Internal Revenue Code:Sec. 267. Losses, expenses, and interest with respect to transactions between related taxpayers
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Contents |
Location in Internal Revenue Code
TITLE 26 - INTERNAL REVENUE CODE
Subtitle A - Income Taxes
CHAPTER 1 - NORMAL TAXES AND SURTAXES
Subchapter B - Computation of Taxable Income
PART IX - ITEMS NOT DEDUCTIBLE
Statute
Sec. 267. Losses, expenses, and interest with respect to
transactions between related taxpayers
(a) In general
(1) Deduction for losses disallowed
No deduction shall be allowed in respect of any loss from the
sale or exchange of property, directly or indirectly, between
persons specified in any of the paragraphs of subsection (b). The
preceding sentence shall not apply to any loss of the
distributing corporation (or the distributee) in the case of a
distribution in complete liquidation.
(2) Matching of deduction and payee income item in the case of
expenses and interest
If -
(A) by reason of the method of accounting of the person to
whom the payment is to be made, the amount thereof is not
(unless paid) includible in the gross income of such person,
and
(B) at the close of the taxable year of the taxpayer for
which (but for this paragraph) the amount would be deductible
under this chapter, both the taxpayer and the person to whom
the payment is to be made are persons specified in any of the
paragraphs of subsection (b),
then any deduction allowable under this chapter in respect of
such amount shall be allowable as of the day as of which such
amount is includible in the gross income of the person to whom
the payment is made (or, if later, as of the day on which it
would be so allowable but for this paragraph). For purposes of
this paragraph, in the case of a personal service corporation
(within the meaning of section 441(i)(2)), such corporation and
any employee-owner (within the meaning of section 269A(b)(2), as
modified by section 441(i)(2)) shall be treated as persons
specified in subsection (b).
(3) Payments to foreign persons
(A)In general.--The Secretary shall by regulations apply the
matching principle of paragraph (2) in cases in which the person
to whom the payment is to be made is not a United States person.
(B) Special rule for certain foreign entities.--
(i) In general.--Notwithstanding
subparagraph (A), in the case of any item payable
to a controlled foreign corporation (as defined in
section 957) or a passive foreign investment
company (as defined in section 1297), a deduction
shall be allowable to the payor with respect to
such amount for any taxable year before the
taxable year in which paid only to the extent that
an amount attributable to such item is includible
(determined without regard to properly allocable
deductions and qualified deficits under section
952(c)(1)(B)) during such prior taxable year in
the gross income of a United States person who
owns (within the meaning of section 958(a)) stock
in such corporation.
(ii) Secretarial authority.--The Secretary
may by regulation exempt transactions from the
application of clause (i), including any
transaction which is entered into by a payor in
the ordinary course of a trade or business in
which the payor is predominantly engaged and in
which the payment of the accrued amounts occurs
within 8\1/2\ months after accrual or within such
other period as the Secretary may prescribe.
(b) Relationships
The persons referred to in subsection (a) are:
(1) Members of a family, as defined in subsection (c)(4);
(2) An individual and a corporation more than 50 percent in
value of the outstanding stock of which is owned, directly or
indirectly, by or for such individual;
(3) Two corporations which are members of the same controlled
group (as defined in subsection (f));
(4) A grantor and a fiduciary of any trust;
(5) A fiduciary of a trust and a fiduciary of another trust, if
the same person is a grantor of both trusts;
(6) A fiduciary of a trust and a beneficiary of such trust;
(7) A fiduciary of a trust and a beneficiary of another trust,
if the same person is a grantor of both trusts;
(8) A fiduciary of a trust and a corporation more than 50
percent in value of the outstanding stock of which is owned,
directly or indirectly, by or for the trust or by or for a person
who is a grantor of the trust;
(9) A person and an organization to which section 501 (relating
to certain educational and charitable organizations which are
exempt from tax) applies and which is controlled directly or
indirectly by such person or (if such person is an individual) by
members of the family of such individual;
(10) A corporation and a partnership if the same persons own -
(A) more than 50 percent in value of the outstanding stock of
the corporation, and
(B) more than 50 percent of the capital interest, or the
profits interest, in the partnership;
(11) An S corporation and another S corporation if the same
persons own more than 50 percent in value of the outstanding
stock of each corporation;
(12) An S corporation and a C corporation, if the same persons
own more than 50 percent in value of the outstanding stock of
each corporation; or
(13) Except in the case of a sale or exchange in satisfaction
of a pecuniary bequest, an executor of an estate and a
beneficiary of such estate.
