PUBLIC LAW 94-455—OCT. 4, 1976
90 STAT. 1903
" (A) Amounts received as compensation (however designated and from whomever received) for the use of, or the r i g h t to use, tangible property of the corporation in any case
where, at any time during the taxable year, 25 percent or I '1 more in value of the outstanding stock of the corporation is owned, directly or indirectly, by or for an individual entitled to the use of the property (whether such r i g h t is obtained directly from the corporation or by means of a sublease or other a r r a n g e m e n t). " (B) Subparagraph (A) shall a p p l y only to a corporation which has personal holding company income in excess of 10 .,. ,... percent of its ordinary gross income. ^ ' ^ " (C) For purposes of the limitation in subparagraph (B), personal holding company income shall be computed— " (i) without regard to subparagraph (A) or paragraph (2), " ( i i) by excluding amounts received as compensation for the use of (or right to use) intangible property (other than mineral, oil, or gas royalties or copyright royalties) if a substantial part of the tangible property used in connection with such intangible property is owned by the corporation and all such tangible and intangible property is used in the active conduct of a trade or business by an individual or individuals described in subparagraph (A), and " ( i i i) by including copyright royalties and adjusted income from mineral, oil, and gas royalties." (b) EFFECTIVE DATE.—The amendment made by subsection (a) 26 USC 543 shall a p p l y to taxable years beginning after December 31, 1976. note. SEC. 2107. WORK INCENTIVE PROGRAM EXPENSES. (a) INCREASE I N L I M I T A T I O N BASED ON A M O U N T OF T A X. —
(1) Paragraph (2) of section 5 0 A (a) (relating to limitation 26 USC 50A. based on amount of tax) is amended by striking out "$25,000" each place it appears and inserting in lieu thereof "$50,000". (2) Paragraph (4) of section 5 0 A (a) (relating to married individuals) is amended— (A) by striking out "$12,500" and inserting in lieu thereof "$25,000^ and .^ (B) by striking out "$25,000" and inserting in lieu thereof ' "$50,000^^'. (3) Paragraph (5) of section 5 0 A (a) (relating to controlled groups) is amended by striking out "$25,000" each place it appears therein and inserting in lieu thereof "$50,000". (4) Paragraph (3) of section 50B(e) is amended by striking 26 USC SOB. out "$25,000" each place it appears therein and inserting in lieu thereof "$50,000".
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(b) EEDUCTION o r PERIOD D U R I N G W H I C H DISCHARGE OF EMPLOYEE
CAUSES RECAPTURE.—Subparagraph (A) of section 50A(c)(1) (relat- 26 USC 50A. ing to work incentive program expenses) is amended— (1) by striking out "12 months " each place it appears and inserting in lieu thereof "90 days", (2) by striking out "12th calendar month " and inserting in ' lieu thereof "90th calendar day", and (3) by striking out "the calendar month " and inserting in lieu thereof " the day".
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