II 112th CONGRESS 1st Session S. 1761 IN THE SENATE OF THE UNITED STATES October 21 (legislative day, October 20), 2011 Ms. Cantwell introduced the following bill; which was read twice and referred to the Committee on Finance A BILL To amend the Internal Revenue Code of 1986 to repeal the exception to the treatment of consolidated groups under the personal holding company rules.

1.

Repeal of exception to treatment as consolidated group under personal holding company rules

(a)

In general

Subsection (b) of section 542 of the Internal Revenue Code of 1986 is amended— (1)by striking paragraphs (2) and (4), and (2)by redesignating paragraphs (3) and (5) as paragraphs (2) and (3), respectively. (b)

Conforming amendments

(1)Paragraph (1) of section 542(b) of such Code is amended by striking paragraphs (2) and (3) and inserting paragraph (2). (2)Clause (ii) of section 1504(c)(2)(B) of such Code is amended by striking section 542(b)(5) and inserting section 542(b)(3). (c)

Effective date

The amendments made by this section shall apply to taxable years beginning on or after the date of the enactment of this Act.