(c) Constructive ownership of stock
For purposes of determining, in applying subsection (b), the
ownership of stock -
(1) Stock owned, directly or indirectly, by or for a
corporation, partnership, estate, or trust shall be considered as
being owned proportionately by or for its shareholders, partners,
or beneficiaries;
(2) An individual shall be considered as owning the stock
owned, directly or indirectly, by or for his family;
(3) An individual owning (otherwise than by the application of
paragraph (2)) any stock in a corporation shall be considered as
owning the stock owned, directly or indirectly, by or for his
partner;
(4) The family of an individual shall include only his brothers
and sisters (whether by the whole or half blood), spouse,
ancestors, and lineal descendants; and
(5) Stock constructively owned by a person by reason of the
application of paragraph (1) shall, for the purpose of applying
paragraph (1), (2), or (3), be treated as actually owned by such
person, but stock constructively owned by an individual by reason
of the application of paragraph (2) or (3) shall not be treated
as owned by him for the purpose of again applying either of such
paragraphs in order to make another the constructive owner of
such stock.
(d) Amount of gain where loss previously disallowed
If -
(1) in the case of a sale or exchange of property to the
taxpayer a loss sustained by the transferor is not allowable to
the transferor as a deduction by reason of subsection (a)(1) (or
by reason of section 24(b) of the Internal Revenue Code of 1939);
and
(2) after December 31, 1953, the taxpayer sells or otherwise
disposes of such property (or of other property the basis of
which in his hands is determined directly or indirectly by
reference to such property) at a gain,
then such gain shall be recognized only to the extent that it
exceeds so much of such loss as is properly allocable to the
property sold or otherwise disposed of by the taxpayer. This
subsection applies with respect to taxable years ending after
December 31, 1953. This subsection shall not apply if the loss
sustained by the transferor is not allowable to the transferor as a
deduction by reason of section 1091 (relating to wash sales) or by
reason of section 118 of the Internal Revenue Code of 1939.
(e) Special rules for pass-thru entities
(1) In general
In the case of any amount paid or incurred by, to, or on behalf
of, a pass-thru entity, for purposes of applying subsection
(a)(2) -
(A) such entity,
(B) in the case of -
(i) a partnership, any person who owns (directly or
indirectly) any capital interest or profits interest of such
partnership, or
(ii) an S corporation, any person who owns (directly or
indirectly) any of the stock of such corporation,
(C) any person who owns (directly or indirectly) any capital
interest or profits interest of a partnership in which such
entity owns (directly or indirectly) any capital interest or
profits interest, and
(D) any person related (within the meaning of subsection (b)
of this section or section 707(b)(1)) to a person described in
subparagraph (B) or (C),
shall be treated as persons specified in a paragraph of
subsection (b). Subparagraph (C) shall apply to a transaction
only if such transaction is related either to the operations of
the partnership described in such subparagraph or to an interest
in such partnership.
(2) Pass-thru entity
For purposes of this section, the term ''pass-thru entity''
means -
(A) a partnership, and
(B) an S corporation.
(3) Constructive ownership in the case of partnerships
For purposes of determining ownership of a capital interest or
profits interest of a partnership, the principles of subsection
(c) shall apply, except that -
(A) paragraph (3) of subsection (c) shall not apply, and
(B) interests owned (directly or indirectly) by or for a C
corporation shall be considered as owned by or for any
shareholder only if such shareholder owns (directly or
indirectly) 5 percent or more in value of the stock of such
corporation.
