,,ii #aad? ,,congress #b;d ,session ,s4 #bfgg ,,9 ,,! ,,s5ate ,,( ,,! ,,unit$ ,,/ates ,m>* #ae1 #bjaf,ms4 ,baldw9 7= h]self1 ,mr4 ,blum5?al1 ,mr4 ,book]1 ,mrs4 ,box]1 ,mr4 ,br[n1 ,mr4 ,c>d91 ,mr4 ,casey1 ,mr4 ,durb91 ,mr4 ,frank51 ,mrs4 ,gillibr&1 ,ms4 ,hirono1 ,ms4 ,klobu*>1 ,mr4 ,leahy1 ,mr4 ,m>key1 ,mr4 ,m55dez1 ,mr4 ,m]kley1 ,ms4 ,mikulski1 ,mrs4 ,murray1 ,mr4 ,pet]s1 ,mr4 ,re$1 ,mr4 ,reid1 ,mr4 ,s*atz1 ,mr4 ,s*um]1 ,mrs4 ,%ahe51 ,ms4 ,/ab5[1 ,mr4 ,udall1 ,ms4 ,w>r51 ,mr4 ,:iteh\se1 & ,mr4 ,wyd57 introduc$ ! foll[+ bill2 :i* 0 read twice & ref]r$ to ! ,committee on ,f9ance ,a ,,bill ,to make college m af=dable1 r$uce /ud5t debt1 & provide great] access to high] education = all /ud5ts ( ! ,unit$ ,/ates4 #a4 ,%ort title2 table ( cont5ts 7a7 ,%ort title ,?is ,act may be cit$ z ! ,9 ! ,r$ ,act ( #bjaf4 7b7 ,table ( cont5ts ,! table ( cont5ts = ?is ,act is z foll[s3 ,sec4 #a4 ,%ort title2 table ( cont5ts4 ,,title ,i--,am]ica's college promise ,sec4 #aja4 ,/ate & ,indian tribe grants = community college4 ,sec4 #ajb4 ,pa?ways to /ud5t success4 ,,title ,,ii--,/ud5t loan ref9anc+ ,sec4 #bja4 ,ref9anc+ programs4 ,,title ,,iii--,f$]al ,pell ,grant protection ,sec4 #cja4 ,f$]al ,pell ,grant protection4 ,sec4 #cjb4 ,po9t ( ord] aga9/ cutt+ ,f$]al ,pell ,grants4 ,sec4 #cjc4 ,affirm+ t ,f$]al ,pell ,grants are a f\ndational inve/m5t 9 af=dable high] education4 ,,title ,,iv--,acc\ntability ,sec4 #dja4 ,support+ ef=ts to ensure t in/itutions ( high] education are acc\ntable = ensur+ ! high value ( degrees & cr$5tials4 ,,title ,v--,(fsets ,sec4 #eja4 ,am5dm5t ( #aihf ,code4 ,sec4 #ejb4 ,fair %>e tax on high-income taxpay]s4 ,sec4 #ejc4 ,expansion ( d5ial ( d$uction = c]ta9 excessive employee remun]ation4 ,sec4 #ejd4 ,p>tn]%ip int]e/s transf]r$ 9 connection ) p]=mance ( s]vices4 ,sec4 #eje4 ,special rules = p>tn]s provid+ inve/m5t managem5t s]vices to p>tn]%ips4 ,sec4 #ejf4 ,consi/5t treatm5t ( /ock options by corporations4 ,sec4 #ejg4 ,application ( executive pay d$uction limit4 ,sec4 #ejh4 ,modifications to rules relat+ to inv]t$ corporations4 ,sec4 #eji4 ,modifications ( =eign tax cr$it rules applicable to major integrat$ oil companies :i* are dual capacity taxpay]s4 ,sec4 #eaj4 ,limitation on section #aii d$uction attributable to oil1 natural gas1 or prim>y products !re(4 ,sec4 #eaa4 ,limitation on d$uction = intangible drill+ & developm5t co/s2 amortization ( disall[$ am\nts4 ,sec4 #eab4 ,limitation on p]c5tage depletion all[ance = oil & gas wells4 ,sec4 #eac4 ,limitation on d$uction = t]ti>y injectants4 ,sec4 #ead4 ,modification ( def9ition ( major integrat$ oil company4 ,sec4 #eae4 ,repeal ( out] ,cont95tal ,%elf deep wat] & deep gas royalty relief4 ,sec4 #eaf4 ,coord9ation ( ,am]ican ,opportunity ,cr$it & ,lifetime ,le>n+ ,cr$it ) ,pell ,grants n us$ = qualifi$ tuition & relat$ exp5ses4 ,sec4 #eag4 ,expansion ( ,pell ,grant exclusion f gross income4 ,i ,am]ica's college promise #aja4 ,/ate & ,indian tribe grants = community college 7a7 ,9 g5]al ,f am\nts appropriat$ "u subsection 7g77#a7 = any fiscal ye>1 ! ,secret>y %all aw>d grants to eligible ,/ates & ,indian tribes to pay ! ,f$]al %>e ( exp5ditures ne$$ to c>ry out ! activities & s]vices describ$ 9 subsection 7e74 7b7 ,f$]al %>e2 non-,f$]al %>e 7#a7 ,f$]al %>e 7,a7 ,=mula ,subject to subp>agraph 7,b71 ! ,f$]al %>e ( a grant "u ?is section %all be bas$ on a =mula1 det]m9$ by ! ,secret>y1 t-- 7i7 acc\nts = ! ,/ate or ,indian tribe's %>e ( eligible /ud5ts2 & 7ii7 provides1 = ea* eligible /ud5t 9 ! ,/ate or ,indian tribe1 a p]-/ud5t am\nt t is-- 7,i7 n less ?an #cjj p]c5t ( ! p]-/ud5t am\nt ( ! ,/ate or ,indian tribe %>e1 det]m9$ "u p>agraph 7#b71 subject to subclause 7,,ii72 & 7,,ii7 n great] ?an #ge p]c5t (-- 7aa7 = ! #bjaf-bjag aw>d ye>1 ! av]age resid5t community college tuition & fees p] /ud5t 9 all ,/ates = ! mo/ rec5t ye> = :i* data are available2 & 7bb7 = ea* subsequ5t aw>d ye>1 ! av]age resid5t community college tuition & fees p] /ud5t 9 all ,/ates calculat$ "u ?is subclause = ! prec$+ ye>1 increas$ by ! less] (-- 7,,aa7 ! p]c5tage by :i* ! av]age resid5t community college tuition & fees p] /ud5t 9 all ,/ates = ! mo/ rec5t ye> = :i* data are available increas$ z comp>$ to su* av]age = ! prec$+ ye>2 or 7,,bb7 #c p]c5t4 7,b7 ,exception = c]ta9 indian tribes ,9 any case 9 :i* n less ?an #ge p]c5t ( ! /ud5ts at ! community colleges op]at$ or controll$ by an ,indian tribe are l[-income /ud5ts1 ! am\nt ( ! ,f$]al %>e = su* ,indian tribe %all be n less ?an #ie p]c5t ( ! total am\nt ne$$ to waive tuition & fees = all eligible /ud5ts enroll$ 9 su* community colleges4 7#b7 ,/ate or tribal %>e 7,a7 ,=mula 7i7 ,9 g5]al ,! ,/ate or tribal %>e ( a grant "u ?is section = ea* fiscal ye> %all be ! am\nt ne$$ to pay #be p]c5t ( ! av]age community college resid5t tuition & fees p] /ud5t 9 all ,/ates 9 ! #bjaf-bjag aw>d ye> = all eligible /ud5ts 9 ! ,/ate or ,indian tribe1 respectively1 = su* fiscal ye>1 except z provid$ 9 clause 7ii74 7ii7 ,exception = c]ta9 indian tribes ,9 a case 9 :i* n less ?an #e p]c5t ( ! /ud5ts at ! community colleges op]at$ or controll$ by an ,indian tribe are l[-income /ud5ts1 ! am\nt ( su* ,indian tribe's tribal %>e %all n exce$ #e p]c5t ( ! total am\nt ne$$ to waive tuition & fees = all eligible /ud5ts enroll$ 9 su* community colleges4 7,b7 ,ne$-bas$ aid ,a ,/ate or ,indian tribe may include any ne$-bas$ f9ancial aid provid$ ?r\gh ,/ate or tribal funds to eligible /ud5ts z "p ( ! ,/ate or tribal %>e4 7,c7 ,no 9-k9d contributions ,a ,/ate or ,indian tribe %all n include 9-k9d contributions = purposes ( ! ,/ate or tribal %>e describ$ 9 subp>agraph 7,a74 7c7 ,eligibility ,to be eligible = a grant "u ?is section1 a ,/ate or ,indian tribe %all agree to waive community college resid5t tuition & fees = all eligible /ud5ts = ea* ye> ( ! grant4 7d7 ,applications 7#a7 ,submission ,= ea* fiscal ye> = :i* a ,/ate or ,indian tribe desires a grant "u ?is section1 an application %all be submitt$ to ! ,secret>y at su* "t1 9 su* mann]1 & conta9+ su* in=mation z ! ,secret>y may require4 ,su* application %all be submitt$ by-- 7,a7 9 ! case ( a ,/ate1 ! ,gov]nor1 ! ,/ate ag5cy ) jurisdiction ov] high] education1 or ano!r ag5cy designat$ by ! ,gov]nor to adm9i/] ! program "u ?is section2 or 7,b7 9 ! case ( an ,indian tribe1 ! gov]n+ body ( su* tribe4 7#b7 ,cont5ts ,ea* ,/ate or ,indian tribe application %all include1 at a m9imum-- 7,a7 an e/imate ( ! numb] ( eligible /ud5ts 9 ! ,/ate or ,indian tribe & ! co/ ( waiv+ community college resid5t tuition & fees = all eligible /ud5ts = ea* fiscal ye> cov]$ by ! grant1 ) annual increases ( an am\nt t %all n exce$ #c p]c5t ( ! prior ye>'s av]age resid5t community college tuition & fees2 7,b7 an assurance t all community colleges 9 ! ,/ate or "u ! jurisdiction ( ! ,indian tribe1 respectively1 w waive resid5t tuition & fees = eligible /ud5ts 9 programs t are-- 7i7 academic programs ) cr$its t c fully transf] via articulation agreem5t t[>d a baccalaureate degree or po/baccalaureate degree at any public in/itution ( high] education 9 ! ,/ate2 or 7ii7 occupational skills tra9+ programs t lead to a recogniz$ po/second>y cr$5tial t is 9 an 9-dem& indu/ry sector or occupation 9 ! ,/ate2 7,c7 a description ( ! promis+ & evid5ce-bas$ in/itutional re=ms & innovative practices to improve /ud5t outcomes1 includ+ completion or transf] rates1 t h be5 or w be adopt$ by ! p>ticipat+ community colleges1 su* z-- 7i7 provid+ compreh5sive academic & /ud5t support s]vices1 includ+ m5tor+ & advis+1 especially = fir/-g5]ation & m9ority /ud5ts2 7ii7 provid+ accel]at$ le>n+ opportunities1 su* z dual or concurr5t enrollm5t programs2 7iii7 advanc+ compet5cy-bas$ education2 7iv7 /r5g!n+ rem$ial education1 