="no-display-inline" id="H50F7A513F69B42219582CEA69669D4C8" style="OLC">
<quoted-block-continuation-text quoted-block-continuation-text-level="paragraph">For
purposes of subparagraph (A), an amount shall be treated as accumulated for the
benefit of a United States person even if the United States person’s interest
in the trust is contingent on a future
event.</quoted-block-continuation-text><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="HE436AEC206F944AAB731A838684ED5C3"><enum>(b)</enum><header>Clarification
regarding discretion To identify beneficiaries</header><text>Subsection (c) of
section 679 is amended by adding at the end the following new paragraph:</text>
<quoted-block display-inline="no-display-inline" id="HE218380F4D6149C7A29CBF93FF5AA22B" style="OLC">
<paragraph id="H34989448CCA341FEA30CD0C0508AD9AD"><enum>(4)</enum><header>Special rule in
case of discretion to identify beneficiaries</header><text display-inline="yes-display-inline">For purposes of paragraph (1)(A), if any
person has the discretion (by authority given in the trust agreement, by power
of appointment, or otherwise) of making a distribution from the trust to, or
for the benefit of, any person, such trust shall be treated as having a
beneficiary who is a United States person unless—</text>
<subparagraph id="H98FA49FC97A1450A86450036938DD34B"><enum>(A)</enum><text>the terms of the
trust specifically identify the class of persons to whom such distributions may
be made, and</text>
</subparagraph><subparagraph id="HDA4F7CC54BD34176AE48FC4F3CF9AB81"><enum>(B)</enum><text>none of those
persons are United States persons during the taxable
year.</text>
</subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="H31CBB9C9E408429F9B231366E321CFC9"><enum>(c)</enum><header>Clarification
that certain agreements and understandings are terms of the
trust</header><text>Subsection (c) of section 679, as amended by subsection
(b), is amended by adding at the end the following new paragraph:</text>
<quoted-block display-inline="no-display-inline" id="H8CECA43C4EC0433FA01BE6AF8254539C" style="OLC">
<paragraph commented="no" id="H73296AD6D7504770931A52F0BDE2B471"><enum>(5)</enum><header>Certain
agreements and understandings treated as terms of the trust</header><text>For
purposes of paragraph (1)(A), if any United States person who directly or
indirectly transfers property to the trust is directly or indirectly involved
in any agreement or understanding (whether written, oral, or otherwise) that
may result in the income or corpus of the trust being paid or accumulated to or
for the benefit of a United States person, such agreement or understanding
shall be treated as a term of the
trust.</text>
</paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection></section><section id="HBACB885C44BC45058458FF5E23BB40D0"><enum>532.</enum><header>Presumption
that foreign trust has United States beneficiary</header>
<subsection id="HF8ED79EE0CCB4895BAE468DC637AA990"><enum>(a)</enum><header>In
general</header><text display-inline="yes-display-inline">Section 679 is
amended by redesignating subsection (d) as subsection (e) and inserting after
subsection (c) the following new subsection:</text>
<quoted-block display-inline="no-display-inline" id="H32C936696490424698DECBD201C8B8B5" style="OLC">
<subsection id="H70E701C658034400A04DA2553BE7EF6D"><enum>(d)</enum><header>Presumption that
foreign trust has United States beneficiary</header><text display-inline="yes-display-inline">If a United States person directly or
indirectly transfers property to a foreign trust (other than a trust described
in section 6048(a)(3)(B)(ii)), the Secretary may treat such trust as having a
United States beneficiary for purposes of applying this section to such
transfer unless such person—</text>
<paragraph id="HA49CACF63C1C4374A8C159445A97D9CF"><enum>(1)</enum><text>submits such
information to the Secretary as the Secretary may require with respect to such
transfer, and</text>
</paragraph><paragraph id="H6174F593951941F2A74CF930DB6F9B77"><enum>(2)</enum><text>demonstrates to
the satisfaction of the Secretary that such trust satisfies the requirements of
subparagraphs (A) and (B) of subsection
(c)(1).</text>
</paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="HD150071E5E8D4CCC8B7152455FC31A62"><enum>(b)</enum><header>Effective
date</header><text>The amendments made by this section shall apply to transfers
of property after the date of the enactment of this Act.</text>
</subsection></section><section commented="no" id="H19ADCCBC745A49369EAE347426ABA604"><enum>533.</enum><header>Uncompensated
use of trust property</header>
<subsection commented="no" id="H499E2A66CD0A487BAA9911E211B9DF38"><enum>(a)</enum><header>In
general</header><text>Paragraph (1) of section 643(i) is amended—</text>
<paragraph commented="no" id="HF550BABD7AF84BA59D0E8C5C71C00462"><enum>(1)</enum><text>by striking
<quote>directly or indirectly to</quote> and inserting <quote>(or permits the
use of any other trust property) directly or indirectly to or by</quote>,
and</text>
</paragraph><paragraph commented="no" id="H834AB052C8204A2BAA3CF15B4B15A96D"><enum>(2)</enum><text>by inserting
<quote>(or the fair market value of the use of such property)</quote> after
<quote>the amount of such loan</quote>.</text>
</paragraph></subsection><subsection id="H02428CC3D542469683BA9109467DA3FE"><enum>(b)</enum><header>Exception for
compensated use</header><text>Paragraph (2) of section 643(i) is amended by
adding at the end the following new subparagraph:</text>
<quoted-block display-inline="no-display-inline" id="HCDFC6E5024134CFD865FC9FAB1543CDA" style="OLC">
<subparagraph id="H918778FB9F7846A0A045C550D9948D78"><enum>(E)</enum><header>Exception for
compensated use of property</header><text display-inline="yes-display-inline">In the case of the use of any trust
property other than a loan of cash or marketable securities, paragraph (1)
shall not apply to the extent that the trust is paid the fair market value of
such use within a reasonable period of time of such
use.</text>
</subparagraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="H457FA3549E134CAE9B0B57AE2BFB8A1F"><enum>(c)</enum><header>Application to
grantor trusts</header><text>Subsection (c) of section 679, as amended by
section 531, is amended by adding at the end the following new
paragraph:</text>
<quoted-block display-inline="no-display-inline" id="H6DC1931762BD40A798CFED43FFF04F24" style="OLC">
<paragraph id="H4043FD74B482485EBB20E3B54D35938C"><enum>(6)</enum><header>Uncompensated
use of trust property treated as a payment</header><text display-inline="yes-display-inline">For purposes of this subsection, a loan of
cash or marketable securities (or the use of any other trust property) directly
or indirectly to or by any United States person (whether or not a beneficiary
under the terms of the trust) shall be treated as paid or accumulated for the
benefit of a United States person. The preceding sentence shall not apply to
the extent that the United States person repays the loan at a market rate of
interest (or pays the fair market value of the use of such property) within a
reasonable period of
time.</text>
</paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection commented="no" id="H15BEC0D236514DB5A0937B79B3A9FC04"><enum>(d)</enum><header>Conforming
amendments</header><text>Paragraph (3) of section 643(i) is amended—</text>
<paragraph commented="no" id="H2AEC1533A7804ECE81855916BDD21F95"><enum>(1)</enum><text>by inserting
<quote>(or use of property)</quote> after <quote>If any loan</quote>,</text>
