112 STAT. 802 PUBLIC LAW 105-206^JULY 22, 1998 " (5) 28-PERCENT RATE GAIN. —For purposes of this subsection— "(A) IN GENERAL.— The term *28-percent rate gain' means the excess (if any) of— "(i) the sum of— "(I) the aggregate long-term capital gain from property held for more than 1 year but not more than 18 months; "(II) collectibles gain; and "(III) section 1202 gain, over "(ii) the sum of— "(I) the aggregate long-term capital loss (not described in subclause (IV)) from property referred to in clause (i)(I); "(II) collectibles loss; "(III) the net short-term capital loss; and "(IV) the amount of long-term capital loss carried under section 1212(b)(l)(B) to the taxable year. AppHcability. " (B) SPECIAL RULES.— "(i) SHORT SALE GAINS AND HOLDING PERIODS.— Rules similar to the rules of section 1233(b) shall apply where the substantially identical property has been held more than 1 year but not more than 18 months; except that, for purposes of such rules— "(I) section 1233(b)(1) shall be applied by substituting '18 months' for '1 year* each place it appears; and "(II) the holding period of such property shall be treated as being 1 year on the day before the earlier of the date of the closing of the short sale or the date such property is disposed of. "(ii) LONG-TERM LOSSES.—Section 1233(d) shall be applied separately by substituting *18 months' for '1 year' each place it appears. "(iii) OPTIONS. — ^A rule similar to the rule of section 1092(f) shall apply where the stock was held for more than 18 months. "(iv) SECTION 1256 CONTRACTS. —Amounts treated as long-term capital gain or loss under section 1256(a)(3) shall be treated as attributable to property held for more than 18 months. "(6) COLLECTIBLES GAIN AND LOSS.— For purposes of this subsection— "(A) IN GENERAL.— The terms 'collectibles gain' and 'collectibles loss' mean gain or loss (respectively) from the sale or exchange of a collectible (as defined in section 408(m) without regard to paragraph (3) thereof) which is a capital asset held for more than 18 months but only to the extent such gain is taken into account in computing gross income and such loss is taken into account in computing taxable income. "(B) PARTNERSHIPS, ETC. —For purposes of subparagraph (A), any gain from the sale of an interest in a partnership, S corporation, or trust which is attributable to unrealized appreciation in the value of collectibles shall be treated as gain from the sale or exchange of a collectible.
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