especially = l[-income /ud5ts1 fir/ g5]ation /ud5ts1 adult /ud5ts1 & /ud5ts f o!r und]repres5t$ gr\ps 9 po/second>y education2 7v7 implem5t+ c\rse r$esigns ( high-enrollm5t c\rses to improve /ud5t outcomes & r$uce co/2 or 7vi7 utiliz+ c>e] pa?ways or degree pa?ways2 7,d7 a description ( h[ ! ,/ate or ,indian tribe w promote alignm5t betwe5 its public second>y s*ool & po/second>y education sy/ems1 includ+ betwe5 #b-ye> & #d-ye> public in/itutions ( high] education & ) m9ority-s]v+ in/itutions describ$ 9 section #cga ( ! ,high] ,education ,act ( #aife 7#bj ,u4,s4,c4 #ajfgq71 to exp& aw>5ess ( & access to po/second>y education1 r$uce ! ne$ = rem$iation & repeat$ c\rsework1 & improve /ud5t outcomes2 7,e7 a description ( h[ ! ,/ate or ,indian tribe w ensure t programs lead+ to a recogniz$ po/second>y cr$5tial meet ! quality crit]ia e/abli%$ by ! ,/ate "u section #abc7;a7 ( ! ,work=ce ,innovation & ,opportunity ,act 7#bi ,u4,s4,c4 #caec7;a77 or o!r quality crit]ia det]m9$ appropriate by ! ,/ate or ,indian tribe2 7,f7 an assurance t all p>ticipat+ community colleges 9 ! ,/ate or "u ! au?ority ( ! ,indian tribe h ent]$ into program p>ticipation agreem5ts "u section #dhg ( ! ,high] ,education ,act ( #aife 7#bj ,u4,s4,c4 #ajid72 7,g7 an assurance t1 = ea* ye> ( ! grant1 ! ,/ate or ,indian tribe w notify ea* eligible /ud5t ( ! /ud5t's rema9+ eligibility = assi/ance "u ?is section2 & 7,h7 a description ( h[ ! ,/ate or ,indian tribe w promote ! improv$ p]=mance ( public in/itutions ( high] education ?r\gh fund+ re=m1 includ+ ?r\gh ! use ( a p]=mance-bas$ model t allocates a portion ( ! ,/ate or ,indian tribe's public high] education exp5ditures bas$ on ! p]=mance ( ^? in/itutions on ,/ate-specifi$ metrics1 includ+ successful /ud5t outcomes4 7e7 ,all[able uses ( funds 7#a7 ,9 g5]al ,a ,/ate or ,indian tribe %all use a grant "u ?is section only to provide funds to p>ticipat+ community colleges to waive resid5t tuition & fees = eligible /ud5ts :o are enroll$ 9-- 7,a7 academic programs ) cr$its t c fully transf] via articulation agreem5t t[>d a baccalaureate degree or po/baccalaureate degree at any public in/itution ( high] education 9 ! ,/ate2 or 7,b7 occupational skills tra9+ programs t lead to a recogniz$ po/second>y cr$5tial t is 9 an 9-dem& indu/ry sector or occupation 9 ! ,/ate4 7#b7 ,additional uses ,if a ,/ate or ,indian tribe demon/rates to ! ,secret>y t x has grant funds rema9+ aft] meet+ ! dem& = activities describ$ 9 p>agraph 7#a71 ! ,/ate or ,indian tribe may use ^? funds to c>ry out "o or m ( ! foll[+3 7,a7 ,exp&+ ! waiv] ( resid5t tuition & fees at community college to /ud5ts :o are return+ /ud5ts or o!rwise n enroll+ 9 po/second>y education = ! fir/ "t1 & :o meet ! /ud5t eligibility requirem5ts ( clauses 7ii7 ?r\gh 7v7 ( subsection 7f77#d77;,a74 7,b7 ,exp&+ ! scope & capacity ( high-quality academic & occupational skills tra9+ programs at community colleges4 7,c7 ,improv+ po/second>y education read9ess 9 ! ,/ate or ,indian tribe1 ?r\gh outrea* & e>ly int]v5tion4 7,d7 ,exp&+ access to dual or concurr5t enrollm5t programs4 7,e7 ,improv+ af=dability at #d-ye> public in/itutions ( high] education4 7#c7 ,use ( funds = adm9i/rative purposes ,a ,/ate or ,indian tribe t receives a grant "u ?is section may n use any funds provid$ "u ?is section = adm9i/rative purposes relat+ to su* grant4 7#d7 ,ma9t5ance ( ef=t ,a ,/ate or ,indian tribe receiv+ a grant "u ?is section is entitl$ to receive its full allotm5t ( funds "u ?is section = a fiscal ye> only if1 = ea* ye> ( ! grant1 ! ,/ate or ,indian tribe provides f9ancial support = public high] education at a level equal to or exce$+ ! av]age am\nt provid$ p] full-"t equival5t /ud5t = public in/itutions ( high] education = ! #c consecutive prec$+ ,/ate or ,indian tribe fiscal ye>s4 ,9 mak+ ! calculation "u ?is p>agraph1 ! ,/ate or ,indian tribe %all exclude capital exp5ses & rese>* & developm5t co/s & include ne$-bas$ f9ancial aid = /ud5ts :o att5d public in/itutions ( high] education4 7#e7 ,annual report ,a ,/ate or ,indian tribe receiv+ a grant "u ?is section %all submit an annual report to ! ,secret>y-- 7,a7 describ+ ! uses ( grant funds "u ?is section1 ! progress made 9 fulfill+ ! requirem5ts ( ! grant1 & ! rates ( graduation1 transf]1 & atta9m5t ( a recogniz$ po/second>y cr$5tial = ! /ud5ts at p>ticipat+ community colleges2 & 7,b7 includ+ any o!r in=mation z ! ,secret>y may require4 7#f7 ,report+ by ,secret>y ,! ,secret>y annually %all-- 7,a7 compile & analyze ! in=mation describ$ 9 p>agraph 7#e72 & 7,b7 prep>e & submit a report to ! ,committee on ,heal?1 ,education1 ,labor1 & ,p5sions ( ! ,s5ate & ! ,committee on ,education & ! ,work=ce ( ! ,h\se ( ,repres5tatives conta9+ ! analysis describ$ 9 subp>agraph 7,a7 & an id5tification ( ,/ate & ,indian tribe be/ practices = a*iev+ ! purpose ( ?is section4 7#g7 ,te*nical assi/ance ,! ,secret>y %all provide te*nical assi/ance to eligible ,/ates & ,indian tribes conc]n+ be/ practices reg>d+ ! promis+ & evid5ce-bas$ in/itutional re=ms & innovative practices to improve /ud5t outcomes z describ$ 9 subsection 7d77#b77;,c7 & %all dissem9ate su* be/ practices among ! ,/ates & ,indian tribes4 7#h7 ,cont9uation ( fund+ 7,a7 ,9 g5]al ,a ,/ate or ,indian tribe receiv+ a grant "u ?is section = a fiscal ye> may cont9ue to receive fund+ "u ?is section = future fiscal ye>s condition$ on ! availability ( budget au?ority & on meet+ ! requirem5ts ( ! grant1 z det]m9$ by ! ,secret>y4 7,b7 ,discont9uation ,! ,secret>y may discont9ue fund+ ( ! ,f$]al %>e ( a grant "u ?is section if ! ,/ate or ,indian tribe has violat$ ! t]ms ( ! grant or is n mak+ adequate progress 9 implem5t+ ! re=ms describ$ 9 ! application submitt$ "u subsection 7d74 7f7 ,def9itions ,9 ?is section3 7#a7 ,c>e] pa?way ,! t]m c>e] pa?way has ! mean+ giv5 ! t]m 9 section #c ( ! ,work=ce ,innovation & ,opportunity ,act 7#bi ,u4,s4,c4 #cajb74 7#b7 ,community college ,! t]m community college means a public in/itution ( high] education at :i* ! highe/ degree t is pr$om9antly aw>d$ to /ud5ts is an associate's degree1 includ+ #b-ye> tribally controll$ colleges "u section #caf ( ! ,high] ,education ,act ( #aife 7#bj ,u4,s4,c4 #ajei;c7 & public #b-ye> ,/ate in/itutions ( high] education4 7#c7 ,dual or concurr5t enrollm5t program ,! t]m dual or concurr5t enrollm5t program means an academic program ?r\gh :i* a second>y s*ool /ud5t is able simultane\sly to e>n cr$it t[>d a second>y s*ool diploma & a po/second>y degree or o!r recogniz$ po/second>y cr$5tial1 includ+ an e>ly college high s*ool program4 7#d7 ,eligible /ud5t 7,a7 ,def9ition ,! t]m eligible /ud5t means a /ud5t :o-- 7i7 7,i7 enrolls 9 a community college = ! fir/ "t1 reg>dless ( age1 aft] ! date ( enactm5t ( ?is ,act2 or 7,,ii7 is enroll$ 9 a community college1 = ! fir/ "t1 z ( ! date ( enactm5t ( ?is ,act2 7ii7 att5ds ! community college on n less ?an a half-"t basis2 7iii7 is ma9ta9+ satisfactory progress1 z def9$ 9 section #dhd7;c7 ( ! ,high] ,education ,act ( #aife 7#bj ,u4,s4,c4 #ajia7;c771 9 ! /ud5t's c\rse ( /udy2 7iv7 qualifies = resid5t tuition1 z det]m9$ by ! ,/ate or ,indian tribe2 & 7v7 is enroll$ 9 an eligible program describ$ 9 subsection 7d77#b77;,b74 7,b7 ,special rule ,an o!rwise eligible /ud5t %all lose eligibility #c cal5d> ye>s aft] fir/ receiv+ b5efits "u ?is section4 7#e7 ,9-dem& indu/ry sector or occupation ,! t]m 9-dem& indu/ry sector or occupation has ! mean+ giv5 ! t]m 9 section #c ( ! ,work=ce ,innovation & ,opportunity ,act 7#bi ,u4,s4,c4 #cajb74 7#f7 ,indian tribe ,! t]m ,indian tribe has ! mean+ giv5 ! t]m 9 section #ajb ( ! ,f$]ally ,recogniz$ ,indian ,tribe ,li/ ,act ( #aiid 7#be ,u4,s4,c4 #dgi;a74 7#g7 ,in/itution ( high] education ,! t]m in/itution ( high] education