</paragraph><paragraph commented="no" id="H21BC742BF01140EAB981D48335B76661"><enum>(2)</enum><text>by inserting
<quote>or the return of such property</quote> before <quote>shall be
disregarded</quote>, and</text>
</paragraph><paragraph commented="no" id="H77322D42566943008374FB807AEE1360"><enum>(3)</enum><text>by striking
<quote><header-in-text level="paragraph" style="OLC">regarding loan
principal</header-in-text></quote> in the heading thereof.</text>
</paragraph></subsection><subsection id="HDCB139F12F544A5BADD7B8DA63720D1B"><enum>(e)</enum><header>Effective
date</header><text display-inline="yes-display-inline">The amendments made by
this section shall apply to loans made, and uses of property, after the date of
the enactment of this Act.</text>
</subsection></section><section id="H838E320ACC9C4EAAA8AB2D9B679AB8DC"><enum>534.</enum><header>Reporting
requirement of United States owners of foreign trusts</header>
<subsection id="H3BF82480265E497CBF4042D7D531C221"><enum>(a)</enum><header>In
general</header><text display-inline="yes-display-inline">Paragraph (1) of
section 6048(b) is amended by inserting <quote>shall submit such information as
the Secretary may prescribe with respect to such trust for such year
and</quote> before <quote>shall be responsible to ensure</quote>.</text>
</subsection><subsection id="HBBBD3632D15449B7BEB44125D47D60C3"><enum>(b)</enum><header>Effective
date</header><text>The amendment made by this section shall apply to taxable
years beginning after the date of the enactment of this Act.</text>
</subsection></section><section display-inline="no-display-inline" id="HBA2F2E14E4484C3FA5FF544F383FA430" section-type="subsequent-section"><enum>535.</enum><header>Minimum penalty with
respect to failure to report on certain foreign trusts</header>
<subsection id="H6890C97F1078444DACD29F92202CF280"><enum>(a)</enum><header>In
general</header><text display-inline="yes-display-inline">Subsection (a) of
section 6677 is amended—</text>
<paragraph id="HBBDCDB8C90384487B05B642828A0B9C0"><enum>(1)</enum><text>by inserting
<quote>the greater of $10,000 or</quote> before <quote>35 percent</quote>,
and</text>
</paragraph><paragraph id="H74E14847CBB7415B9768438C893D6046"><enum>(2)</enum><text>by striking the
last sentence and inserting the following: <quote>At such time as the gross
reportable amount with respect to any failure can be determined by the
Secretary, any subsequent penalty imposed under this subsection with respect to
such failure shall be reduced as necessary to assure that the aggregate amount
of such penalties do not exceed the gross reportable amount (and to the extent
that such aggregate amount already exceeds the gross reportable amount the
Secretary shall refund such excess to the taxpayer).</quote></text>
</paragraph></subsection><subsection id="HA2DD36382A6844488BC55ADCAE4C0860"><enum>(b)</enum><header>Effective
date</header><text>The amendments made by this section shall apply to notices
and returns required to be filed after December 31, 2009.</text>
</subsection></section></subtitle><subtitle id="HE400E6B192AD41FD96A19D9167E829B9"><enum>E</enum><header>Substitute
dividends and dividend equivalent payments received by foreign persons treated
as dividends</header>
<section display-inline="no-display-inline" id="H9DD452CAD2504B11AD184C43908D11F2" section-type="subsequent-section"><enum>541.</enum><header>Substitute dividends
and dividend equivalent payments received by foreign persons treated as
dividends</header>
<subsection id="HA6A335BB93E4433C870F4C0472CCFBF2"><enum>(a)</enum><header>In
general</header><text>Section 871 is amended by redesignating subsection (l) as
subsection (m) and by inserting after subsection (k) the following new
subsection:</text>
<quoted-block display-inline="no-display-inline" id="H4AB58BD2126C4FD38176B5239E2E763E" style="OLC">
<subsection display-inline="no-display-inline" id="HCD77B325EABC4DCBA8B1B37C172F6FD8"><enum>(l)</enum><header>Treatment of
dividend equivalent payments</header>
<paragraph id="HA67D2AE15A8042F38036DFD7093FD1D5"><enum>(1)</enum><header>In
general</header><text display-inline="yes-display-inline">For purposes of this
section, sections 881 and 4948(a), and chapters 3 and 4, a dividend equivalent
shall be treated as a dividend from sources within the United States.</text>
</paragraph><paragraph id="H41A8C73BEBA441D8929ABCA6C8796192"><enum>(2)</enum><header>Dividend
equivalent</header><text>For purposes of this subsection, the term
<term>dividend equivalent</term> means—</text>
<subparagraph id="H2545778CAA1E4C34A81A07CA53C8DD12"><enum>(A)</enum><text display-inline="yes-display-inline">any substitute dividend,</text>
</subparagraph><subparagraph id="H158576107D6B46CA9BB95072ECB39EF2"><enum>(B)</enum><text>any payment made
pursuant to a specified notional principal contract that (directly or
indirectly) is contingent upon, or determined by reference to, the payment of a
dividend from sources within the United States, and</text>
</subparagraph><subparagraph id="HCFAC23FD64EF49399F441A49247E0751"><enum>(C)</enum><text display-inline="yes-display-inline">any other payment determined by the
Secretary to be substantially similar to a payment described in subparagraph
(A) or (B).</text>
</subparagraph></paragraph><paragraph id="H80A35B93ACEE42B29E66643711189DD8"><enum>(3)</enum><header>Specified
notional principal contract</header><text>For purposes of this subsection, the
term <quote>specified notional principal contract</quote> means—</text>
<subparagraph id="H2F271A2376194BD18E0CF96835C0AE1B"><enum>(A)</enum><text>any notional
principal contract if—</text>
<clause id="H8DB1B51041C04922B8342B9BB4CC3397"><enum>(i)</enum><text>in
connection with entering into such contract, any long party transfers the
underlying security,</text>
</clause><clause id="HAA6D5BD967754DAD8886375E9FB7A369"><enum>(ii)</enum><text>in connection
with the termination of such contract, any short party transfers the underlying
security to any long party,</text>
</clause><clause id="H8F07E2C9600B468B998DF2BF461CE62B"><enum>(iii)</enum><text display-inline="yes-display-inline">the underlying security is not readily
tradable on an established securities market,</text>
</clause><clause commented="no" id="H2DA1CC0D876A43C481B9CFBE6CEE344D"><enum>(iv)</enum><text>in connection
with entering into such contract, the underlying security is posted as
collateral by any short party to the contract, or</text>
</clause><clause id="H347AE265837E47C6AF4613018C76CEC6"><enum>(v)</enum><text>such contract is
identified by the Secretary as a specified notional principal contract,</text>
</clause></subparagraph><subparagraph id="HA8051ABBDD1B40B189B7A1ACA41073A5"><enum>(B)</enum><text display-inline="yes-display-inline">in the case of payments made after the date
which is 2 years after the date of the enactment of this subsection, any
notional principal contract unless the Secretary determines that such contract
is of a type which does not have the potential for tax avoidance.</text>
</subparagraph></paragraph><paragraph id="HBF30678EFAF74EAB85A3986EC88A3906"><enum>(4)</enum><header>Definitions</header><text>For
purposes of paragraph (3)(A)—</text>
<subparagraph id="H585B2D5A6B2B42F6BF549AD78E356471"><enum>(A)</enum><header>Long
party</header><text display-inline="yes-display-inline">The term <quote>long
party</quote> means, with respect to any underlying security of any notional
principal contract, any party to the contract which is entitled to receive any
payment pursuant to such contract which is contingent upon, or determined by
