Page:United States Statutes at Large Volume 104 Part 2.djvu/964

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104 STAT. 1388-556 PUBLIC LAW 101-508 —NOV. 5, 1990 (1) IN GENERAL.— Except as provided in paragraph (2), the amendments made by this section shall apply to property placed in service after December 31, 1990. (2) EXCEPTIONS.—The amendments made by this section shall not apply to— (A) any transition property (as defined in section 49(e) of the Internal Revenue Code of 1986 (as in effect on the day before the date of the enactment of this Act), (B) any property with respect to which qualified progress expenditures were previously taken into account under section 46(d) of such Code (as so in effect), and (C) any property described in section 46(b)(2)(C) of such Code (as so in effect). SEC. 11814. ELIMINATION OF OBSOLETE PROVISIONS IN SECTION 243(b). (a) IN GENERAL.— Subsection (b) of section 243 is amended to read as follows: "(b) QUALIFYING DIVIDENDS. — "(1) IN GENERAL.—For purposes of this section, the term 'qualifying dividend' means any dividend received by a corporation— "(A) if at the close of the day on which such dividend is received, such corporation is a member of the same affiliated group as the corporation distributing such dividend, and "(B) if— "(i) such dividend is distributed out of the earnings and profits of a taxable year of the distributing corporation which ends after December 31, 1963, for which an election under section 1562 was not in effect, and on each day of which the distributing corporation and the corporation receiving the dividend were members of such affiliated group, or "(ii) such dividend is paid by a corporation with respect to which an election under section 936 is in effect for the taxable year in which such dividend is paid. "(2) AFFIUATED GROUP.— For purposes of this subsection, the term 'affiliated group' has the meaning given such term by section 1504(a), except that for such purposes sections 1504(b)(2), 1504(b)(4), and 1504(c) shall not apply. " (3) SPECIAL RULE FOR GROUPS WHICH INCLUDE LIFE INSURANCE COMPANIES.— "(A) IN GENERAL.—In the case an affiliated group which includes 1 or more insurance companies under section 801, no dividend by any member of such group shall be treated as a qualifying dividend unless an election under this paragraph is in effect for the taxable year in which the dividend is received. The preceding sentence shall not apply in the case of a dividend described in paragraph (l)(B)(ii). "(B) EFFECT OF ELECTION. —If an election under this paragraph is in effect with respect to any affiliated group— "(i) part II of subchapter B of chapter 6 (relating to certain controlled corporations) shall be applied with respect to the members of such group without regard to sections 1563(a)(4) and 1563(b)(2)(D), and