has ! mean+ giv5 ! t]m 9 section #aja ( ! ,high] ,education ,act ( #aife 7#bj ,u4,s4,c4 #ajja74 7#h7 ,recogniz$ po/second>y cr$5tial ,! t]m recogniz$ po/second>y cr$5tial has ! mean+ z describ$ 9 section #c ( ! ,work=ce ,innovation & ,opportunity ,act 7#bi ,u4,s4,c4 #cajb74 7#i7 ,secret>y ,! t]m ,secret>y means ! ,secret>y ( ,education4 7#aj7 ,/ate ,! t]m ,/ate has ! mean+ giv5 ! t]m 9 section #ajc ( ! ,high] ,education ,act ( #aife 7#bj ,u4,s4,c4 #ajjc74 7g7 ,appropriations 7#a7 ,au?orization & appropriations ,= ! purpose ( mak+ grants "u ?is section1 !re are au?oriz$ to be appropriat$1 & !re are appropriat$-- 7,a7 #a1cfe1jjj1jjj = fiscal ye> #bjaf2 7,b7 #c1jbj1jjj1jjj = fiscal ye> #bjag2 7,c7 #c1hed1jjj1jjj = fiscal ye> #bjah2 7,d7 #e1cie1jjj1jjj = fiscal ye> #bjai2 7,e7 #g1jfa1jjj1jjj = fiscal ye> #bjbj2 7,f7 #h1jhe1jjj1jjj = fiscal ye> #bjba2 7,g7 #aj1ahb1jjj1jjj = fiscal ye> #bjbb2 7,h7 #ac1jai1jjj1jjj = fiscal ye> #bjbc2 7,i7 #ac1ehc1jjj1jjj = fiscal ye> #bjbd2 & 7,j7 #ad1aga1jjj1jjj = fiscal ye> #bjbe & ea* succe$+ fiscal ye>4 7#b7 ,availability ,funds appropriat$ "u p>agraph 7#a7 %all rema9 available to ! ,secret>y until exp5d$4 7#c7 ,insuffici5t funds ,if ! am\nt appropriat$ "u p>agraph 7#a7 = a fiscal ye> is n suffici5t to aw>d ea* p>ticipat+ ,/ate & ,indian tribe a grant "u ?is section t is equal to ! m9imum am\nt ( ! ,f$]al %>e describ$ 9 subsection 7b77#a71 ! ,secret>y may ratably r$uce ! am\nt ( ea* su* grant or take o!r actions necess>y to ensure an equitable di/ribution ( su* am\nt4 #ajb4 ,pa?ways to /ud5t success 7a7 ,pa?ways to /ud5t success = hi/orically black colleges & univ]sities 7#a7 ,9 g5]al ,f am\nts appropriat$ "u subsection 7d77#a7 = any fiscal ye>1 ! ,secret>y %all aw>d grants to p>ticipat+ #d-ye> hi/orically black colleges or univ]sities t meet ! requirem5ts ( p>agraph 7#b7 to-- 7,a7 enc\rage /ud5ts to enroll z fir/-"t /ud5ts & successfully complete a ba*elor's degree at p>ticipat+ in/itutions2 7,b7 provide inc5tives to community college /ud5ts to transf] to p>ticipat+ in/itutions ?r\gh /rong transf] pa?ways to complete a ba*elor's degree program2 & 7,c7 support p>ticipat+ in/itutions to bett] s]ve new & exi/+ /ud5ts by engag+ 9 re=ms & innovations design$ to improve completion rates & o!r /ud5t outcomes4 7#b7 ,eligibility ,to be eligible to receive a grant "u ! program "u ?is subsection1 an in/itution %all be a hi/orically black college or univ]sity t-- 7,a7 has a /ud5t body ( :i* n less ?an #ce p]c5t are l[-income /ud5ts2 7,b7 commits to ma9ta9+ or adopt+ & implem5t+ promis+ & evid5ce-bas$ in/itutional re=ms & innovative practices to improve ! completion rates & o!r /ud5t outcomes1 su* z-- 7i7 provid+ compreh5sive academic & /ud5t support s]vices1 includ+ m5tor+ & advis+2 7ii7 provid+ accel]at$ le>n+ opportunities & degree pa?ways1 su* z dual enrollm5t & pa?ways to graduate & pr(essional degree programs2 7iii7 advanc+ di/ance & compet5cy-bas$ education2 7iv7 p>tn]+ ) employ]s1 indu/ry1 n-=-pr(it associations1 & o!r gr\ps to provide opportunities to advance le>n+ outside ! classroom1 includ+ "w-bas$ le>n+ opportunities su* z int]n%ips or appr5tice%ips or programs design$ to improve int]cultural developm5t & p]sonal gr[?1 su* z =eign ex*ange & /udy abroad programs2 7v7 re=m+ rem$ial education1 especially = l[-income /ud5ts1 fir/ g5]ation college /ud5ts1 adult /ud5ts1 & o!r und]repres5t$ /ud5ts2 or 7vi7 implem5t+ c\rse r$esigns ( high-enrollm5t c\rses to improve /ud5t outcomes & r$uce co/2 7,c7 sets p]=mance goals = improv+ /ud5t outcomes = ! duration ( ! grant2 & 7,d7 if receiv+ a grant = transf] /ud5ts1 has articulation agreem5ts ) community colleges at ! national1 ,/ate1 or local level to ensure t community college cr$its c fully transf] to ! p>ticipat+ in/itution4 7#c7 ,grant am\nt 7,a7 ,initial am\nt ,= ! fir/ ye> t an eligible in/itution p>ticipates 9 ! grant program "u ?is subsection & subject to subp>agraph 7,c71 su* eligible in/itution %all receive a grant 9 an am\nt bas$ on ! product (-- 7i7 ! actual co/ ( tuition & fees at ! eligible in/itution 9 su* ye> 7ref]r$ to 9 ?is subsection z ! p]-/ud5t rebate72 multipli$ by 7ii7 ! numb] ( eligible /ud5ts enroll$ 9 ! eligible in/itution = ! prec$+ ye>4 7,b7 ,subsequ5t increases ,= ea* succe$+ ye> aft] ! fir/ ye> ( ! grant program "u ?is subsection1 ea* p>ticipat+ eligible in/itution %all receive a grant 9 ! am\nt det]m9$ "u subp>agraph 7,a7 = su* ye>1 except t 9 no case %all ! am\nt ( ! p]-/ud5t rebate = an eligible in/itution increase by m ?an #c p]c5t z comp>$ to ! am\nt ( su* rebate = ! prec$+ ye>4 7,c7 ,limitations 7i7 ,maximum p]-/ud5t rebate ,no eligible in/itution p>ticipat+ 9 ! grant program "u ?is subsection %all receive a p]-/ud5t rebate am\nt = any ye> t is great] ?an ! national av]age ( annual tuition & fees at public #d-ye> in/itutions ( high] education = su* ye>1 z det]m9$ by ! ,secret>y4 7ii7 ,fir/ ye> tuition & fees ,dur+ ! fir/ ye> ( p>ticipation 9 ! grant program "u ?is subsection1 no eligible in/itution may increase tuition & fees at a rate great] ?an any annual increase at ! eligible in/itution 9 ! previ\s #e ye>s4 7#d7 ,application ,an eligible in/itution t desires a grant "u ?is subsection %all submit an application to ! ,secret>y at su* "t1 9 su* mann]1 & conta9+ su* in=mation z ! ,secret>y may require4 7#e7 ,use ( funds ,funds aw>d$ "u ?is subsection to a p>ticipat+ eligible in/itution %all be-- 7,a7 appli$ 9 _! entirety to /ud5t acc\nts2 & 7,b7 us$ to waive or significantly r$uce tuition & fees = eligible /ud5ts 9 an am\nt ( n m ?an up to ! annual p]-/ud5t rebate am\nt = ea* /ud5t1 = n m ?an ! fir/ #fj cr$its an eligible /ud5t enrolls 9 ! p>ticipat+ eligible in/itution4 7b7 ,pa?ways to /ud5t success = ,hispanic-,s]v+ in/itutions1 ,asian ,am]ican & ,native ,am]ican ,pacific ,isl&]-,s]v+ in/itutions1 ,tribal ,colleges & ,univ]sities1 ,alaska ,native-,s]v+ in/itutions1 ,native ,hawaiian-,s]v+ in/itutions1 ,pr$om9antly ,black ,in/itutions1 & ,native ,am]ican-,s]v+ nontribal in/itutions 7#a7 ,9 g5]al ,f am\nts appropriat$ "u subsection 7d77#a7 = any fiscal ye>1 ! ,secret>y %all aw>d grants to p>ticipat+ #d-ye> m9ority-s]v+ in/itutions to-- 7,a7 enc\rage /ud5ts to enroll z fir/-"t /ud5ts & successfully complete a ba*elor's degree at p>ticipat+ in/itutions2 7,b7 provide inc5tives to community college /ud5ts to transf] to p>ticipat+ in/itutions ?r\gh /rong transf] pa?ways to complete a ba*elor's degree program2 & 7,c7 support p>ticipat+ in/itutions to bett] s]ve new & exi/+ /ud5ts by engag+ 9 re=ms & innovations design$ to improve completion rates & o!r /ud5t outcomes4 7#b7 ,in/itutional eligibility ,to be eligible to p>ticipate & receive a grant "u ?is subsection1 an in/itution %all be a m9ority-s]v+ in/itution t-- 7,a7 has a /ud5t body ( :i* n less ?an #ce p]c5t are l[-income /ud5ts2 7,b7 commits to ma9ta9+ or adopt+ & implem5t+ promis+ & evid5ce-bas$ in/itutional re=ms & innovative practices to improve ! completion rates & o!r /ud5t outcomes1 su* z-- 7i7 provid+ compreh5sive academic & /ud5t support s]vices1 includ+ m5tor+ & advis+2 7ii7 provid+ accel]at$ le>n+ opportunities & degree pa?ways1 su* z dual enrollm5t & pa?ways to graduate & pr(essional degree programs2 7iii7 advanc+ di/ance & compet5cy-bas$ education2 7iv7 p>tn]+ ) employ]s1 indu/ry1 n-=-pr(it associations1 & o!r gr\ps to provide opportunities to advance le>n+ outside ! classroom1 includ+ "w-bas$ le>n+ opportunities su* z int]n%ips or appr5tice%ips or programs design$ to improve int]cultural developm5t & p]sonal gr[?1 su* z =eign ex*ange & /udy abroad programs2 7v7 re=m+ rem$ial education1 especially = l[-income /ud5ts1 fir/ g5]ation college /ud5ts1 adult /ud5ts1 & o!r und]repres5t$ /ud5ts2 & 7vi7 