reference to, the payment of a dividend from sources within the United States
with respect to such underlying security.</text>
</subparagraph><subparagraph id="H1AEF95F77B114F2681494A00FC20C39B"><enum>(B)</enum><header>Short
party</header><text>The term <quote>short party</quote> means, with respect to
any underlying security of any notional principal contract, any party to the
contract which is not a long party with respect to such underlying security.</text>
</subparagraph><subparagraph id="HFB4D04E430084332A87012F2AD2910A8"><enum>(C)</enum><header>Underlying
security</header><text>The term <quote>underlying security</quote> means, with
respect to any notional principal contract, the security with respect to which
the dividend referred to in paragraph (2)(B) is paid. For purposes of this
paragraph, any index or fixed basket of securities shall be treated as a single
security.</text>
</subparagraph></paragraph><paragraph id="H1C117BF18DF14794BEDF9360E5B91382"><enum>(5)</enum><header>Payments
determined on gross basis</header><text display-inline="yes-display-inline">For
purposes of this subsection, the term <quote>payment</quote> includes any gross
amount which is used in computing any net amount which is transferred to or
from the taxpayer.</text>
</paragraph><paragraph id="H544578B623D54371936BA993535B9AE4"><enum>(6)</enum><header>Prevention of
over-withholding</header><text>In the case of any chain of dividend equivalents
one or more of which is subject to tax under this section or section 881, the
Secretary may reduce such tax, but only to the extent that the taxpayer can
establish that such tax has been paid with respect to another dividend
equivalent in such chain. For purposes of this paragraph, a dividend shall be
treated as a dividend equivalent.</text>
</paragraph><paragraph id="H1AF18C17BECC47799B081396BB6AE71C"><enum>(7)</enum><header>Coordination
with chapters 3 and 4</header><text>For purposes of chapters 3 and 4, each
person that is a party to any contract or other arrangement that provides for
the payment of a dividend equivalent shall be treated as having control of such
payment.</text>
</paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="HD8915E350B8046288ABF95E648891895"><enum>(b)</enum><header>Effective
date</header><text>The amendments made by this section shall apply to payments
made on or after the date that is 90 days after the date of the enactment of
this Act.</text>
</subsection></section></subtitle><enum>VI</enum><header>Other revenue
provisions</header>
<subtitle id="H8916E2780EC5459FAB372247F04A23F0"><enum>A</enum><header>Partnership
interests held by partners providing services</header>
<section commented="no" id="H0537AA254C104E3AB08AC8F83F5EAAC1" section-type="subsequent-section"><enum>601.</enum><header>Partnership
interests transferred in connection with performance of services</header>
<subsection commented="no" id="H1F86FEC6CB3344D49746817E62CD61DB"><enum>(a)</enum><header>Modification to
election To include partnership interest in gross income in year of
transfer</header><text display-inline="yes-display-inline">Subsection (c) of
section 83 is amended by redesignating paragraph (4) as paragraph (5) and by
inserting after paragraph (3) the following new paragraph:</text>
<quoted-block display-inline="no-display-inline" id="H2567FD783643450B87A26F5587915450" style="OLC">
<paragraph id="HD0C5E1EB2E0C4235B9F48F492730BA28"><enum>(4)</enum><header>Partnership
interests</header><text display-inline="yes-display-inline">Except as provided
by the Secretary, in the case of any transfer of an interest in a partnership
in connection with the provision of services to (or for the benefit of) such
partnership—</text>
<subparagraph id="H836532549902493AB39ED16BDC0F5E19"><enum>(A)</enum><text display-inline="yes-display-inline">the fair market value of such interest
shall be treated for purposes of this section as being equal to the amount of
the distribution which the partner would receive if the partnership sold (at
the time of the transfer) all of its assets at fair market value and
distributed the proceeds of such sale (reduced by the liabilities of the
partnership) to its partners in liquidation of the partnership, and</text>
</subparagraph><subparagraph id="H14F2B2E8F69F4DD599DAB88277EFC95B"><enum>(B)</enum><text>the person
receiving such interest shall be treated as having made the election under
subsection (b)(1) unless such person makes an election under this paragraph to
have such subsection not
apply.</text>
</subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="HEF35B8DA51634E6A8DCEF14873593709"><enum>(b)</enum><header>Conforming
amendment</header><text>Paragraph (2) of section 83(b) is amended by inserting
<quote>or subsection (c)(4)(B)</quote> after <quote>paragraph (1)</quote>
.</text>
</subsection><subsection id="H4C3F6C85BE1A42B2B5CC8606EAC34192"><enum>(c)</enum><header>Effective
date</header><text>The amendments made by this section shall apply to interests
in partnerships transferred after the date of the enactment of this Act.</text>
</subsection></section><section display-inline="no-display-inline" id="HA7015A6B256543FFB118C5B15CD7CE97" section-type="subsequent-section"><enum>602.</enum><header>Income of partners
for performing investment management services treated as ordinary income
received for performance of services</header>
<subsection id="H4858D39C83714CCB99CB1D31FA615333"><enum>(a)</enum><header>In
general</header><text>Part I of subchapter K of chapter 1 is amended by adding
at the end the following new section:</text>
<quoted-block display-inline="no-display-inline" id="HD523595E6BC547828A849FB874C005CC" style="OLC">
<section id="H9FB5192BB4F24A9FBE3F69F0E01FE0D8"><enum>710.</enum><header>Special rules
for partners providing investment management services to partnership</header>
<subsection id="H377D606AAA6241708FD8142D389FD085"><enum>(a)</enum><header>Treatment of
distributive share of partnership items</header><text display-inline="yes-display-inline">For purposes of this title, in the case of
an investment services partnership interest—</text>
<paragraph id="HDADC3A4F2B914EAA82DF46B09DB1C326"><enum>(1)</enum><header>In
general</header><text>Notwithstanding section 702(b)—</text>
<subparagraph id="H754914E67FA44455AC7B671EE8A06F89"><enum>(A)</enum><text>any net income
with respect to such interest for any partnership taxable year shall be treated
as ordinary income, and</text>
</subparagraph><subparagraph id="HDD24CE303B944970A6F3578FC282552A"><enum>(B)</enum><text>any net loss with
respect to such interest for such year, to the extent not disallowed under
paragraph (2) for such year, shall be treated as an ordinary loss.</text>
</subparagraph><continuation-text continuation-text-level="paragraph">All items
of income, gain, deduction, and loss which are taken into account in computing
net income or net loss shall be treated as ordinary income or ordinary loss (as
the case may be).</continuation-text></paragraph><paragraph id="HB98FAC62D1EE4B51840957A55C5612D4"><enum>(2)</enum><header>Treatment of
losses</header>
<subparagraph id="H1D804388534F487D8178BB50CD5636A6"><enum>(A)</enum><header>Limitation</header><text>Any
net loss with respect to such interest shall be allowed for any partnership
taxable year only to the extent that such loss does not exceed the excess (if
any) of—</text>
<clause id="H97F2038EC2C5461A8561CD894F85D14F"><enum>(i)</enum><text>the aggregate net
income with respect to such interest for all prior partnership taxable years,
