PUBLIC LAW 105-34—AUG. 5, 1997 111 STAT. 1007 "(2) ELECTION. — The election under this subsection shall Applicability. apply to the taxable year for which made and all subsequent taxable years unless revoked with the consent of the Secretary. " (b) SPECIAL RULES FOR CERTAIN SERVICE PARTNERSHIPS.— " (1) CERTAIN PARTNERS NOT COUNTED.—For purposes of this section, the term 'partner' does not include any individual performing substantial services in connection with the activities of the partnership and holding an interest in such partnership, or an individual who formerly performed substantial services in connection with such activities and who held an interest in such partnership at the time the individual performed such services. "(2) EXCLUSION. —For purposes of this part, an election under subsection (a) shall not be effective with respect to any partnership if substantially all the partners of such partnership— "(A) are individuals performing substantial services in connection with the activities of such partnership or are personal service corporations (as defined in section 269A(b)) the owner-employees (as defined in section 269A(b)) of which perform such substantial services, "(B) are retired partners who had performed such substantial services, or "(C) are spouses of partners who are performing (or had previously performed) such substantial services. "(3) SPECDVL RULE FOR LOWER TIER PARTNERSHIPS. —For purposes of this subsection, the activities of a partnership shall include the activities of any other partnership in which the partnership owns directly an interest in the capital and profits of at least 80 percent. "(c) EXCLUSION OF COMMODITY POOLS.— For purposes of this part, an election under subsection (a) shall not be effective with respect to any partnership the principal activity of which is the buying and selling of commodities (not described in section 1221(1)), or options, futures, or forwards with respect to such commodities. " (d) SECRETARY MAY RELY ON TREATMENT ON RETURN.—I f, on the partnership return of any partnership, such partnership is treated as an electing large partnership, such treatment shall be binding on such partnership and all partners of such partnership but not on the Secretary. "SEC. 776. SPECIAL RULES FOR PARTNERSHIPS HOLDING OIL AND GAS PROPERTIES. "(a) COMPUTATION OF PERCENTAGE DEPLETION. —In the case of an electing large partnership, except as provided in subsection (b)- "(1) the allow£ince for depletion under section 611 with respect to any partnership oil or gas property shall be computed at the peirtnership level without regard to any provision of section 613A requiring such allowance to be computed separately by each partner, "(2) such allowance shall be determined without regard to the provisions of section 613A(c) limiting the amount of production for which percentage depletion is allowable and without regard to paragraph (1) of section 613A(d), and "(3) paragraph (3) of section 705(a) shall not apply. " (b) TREATMENT OF CERTAIN PARTNERS. —
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