PUBLIC LAW 99-514—OCT. 22, 1986
100 STAT. 2385
SEC. 904. REPEAL OF SPECIAL REORGANIZATION RULES FOR FINANCIAL INSTITUTIONS.
(a) GENERAL RULE.—Subparagraph (D) of section 368(a)(3) (relating to agency receivership proceedings which involve financial institutions) is amended to read as follows: "(D)
AGENCY
RECEIVERSHIP
PROCEEDINGS
WHICH
INVOLVE
FINANCIAL INSTITUTIONS.—For purposes of subparagraphs (A) and (B), in the case of a receivership, foreclosure, or similar proceeding before a Federal or State agency involving a financial institution referred to in section 581 or 591, the agency shall be treated as a court." (b) REPEAL OF SPECIAL TREATMENT FOR F S L I C FINANCIAL ASSISTANCE.—
(1) Section 597 (relating to FSLIC financial assistance) is hereby repealed. (2) The table of sections for part II of subchapter H of chapter 1 is amended by striking out the item relating to section 597. (c) EFFECTIVE DATES.— (1) SUBSECTION (a).—The amendments made by subsection (a)
shall apply to acquisitions after December 31, 1988, in taxable years ending after such date. (2) SUBSECTION (b).—
(A) IN GENERAL.—The amendments made by subsection (b) shall apply to transfers after December 31, 1988, in taxable years ending after such date; except that such amendments shall not apply to transfers after such date pursuant to an acquisition to which the amendments made by subsection (a) do not apply. (B) CLARIFICATION OF TREATMENT OF AMOUNTS EXCLUDED
UNDER SECTION 597.—Section 265(a)(1) of the Internal Revenue Code of 1986 (as amended by this title) shall not deny any deduction by reason of such deduction being allocable to amounts excluded from gross income under section 597 of the Internal Revenue Code of 1954 (as in effect on the day before the date of the enactment of this Act). SEC. 905. TREATMENT OF LOSSES ON DEPOSITS OR ACCOUNTS IN INSOLVENT FINANCIAL INSTITUTIONS.
(a) IN GENERAL.—Section 165 (relating to losses^ is amended by redesignating subsection (1) as subsection (m) and by inserting after subsection (k) the following new subsection: "(1) TREATMENT OF CERTAIN LOSSES IN INSOLVENT FINANCIAL INSTITUTIONS.— "(1) IN GENERAL.—If—
"(A) as of the close of the taxable year, it can reasonably be estimated that there is a loss on a qualified individual's deposit in a qualified financial institution, and "(B) such loss is on account of the bankruptcy or insolvency of such institution, then the taxpayer may elect to treat the amount so estimated as a loss described in subsection (c)(3) incurred during the taxable year. "(2) QUALIFIED INDIVIDUAL DEFINED.—For purposes of this subsection, the term 'qualified individual' means any individual, except an individual— "(A) who owns at least 1 percent in value of the outstanding stock of the qualified financial institution,
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