over</text>
</clause><clause id="HABDCFE8F09434BB1B8D4DD661B4CAB69"><enum>(ii)</enum><text>the aggregate net
loss with respect to such interest not disallowed under this subparagraph for
all prior partnership taxable years.</text>
</clause></subparagraph><subparagraph id="H3D4DA83D4B1249D1BD7C4F6510D974C0"><enum>(B)</enum><header>Carryforward</header><text>Any
net loss for any partnership taxable year which is not allowed by reason of
subparagraph (A) shall be treated as an item of loss with respect to such
partnership interest for the succeeding partnership taxable year.</text>
</subparagraph><subparagraph id="HDCBFDD17ED95405A926B2A3A4490AA75"><enum>(C)</enum><header>Basis
adjustment</header><text>No adjustment to the basis of a partnership interest
shall be made on account of any net loss which is not allowed by reason of
subparagraph (A).</text>
</subparagraph><subparagraph id="HC10D3ACCCCB34E5C80F12F0CE1A1F353"><enum>(D)</enum><header>Prior
partnership years</header><text>Any reference in this paragraph to prior
partnership taxable years shall only include prior partnership taxable years to
which this section applies.</text>
</subparagraph></paragraph><paragraph id="H2A96E0F981AA43BCA97452563CF7BD4C"><enum>(3)</enum><header>Net income and
loss</header><text>For purposes of this section—</text>
<subparagraph id="H63642606A5C34C369394E14C1EC779CF"><enum>(A)</enum><header>Net
income</header><text>The term <term>net income</term> means, with respect to
any investment services partnership interest for any partnership taxable year,
the excess (if any) of—</text>
<clause id="H373972B521CC451982619F005D2E7BF5"><enum>(i)</enum><text>all items of
income and gain taken into account by the holder of such interest under section
702 with respect to such interest for such year, over</text>
</clause><clause id="HB585C50872D6404EB5F23EED40BC9426"><enum>(ii)</enum><text>all items of
deduction and loss so taken into account.</text>
</clause></subparagraph><subparagraph id="H782904F32A30493B81218EC7BF14B98E"><enum>(B)</enum><header>Net
loss</header><text>The term <term>net loss</term> means, with respect to such
interest for such year, the excess (if any) of the amount described in
subparagraph (A)(ii) over the amount described in subparagraph (A)(i).</text>
</subparagraph></paragraph></subsection><subsection id="H88EF129B44C54371BBA8CE6F248F95BF"><enum>(b)</enum><header>Dispositions of
partnership interests</header>
<paragraph id="HF2193C00DD544466884C4CB35AB77696"><enum>(1)</enum><header>Gain</header><text>Any
gain on the disposition of an investment services partnership interest shall be
treated as ordinary income and shall be recognized notwithstanding any other
provision of this subtitle.</text>
</paragraph><paragraph id="H1B4935CB2B62499DA5F8B5C7435C0E6D"><enum>(2)</enum><header>Loss</header><text>Any
loss on the disposition of an investment services partnership interest shall be
treated as an ordinary loss to the extent of the excess (if any) of—</text>
<subparagraph id="H625DDC47BE1B4BA78F36F4E8E206573E"><enum>(A)</enum><text>the aggregate net
income with respect to such interest for all partnership taxable years,
over</text>
</subparagraph><subparagraph id="HBA5A31F7D1A744FAB96B5155F49F4911"><enum>(B)</enum><text>the aggregate net
loss with respect to such interest allowed under subsection (a)(2) for all
partnership taxable years.</text>
</subparagraph></paragraph><paragraph id="HECE59014ACAD4767AC9084E032D84A28"><enum>(3)</enum><header>Disposition of
portion of interest</header><text>In the case of any disposition of an
investment services partnership interest, the amount of net loss which
otherwise would have (but for subsection (a)(2)(C)) applied to reduce the basis
of such interest shall be disregarded for purposes of this section for all
succeeding partnership taxable years.</text>
</paragraph><paragraph commented="no" display-inline="no-display-inline" id="HC0BF0BCE71AE4D6C8C9BEF071E10B7F6"><enum>(4)</enum><header>Distributions of
partnership property</header><text>In the case of any distribution of property
by a partnership with respect to any investment services partnership interest
held by a partner—</text>
<subparagraph commented="no" id="HC12AC48C515649F5BBD005C6923CF196"><enum>(A)</enum><text>the excess (if
any) of—</text>
<clause commented="no" id="HCC38A12AE79647D69EF7EAB5FB75A462"><enum>(i)</enum><text>the fair market
value of such property at the time of such distribution, over</text>
</clause><clause commented="no" id="H374B5AE60D2B412490F5378D385BC9D9"><enum>(ii)</enum><text>the adjusted
basis of such property in the hands of the partnership,</text>
</clause><continuation-text commented="no" continuation-text-level="subparagraph">shall be taken into account as an
increase in such partner’s distributive share of the taxable income of the
partnership (except to the extent such excess is otherwise taken into account
in determining the taxable income of the partnership),</continuation-text></subparagraph><subparagraph commented="no" id="H3FE9E2EF5EB04C0B97524806A0FE2C53"><enum>(B)</enum><text>such property
shall be treated for purposes of subpart B of part II as money distributed to
such partner in an amount equal to such fair market value, and</text>
</subparagraph><subparagraph commented="no" id="HCE65F184903840B994C5F0CD58A2218B"><enum>(C)</enum><text>the basis of such
property in the hands of such partner shall be such fair market value.</text>
</subparagraph><continuation-text continuation-text-level="paragraph">Subsection
(b) of section 734 shall be applied without regard to the preceding
sentence.</continuation-text></paragraph><paragraph id="H34E2001979E94777932D002DAF75E6A0"><enum>(5)</enum><header>Application of
section 751</header><text>In applying section 751(a), an investment services
partnership interest shall be treated as an inventory item.</text>
</paragraph></subsection><subsection id="HFD838F6CC1ED416CB80CFAD6EDC3DF1E"><enum>(c)</enum><header>Investment
services partnership interest</header><text display-inline="yes-display-inline">For purposes of this section—</text>
<paragraph id="HCC5F17F8CD5747F7A93C55C1C8D3E160"><enum>(1)</enum><header>In
general</header><text display-inline="yes-display-inline">The term
<term>investment services partnership interest</term> means any interest in a
partnership which is held (directly or indirectly) by any person if it was
reasonably expected (at the time that such person acquired such interest) that
such person (or any person related to such person) would provide (directly or
indirectly) a substantial quantity of any of the following services with
respect to assets held (directly or indirectly) by the partnership:</text>
<subparagraph id="HBCA4DC44BA2D4AEEBD59FC5E97426225"><enum>(A)</enum><text>Advising as to the
advisability of investing in, purchasing, or selling any specified
asset.</text>
</subparagraph><subparagraph id="H9A5A09CC96974430BCE1F03115516D40"><enum>(B)</enum><text>Managing,
acquiring, or disposing of any specified asset.</text>
</subparagraph><subparagraph id="HCE03C01700344206841CB0F14193AE5F"><enum>(C)</enum><text>Arranging
financing with respect to acquiring specified assets.</text>
</subparagraph><subparagraph id="HA5DF9A84F16148A488B14CE317C4ED43"><enum>(D)</enum><text>Any activity in
support of any service described in subparagraphs (A) through (C).</text>
</subparagraph><continuation-text continuation-text-level="paragraph">For
purposes of this paragraph, the term <term>specified asset</term> means
securities (as defined in section 475(c)(2) without regard to the last sentence