(4) Subsection (a)(2) not to apply to certain guaranteed payments
of partnerships
In the case of any amount paid or incurred by a partnership,
subsection (a)(2) shall not apply to the extent that section
707(c) applies to such amount.
(5) Exception for certain expenses and interest of partnerships
owning low-income housing
(A) In general
This subsection shall not apply with respect to qualified
expenses and interest paid or incurred by a partnership owning
low-income housing to -
(i) any qualified 5-percent or less partner of such
partnership, or
(ii) any person related (within the meaning of subsection
(b) of this section or section 707(b)(1)) to any qualified
5-percent or less partner of such partnership.
(B) Qualified 5-percent or less partner
For purposes of this paragraph, the term ''qualified
5-percent or less partner'' means any partner who has (directly
or indirectly) an interest of 5 percent or less in the
aggregate capital and profits interests of the partnership but
only if -
(i) such partner owned the low-income housing at all times
during the 2-year period ending on the date such housing was
transferred to the partnership, or
(ii) such partnership acquired the low-income housing
pursuant to a purchase, assignment, or other transfer from
the Department of Housing and Urban Development or any State
or local housing authority.
For purposes of the preceding sentence, a partner shall be
treated as holding any interest in the partnership which is
held (directly or indirectly) by any person related (within the
meaning of subsection (b) of this section or section 707(b)(1))
to such partner.
(C) Qualified expenses and interest
For purpose of this paragraph, the term ''qualified expenses
and interest'' means any expense or interest incurred by the
partnership with respect to low-income housing held by the
partnership but -
(i) only if the amount of such expense or interest (as the
case may be) is unconditionally required to be paid by the
partnership not later than 10 years after the date such
amount was incurred, and
(ii) in the case of such interest, only if such interest is
incurred at an annual rate not in excess of 12 percent.
(D) Low-income housing
For purposes of this paragraph, the term ''low-income
housing'' means -
(i) any interest in property described in clause (i), (ii),
(iii), or (iv) of section 1250(a)(1)(B), and
(ii) any interest in a partnership owning such property.
(6) Cross reference
For additional rules relating to partnerships, see section
707(b).
(f) Controlled group defined; special rules applicable to
controlled groups
(1) Controlled group defined
For purposes of this section, the term ''controlled group'' has
the meaning given to such term by section 1563(a), except that -
(A) ''more than 50 percent'' shall be substituted for ''at
least 80 percent'' each place it appears in section 1563(a),
and
(B) the determination shall be made without regard to
subsections (a)(4) and (e)(3)(C) of section 1563.
(2) Deferral (rather than denial) of loss from sale or exchange
between members
In the case of any loss from the sale or exchange of property
which is between members of the same controlled group and to
which subsection (a)(1) applies (determined without regard to
this paragraph but with regard to paragraph (3)) -
(A) subsections (a)(1) and (d) shall not apply to such loss,
but
(B) such loss shall be deferred until the property is
transferred outside such controlled group and there would be
recognition of loss under consolidated return principles or
until such other time as may be prescribed in regulations.
(3) Loss deferral rules not to apply in certain cases
(A) Transfer to DISC
For purposes of applying subsection (a)(1), the term
''controlled group'' shall not include a DISC.
(B) Certain sales of inventory
Except to the extent provided in regulations prescribed by
the Secretary, subsection (a)(1) shall not apply to the sale or
exchange of property between members of the same controlled
group (or persons described in subsection (b)(10)) if -
(i) such property in the hands of the transferor is
property described in section 1221(a)(1),
(ii) such sale or exchange is in the ordinary course of the
transferor's trade or business,
(iii) such property in the hands of the transferee is
property described in section 1221(a)(1), and
(iv) the transferee or the transferor is a foreign
corporation.
(C) Certain foreign currency losses
To the extent provided in regulations, subsection (a)(1)
shall not apply to any loss sustained by a member of a
controlled group on the repayment of a loan made to another
member of such group if such loan is payable in a foreign
currency or is denominated in such a currency and such loss is
attributable to a reduction in value of such foreign currency.