implem5t+ c\rse r$esigns ( high-enrollm5t c\rses to improve /ud5t outcomes & r$uce co/2 7,c7 sets p]=mance goals = improv+ /ud5t outcomes = ! duration ( ! grant2 & 7,d7 if receiv+ a grant = transf] /ud5ts1 has articulation agreem5ts ) community colleges at ! national1 ,/ate1 or local levels to ensure t community college cr$its c fully transf] to ! p>ticipat+ in/itution4 7#c7 ,grant am\nt 7,a7 ,initial am\nt ,= ! fir/ ye> t an eligible in/itution p>ticipates 9 ! grant program "u ?is subsection & subject to subp>agraph 7,c71 su* p>ticipat+ eligible in/itution %all receive a grant 9 an am\nt bas$ on ! product (-- 7i7 ! actual co/ ( tuition & fees at ! eligible in/itution 9 su* ye> 7ref]r$ to 9 ?is subsection z ! p]-/ud5t rebate72 multipli$ by 7ii7 ! numb] ( eligible /ud5ts enroll$ 9 ! eligible in/itution = ! prec$+ ye>4 7,b7 ,subsequ5t increases ,= ea* succe$+ ye> aft] ! fir/ ye> ( ! grant program "u ?is subsection1 ea* p>ticipat+ eligible in/itution %all receive a grant 9 ! am\nt det]m9$ "u subp>agraph 7,a7 = su* ye>1 except t 9 no case %all ! am\nt ( ! p]-/ud5t rebate increase by m ?an #c p]c5t z comp>$ to ! am\nt ( su* rebate = ! prec$+ ye>4 7,c7 ,limitations 7i7 ,maximum p]-/ud5t rebate ,no eligible in/itution p>ticipat+ 9 ! grant program "u ?is subsection %all receive a p]-/ud5t rebate am\nt = a grant ye> great] ?an ! national av]age ( public #d-ye> in/itutional tuition & fees1 z det]m9$ by ! ,secret>y4 7ii7 ,fir/ ye> tuition & fees ,dur+ ! fir/ ye> ( p>ticipation 9 ! grant program "u ?is subsection1 no eligible in/itution may increase tuition & fees at a rate great] ?an any annual increase made by ! in/itution 9 ! previ\s #e ye>s4 7#d7 ,application ,an eligible in/itution %all submit an application to ! ,secret>y at su* "t1 9 su* a mann]1 & conta9+ su* in=mation z det]m9$ by ! ,secret>y4 7#e7 ,use ( funds ,funds aw>d$ "u ?is subsection to a p>ticipat+ eligible in/itution %all be-- 7,a7 appli$ 9 _! entirety to /ud5t acc\nts2 & 7,b7 us$ to waive or significantly r$uce tuition & fees = eligible /ud5ts 9 an am\nt ( n m ?an up to ! annual p]-/ud5t rebate am\nt = ea* /ud5t1 = n m ?an ! fir/ #fj cr$its an eligible /ud5t enrolls 9 ! p>ticipat+ eligible in/itution4 7c7 ,def9itions ,9 ?is section3 7#a7 ,eligible /ud5t 7,a7 ,def9ition ,! t]m eligible /ud5t means a /ud5t1 reg>dless ( age1 :o-- 7i7 7,i7 enrolls 9 a hi/orically black college or univ]sity1 or m9ority-s]v+ in/itution1 = ! fir/ "t2 or 7,,ii7 transf]s f a community college into a hi/orically black college or univ]sity1 or m9ority-s]v+ in/itution1 = ! fir/ "t2 7ii7 att5ds ! hi/orically black college or univ]sity1 or m9ority s]v+ in/itution1 on at lea/ a half-"t basis2 7iii7 ma9ta9s satisfactory academic progress2 & 7iv7 is a l[-income /ud5t4 7,b7 ,special rules 7i7 ,fir/ #c ye>s ,an o!rwise eligible /ud5t %all lose eligibility #c cal5d> ye>s aft] fir/ receiv+ b5efits "u ?is section4 7ii7 ,special rule = c]ta9 /ud5ts ,not)/&+ subp>agraph 7,a77i71 an o!rwise eligible /ud5t ^: p>5t or gu>dian 0 d5i$ a ,,plus loan aft] ,novemb] #bjaa & be=e ,m>* #bi1 #bjae1 & :o subsequ5tly )drew f a hi/orically black college or univ]sity1 or m9ority-s]v+ in/itution1 & has n yet complet$ a program ( /udy at su* hi/orically black college or univ]sity or m9ority-s]v+ in/itution1 %all be eligible to p>ticipate "u subsection 7a7 or 7b7 9 ord] to complete su* program ( /udy1 subject to all o!r requirem5ts ( subsection 7a7 or 7b7 7z ! case may be74 7#b7 ,hi/orically black college or univ]sity ,! t]m hi/orically black college or univ]sity means a "p ,b in/itution describ$ 9 section #cbb7b7 ( ! ,high] ,education ,act ( #aife 7#bj ,u4,s4,c4 #ajfa7b774 7#c7 ,l[-income /ud5t ,! t]m l[-income /ud5t has ! mean+ giv5 su* t]m by ! ,secret>y1 except t su* t]m %all n exclude any /ud5t eligible = a ,f$]al ,pell ,grant "u section #dja ( ! ,high] ,education ,act ( #aife 7#bj ,u4,s4,c4 #ajgj;a74 7#d7 ,m9ority-s]v+ in/itution ,! t]m m9ority-s]v+ in/itution means any public or n-=-pr(it in/itution ( high] education-- 7,a7 describ$ 9 p>agraphs 7#b7 ?r\gh 7#g7 ( section #cga7;a7 ( ! ,high] ,education ,act ( #aife 7#bj ,u4,s4,c4 #ajfgq7a772 & 7,b7 designat$ z a m9ority-s]v+ in/itution by ! ,secret>y4 7d7 ,appropriations 7#a7 ,au?orization & appropriations = ,,hbcu & ,,msi grants ,= ! purpose ( c>ry+ out subsections 7a7 & 7b71 !re are au?oriz$ to be appropriat$1 & !re are appropriat$-- 7,a7 #ee1jjj1jjj = fiscal ye> #bjaf2 7,b7 #ahj1jjj1jjj = fiscal ye> #bjag2 7,c7 #a1jgb1jjj1jjj = fiscal ye> #bjah2 7,d7 #a1aae1jjj1jjj = fiscal ye> #bjai2 7,e7 #a1afj1jjj1jjj = fiscal ye> #bjbj2 7,f7 #a1bjf1jjj1jjj = fiscal ye> #bjba2 7,g7 #a1bbe1jjj1jjj = fiscal ye> #bjbb2 7,h7 #a1cjf1jjj1jjj = fiscal ye> #bjbc2 7,i7 #a1cei1jjj1jjj = fiscal ye> #bjbd2 & 7,j7 #a1dad1jjj1jjj = fiscal ye> #bjbe & ea* succe$+ fiscal ye>4 7#b7 ,availability ,funds appropriat$ "u p>agraph 7#a7 are to rema9 available to ! ,secret>y until exp5d$4 7#c7 ,insuffici5t funds ,if ! am\nt appropriat$ "u p>agraph 7#a7 = a fiscal ye> is n suffici5t to aw>d1 to ea* p>ticipat+ in/itution 9 ! grant programs "u subsections 7a7 & 7b71 a grant "u ?is section equal to #ajj p]c5t ( ! grant am\nt det]m9$ "u subsection 7a77#c7 or 7b77#c7 7z ! case may be71 ! ,secret>y may ratably r$uce ! am\nt ( ea* su* grant or take o!r actions necess>y to ensure an equitable di/ribution ( su* am\nt4 ,,ii ,/ud5t loan ref9anc+ #bja4 ,ref9anc+ programs 7a7 ,program au?ority ,section #dea7;a7 ( ! ,high] ,education ,act ( #aife 7#bj ,u4,s4,c4 #ajhg;a7a77 is am5d$-- 7#a7 by /rik+ & 7#b7 & ins]t+ 7#b72 & 7#b7 by ins]t+ 2 & 7#c7 to make loans "u section #dfj;,a & section #dfj;,b aft] section #dei;,a4 7b7 ,ref9anc+ program ,"p ,d ( title ,,iv ( ! ,high] ,education ,act ( #aife 7#bj ,u4,s4,c4 #ajhg;a et seq47 is am5d$ by add+ at ! end ! foll[+3 #dfj;,a4 ,ref9anc+ ,,ffel & ,f$]al ,direct ,loans 7a7 ,9 g5]al ,beg9n+ n lat] ?an #ahj days aft] ! date ( enactm5t ( ! ,9 ! ,r$ ,act ( #bjaf1 ! ,secret>y %all e/abli% a program "u :i* ! ,secret>y1 ^u ! receipt ( an application f a qualifi$ borr[]1 makes a loan "u ?is "p1 9 accordance ) ! provisions ( ?is section1 9 ord] to p]mit ! borr[] to obta9 ! int]e/ rate provid$ "u subsection 7c74 7b7 ,ref9anc+ ,direct ,loans 7#a7 ,f$]al ,direct ,loans ,^u application ( a qualifi$ borr[]1 ! ,secret>y %all repay a ,f$]al ,direct ,/af=d ,loan1 a ,f$]al ,direct ,unsubsidiz$ ,/af=d ,loan1 a ,f$]al ,direct ,,plus ,loan1 or a ,f$]al ,direct ,consolidation ,loan ( ! qualifi$ borr[]1 = :i* ! fir/ disbursem5t 0 made1 or ! application = ! consolidation loan 0 receiv$1 be=e ,july #a1 #bjaf1 ) ! proce$s ( a ref9anc$ ,f$]al ,direct ,/af=d ,loan1 a ,f$]al ,direct ,unsubsidiz$ ,/af=d ,loan1 a ,f$]al ,direct ,,plus ,loan1 or a ,f$]al ,direct ,consolidation ,loan1 respectively1 issu$ to ! borr[] 9 an am\nt equal to ! sum ( ! unpaid pr9cipal1 accru$ unpaid int]e/1 & late *>ges ( ! orig9al loan4 7#b7 ,ref9anc+ ,,ffel program loans z ref9anc$ ,f$]al ,direct ,loans ,^u application ( a qualifi$ borr[] = any loan t 0 made1 insur$1 or gu>ante$ "u "p ,b & = :i* ! fir/ disbursem5t 0 made1 or ! application = ! consolidation loan 0 receiv$1 be=e ,july #a1 #bjaj1 ! ,secret>y %all make a loan "u ?is "p1 9 an am\nt equal to ! sum ( ! unpaid pr9cipal1 accru$ unpaid int]e/1 & late *>ges ( ! orig9al loan to ! borr[] 9 accordance ) ! foll[+3 7,a7 ,! ,secret>y %all pay ! proce$s ( su* loan to ! eligible l5d] ( ! loan made1 insur$1 or gu>ante$ "u "p ,b1 9 ord] to dis*>ge ! borr[] f any rema9+ obligation to ! l5d] ) respect to ! orig9al loan4 7,b7 ,a loan made "u ?is section t 0 orig9ally-- 7i7 a loan orig9ally made1 insur$1 or gu>ante$ "u section #dbh %all be a ,f$]al ,direct ,/af=d ,loan2 7ii7 a loan orig9ally made1 insur$1 or gu>ante$ "u section #dbh;,b %all be a ,f$]al ,direct ,,plus ,loan2 7iii7 a loan orig9ally made1 insur$1 or gu>ante$ "u section #dbh;,h %all be a ,f$]al ,direct ,unsubsidiz$ ,/af=d ,loan2 & 7iv7 a loan orig9ally made1 insur$1 or gu>ante$ "u section #dbh;,c %all be a ,f$]al ,direct ,consolidation ,loan4 7,c7 ,! int]e/ rate = ea* loan made by ! ,secret>y "u ?is p>agraph %all be ! rate provid$ "u subsection 7c74 7c7 ,int]e/ rates 7#a7 ,9 g5]al ,! int]e/ rate = ! ref9anc$ ,f$]al ,direct ,/af=d ,loans1 ,f$]al ,direct ,unsubsidiz$ ,/af=d ,loans1 ,f$]al ,direct ,,plus ,loans1 & ,f$]al ,direct ,consolidation ,loans1 %all be a rate equal to-- 7,a7 9 any case :]e ! orig9al loan 0 a loan "u section #dbh or #dbh;,h1 a ,f$]al ,direct ,/af=d loan1 or a ,f$]al ,direct ,unsubsidiz$ ,/af=d ,loan1 t 0 issu$ to an und]graduate /ud5t1 a rate equal to ! rate = ,f$]al ,direct ,/af=d ,loans & ,f$]al ,direct ,unsubsidiz$ ,/af=d ,loans issu$ to und]graduate /ud5ts = ! #ab-mon? p]iod beg9n+ on ,july #a1 #bjac1 & end+ on ,june #cj1 #bjad2 7,b7 9 any case :]e ! orig9al loan 0 a loan "u section #dbh or #dbh;,h1 a ,f$]al ,direct ,/af=d ,loan1 or a ,f$]al ,direct ,unsubsidiz$ ,/af=d ,loan1 t 0 issu$ to a graduate or pr(essional /ud5t1 a rate equal to ! rate = ,f$]al ,direct ,unsubsidiz$ ,/af=d ,loans issu$ to graduate or pr(essional /ud5ts = ! #ab-mon? p]iod beg9n+ on ,july #a1 #bjac1 & end+ on ,june #cj1 #bjad2 7,c7 9 any case :]e ! orig9al loan 0 a loan "u section #dbh;,b or a ,f$]al ,direct ,,plus ,loan1 a rate equal to ! rate = ,f$]al ,direct ,,plus ,loans = ! #ab-mon? p]iod beg9n+ on ,july #a1 #bjac1 & end+ on ,june #cj1 #bjad2 & 7,d7 9 any case :]e ! orig9al loan 0 a loan "u section #dbh;,c or a ,f$]al ,direct ,consolidation ,loan1 a rate calculat$ 9 accordance ) p>agraph 7#b74 7#b7 ,int]e/ ,rates = ,consolidation ,loans 7,a7 ,me?od ( calculation ,9 ord] to det]m9e ! int]e/ rate = any ref9anc$ ,f$]al ,direct ,consolidation ,loan "u p>agraph 7#a77;,d71 ! ,secret>y %all-- 7i7 det]m9e ea* ( ! compon5t loans t 7 orig9ally consolidat$ 9 ! loan "u section #dbh;,c or ! ,f$]al ,direct ,consolidation ,loan1 & calculate ! proportion ( ! unpaid pr9cipal balance ( ! loan "u section #dbh;,c or ! ,f$]al ,direct ,consolidation ,loan t ea* compon5t loan repres5ts2 7ii7 use ! proportions det]m9$ 9 accordance ) clause 7i7 & ! int]e/ rate applicable = ea* compon5t loan1 z det]m9$ "u subp>agraph 7,b71 to calculate ! weight$ av]age ( ! int]e/ rates on ! loans consolidat$ into ! loan "u section #dbh;,c or ! ,f$]al ,direct ,consolidation ,loan2 & 7iii7 apply ! weight$ av]age calculat$ "u clause 7ii7 z ! int]e/ rate = ! ref9anc$ ,f$]al ,direct ,consolidation ,loan4 7,b7 ,int]e/ rates = compon5t loans ,! int]e/ rates = ! compon5t loans ( a loan made "u section #dbh;,c or a ,f$]al ,direct ,consolidation ,loan %all be ! foll[+3 7i7 ,! int]e/ rate = any loan "u section #dbh or #dbh;,h1 ,f$]al ,direct ,/af=d ,loan1 or ,f$]al ,direct ,unsubsidiz$ ,/af=d ,loan issu$ to an und]graduate /ud5t %all be a rate equal to ! less] (-- 7,i7 ! rate = ,f$]al ,direct ,/af=d ,loans & ,f$]al ,direct ,unsubsidiz$ ,/af=d ,loans issu$ to und]graduate /ud5ts = ! #ab-mon? p]iod beg9n+ on ,july #a1 #bjac1 & end+ on ,june #cj1 #bjad2 or 7,,ii7 ! orig9al int]e/ rate ( ! compon5t loan4 7ii7 ,! int]e/ rate = any loan "u section #dbh or #dbh;,h1 ,f$]al ,direct ,/af=d ,loan1 or ,f$]al ,direct ,unsubsidiz$ ,/af=d ,loan issu$ to a graduate or pr(essional /ud5t %all be a rate equal to ! less] (-- 7,i7 ! rate = ,f$]al ,direct ,unsubsidiz$ ,/af=d ,loans issu$ to graduate or pr(essional /ud5ts = ! #ab-mon? p]iod beg9n+ on ,july #a1 #bjac1 & end+ on ,june #cj1 #bjad2 or 7,,ii7 ! orig9al int]e/ rate ( ! compon5t loan4 7iii7 ,! int]e/ rate = any loan "u section #dbh;,b or ,f$]al ,direct ,,plus ,loan %all be a rate equal to ! less] (-- 7,i7 ! rate = ,f$]al ,direct ,,plus ,loans = ! #ab-mon? p]iod beg9n+ on ,july #a1 #bjac1 & end+ on ,june #cj1 #bjad2 or 7,,ii7 ! orig9al int]e/ rate ( ! compon5t loan4 7iv7 ,! int]e/ rate = any compon5t loan t is a loan "u section #dbh;,c or a ,f$]al ,direct ,consolidation ,loan %all be ! weight$ av]age ( ! int]e/ rates t w\ld apply "u ?is subp>agraph = ea* loan compris+ ! compon5t consolidation loan4 7v7 ,! int]e/ rate = any eligible loan t is a compon5t ( a loan made "u section #dbh;,c or a ,f$]al ,direct ,consolidation ,loan & is n describ$ 9 clauses 7i7 ?r\gh 7iv7 %all be ! int]e/ rate on ! orig9al compon5t loan4 7#c7 ,fix$ ,rate ,! applicable rate ( int]e/ det]m9$ "u p>agraph 7#a7 = a ref9anc$ loan "u ?is section %all be fix$ = ! p]iod ( ! loan4 7d7 ,t]ms & conditions ( loans 7#a7 ,9 g5]al ,a loan t is ref9anc$ "u ?is section %all h ! same t]ms & conditions z ! orig9al loan1 except z o!rwise provid$ 9 ?is section4 7#b7 ,no automatic ext5sion ( repaym5t p]iod ,ref9anc+ a loan "u ?is section %all n result 9 ! ext5sion ( ! duration ( ! repaym5t p]iod ( ! loan1 & ! borr[] %all reta9 ! same repaym5t t]m t 0 9 effect on ! orig9al loan4 ,no?+ 9 ?is p>agraph %all be con/ru$ to prev5t a borr[] f elect+ a diff]5t repaym5t plan at any "t 9 accordance ) section #dee7;d77#c74 7e7 ,def9ition ( qualifi$ borr[] 7#a7 ,9 ,g5]al ,= purposes ( ?is section1 ! t]m qualifi$ borr[] means a borr[]-- 7,a7 ( a loan "u ?is "p or "p ,b = :i* ! fir/ disbursem5t 0 made1 or ! application = a consolidation loan 0 receiv$1 be=e ,july #a1 #bjaf2 & 7,b7 :o meets ! eligibility requirem5ts bas$ on income or debt-to-income ratio e/abli%$ by ! ,secret>y4 7#b7 ,income requirem5ts ,n lat] ?an #ahj days aft] ! date ( enactm5t ( ! ,9 ! ,r$ ,act ( #bjaf1 ! ,secret>y %all e/abli% eligibility requirem5ts bas$ on income or debt-to-income ratio t take into consid]ation provid+ access to ref9anc+ "u ?is section = borr[]s ) ! greate/ f9ancial ne$4 7f7 ,notification to borr[]s ,! ,secret>y1 9 coord9ation ) ! ,director ( ! ,bureau ( ,consum] ,f9ancial ,protection1 %all und]take a campaign to al]t borr[]s ( loans t are eligible = ref9anc+ "u ?is section t ! borr[]s are eligible to apply = su* ref9anc+4 ,! campaign %all include ! foll[+ activities3 7#a7 ,develop+ consum] in=mation mat]ials ab\t ! availability ( ,f$]al /ud5t loan ref9anc+4 7#b7 ,requir+ s]vic]s ( loans "u ?is "p or "p ,b to provide su* consum] in=mation to borr[]s 9 a mann] det]m9$ appropriate by ! ,secret>y1 9 consultation ) ! ,director ( ! ,bureau ( ,consum] ,f9ancial ,protection4 #dfj;,b4 ,f$]al ,direct ,ref9anc$ ,private ,loan program 7a7 ,def9itions ,9 ?is section3 7#a7 ,eligible private education loan ,! t]m eligible private education loan means a private education loan1 z def9$ 9 section #adj7;a7 ( ! ,tru? 9 ,l5d+ ,act 7#ae ,u4,s4,c4 #afej7;a771 t-- 7,a7 0 disburs$ to ! borr[] be=e ,july #a1 #bjaf2 & 7,b7 0 = ! borr[]'s own po/second>y educational exp5ses = an eligible program at an in/itution ( high] education p>ticipat+ 9 ! loan program "u ?is "p1 z ( ! date t ! loan 0 disburs$4 7#b7 ,f$]al ,direct ,ref9anc$ ,private ,loan ,! t]m ,f$]al ,direct ,ref9anc$ ,private ,loan means a loan issu$ "u subsection 7b77#a74 7#c7 ,private educational l5d] ,! t]m private educational l5d] has ! mean+ giv5 ! t]m 9 section #adj7;a7 ( ! ,tru? 9 ,l5d+ ,act 7#ae ,u4,s4,c4 #afej7;a774 7#d7 ,qualifi$ borr[] ,! t]m qualifi$ borr[] means an individual :o-- 7,a7 has an eligible private education loan2 7,b7 has be5 curr5t on paym5ts on ! eligible private education loan = ! #f mon?s prior to ! date ( ! qualifi$ borr[]'s application = ref9anc+ "u ?is section1 & is 9 good /&+ on ! loan at ! "t ( su* application2 7,c7 is n 9 default on ! eligible private education loan or on any loan made1 insur$1 or gu>ante$ "u ?is "p or "p ,b or ,e2 & 7,d7 meets ! eligibility requirem5ts describ$ 9 subsection 7b77#b74 7b7 ,program au?oriz$ 7#a7 ,9 g5]al ,! ,secret>y1 9 