thereof), real estate held for rental or investment, interests in partnerships,
commodities (as defined in section 475(e)(2)), or options or derivative
contracts with respect to any of the foregoing.</continuation-text></paragraph><paragraph id="HAF11A3F75A404CA280F15E0C0A9646BF"><enum>(2)</enum><header>Exception for
certain capital interests</header>
<subparagraph id="HB6FCFEDC29524CB2B3AE9B6D5965AFC5"><enum>(A)</enum><header>In
general</header><text>In the case of any portion of an investment services
partnership interest which is a qualified capital interest, all items of
income, gain, loss, and deduction which are allocated to such qualified capital
interest shall not be taken into account under subsection (a) if—</text>
<clause id="H9BC6D97087D743E4AD4BCEBD361F7086"><enum>(i)</enum><text>allocations of
items are made by the partnership to such qualified capital interest in the
same manner as such allocations are made to other qualified capital interests
held by partners who do not provide any services described in paragraph (1) and
who are not related to the partner holding the qualified capital interest,
and</text>
</clause><clause id="HD469A7E50DF04F9FAA08BA250D28FC08"><enum>(ii)</enum><text>the allocations
made to such other interests are significant compared to the allocations made
to such qualified capital interest.</text>
</clause></subparagraph><subparagraph id="H78D085E7616A445CB7E6FADF1C0724AA"><enum>(B)</enum><header>Special rule for
no or insignificant allocations to nonservice providers</header><text>To the
extent provided by the Secretary in regulations or other guidance, in any case
in which the requirements of subparagraph (A)(ii) are not satisfied, items of
income, gain, loss, and deduction shall not be taken into account under
subsection (a) to the extent that such items are properly allocable under such
regulations or other guidance to qualified capital interests.</text>
</subparagraph><subparagraph display-inline="no-display-inline" id="HD7FE54568702451DA6C0737E7F70553D"><enum>(C)</enum><header>Special rule for
dispositions</header><text display-inline="yes-display-inline">In the case of
any investment services partnership interest any portion of which is a
qualified capital interest, subsection (b) shall not apply to so much of any
gain or loss as bears the same proportion to the entire amount of such gain or
loss as—</text>
<clause id="H65334EC755834A73A10603884E184D59"><enum>(i)</enum><text display-inline="yes-display-inline">the distributive share of gain or loss that
would have been allocable to the qualified capital interest under subparagraph
(A) if the partnership sold all of its assets immediately before the
disposition, bears to</text>
</clause><clause id="HD462F7D346D24AA8827395727E0CD45C"><enum>(ii)</enum><text>the distributive
share of gain or loss that would have been so allocable to the investment
services partnership interest of which such qualified capital interest is a
part.</text>
</clause></subparagraph><subparagraph commented="no" display-inline="no-display-inline" id="H1EE62D96AC9E4081BBE60AD333148B3E"><enum>(D)</enum><header>Qualified
capital interest</header><text>For purposes of this paragraph, the term
<term>qualified capital interest</term> means so much of a partner’s interest
in the capital of the partnership as is attributable to—</text>
<clause commented="no" id="HABDF2FA359FB4ACCB7442567846C417D"><enum>(i)</enum><text>the fair market
value of any money or other property contributed to the partnership in exchange
for such interest (determined without regard to section 752(a)) ,</text>
</clause><clause commented="no" id="H70C1208C10AA4B87B839AF3E76ED5751"><enum>(ii)</enum><text>any amounts which
have been included in gross income under section 83 with respect to the
transfer of such interest, and</text>
</clause><clause commented="no" id="HD30BD0DA87FF4A46AE31A0E519998189"><enum>(iii)</enum><text>the excess (if
any) of—</text>
<subclause id="HDA02777FDC2C4FD0B4D905FD9732DE61"><enum>(I)</enum><text>any items of
income and gain taken into account under section 702 with respect to such
interest for taxable years to which this section applies, over</text>
</subclause><subclause id="H66205D8B19D3431DA0DFC35964F10603"><enum>(II)</enum><text>any items of
deduction and loss so taken into account.</text>
</subclause></clause><continuation-text commented="no" continuation-text-level="subparagraph">The qualified capital interest
shall be reduced by distributions from the partnership with respect to such
interest for taxable years to which this section applies and by the excess (if
any) of the amount described in clause (iii)(II) over the amount described in
clause (iii)(I).</continuation-text></subparagraph><subparagraph id="H4C0D23C5F76D4B7F8DDBBD5BBFE5B3EF"><enum>(E)</enum><header>Treatment of
certain loans</header>
<clause id="HA4E8C4A056ED43529BB2E988A86886E8"><enum>(i)</enum><header>Proceeds of
partnership loans not treated as qualified capital interest of service
providing partners</header><text>For purposes of this paragraph, an investment
services partnership interest shall not be treated as a qualified capital
interest to the extent that such interest is acquired in connection with the
proceeds of any loan or other advance made or guaranteed, directly or
indirectly, by any other partner or the partnership (or any person related to
any such other partner or the partnership).</text>
</clause><clause id="H18CCBF3B2D994250B1FBB56C5855B643"><enum>(ii)</enum><header>Reduction in
allocations to qualified capital interests for loans from nonservice providing
partners to the partnership</header><text>For purposes of this paragraph, any
loan or other advance to the partnership made or guaranteed, directly or
indirectly, by a partner not providing services described in paragraph (1) to
the partnership (or any person related to such partner) shall be taken into
account in determining the qualified capital interests of the partners in the
partnership.</text>
</clause></subparagraph></paragraph><paragraph id="H8B650BAF67774699968FCE131C7D808F"><enum>(3)</enum><header>Related
persons</header><text display-inline="yes-display-inline">A person shall be
treated as related to another person if the relationship between such persons
would result in a disallowance of losses under section 267 or 707(b).</text>
</paragraph></subsection><subsection id="H1E6C42C8A44C43069775FC7836A7F168"><enum>(d)</enum><header>Other income and
gain in connection with investment management services</header>
<paragraph id="HF93F4F295C9544208F5F64B7D288FC0F"><enum>(1)</enum><header>In
general</header><text display-inline="yes-display-inline">If—</text>
<subparagraph id="H9E39630493654614885F19945C8867C3"><enum>(A)</enum><text>a person performs
(directly or indirectly) investment management services for any entity,</text>
</subparagraph><subparagraph id="HE1207F44B49A4BBDAB465360B57D6635"><enum>(B)</enum><text>such person holds
(directly or indirectly) a disqualified interest with respect to such entity,
and</text>
</subparagraph><subparagraph id="H6DBB89BD1FE34B8998B4CD9813F7D053"><enum>(C)</enum><text display-inline="yes-display-inline">the value of such interest (or payments
thereunder) is substantially related to the amount of income or gain (whether
or not realized) from the assets with respect to which the investment
management services are performed,</text>
</subparagraph><continuation-text continuation-text-level="paragraph">any income
or gain with respect to such interest shall be treated as ordinary income.
