98 STAT. 812
PUBLIC LAW 98-369—JULY 18, 1984
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"(D) SPECIAL RULES FOR APPLICATION OF SUBPARAGRAPH <C).— "(i) PARTNERSHIPS IN WHICH TAXPAYER IS A QUALIFIED
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CORPORATE PARTNER.—In the case of an active business of a partnership, if— "(I) the taxpayer is a qualified corporate partner in the partnership, and "(II) during the entire 12-month period ending on the last day of the partnership s taxable year, ,,.,.,.^., there was at least 1 full-time employee of the partnership (or of a qualified corporate partner) substantially all the services of whom were in the ••^active management of such business, then the taxpayer's proportionate share (determined on , the basis of its profits interest) of the activities of the
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partnership in such business shall be treated as activities of the taxpayer (and clause (i) of subparagraph (C) shall not apply in determining whether such business ~s <ii-M v. ( is a qualifying business of the taxpayer). "(ii) QUALIFIED CORPORATE PARTNER.—For purposes of •,. clause (i), the term 'qualified corporate partner means any corporation if^ _,^^, "(I) such corporation is a general partner in the partnership, „',..^ "(II) such corporation has an interest of 10 percent or more in the profits and losses of the partnership, and "(III) such corporation has contributed property to the partnership in an amount not less than the lesser of $500,000 or 10 percent of the net worth of the corporation. For purposes of subclause (III), any contribution of property other than money shall be taken into account at its fair market value. "(iii) DEDUCTION FOR OWNER EMPLOYEE COMPENSATION NOT TAKEN INTO ACCOUNT.—For purposes of clause (iii) ' f-G Qf subparagraph (C), there shall not be taken into account any deduction in respect of compensation for personal services rendered by any employee (other than a non-owner employee) of the taxpayer or any member of such employee s family (within the meaning
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of section 318(a)(1)). "(iv)
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SPECIAL RULE FOR BANKS.—For purposes of
clause (iii) of subparagraph (C), in the case of a bank (as defined in section 581) or a financial institution to which section 591 applies— "(I) gross income shall be determined without regard to the exclusion of interest from gross income under section 103, and "(II) in addition to the deductions described in such clause, there shall also be taken into account the amount of the deductions which are allowable for amounts paid or credited to the accounts of depositors or holders of accounts as dividends or interest on their deposits or withdrawable accounts under section 163 or 591. "(v) SPECIAL RULE FOR U F E INSURANCE COMPANIES.—
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