consultation ) ! ,secret>y ( ! ,treasury1 %all c>ry out a program "u :i* ! ,secret>y1 ^u application by a qualifi$ borr[] :o has an eligible private education loan1 %all issue su* borr[] a loan "u ?is "p 9 accordance ) ! foll[+3 7,a7 ,! loan issu$ "u ?is program %all be 9 an am\nt equal to ! sum ( ! unpaid pr9cipal1 accru$ unpaid int]e/1 & late *>ges ( ! private education loan4 7,b7 ,! ,secret>y %all pay ! proce$s ( ! loan issu$ "u ?is program to ! private educational l5d] ( ! private education loan1 9 ord] to dis*>ge ! qualifi$ borr[] f any rema9+ obligation to ! l5d] ) respect to ! orig9al loan4 7,c7 ,! ,secret>y %all require t ! qualifi$ borr[] und]go loan c\nsel+ t provides all ( ! in=mation & c\nsel+ requir$ "u clauses 7i7 ?r\gh 7viii7 ( section #dhe7;b77#a77;,a7 be=e ! loan is ref9anc$ 9 accordance ) ?is section1 & be=e ! proce$s ( su* loan are paid to ! private educational l5d]4 7,d7 ,! ,secret>y %all issue ! loan z a ,f$]al ,direct ,ref9anc$ ,private ,loan1 :i* %all h ! same t]ms1 conditions1 & b5efits z a ,f$]al ,direct ,unsubsidiz$ ,/af=d ,loan1 except z o!rwise provid$ 9 ?is section4 7#b7 ,borr[] eligibility ,n lat] ?an #ahj days aft] ! date ( enactm5t ( ! ,9 ! ,r$ ,act ( #bjaf1 ! ,secret>y1 9 consultation ) ! ,secret>y ( ! ,treasury & ! ,director ( ! ,bureau ( ,consum] ,f9ancial ,protection1 %all e/abli% eligibility requirem5ts-- 7,a7 bas$ on income or debt-to-income ratio t take into consid]ation provid+ access to ref9anc+ "u ?is section = borr[]s ) ! greate/ f9ancial ne$2 7,b7 to ensure eligibility only = borr[]s 9 good /&+2 7,c7 to m9imize inequities betwe5 ,f$]al ,direct ,ref9anc$ ,private ,loans & o!r ,f$]al /ud5t loans2 7,d7 to preclude w9dfall pr(its = private educational l5d]s2 & 7,e7 to ensure full access to ! program au?oriz$ 9 ?is subsection = borr[]s ) private loans :o o!rwise meet ! crit]ia e/abli%$ 9 accordance ) subp>agraphs 7,a7 & 7,b74 7c7 ,int]e/ rate 7#a7 ,9 g5]al ,! int]e/ rate = a ,f$]al ,direct ,ref9anc$ ,private ,loan is-- 7,a7 9 ! case ( a ,f$]al ,direct ,ref9anc$ ,private ,loan = a private education loan orig9ally issu$ = und]graduate po/second>y educational exp5ses1 a rate equal to ! rate = ,f$]al ,direct ,/af=d ,loans & ,f$]al ,direct ,unsubsidiz$ ,/af=d ,loans issu$ to und]graduate /ud5ts = ! #ab-mon? p]iod beg9n+ on ,july #a1 #bjac1 & end+ on ,june #cj1 #bjad2 & 7,b7 9 ! case ( a ,f$]al ,direct ,ref9anc$ ,private ,loan = a private education loan orig9ally issu$ = graduate or pr(essional degree po/second>y educational exp5ses1 a rate equal to ! rate = ,f$]al ,direct ,unsubsidiz$ ,/af=d ,loans issu$ to graduate or pr(essional /ud5ts = ! #ab-mon? p]iod beg9n+ on ,july #a1 #bjac1 & end+ on ,june #cj1 #bjad4 7#b7 ,comb9$ und]graduate & graduate /udy loans ,if a ,f$]al ,direct ,ref9anc$ ,private ,loan is = a private education loan orig9ally issu$ = bo? und]graduate & graduate or pr(essional po/second>y educational exp5ses1 ! int]e/ rate %all be a rate equal to ! rate = ,f$]al ,direct ,,plus ,loans = ! #ab-mon? p]iod beg9n+ on ,july #a1 #bjac1 & end+ on ,june #cj1 #bjad4 7#c7 ,fix$ ,rate ,! applicable rate ( int]e/ det]m9$ "u ?is subsection = a ,f$]al ,direct ,ref9anc$ ,private ,loan %all be fix$ = ! p]iod ( ! loan4 7d7 ,no inclusion 9 aggregate limits ,! am\nt ( a ,f$]al ,direct ,ref9anc$ ,private ,loan1 or a ,f$]al ,direct ,consolidat$ ,loan to ! ext5t su* loan 0 us$ to repay a ,f$]al ,direct ,ref9anc$ ,private ,loan1 %all n be includ$ 9 calculat+ a borr[]'s annual or aggregate loan limits "u section #dbh or #dbh;,h4 7e7 ,no eligibility = s]vice-,relat$ repaym5t ,not)/&+ sections #dbh,k7a77#b77;,a71 #dbh,l7b77#b71 #dee7m77#c77;,a71 & #dfj7;b71 a ,f$]al ,direct ,ref9anc$ ,private ,loan1 or any ,f$]al ,direct ,consolidation ,loan to ! ext5t su* loan 0 us$ to repay a ,f$]al ,direct ,ref9anc$ ,private ,loan1 %all n be eligible = any loan repaym5t or loan =giv5ess program "u section #dbh,k1 #dbh,l1 or #dfj or = ! repaym5t plan = public s]vice employees "u section #dee7m74 7f7 ,private educational l5d] report+ requirem5t 7#a7 ,report+ requir$ ,n lat] ?an #ahj days aft] ! date ( enactm5t ( ! ,9 ! ,r$ ,act ( #bjaf1 ! ,secret>y1 9 consultation ) ! ,secret>y ( ! ,treasury & ! ,director ( ! ,bureau ( ,consum] ,f9ancial ,protection1 %all e/abli% a requirem5t t private educational l5d]s report ! data describ$ 9 p>agraph 7#b7 to ! ,secret>y1 to ,congress1 to ! ,secret>y ( ! ,treasury1 & to ! ,director ( ! ,bureau ( ,consum] ,f9ancial ,protection1 9 ord] to all[ = an assessm5t ( ! private education loan m>ket4 7#b7 ,cont5ts ( report+ ,! data t private educational l5d]s %all report 9 accordance ) p>agraph 7#a7 %all include ea* ( ! foll[+ ab\t private education loans 7z def9$ 9 section #adj7;a7 ( ! ,tru? 9 ,l5d+ ,act 7#ae ,u4,s4,c4 #afej7;a7773 7,a7 ,! total am\nt ( private education loan debt ! l5d] holds4 7,b7 ,! total numb] ( private education loan borr[]s ! l5d] s]ves4 7,c7 ,! av]age int]e/ rate on ! out/&+ private education loan debt held by ! l5d]4 7,d7 ,! proportion ( private education loan borr[]s :o are 9 default on a loan held by ! l5d]4 7,e7 ,! proportion ( ! out/&+ private education loan volume held by ! l5d] t is 9 default4 7,f7 ,! proportions ( out/&+ private education loan borr[]s :o are #cj1 #fj1 & #ij days del9qu5t4 7,g7 ,! proportions ( out/&+ private education loan volume t is #cj1 #fj1 & #ij days del9qu5t4 7g7 ,notification to borr[]s ,! ,secret>y1 9 coord9ation ) ! ,secret>y ( ! ,treasury & ! ,director ( ! ,bureau ( ,consum] ,f9ancial ,protection1 %all und]take a campaign to al]t borr[]s ab\t ! availability ( private /ud5t loan ref9anc+ "u ?is section4 4 7c7 ,am5dm5ts to public s]vice repaym5t plan provisions ,section #dee7m7 ( ! ,high] ,education ,act ( #aife 7#bj ,u4,s4,c4 #ajhg;e7m77 is am5d$-- 7#a7 by r$esignat+ p>agraphs 7#c7 & 7#d7 z p>agraphs 7#d7 & 7#e71 respectively2 7#b7 by ins]t+ aft] p>agraph 7#b7 ! foll[+3 7#c7 ,special rules = section #dfj;,a loans 7,a7 ,ref9anc$ ,f$]al ,direct loans ,not)/&+ p>agraph 7#a71 9 det]m9+ ! numb] ( mon?ly paym5ts t meet ! requirem5ts ( su* p>agraph = an eligible ,f$]al ,direct ,loan ref9anc$ "u section #dfj;,a t 0 orig9ally a loan "u ?is "p1 ! ,secret>y %all include all mon?ly paym5ts made on ! orig9al loan t meet ! requirem5ts ( su* p>agraph4 7,b7 ,ref9anc$ ,,ffel loans ,9 ! case ( an eligible ,f$]al ,direct ,loan ref9anc$ "u section #dfj;,a t 0 orig9ally a loan "u "p ,b1 only mon?ly paym5ts made aft] ! date on :i* ! loan 0 ref9anc$ may be includ$ = purposes ( p>agraph 7#a74 2 & 7#c7 9 p>agraph 7#d77;,a7 7z r$esignat$ by p>agraph 7#a771 by ins]t+ 7includ+ any ,f$]al ,direct ,/af=d ,loan1 ,f$]al ,direct ,,plus ,loan1 ,f$]al ,direct ,unsubsidiz$ ,/af=d ,loan1 or ,f$]al ,direct ,consolidation ,loan ref9anc$ "u section #dfj;,a7 be=e ! p]iod at ! end4 7d7 ,income-,bas$ repaym5t ,section #dic;,c ( ! ,high] ,education ,act ( #aife 7#bj ,u4,s4,c4 #ajih;e7 is am5d$ by add+ at ! end ! foll[+3 7f7 ,special rule = ref9anc$ loans 7#a7 ,ref9anc$ ,f$]al ,direct & ,,ffel loans ,9 calculat+ ! p]iod ( "t dur+ :i* a borr[] ( a loan t is ref9anc$ "u section #dfj;,a has made mon?ly paym5ts = purposes ( subsection 7b77#g71 ! ,secret>y %all deem ! p]iod to include all mon?ly paym5ts made = ! orig9al loan1 & all mon?ly paym5ts made = ! ref9anc$ loan1 t o!rwise meet ! requirem5ts ( ?is section4 7#b7 ,f$]al ,direct ,ref9anc$ ,private ,loans ,9 calculat+ ! p]iod ( "t dur+ :i* a borr[] ( a ,f$]al ,direct ,ref9anc$ ,private ,loan "u section #dfj;,b has made mon?ly paym5ts = purposes ( subsection 7b77#g71 ! ,secret>y %all include only paym5ts-- 7,a7 t are made aft] ! date ( ! issuance ( ! ,f$]al ,direct ,ref9anc$ ,private ,loan2 & 7,b7 t o!rwise meet ! requirem5ts ( ?is section4 4 ,,iii ,f$]al ,pell ,grant