Rules similar to the rules of subsection (c)(2) shall apply for purposes of
this subsection.</continuation-text></paragraph><paragraph id="HC42643EF82F1433F9F8EC4EF797CF63F"><enum>(2)</enum><header>Definitions</header><text>For
purposes of this subsection—</text>
<subparagraph id="HB8B0629945034F149DD4E9472E8A9B9A"><enum>(A)</enum><header>Disqualified
interest</header>
<clause id="HC9E1B2942F3A4F3BA3617EBCA885101A"><enum>(i)</enum><header>In
general</header><text>The term <term>disqualified interest</term> means, with
respect to any entity—</text>
<subclause id="HCF65DDD0D3924333A7BD0EF7C84FFDDE"><enum>(I)</enum><text>any interest in
such entity other than indebtedness,</text>
</subclause><subclause id="HD7D37B8F347D48608090D00E960D9B87"><enum>(II)</enum><text>convertible or
contingent debt of such entity,</text>
</subclause><subclause id="H27114DC2560E44BCB0A9EFB076D3EECC"><enum>(III)</enum><text>any option or
other right to acquire property described in subclause (I) or (II), and</text>
</subclause><subclause id="H88F6DE8382FB4CF5A7BA89E23EE0B57C"><enum>(IV)</enum><text>any derivative
instrument entered into (directly or indirectly) with such entity or any
investor in such entity.</text>
</subclause></clause><clause id="H8C2C0BD8878F4E4686B0FAEE20AD8B24"><enum>(ii)</enum><header>Exceptions</header><text>Such
term shall not include—</text>
<subclause id="HB581A688579348A28618747C0DC3AEE2"><enum>(I)</enum><text>a partnership
interest,</text>
</subclause><subclause id="H5CD0C75A12534CC0A7FBDB115AA8D5F7"><enum>(II)</enum><text>except as
provided by the Secretary, any interest in a taxable corporation, and</text>
</subclause><subclause id="H1EC250D606164485BB791D1875F556D2"><enum>(III)</enum><text>except as
provided by the Secretary, stock in an S corporation.</text>
</subclause></clause></subparagraph><subparagraph id="H3861E150F605483AB0BA1D58BDC3EA73"><enum>(B)</enum><header>Taxable
corporation</header><text>The term <term>taxable corporation</term>
means—</text>
<clause id="H3F3FCFA2A1894CE9B562E9CD2587A729"><enum>(i)</enum><text>a
domestic C corporation, or</text>
</clause><clause id="HBE5F198CB95F4585B635E72D0737E193"><enum>(ii)</enum><text>a
foreign corporation substantially all of the income of which is—</text>
<subclause id="H61FD7B1E8DE44A7D9557E647FF408C45"><enum>(I)</enum><text>effectively
connected with the conduct of a trade or business in the United States,
or</text>
</subclause><subclause id="HD063ABAC7913471B8F2076D1C50EE68A"><enum>(II)</enum><text>subject to a
comprehensive foreign income tax (as defined in section 457A(d)(2)).</text>
</subclause></clause></subparagraph><subparagraph id="HEA285B8F99924E62883DC0172BBBBBF1"><enum>(C)</enum><header>Investment
management services</header><text>The term <term>investment management
services</term> means a substantial quantity of any of the services described
in subsection (c)(1).</text>
</subparagraph></paragraph></subsection><subsection commented="no" id="H55F0DDD14C0E4FF884B24F62BE6F9D7C"><enum>(e)</enum><header>Regulations</header><text>The
Secretary shall prescribe such regulations or other guidance as is necessary or
appropriate to carry out the purposes of this section, including regulations or
other guidance to—</text>
<paragraph commented="no" id="H017357DE80514467B09C1DD9AAAA1A0D"><enum>(1)</enum><text>provide
modifications to the application of this section (including treating related
persons as not related to one another) to the extent such modification is
consistent with the purposes of this section,</text>
</paragraph><paragraph id="H731968AA4C12415BB6A887C22E56A799"><enum>(2)</enum><text>prevent the
avoidance of the purposes of this section, and</text>
</paragraph><paragraph commented="no" id="HBEB581BC96264D39A265DB6DE3A8BB8E"><enum>(3)</enum><text>coordinate this
section with the other provisions of this title.</text>
</paragraph></subsection><subsection commented="no" id="HE8A15EE5EECF47F19F9C7A3587BA86A9"><enum>(f)</enum><header>Cross
reference</header><text>For 40 percent penalty on certain underpayments due to
the avoidance of this section, see section
6662.</text>
</subsection></section><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="H3A817FCC1B2B413985D644436F0E515F"><enum>(b)</enum><header>Income from
investment services partnership interests not treated as qualifying income of
publicly traded partnerships</header><text>Subsection (d) of section 7704 is
amended by adding at the end the following new paragraph:</text>
<quoted-block display-inline="no-display-inline" id="HD77A73C7DAD34BAB825A8EADDEC691B1" style="OLC">
<paragraph id="H4B7FC6E5A05F45EFBF79C74A559F0CE3"><enum>(6)</enum><header>Income from
investment services partnership interests not qualified</header>
<subparagraph id="H05D43233D8DD43B7975F08489B1A8009"><enum>(A)</enum><header>In
general</header><text>Items of income and gain shall not be treated as
qualifying income if such items are treated as ordinary income by reason of the
application of section 710 (relating to special rules for partners providing
investment management services to partnership).</text>
</subparagraph><subparagraph id="H0605020C19ED404E9FA7EBD3D7C195B6"><enum>(B)</enum><header>Special rules
for certain partnerships</header>
<clause id="H5299F60E332B49819D514AD3A13C9B47"><enum>(i)</enum><header>Certain
partnerships owned by real estate investment trusts</header><text>Subparagraph
(A) shall not apply in the case of a partnership which meets each of the
following requirements:</text>
<subclause id="H5054611B44C04562A730C4B88A70FA77"><enum>(I)</enum><text>Such partnership
is treated as publicly traded under this section solely by reason of interests
in such partnership being convertible into interests in a real estate
investment trust which is publicly traded.</text>
</subclause><subclause id="HE2EA4C8AEA15416A902C28B8E2A8159D"><enum>(II)</enum><text display-inline="yes-display-inline">50 percent or more of the capital and
profits interests of such partnership are owned, directly or indirectly, at all
times during the taxable year by such real estate investment trust (determined
with the application of section 267(c)).</text>
</subclause><subclause id="H4B0C8CE5CCAE4D79BBBEE9A4333C8D30"><enum>(III)</enum><text>Such partnership
meets the requirements of paragraphs (2), (3), and (4) of section
856(c).</text>
</subclause></clause><clause id="HF00CB609E4FB4D37BE05036AF4D686EB"><enum>(ii)</enum><header>Certain
partnerships owning other publicly traded
partnerships</header><text>Subparagraph (A) shall not apply in the case of a
partnership which meets each of the following requirements:</text>
<subclause id="H48451ADF69AB43FEA1DFF7B67879F85B"><enum>(I)</enum><text>Substantially all
of the assets of such partnership consist of interests in one or more publicly
traded partnerships (determined without regard to subsection (b)(2)).</text>
</subclause><subclause commented="no" id="H25CACBA695AF476FB3BC6ED7379ED65E"><enum>(II)</enum><text>Substantially all
of the income of such partnership is ordinary income or section 1231 gain (as
defined in section 1231(a)(3)).</text>
</subclause></clause></subparagraph><subparagraph id="HFDD6B09D39CD49B3844FCCE523E2C3C3"><enum>(C)</enum><header>Transitional
rule</header><text>In the case of a partnership which is a publicly traded
partnership on the date of the enactment of this paragraph, subparagraph (A)
shall not apply to any taxable year of the partnership beginning before the
date which is 10 years after the date of the enactment of this
paragraph.</text>
</subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="H8B682F9D9D9047318E6E13ABA90D41BB"><enum>(c)</enum><header>Imposition of
penalty on underpayments</header>
<paragraph id="HFF0CBF6925544C13A35CA2F319A551AE"><enum>(1)</enum><header>In
general</header><text>Subsection (b) of section 6662, as amended by section
512, is amended by inserting after paragraph (6) the following new
paragraph:</text>
<quoted-block display-inline="no-display-inline" id="H7BB4017AA44D42AC98A1F1E7902E5CF9" style="OLC">
<paragraph id="HEE660AFB7C1B453E9FF6DC2C2EB3237D"><enum>(7)</enum><text>The application of
subsection (d) of section 710 or the regulations prescribed under section