(4) Determination of relationship resulting in disallowance of
loss, for purposes of other provisions
For purposes of any other section of this title which refers to
a relationship which would result in a disallowance of losses
under this section, deferral under paragraph (2) shall be treated
as disallowance.
(g) Coordination with section 1041
Subsection (a)(1) shall not apply to any transfer described in
section 1041(a) (relating to transfers of property between spouses
or incident to divorce).
Sources
(Aug. 16, 1954, ch. 736, 68A Stat. 78; Pub. L. 95-628, Sec. 2(a),
Nov. 10, 1978, 92 Stat. 3627; Pub. L. 97-354, Sec. 3(h), Oct. 19,
1982, 96 Stat. 1689; Pub. L. 98-369, div. A, title I, Sec.
174(a)-(b)(4), title VII, Sec. 721(s), July 18, 1984, 98 Stat.
704-707, 970; Pub. L. 99-514, title VIII, Sec. 803(b)(5),
806(c)(2), title XVIII, Sec. 1812(c)(1), (2), (3)(C), (4)(A),
1842(a), Oct. 22, 1986, 100 Stat. 2356, 2364, 2834, 2835, 2852;
Pub. L. 100-647, title I, Sec. 1006(e)(9), 1008(e)(6), Nov. 10,
1988, 102 Stat. 3401, 3441; Pub. L. 105-34, title XIII, Sec.
1308(a), title XVI, Sec. 1604(e)(1), Aug. 5, 1997, 111 Stat. 1041,
1098; Pub. L. 106-170, title V, Sec. 532(c)(2)(C), Dec. 17, 1999,
113 Stat. 1930.)
References in Text
REFERENCES IN TEXT
Sections 24(b) and 118 of the Internal Revenue Code of 1939,
referred to in subsec. (d), were classified to sections 24(b) and
118 of former Title 26, Internal Revenue Code. Sections 24(b) and
118 were repealed by section 7851(a)(1) of this title. For table
of comparisons of the 1939 Code to the 1986 Code (formerly I.R.C.
1954), see Table I preceding section 1 of this title. See, also,
section 7851(e) of this title for provision that references in the
1986 Code to a provision of the 1939 Code, not then applicable,
shall be deemed a reference to the corresponding provision of the
1986 Code, which is then applicable.
Miscellaneous
AMENDMENTS
2004 - Subsec.841(b),Pub.L.108-357, amended Sec.267(a)(3)
by (1) by striking ``The Secretary'' and inserting:
"(A) In general.--The Secretary", and
(2) by adding at the end the following new subparagraph:
"(B) Special rule for certain foreign entities.--".
1999 - Subsec. (f)(3)(B)(i), (iii). Pub. L. 106-170 substituted
''1221(a)(1)'' for ''1221(1)''.
1997 - Subsec. (b)(13). Pub. L. 105-34, Sec. 1308(a), added par.
(13).
Subsec. (f)(4). Pub. L. 105-34, Sec. 1604(e)(1), added par. (4).
1988 - Subsec. (a)(1). Pub. L. 100-647, Sec. 1006(e)(9), struck
out ''(other than a loss in case of a distribution in corporate
liquidation)'' after ''exchange of property'' and inserted at end
''The preceding sentence shall not apply to any loss of the
distributing corporation (or the distributee) in the case of a
distribution in complete liquidation.''
Subsec. (a)(2). Pub. L. 100-647, Sec. 1008(e)(6), made technical
correction to directory language of Pub. L. 99-514, Sec. 806(c)(2),
see 1986 Amendment note below.
1986 - Subsec. (a)(2). Pub. L. 99-514, Sec. 806(c)(2), as amended
by Pub. L. 100-647, Sec. 1008(e)(6), inserted at end ''For purposes
of this paragraph, in the case of a personal service corporation
(within the meaning of section 441(i)(2)), such corporation and any
employee-owner (within the meaning of section 269A(b)(2), as
modified by section 441(i)(2)) shall be treated as persons
specified in subsection (b).''