protection #cja4 ,f$]al ,pell ,grant protection ,section #dja7;b77#g7 ( ! ,high] ,education ,act ( #aife 7#bj ,u4,s4,c4 #ajgj;a7b77#g77 is am5d$-- 7#a7 9 subp>agraph 7,a77iii71 by /rik+ clauses 7ii7 & 7iii7 ( subp>agraph 7,b7 & ins]t+ subp>agraph 7,b77ii72 & 7#b7 9 subp>agraph 7,c7-- 7,a7 9 clause 7ii7-- 7i7 9 ! clause head+1 by /rik+ ,aw>d ye>s #bjad-bjae ?r\gh #bjag-bjah & ins]t+ ,aw>d ye> #bjad-bjae & subsequ5t aw>d ye>s2 7ii7 9 ! matt] prec$+ subclause 7,i71 by /rik+ ea* ( ! aw>d ye>s #bjad-bjae ?r\gh #bjag-bjah & ins]t+ aw>d ye> #bjad-bjae & ea* subsequ5t aw>d ye>2 & 7iii7 9 subclause 7,i71 by /rik+ clause 7iv77,,ii7 & ins]t+ clause 7iii77,,ii72 7,b7 by /rik+ clause 7iii72 & 7,c7 by r$esignat+ clause 7iv7 z clause 7iii74 #cjb4 ,po9t ( ord] aga9/ cutt+ ,f$]al ,pell ,grants 7a7 ,po9t ( ,ord] ,x %all n be 9 ord] 9 ! ,s5ate to consid] any bill1 jo9t resolution1 motion1 am5dm5t1 am5dm5t betwe5 ! ,h\ses1 or conf]5ce report t w\ld decrease ! appropriations provid$ = ,f$]al ,pell ,grants "u section #dja7;b77#g7 ( ! ,high] ,education ,act ( #aife 7#bj ,u4,s4,c4 #ajgj;a7b77#g77 or re/rict eligibility = ,f$]al ,pell ,grants4 7b7 ,waiv] & appeal ,subsection 7a7 may be waiv$ or susp5d$ 9 ! ,s5ate only by an affirmative vote ( ?ree-fif?s ( ! ,memb]s1 duly *os5 & sworn4 ,an affirmative vote ( ?ree-fif?s ( ! ,memb]s ( ! ,s5ate1 duly *os5 & sworn1 %all be requir$ to su/a9 an appeal ( ! rul+ ( ! ,*air on a po9t ( ord] rais$ "u subsection 7a74 #cjc4 ,affirm+ t ,f$]al ,pell ,grants are a f\ndational inve/m5t 9 af=dable high] education 7a7 ,f9d+s ,congress f9ds ! foll[+3 7#a7 ,rese>* %[s t ) high] educational atta9m5t1 individuals are m likely to be employ$1 e>n high] wages1 secure heal? & retirem5t b5efits1 make heal?i] life *oices1 & be m engag$ citiz5s ( _! communities4 7#b7 ,high] education1 :e!r at a #b- or #d-ye> in/itution1 c help p ( ! ,unit$ ,/ates f l[] income backgr\nds climb into ! middle class4 7#c7 ,9 #bjae1 m ?an #bj1jjj1jjj /ud5ts enroll$ 9 colleges & univ]sities 9 ! ,unit$ ,/ates--an increase ( #d1ijj1jjj s9ce #bjjj4 7#d7 ,despite ! b5efits ( fur!r education beyond high s*ool1 _m /ud5ts f l[-income backgr\nds d n att5d college4 ,accord+ to ! ,unit$ ,/ates ,c5sus ,bureau1 approximately #hj p]c5t ( high s*ool graduates f ! weal?ie/ families pursue high] education1 :ile only a little m ?an half f ! l[e/ income qu>tile att5d college4 7#e7 ,f$]al ,pell ,grants provide ne$-bas$ aid to /ud5ts :o want to fur!r _! education & are ! s+le l>ge/ s\rce ( grant aid = help+ /ud5ts af=d college4 7#f7 ,9 aw>d ye> #bjac-bjad1 an e/imat$ #gc p]c5t ( all ,pell ,grant recipi5ts _h a total family income equal to or less ?an #cj1jjj4 7#g7 ,9 #bjae1 m ?an #h1bjj1jjj /ud5ts1 or approximately #da p]c5t ( all und]graduates1 us$ ,f$]al ,pell ,grants to f9ance _! education4 7b7 ,s5se ( ! ,s5ate ,x is ! s5se ( ! ,s5ate t ,congress %\ld-- 7#a7 affirm t ,f$]al ,pell ,grants are a f\ndational inve/m5t 9 af=dable high] education = /ud5ts & families2 & 7#b7 commit to ensur+ t ,f$]al ,pell ,grants rema9 a /able s\rce ( f9ancial support = /ud5ts & families4 ,,iv ,acc\ntability #dja4 ,support+ ef=ts to ensure t in/itutions ( high] education are acc\ntable = ensur+ ! high value ( degrees & cr$5tials 7a7 ,f9d+s ,congress f9ds ! foll[+3 7#a7 ,! employm5t rate = p ( ! ,unit$ ,/ates betwe5 ! ages ( #ba to #be has decl9$ by #ab p]c5t f #bjjj ?r\gh #bjab4 7#b7 ,! co/ ( att5d+ a #d-ye> public in/itution ( high] education has increas$ by #cb p]c5t f #bjjb ?r\gh #bjab4 7#c7 ,m ?an #a 9 #d /ud5t loan borr[]s are n[ 9 default or del9qu5t on a /ud5t loan4 7#d7 ,!re are limit$ means ?r\gh :i* to ensure t in/itutions ( high] education are held acc\ntable = ! value ( ! degrees & cr$5tials obta9$ by /ud5ts1 or ! outcomes ( ^? /ud5ts4 7#e7 ,/ud5t borr[]s :o obta9 a high-value degree or cr$5tial are mu* m likely to be able to f9d a good pay+ job & repay _! /ud5t loan debt4 7b7 ,s5se ( ! ,s5ate ,x is ! s5se ( ! ,s5ate t ,congress %\ld support ef=ts to ensure t in/itutions ( high] education h /rong inc5tives to ensure t /ud5ts graduate ) degrees & cr$5tials t h a high value1 & t w enable graduates to secure good-pay+ employm5t 9 _! field ( /udy & enjoy long-t]m success1 by-- 7#a7 enhanc+ acc\ntability = in/itutions ( high] education = ! quality & co/ ( degree programs1 includ+ /ud5t debt burd52 7#b7 hold+ in/itutions ( high] education & _! lead]s f9ancially acc\ntable :5 ! in/itutions or lead]s engage 9 fraud or misconduct t violates ,f$]al & ,/ate laws2 7#c7 creat+ inc5tives & tools t w all[ ,/ate gov]nm5ts & in/itutions ( high] education to curb tuition inflation & ma9ta9 inve/m5t 9 high] education2 7#d7 creat+ inc5tives = in/itutions ( high] education to direct m res\rces to _! academic programs & to provide pa?ways to ensure t all /ud5ts c complete _! degrees & cr$5tials 9 a timely mann]2 & 7#e7 gu>antee+ t ! s]vic+ ( /ud5t loans made1 insur$1 or gu>ante$ "u "p ,b or ,d ( title ,,iv ( ! ,high] ,education ,act ( #aife 7#bj ,u4,s4,c4 #ajga et seq41 #ajhg;a et seq47 provid$ ?r\gh ^! in/itutions ( high] education w meet ! highe/ /&>ds ( quality1 cu/om] s]vice1 & compliance ) ! law to promote borr[] success & m9imize defaults4 ,v ,(fsets #eja4 ,am5dm5t ( #aihf ,code ,except z o!rwise expressly provid$1 :5ev] 9 ?is title an am5dm5t or repeal is express$ 9 t]ms ( an am5dm5t to1 or repeal (1 a section or o!r provision1 ! ref]5ce %all be consid]$ to be made to a section or o!r provision ( ! ,int]nal ,rev5ue ,code ( #aihf4 #ejb4 ,fair %>e tax on high-income taxpay]s 7a7 ,9 g5]al ,sub*apt] ,a ( *apt] #a is am5d$ by add+ at ! end ! foll[+ new "p3 ,,vii ,fair %>e tax on high-income taxpay]s ,sec4 #ei;,a4 ,fair %>e tax4 #ei;,a4 ,fair %>e tax 7a7 ,g5]al rule 7#a7 ,phase-9 ( tax ,9 ! case ( any high-income taxpay]1 !re is h]eby impos$ = a taxable ye> 79 addition to any o!r tax impos$ by ?is subtitle7 a tax equal to ! product (-- 7,a7 ! am\nt det]m9$ "u p>agraph 7#b71 & 7,b7 a fraction 7n to exce$ #a7-- 7i7 ! num]ator ( :i* is ! excess (-- 7,i7 ! taxpay]'s adju/$ gross income1 ov] 7,,ii7 ! doll> am\nt 9 effect "u subsection 7c77#a71 & 7ii7 ! d5om9ator ( :i* is ! doll> am\nt 9 effect "u subsection 7c77#a74 7#b7 ,am\nt ( tax ,! am\nt ( tax det]m9$ "u ?is p>agraph is an am\nt equal to ! excess 7if any7 (-- 7,a7 ! t5tative fair %>e tax = ! taxable ye>1 ov] 7,b7 ! excess (-- 7i7 ! sum (-- 7,i7 ! regul> tax liability 7z def9$ 9 section #bf7;b77 = ! taxable ye>1 det]m9$ )\t reg>d to any tax liability det]m9$ "u ?is section1 7,,ii7 ! tax impos$ by section #ee = ! taxable ye>1 plus 7,,iii7 ! payroll tax = ! taxable ye>1 ov] 7ii7 ! cr$its all[able "u "p ,,iv ( sub*apt] ,a 7o!r ?an sections #bg7;a71 #ca1 & #cd74 7b7 ,t5tative fair %>e tax ,= purposes ( ?is section-- 7#a7 ,9 g5]al ,! t5tative fair %>e tax = ! taxable ye> is #cj p]c5t ( ! excess (-- 7,a7 ! adju/$ gross income ( ! taxpay]1 ov] 7,b7 ! modifi$ *>itable contribution d$uction = ! taxable ye>4 7#b7 ,modifi$ *>itable contribution d$uction ,= purposes ( p>agraph 7#a7-- 7,a7 ,9 g5]al ,! modifi$ *>itable contribution d$uction = any taxable ye> is an am\nt equal to ! am\nt :i* be>s ! same ratio to ! d$uction all[able "u section #agj 7section #fdb7;c7 9 ! case ( a tru/ or e/ate7 = su* taxable ye> z-- 7i7 ! am\nt ( itemiz$ d$uctions all[able "u ! regul> tax 7z def9$ 9 section #ee7 = su* taxable ye>1 det]m9$ aft] ! application ( section #fh1 be>s to 7ii7 su* am\nt1 det]m9$ be=e ! application ( section #fh4 7,b7 ,taxpay] mu/ itemize ,9 ! case ( any individual :o does n elect to itemize d$uctions = ! taxable ye>1 ! modifi$ *>itable contribution d$uction %all be z]o4 7c7 ,high-,income taxpay] ,= purposes ( ?is section-- 7#a7 ,9 g5]al ,! t]m high-income taxpay] means1 ) respect to any taxable ye>1 any