710(e) to prevent the avoidance of the purposes of section
710.</text>
</paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph><paragraph id="HF385B84B18F14EA4A23204924196F568"><enum>(2)</enum><header>Amount of
penalty</header>
<subparagraph id="H677D0349983142C3972901123D6AB154"><enum>(A)</enum><header>In
general</header><text>Section 6662, as amended by section 512, is amended by
adding at the end the following new subsection:</text>
<quoted-block display-inline="no-display-inline" id="HEBAA310C27D24720BCDC22AC8DC9AC8C" style="OLC">
<subsection id="H4077D7F9D9DB4D158142B636D622FE4F"><enum>(j)</enum><header>Increase in
penalty in case of property transferred for investment management
services</header><text>In the case of any portion of an underpayment to which
this section applies by reason of subsection (b)(7), subsection (a) shall be
applied with respect to such portion by substituting <quote>40 percent</quote>
for <quote>20
percent</quote>.</text>
</subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subparagraph><subparagraph display-inline="no-display-inline" id="HD9E3CCF4A100415BA334193A227247F1"><enum>(B)</enum><header>Conforming
amendments</header><text>Subparagraph (B) of section 6662A(e)(2) is
amended—</text>
<clause id="HED778750D90E4BADA415A4E6DC14DA58"><enum>(i)</enum><text>by
striking <quote>section 6662(h)</quote> and inserting <quote>subsection (h) or
(i) of section 6662</quote>, and</text>
</clause><clause id="H3D7E40322655432FA2E00D66CAA811A3"><enum>(ii)</enum><text>by
striking <quote><header-in-text level="subparagraph" style="OLC">gross
valuation misstatement penalty</header-in-text></quote> in the heading and
inserting <quote><header-in-text level="subparagraph" style="OLC">certain
increased underpayment penalties</header-in-text></quote>.</text>
</clause></subparagraph></paragraph><paragraph display-inline="no-display-inline" id="H9D6C79037F254011B28A643E304B68AA"><enum>(3)</enum><header>Special rules
for application of reasonable cause exception</header><text>Subsection (c) of
section 6664 is amended—</text>
<subparagraph id="HEFE30AAEF99B452790AD7418601C0703"><enum>(A)</enum><text>by redesignating
paragraphs (2) and (3) as paragraphs (3) and (4), respectively,</text>
</subparagraph><subparagraph id="H42CF94FFCAC140CEBA6E196AFED9B43D"><enum>(B)</enum><text>by striking
<quote>paragraph (2)</quote> in paragraph (4), as so redesignated, and
inserting <quote>paragraph (3)</quote>, and</text>
</subparagraph><subparagraph id="HE8C08A23018541C59A02E9F4FAF7F8E5"><enum>(C)</enum><text>by inserting after
paragraph (1) the following new paragraph:</text>
<quoted-block display-inline="no-display-inline" id="H8D1D73DC404944BFAE71E240DC914961" style="OLC">
<paragraph id="HE3D4D17F14F0471FA9EFAB0080C255D3"><enum>(2)</enum><header>Special rule for
underpayments attributable to investment management services</header>
<subparagraph id="HE7D21B5E68F445AAB5FF5AB653C9E723"><enum>(A)</enum><header>In
general</header><text>Paragraph (1) shall not apply to any portion of an
underpayment to which this section applies by reason of subsection (b)(7)
unless—</text>
<clause id="HE5BD5BF40997486C942C2A4EEBA5F4B0"><enum>(i)</enum><text display-inline="yes-display-inline">the relevant facts affecting the tax
treatment of the item are adequately disclosed,</text>
</clause><clause id="HB06F40521A2542EE90FC1B3975BBCCFA"><enum>(ii)</enum><text>there is or was
substantial authority for such treatment, and</text>
</clause><clause id="H3C27CE73E7B6451FA8879D3006CCDCC0"><enum>(iii)</enum><text>the taxpayer
reasonably believed that such treatment was more likely than not the proper
treatment.</text>
</clause></subparagraph><subparagraph id="H8AC7ACC09BA248B6AAC0FC8595A4758D"><enum>(B)</enum><header>Rules relating
to reasonable belief</header><text>Rules similar to the rules of subsection
(d)(3) shall apply for purposes of subparagraph
(A)(iii).</text>
</subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subparagraph></paragraph></subsection><subsection id="H2CC991B7562F41E5B25911B5F1C358BA"><enum>(d)</enum><header>Income and loss
from investment services partnership interests taken into account in
determining net earnings from self-Employment</header>
<paragraph id="H5BF1BC65A24B44519DB768B2CCA82CCD"><enum>(1)</enum><header>Internal Revenue
Code</header><text>Section 1402(a) is amended by striking <quote>and</quote> at
the end of paragraph (16), by striking the period at the end of paragraph (17)
and inserting <quote>; and</quote>, and by inserting after paragraph (17) the
following new paragraph:</text>
<quoted-block display-inline="no-display-inline" id="H7845F7DF2AC341CD8D889955A5AF4575" style="OLC">
<paragraph id="H710AC0A7DB2F4BEFA7BC883616FE703E"><enum>(18)</enum><text display-inline="yes-display-inline">notwithstanding the preceding provisions of
this subsection, in the case of any individual engaged in the trade or business
of providing services described in section 710(c)(1) with respect to any
entity, any amount treated as ordinary income or ordinary loss of such
individual under section 710 with respect to such entity shall be taken into
account in determining the net earnings from self-employment of such
individual.</text>
</paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph><paragraph display-inline="no-display-inline" id="HECDA724492004F70B2AE1A222F43F055"><enum>(2)</enum><header>Social Security
Act</header><text>Section 211(a) of the Social Security Act is amended by
inserting after paragraph (16) the following new paragraph:</text>
<quoted-block display-inline="no-display-inline" id="HC7F832AB02D54CEC9ADDCB724DC19E84" style="OLC">
<paragraph id="HDF5F57AA58264052A4255CAECA40C830"><enum>(17)</enum><text display-inline="yes-display-inline">Notwithstanding the preceding provisions of
this subsection, in the case of any individual engaged in the trade or business
of providing services described in section 710(c)(1) of the Internal Revenue
Code of 1986 with respect to any entity, any amount treated as ordinary income
or ordinary loss of such individual under section 710 of such Code with respect
to such entity shall be taken into account in determining the net earnings from
self-employment of such
individual.</text>
</paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></subsection><subsection id="H5434DCC74C8F484686DDF19FD03F543B"><enum>(e)</enum><header>Conforming
amendments</header>
<paragraph id="H7E6A35DD5EC9492D947C147DA4C315D2"><enum>(1)</enum><text>Subsection (d) of
section 731 is amended by inserting <quote>section 710(b)(4) (relating to
distributions of partnership property),</quote> after <quote>to the extent
otherwise provided by</quote>.</text>
</paragraph><paragraph id="H7AD917FE799A46C2BBD110ACDCA2C977"><enum>(2)</enum><text>Section 741 is
amended by inserting <quote>or section 710 (relating to special rules for
partners providing investment management services to partnership)</quote>
before the period at the end.</text>
</paragraph><paragraph id="H50A6F1AFB04C4773A5781322F7537C4E"><enum>(3)</enum><text display-inline="yes-display-inline">The table of sections for part I of
subchapter K of chapter 1 is amended by adding at the end the following new
item:</text>
<quoted-block display-inline="no-display-inline" id="H1A3E86837FA545FCBF9650E03FF32886" style="OLC">
<toc container-level="quoted-block-container" idref="HD523595E6BC547828A849FB874C005CC" lowest-bolded-level="division-lowest-bolded" lowest-level="section" quoted-block="no-quoted-block" regeneration="yes-regeneration">
<toc-entry idref="H9FB5192BB4F24A9FBE3F69F0E01FE0D8" level="section">Sec. 710. Special rules for partners providing investment
management services to
partnership.</toc-entry>
</toc>
<after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></subsection><subsection id="HA016E5FC034E4F0E847A50AC11A7CDBB"><enum>(f)</enum><header>Effective
date</header>
<paragraph id="HB5FA9F022AB2403A9EC00B5E97B50B55"><enum>(1)</enum><header>In
general</header><text>Except as otherwise provided in this subsection, the
amendments made by this section shall apply to taxable years ending after
December 31, 2009.</text>