Subsec. (a)(3). Pub. L. 99-514, Sec. 1812(c)(1), added par. (3).
Subsec. (b)(12). Pub. L. 99-514, Sec. 1812(c)(4)(A), substituted
''same persons own'' for ''same persons owns''.
Subsec. (e)(5)(D). Pub. L. 99-514, Sec. 803(b)(5), substituted in
cl. (i) ''interest in property described in clause (i), (ii),
(iii), or (iv) of section 1250(a)(1)(B)'' for ''interest in
low-income housing (as defined in paragraph (5) of section
189(e))'' and in cl. (ii) ''such property'' for ''low-income
housing (as so defined)''.
Subsec. (e)(6). Pub. L. 99-514, Sec. 1812(c)(3)(C), added par.
(6).
Subsec. (f)(3)(B). Pub. L. 99-514, Sec. 1812(c)(2), inserted
''(or persons described in subsection (b)(10))''.
Subsec. (g). Pub. L. 99-514, Sec. 1842(a), added subsec. (g).
1984 - Subsec. (a). Pub. L. 98-369, Sec. 174(a), amended subsec.
(a) generally, substituting ''In general'' for ''Deduction
disallowed'' in heading, ''Deduction for losses disallowed'' for
''Losses'' in par. (1) heading, and provisions dealing with
matching of deduction and payee income item in the case of expenses
and interest for provisions dealing with unpaid expenses and
interest in par. (2).
Subsec. (b)(3). Pub. L. 98-369, Sec. 174(b)(2)(A), substituted
''Two corporations which are members of the same controlled group
(as defined in subsection (f))'' for ''Two corporations more than
50 percent in value of the outstanding stock of each of which is
owned, directly or indirectly, by or for the same individual, if
either one of such corporations, with respect to the taxable year
of the corporation preceding the date of the sale or exchange was,
under the law applicable to such taxable year, a personal holding
company or a foreign personal holding company''.
Subsec. (b)(10). Pub. L. 98-369, Sec. 174(b)(3), substituted ''A
corporation'' for ''An S corporation'' in introductory provisions
and ''the corporation'' for ''the S corporation'' in subpar. (A).
Subsec. (b)(12). Pub. L. 98-369, Sec. 174(b)(4), substituted
''the same persons'' for ''the same individual''.
Subsec. (e). Pub. L. 98-369, Sec. 174(b)(1), added subsec. (e).
Pub. L. 98-369, Sec. 174(a)(2), struck out subsec. (e) which
provided that for purposes of subsection (a)(2) where the last day
of the 2 1/2 month period falls on Saturday, Sunday, or a legal
holiday, such last day be treated as falling on the next succeeding
day which is not a Saturday, Sunday, or a legal holiday, and the
determination of what constitutes a legal holiday be made under
section 7503 with respect to the payor's return of tax under this
chapter for the preceding taxable year.
Subsec. (f). Pub. L. 98-369, Sec. 174(b)(2)(B), added subsec.
(f).
Pub. L. 98-369, Sec. 174(b)(1), struck out subsec. (f) which
related to special rules for unpaid expenses and interest of S
corporations and treatment under such provisions of certain
shareholders, etc., as related persons.
Pub. L. 98-369, Sec. 721(s), in closing provision of par. (1)
substituted ''then any deduction allowable under such sections in
respect of such amount shall be allowable as of the day as of which
such payment is includible in the gross income of the person to
whom the payment is made (or, if later, as of the day on which it
would be so allowable but for this paragraph)'' for ''then no
deduction shall be allowed in respect of expenses otherwise
deductible under section 162 or 212, or of interest otherwise
deductible under section 163, before the day as of which the amount
thereof is includible in the gross income of the person to whom the
payment is made''.
1982 - Subsec. (b)(10) to (12). Pub. L. 97-354, Sec. 3(h)(1),
(3), added pars. (10) to (12).
Subsec. (f). Pub. L. 97-354, Sec. 3(h)(2), added subsec. (f).
