Page:United States Statutes at Large Volume 98 Part 1.djvu/1035

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PUBLIC LAW 98-000—MMMM. DD, 1984

PUBLIC LAW 98-369—JULY 18, 1984

98 STAT. 987

derived from such transaction shall be treated as described in this paragraph. For purposes of the preceding sentence, foreign trade income shall not include any income properly allocable to excluded property described in subparagraph (B) of section 927(a)(2) (relating to intangibles). Post, p. 991. "(3)

INCOME DETERMINED WITH REGARD TO ADMINISTRATIVE

PRICING RULES.—In the case of any transaction with respect to which paragraph (1) or (2) of section 925(a) (or the corresponding Post, p. 990. provisions of the regulations prescribed under section 925(b)) applies, 16/23 of the foreign trade income derived from such transaction shall be treated as described in this paragraph.

b

"(4) SPECIAL RULE FOR FOREIGN TRADE INCOME ALLOCABLE TO A COOPERATIVE.—

"(A) IN GENERAL.—In any case in which a qualified cooperative is a shareholder of a FSC, paragraph (3) shall be applied with respect to that portion of the foreign trade income of such FSC for any taxable year which is properly allocable to the marketing of agricultural or horticultural products (or the providing of related services) by such cooperative by substituting *100 percent' for '16/23'. "(B) PARAGRAPH ONLY TO APPLY TO AMOUNTS FSC DISTRIB-

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UTES.—Subparagraph (A) shall not apply for any taxable year unless the FSC distributes to the qualified cooperative the amount which (but for such subparagraph) would not be treated as exempt foreign trade income. Any distribution

under this subparagraph for any taxable year— "(i) shall be made before the due date for filing the return of tax for such taxable year, but "(ii) shall be treated as made on the last day of such taxable year. "(5) SPECIAL RULE FOR MILITARY PROPERTY.—Under regulations prescribed by the Secretary, that portion of the foreign trading gross receipts of the FSC for the taxable year attributable to the disposition of, or services relating to, military property (within the meaning of section 995(b)(3)(B)) which may be treated as exempt foreign trade income shall equal 50 percent of the amount which (but for this paragraph) would be treated as exempt foreign trade income. "(b) FOREIGN TRADE INCOME DEFINED.—For purposes of this subpart, the term 'foreign trade income' means the gross income of a FSC attributable to foreign trading gross receipts. "SEC. 924. FOREIGN TRADING GROSS RECEIPTS.

"(a) IN GENERAL.—Except as otherwise provided in this section, for purposes of this subpart, the term 'foreign trading gross receipts' means the gross receipts of any FSC which are— "(1) from the sale, exchange, or other disposition of export property, "(2) from the lease or rental of export property for use by the lessee outside the United States, ^, "(3) for services which are related and subsidiary to— "(A) any sale, exchange, or other disposition of export property by such corporation, or .-' "(B) any lease or rental of export property described in paragraph (2) by such corporation,

26 USC 924.