108th CONGRESS
1st Session
S. 752
To amend the Internal Revenue Code of 1986 to treat distributions
from publicly traded partnerships as qualifying income of regulated investment
companies, and for other purposes.
IN THE SENATE OF THE UNITED STATES
April 1, 2003
Mr. BINGAMAN (for himself and Mrs. HUTCHISON) introduced the following
bill; which was read twice and referred to the Committee on Finance
A BILL
To amend the Internal Revenue Code of 1986 to treat distributions
from publicly traded partnerships as qualifying income of regulated investment
companies, and for other purposes.
Be it enacted by the Senate and House of Representatives of the United
States of America in Congress assembled,
SECTION 1. DISTRIBUTIONS FROM PUBLICLY TRADED PARTNERSHIPS TREATED AS QUALIFYING
INCOME OF REGULATED INVESTMENT COMPANIES.
(a) IN GENERAL- Paragraph (2) of section 851(b) of the Internal Revenue Code
of 1986 (defining regulated investment company) is amended by inserting `distributions
or other income derived from an interest in a publicly traded partnership
(as defined in section 7704(b)),' after `dividends, interest,'.
(b) SOURCE FLOW-THROUGH RULE NOT TO APPLY- The last sentence of section 851(b)
of such Code is amended by inserting `(other than a publicly traded partnership
(as defined in section 7704(b)))' after `derived from a partnership'.
SEC. 2. SPECIAL PASSIVE ACTIVITY RULE FOR PUBLICLY TRADED PARTNERSHIPS TO
APPLY TO REGULATED INVESTMENT COMPANIES.
Subsection (k) of section 469 of the Internal Revenue Code of 1986 (relating
to separate application of section in case of publicly traded partnerships)
is amended by adding at the end the following new paragraph:
`(4) APPLICATION TO REGULATED INVESTMENT COMPANIES- For purposes of this
section, a regulated investment company (as defined in section 851) holding
an interest in a publicly traded partnership shall be treated as a taxpayer
described in subsection (a)(2) with respect to items attributable to such
interest.'
SEC. 3. EFFECTIVE DATE.
The amendments made by this Act shall apply to taxable years beginning after
the date of the enactment of this Act.
END