1978 - Subsec. (e). Pub. L. 95-628 added subsec. (e).
EFFECTIVE DATE OF 1999 AMENDMENT
Amendment by Pub. L. 106-170 applicable to any instrument held,
acquired, or entered into, any transaction entered into, and
supplies held or acquired on or after Dec. 17, 1999, see section
532(d) of Pub. L. 106-170, set out as a note under section 170 of
this title.
EFFECTIVE DATE OF 1997 AMENDMENT
Section 1308(c) of Pub. L. 105-34 provided that: ''The amendments
made by this section (amending this section and section 1239 of
this title) shall apply to taxable years beginning after the date
of the enactment of this Act (Aug. 5, 1997).''
Section 1604(e)(2) of Pub. L. 105-34 provided that: ''The
amendment made by paragraph (1) (amending this section) shall take
effect as if included in section 174(b) of the Tax Reform Act of
1984 (Pub. L. 98-369).''
EFFECTIVE DATE OF 1988 AMENDMENT
Amendment by Pub. L. 100-647 effective, except as otherwise
provided, as if included in the provision of the Tax Reform Act of
1986, Pub. L. 99-514, to which such amendment relates, see section
1019(a) of Pub. L. 100-647, set out as a note under section 1 of
this title.
EFFECTIVE DATE OF 1986 AMENDMENT
If any interest costs incurred after Dec. 31, 1986, are
attributable to costs incurred before Jan. 1, 1987, the amendment
by section 803(b)(5) of Pub. L. 99-514 is applicable to such
interest costs only to the extent such interest costs are
attributable to costs which were required to be capitalized under
section 263 of the Internal Revenue Code of 1954 and which would
have been taken into account in applying section 189 of the
Internal Revenue Code of 1954 (as in effect before its repeal by
section 803 of Pub. L. 99-514) or, if applicable, section 266 of
such Code, see section 7831(d)(2) of Pub. L. 101-239, set out as an
Effective Date note under section 263A of this title.
Amendment by section 803(b)(5) of Pub. L. 99-514 applicable,
except as otherwise provided, to costs incurred after Dec. 31,
1986, in taxable years ending after that date, see section 803(d)
of Pub. L. 99-514, set out as a note under section 263A of this
title.
Amendment by section 806(c)(2) of Pub. L. 99-514 applicable to
taxable years beginning after Dec. 31, 1986, with special
provisions applicable to taxpayers who are required to change their
accounting periods, see section 806(e) of Pub. L. 99-514, set out
as a note under section 1378 of this title.
Amendment by sections 1812(c)(1), (2), (3)(C), (4)(A) and 1842(a)
of Pub. L. 99-514 effective, except as otherwise provided, as if
included in the provisions of the Tax Reform Act of 1984, Pub. L.
98-369, div. A, to which such amendment relates, see section 1881
of Pub. L. 99-514, set out as a note under section 48 of this
title.
EFFECTIVE DATE OF 1984 AMENDMENT
Section 174(c) of Pub. L. 98-369, as amended by Pub. L. 99-514,
Sec. 2, Oct. 22, 1986, 100 Stat. 2095, provided that:
''(1) Subsections (a) and (b)(1). - The amendments made by
subsections (a) and (b)(1) (amending this section) shall apply to
amounts allowable as deductions under chapter 1 of the Internal
Revenue Code of 1986 (formerly I.R.C. 1954) for taxable years
beginning after December 31, 1983. For purposes of the preceding
sentence, the allowability of a deduction shall be determined
without regard to any disallowance or postponement of deductions
under section 267 of such Code.
''(2) Subsection (b) (other than paragraph (1)). -
''(A) In general. - Except as provided in subparagraph (B), the
amendments made by subsection (b) (other than paragraph (1)
thereof) (amending this section and sections 170, 368, 514, and
1235 of this title) shall apply to transactions after December
31, 1983, in taxable years ending after such date.