</paragraph><paragraph id="H1F23ED72B440489E87B3492B1539D46B"><enum>(2)</enum><header>Partnership
taxable years which include effective date</header><text display-inline="yes-display-inline">In applying section 710(a) of the Internal
Revenue Code of 1986 (as added by this section) in the case of any partnership
taxable year which includes December 31, 2009, the amount of the net income
referred to in such section shall be treated as being the lesser of the net
income for the entire partnership taxable year or the net income determined by
only taking into account items attributable to the portion of the partnership
taxable year which is after such date.</text>
</paragraph><paragraph id="H87658D8FF7214C059E1BDA67688F9CD4"><enum>(3)</enum><header>Dispositions of
partnership interests</header><text display-inline="yes-display-inline">Section
710(b) of the Internal Revenue Code of 1986 (as added by this section) shall
apply to dispositions and distributions after December 31, 2009.</text>
</paragraph><paragraph id="H9A8EFE01696D4E9DAB4D70B93A8DACA6"><enum>(4)</enum><header>Other income and
gain in connection with investment management services</header><text display-inline="yes-display-inline">Section 710(d) of such Code (as added by
this section) shall take effect on January 1, 2010.</text>
</paragraph><paragraph id="H2A0F28300D75433096672B49FE0F9149"><enum>(5)</enum><header>Publicly traded
partnerships</header><text display-inline="yes-display-inline">The amendment
made by subsection (b) shall apply to taxable years beginning after December
31, 2009.</text>
</paragraph></subsection></section></subtitle><subtitle id="HB4530AB8651E4F72A24BCB57496AC9D8"><enum>B</enum><header>Time for payment
of corporate estimated taxes</header>
<section id="H3DF30E206ECC4EFFBE8294B860AC5E5C"><enum>611.</enum><header>Time for
payment of corporate estimated taxes</header><text display-inline="no-display-inline">The percentage under paragraph (1) of
section 202(b) of the Corporate Estimated Tax Shift Act of 2009 in effect on
the date of the enactment of this Act is increased by 26.5 percentage
points.</text>
</section></subtitle><subtitle id="H4C742A5E945042FE99A2CE163084F5C8"><enum>C</enum><header>Tax Expenditure
Study</header>
<section id="H05FC8F44C0424A73B3DD765DE6F22743"><enum>621.</enum><header>Findings</header><text display-inline="no-display-inline">Congress finds the following:</text>
<paragraph id="HDDF1CE16DB054EEBA6B0F0F5D03ECD92"><enum>(1)</enum><text display-inline="yes-display-inline">Currently, the aggregate cost of Federal
tax expenditures rivals, or even exceeds, the amount of total Federal
discretionary spending.</text>
</paragraph><paragraph id="HE13D72AED6B446A0B7059D1828B4322B"><enum>(2)</enum><text display-inline="yes-display-inline">Given the escalating public debt, a
critical examination of this use of taxpayer dollars is essential.</text>
</paragraph><paragraph id="H37EEF78ABDA047B4B64D1D35C4BA2671"><enum>(3)</enum><text display-inline="yes-display-inline">Additionally, tax expenditures can
complicate the Internal Revenue Code of 1986 for taxpayers and complicate tax
administration for the Internal Revenue Service.</text>
</paragraph><paragraph id="H011D34620BC446FDBE6EA6899ED67765"><enum>(4)</enum><text display-inline="yes-display-inline">To facilitate a better understanding of tax
expenditures in the future, it is constructive for legislation extending these
provisions to include a study of such provisions. </text>
</paragraph></section><section id="HAE14298DF1D941EBA0CB474FEAB37A86"><enum>622.</enum><header>Study of
extended tax expenditures</header>
<subsection id="H1FD43A9542794D97AF9F2153C8365ACA"><enum>(a)</enum><header>In
general</header><text display-inline="yes-display-inline">Not later than
November 30, 2010, the Chief of Staff of the Joint Committee on Taxation, in
consultation with the Comptroller General of the United States, shall submit to
the Committee on Ways and Means of the House of Representatives and the
Committee on Finance of the Senate a report on each tax expenditure (as defined
in section 3(3) of the Congressional Budget Impoundment Control Act of 1974 (2
U.S.C. 622(3)) extended by this Act.</text>
</subsection><subsection id="H1001D706B1404AE38AC1ACD6B8A493F8"><enum>(b)</enum><header>Rolling
submission of reports</header><text display-inline="yes-display-inline">The
Chief of Staff of the Joint Committee on Taxation shall initially submit the
reports for each such tax expenditure enacted in subtitle B of title I
(relating to business tax relief) and title IV (relating to energy provisions)
in order of the tax expenditure incurring the least aggregate cost to the
greatest aggregate cost (determined by reference to the cost estimate of this
Act by the Joint Committee on Taxation). Thereafter, such reports may be
submitted in such order as the Chief of Staff determines appropriate.</text>
</subsection><subsection id="H2208301DCDF54B8DB3C2249E327484F1"><enum>(c)</enum><header>Contents of
report</header><text>Such reports shall contain the following:</text>
<paragraph id="H6995C7357A8C494FAA2383F1A3456ABB"><enum>(1)</enum><text>An explanation of
the tax expenditure and any relevant economic, social, or other context under
which it was first enacted.</text>
</paragraph><paragraph id="H14CCBAA843F848D49966DC63E7843989"><enum>(2)</enum><text>A
description of the intended purpose of the tax expenditure.</text>
</paragraph><paragraph id="HCD188E43ABE1437FA9C00C09E2680CF8"><enum>(3)</enum><text display-inline="yes-display-inline">An analysis of the overall success of the
tax expenditure in achieving such purpose, and evidence supporting such
analysis.</text>
</paragraph><paragraph id="H8FAF50D70CF44C59962FCCF614E1D8B9"><enum>(4)</enum><text>An analysis of the
extent to which further extending the tax expenditure, or making it permanent,
would contribute to achieving such purpose.</text>
</paragraph><paragraph commented="no" id="H1E0FFD9A71DC4E6198B05F573C631B98"><enum>(5)</enum><text display-inline="yes-display-inline">A description of the direct and indirect
beneficiaries of the tax expenditure, including identifying any unintended
beneficiaries.</text>
</paragraph><paragraph id="HF4CD48C1EE434EA19C4F816D89206659"><enum>(6)</enum><text display-inline="yes-display-inline">An analysis of whether the tax expenditure
is the most cost-effective method for achieving the purpose for which it was
intended, and a description of any more cost-effective methods through which
such purpose could be accomplished.</text>
</paragraph><paragraph id="H34A4C67DCC6E4E8B891424800198FA79"><enum>(7)</enum><text display-inline="yes-display-inline">A description of any unintended effects of
the tax expenditure that are useful in understanding the tax expenditure’s
overall value.</text>
</paragraph><paragraph id="HA93B86EA1C624CCCB2864B896123EB03"><enum>(8)</enum><text display-inline="yes-display-inline">An analysis of how the tax expenditure
could be modified to better achieve its original purpose.</text>
</paragraph><paragraph id="HB0CD9C73C2A24BD88F7EBEAF1795E82B"><enum>(9)</enum><text>A
brief description of any interactions (actual or potential) with other tax
expenditures or direct spending programs in the same or related budget function
worthy of further study.</text>
</paragraph><paragraph id="H1A1F554E798B4E7BB02E8E4D633C8D9D"><enum>(10)</enum><text display-inline="yes-display-inline">A description of any unavailable
information the staff of the Joint Committee on Taxation may need to complete a
more thorough examination and analysis of the tax expenditure, and what must be
done to make such information available.</text>
</paragraph></subsection><subsection id="H68EC2A6D1C254011BE9A1EE8F78A68E4"><enum>(d)</enum><header>Minimum analysis
by deadline</header><text display-inline="yes-display-inline">In the event the
Chief of Staff of the Joint Committee on Taxation concludes it will not be
feasible to complete all reports by the date specified in subsection (a), at a
minimum, the reports for each tax expenditure enacted in subtitle B of title I
(relating to business tax relief) and title IV (relating to energy provisions)
shall be completed by such date.</text>
</subsection></section></subtitle>