''(B) Exception for transfers to foreign corporations on or
before march 1, 1984. - The amendments made by subsection (b)(2)
(amending this section) shall not apply to property transferred
to a foreign corporation on or before March 1, 1984.
''(3) Exception for existing indebtedness, etc. -
''(A) In general. - The amendments made by this section
(amending this section and sections 170, 368, 514, and 1235 of
this title) shall not apply to any amount paid or incurred -
''(i) on indebtedness incurred on or before September 29,
1983, or
''(ii) pursuant to a contract which was binding on September
29, 1983, and at all times thereafter before the amount is paid
or incurred.
''(B) Treatment of renegotiations, extensions, etc. - If any
indebtedness (or contract described in subparagraph (A)) is
renegotiated, extended, renewed, or revised after September 29,
1983, subparagraph (A) shall not apply to any amount paid or
incurred on such indebtedness (or pursuant to such contract)
after the date of such renegotiation, extension, renewal, or
revision.''
Amendment by section 721(s) of Pub. L. 98-369 effective as if
included in the Subchapter S Revision Act of 1982, Pub. L. 97-354,
see section 721(y)(1) of Pub. L. 98-369, set out as a note under
section 1361 of this title.
EFFECTIVE DATE OF 1982 AMENDMENT
Amendment by Pub. L. 97-354 applicable to taxable years beginning
after Dec. 31, 1982, see section 6(a) of Pub. L. 97-354, set out as
an Effective Date note under section 1361 of this title.
EFFECTIVE DATE OF 1978 AMENDMENT
Section 2(b) of Pub. L. 95-628 provided that: ''The amendment
made by subsection (a) (amending this section) shall apply with
respect to payments made after the date of the enactment of this
Act (Nov. 10, 1978).''
CONSTRUCTION OF SECTION 806 OF PUB. L. 99-514
Nothing in section 806 of Pub. L. 99-514 (amending this section)
or in any legislative history relating thereto to be construed as
requiring the Secretary of the Treasury or his delegate to permit
an automatic change of a taxable year, see section 1008(e)(9) of
Pub. L. 100-647, set out as a note under section 1378 of this
title.
PLAN AMENDMENTS NOT REQUIRED UNTIL JANUARY 1, 1989
For provisions directing that if any amendments made by subtitle
A or subtitle C of title XI (Sec. 1101-1147 and 1171-1177) or title
XVIII (Sec. 1800-1899A) of Pub. L. 99-514 require an amendment to
any plan, such plan amendment shall not be required to be made
before the first plan year beginning on or after Jan. 1, 1989, see
section 1140 of Pub. L. 99-514, as amended, set out as a note under
section 401 of this title.
EXCEPTION FOR CERTAIN INDEBTEDNESS
Section 1812(c)(5) of Pub. L. 99-514 provided that: ''Clause (i)
of section 174(c)(3)(A) of the Tax Reform Act of 1984 (section
174(c)(3)(A)(i) of Pub. L. 98-369, set out as a note above) shall
be applied by substituting 'December 31, 1983' for 'September 29,
1983' in the case of indebtedness which matures on January 1, 1999,
the payments on which from January 1989 through November 1993 equal
U/L plus $77,600, the payments on which from December 1993 to
maturity equal U/L plus $50,100, and which accrued interest at
13.75 percent through December 31, 1989.''
References
SECTION REFERRED TO IN OTHER SECTIONS
This section is referred to in sections 40, 42, 45D, 51, 56, 108,
121, 144, 147, 163, 165, 167, 170, 179, 179A, 197, 213, 221, 263A,
274, 280A, 280F, 304, 336, 341, 351, 355, 409, 447, 453, 464, 465,
468B, 469, 475, 483, 503, 514, 613A, 631, 643, 664, 685, 707, 860L,
864, 871, 936, 988, 1031, 1033, 1060, 1202, 1235, 1237, 1239, 1259,
1397, 1400B, 1400C, 2057, 4946, 4951, 4975, 5881, 6038, 6038A,
6111, 6166, 7612 of this title; title 29 sections 1108, 1384.