taxpay] 7o!r ?an a corporation7 ) an adju/$ gross income = su* taxable ye> 9 excess ( #a1jjj1jjj 7#ej p]c5t ( su* am\nt 9 ! case ( a m>ri$ individual :o files a sep>ate return74 7#b7 ,inflation adju/m5t 7,a7 ,9 g5]al ,9 ! case ( a taxable ye> beg9n+ aft] #bjaf1 ! #a1jjj1jjj am\nt "u p>agraph 7#a7 %all be increas$ by an am\nt equal to-- 7i7 su* doll> am\nt1 multipli$ by 7ii7 ! co/-(-liv+ adju/m5t det]m9$ "u section #a7;f77#c7 = ! cal5d> ye> 9 :i* ! taxable ye> beg9s1 det]m9$ by sub/itut+ cal5d> ye> #bjae = cal5d> ye> #aiib 9 subp>agraph 7,b7 !re(4 7,b7 ,r\nd+ ,if any am\nt z adju/$ "u subp>agraph 7,a7 is n a multiple ( #aj1jjj1 su* am\nt %all be r\nd$ to ! next l[e/ multiple ( #aj1jjj4 7d7 ,payroll tax ,= purposes ( ?is section1 ! payroll tax = any taxable ye> is an am\nt equal to ! excess (-- 7#a7 ! taxes impos$ on ! taxpay] "u sections #adja1 #adaa1 #caja1 #cbja1 & #cbaa7;a7 7to ! ext5t su* tax is attributable to ! rate ( tax 9 effect "u section #caja7 ) respect to su* taxable ye> or wages or comp5sation receiv$ dur+ su* taxable ye>1 ov] 7#b7 ! d$uction all[able "u section #afd7;f7 = su* taxable ye>4 7e7 ,special rule = e/ates & tru/s ,= purposes ( ?is section1 9 ! case ( an e/ate or tru/1 adju/$ gross income %all be comput$ 9 ! mann] describ$ 9 section #fg7;e74 7f7 ,n treat$ z tax impos$ by ?is *apt] = c]ta9 purposes ,! tax impos$ "u ?is section %all n be treat$ z tax impos$ by ?is *apt] = purposes ( det]m9+ ! am\nt ( any cr$it "u ?is *apt] 7o!r ?an ! cr$it all[$ "u section #bg7;a77 or = purposes ( section #ee4 4 7b7 ,cl]ical am5dm5t ,! table ( p>ts = sub*apt] ,a ( *apt] #a is am5d$ by add+ at ! end ! foll[+ new item3 ,"p ,,vii4 ,fair %>e tax on high-,income taxpay]s 4 7c7 ,effective date ,! am5dm5ts made by ?is section %all apply to taxable ye>s beg9n+ aft] ,decemb] #ca1 #bjae4 #ejc4 ,expansion ( d5ial ( d$uction = c]ta9 excessive employee remun]ation 7a7 ,application to all curr5t & =m] employees 7#a7 ,9 g5]al ,section #afb7m7 is am5d$-- 7,a7 by /rik+ cov]$ employee ea* place x appe>s 9 p>agraphs 7#a7 & 7#d7 & ins]t+ cov]$ individual1 & 7,b7 by /rik+ su* employee ea* place x appe>s 9 subp>agraphs 7,a7 & 7,g7 ( p>agraph 7#d7 & ins]t+ su* individual4 7#b7 ,cov]$ individual ,p>agraph 7#c7 ( section #afb7m7 is am5d$ to read z foll[s3 7#c7 ,cov]$ individual ,= purposes ( ?is subsection1 ! t]m cov]$ individual means any individual :o is an (fic]1 director1 or employee ( ! taxpay] or a =m] (fic]1 director1 or employee ( ! taxpay]4 4 7#c7 ,con=m+ am5dm5ts 7,a7 ,section #dh;,d7b77#c77;,a7 is am5d$ by ins]t+ 7z 9 effect = taxable ye>s beg9n+ be=e ,janu>y #a1 #bjaf7 aft] section #afb7m77#c74 7,b7 ,section #dji;,a7b77#c77;,d77ii7 is am5d$ by ins]t+ 7z 9 effect = taxable ye>s beg9n+ be=e ,janu>y #a1 #bjaf7 aft] section #afb7m77#c74 7b7 ,expansion ( applicable employee remun]ation 7#a7 ,elim9ation ( exception = commission-bas$ pay 7,a7 ,9 g5]al ,p>agraph 7#d7 ( section #afb7m71 z am5d$ by subsection 7a71 is am5d$ by /rik+ subp>agraph 7,b7 & by r$esignat+ subp>agraphs 7,c7 ?r\gh 7,g7 z subp>agraphs 7,b7 ?r\gh 7,f71 respectively4 7,b7 ,con=m+ am5dm5ts 7i7 ,section #afb7m77#e7 is am5d$-- 7,i7 by /rik+ subp>agraphs 7,b71 7,c71 & 7,d7 !re( 9 subp>agraph 7,e7 & ins]t+ subp>agraphs 7,b7 & 7,c7 !re(1 & 7,,ii7 by /rik+ subp>agraphs 7,f7 & 7,g7 9 subp>agraph 7,g7 & ins]t+ subp>agraphs 7,e7 & 7,f74 7ii7 ,section #afb7m77#f7 is am5d$-- 7,i7 by /rik+ subp>agraphs 7,b71 7,c71 & 7,d7 !re( 9 subp>agraph 7,d7 & ins]t+ subp>agraphs 7,b7 & 7,c7 !re(1 & 7,,ii7 by /rik+ subp>agraphs 7,f7 & 7,g7 9 subp>agraph 7,g7 & ins]t+ subp>agraphs 7,e7 & 7,f74 7#b7 ,inclusion ( p]=mance-bas$ comp5sation 7,a7 ,9 g5]al ,p>agraph 7#d7 ( section #afb7m71 z am5d$ by subsection 7a7 & p>agraph 7#a7 ( ?is subsection1 is am5d$ by /rik+ subp>agraph 7,b7 & r$esignat+ subp>agraphs 7,c7 ?r\gh 7,f7 z subp>agraphs 7,b7 ?r\gh 7,e71 respectively4 7,b7 ,con=m+ am5dm5ts 7i7 ,section #afb7m77#e71 z am5d$ by p>agraph 7#a71 is am5d$-- 7,i7 by /rik+ subp>agraphs 7,b7 & 7,c7 !re( 9 subp>agraph 7,e7 & ins]t+ subp>agraph 7,b7 !re(1 & 7,,ii7 by /rik+ subp>agraphs 7,e7 & 7,f7 9 subp>agraph 7,g7 & ins]t+ subp>agraphs 7,d7 & 7,e74 7ii7 ,section #afb7m77#f71 z am5d$ by p>agraph 7#a71 is am5d$-- 7,i7 by /rik+ subp>agraphs 7,b7 & 7,c7 !re( 9 subp>agraph 7,d7 & ins]t+ subp>agraph 7,b7 !re(1 & 7,,ii7 by /rik+ subp>agraphs 7,e7 & 7,f7 9 subp>agraph 7,g7 & ins]t+ subp>agraphs 7,d7 & 7,e74 7c7 ,expansion ( applicable employ] ,p>agraph 7#b7 ( section #afb7m7 is am5d$ to read z foll[s3 7#b7 ,publicly held corporation ,= purposes ( ?is subsection1 ! t]m publicly held corporation means any corporation :i* is an issu] 7z def9$ 9 section #c ( ! ,securities ,ex*ange ,act ( #aicd 7#ae ,u4,s4,c4 #gh;c77-- 7,a7 ! securities ( :i* are regi/]$ "u section #ab ( su* ,act 7#ae ,u4,s4,c4 #ghl71 or 7,b7 t is requir$ to file reports "u section #ae7;d7 ( su* ,act 7#ae ,u4,s4,c4 #ghj7;d774 4 7d7 ,regulatory au?ority 7#a7 ,9 g5]al ,section #afb7m7 is am5d$ by add+ at ! end ! foll[+ new p>agraph3 7#g7 ,regulations ,! ,secret>y may prescribe su* guidance1 rules1 or regulations1 includ+ ) respect to report+1 z are necess>y to c>ry out ! purposes ( ?is subsection4 4 7#b7 ,con=m+ am5dm5t ,p>agraph 7#f7 ( section #afb7m7 is am5d$ by /rik+ subp>agraph 7,h74 7e7 ,effective date ,! am5dm5ts made by ?is section %all apply to taxable ye>s beg9n+ aft] ,decemb] #ca1 #bjae4 #ejd4 ,p>tn]%ip int]e/s transf]r$ 9 connection ) p]=mance ( s]vices 7a7 ,modification to election ,to include p>tn]%ip int]e/ 9 gross income 9 ye> ( transf] ,subsection 7c7 ( section #hc is am5d$ by r$esignat+ p>agraph 7#d7 z p>agraph 7#e7 & by ins]t+ aft] p>agraph 7#c7 ! foll[+ new p>agraph3 7#d7 ,p>tn]%ip int]e/s ,except z provid$ by ! ,secret>y-- 7,a7 ,9 g5]al ,9 ! case ( any transf] ( an int]e/ 9 a p>tn]%ip 9 connection ) ! provision ( s]vices to 7or = ! b5efit (7 su* p>tn]%ip-- 7i7 ! fair m>ket value ( su* int]e/ %all be treat$ = purposes ( ?is section z be+ equal to ! am\nt ( ! di/ribution :i* ! p>tn] w\ld receive if ! p>tn]%ip sold 7at ! "t ( ! transf]7 all ( its assets at fair m>ket value & di/ribut$ ! proce$s ( su* sale 7r$uc$ by ! liabilities ( ! p>tn]%ip7 to its p>tn]s 9 liquidation ( ! p>tn]%ip1 & 7ii7 ! p]son receiv+ su* int]e/ %all be treat$ z hav+ made ! election "u subsection 7b77#a7 unless su* p]son makes an election "u ?is p>agraph to h su* subsection n apply4 7,b7 ,election ,! election "u subp>agraph 7,a77ii7 %all be made "u rules simil> to ! rules ( subsection 7b77#b74 4 7b7 ,effective date ,! am5dm5ts made by ?is section %all apply to int]e/s 9 p>tn]%ips transf]r$ aft] ! date ( ! enactm5t ( ?is ,act4 #eje4 ,special rules = p>tn]s provid+ inve/m5t managem5t s]vices to p>tn]%ips 7a7 ,9 g5]al ,"p ,i ( sub*apt] ,k ( *apt] #a is am5d$ by add+ at ! end ! foll[+ new section3 #gaj4 ,special rules = p>tn]s provid+ inve/m5t managem5t s]vices to p>tn]%ips 7a7 ,treatm5t ( di/ributive %>e ( p>tn]%ip items ,= purposes ( ?is title1 9 ! case ( an inve/m5t s]vices p>tn]%ip int]e/-- 7#a7 ,9 g5]al ,not)/&+ section #gjb7;b7-- 7,a7 an am\nt equal to ! net capital ga9 ) respect to su* int]e/ = any p>tn]%ip taxable ye> %all be treat$ z ord9>y income1 & 7,b7 subject to ! limitation ( p>agraph 7#b71 an am\nt equal to ! net capital loss ) respect to su* int]e/ = any p>tn]%ip taxable ye> %all be treat$ z an ord9>y loss4 7#b7 ,re*>act]ization ( losses limit$ to re*>act]iz$ ga9s ,! am\nt treat$ z ord9>y loss "u p>agraph 7#a77;,b7 = any taxable ye> %all n exce$ ! excess 7if any7 (-- 7,a7 ! aggregate am\nt treat$ z ord9>y income "u p>agraph 7#a77;,a7 ) respect to ! inve/m5t s]vices p>tn]%ip int]e/ = all prec$+ p>tn]%ip taxable ye>s to :i* ?is section applies1 ov] 7,b7 ! aggregate am\nt treat$ z ord9>y loss "u p>agraph 7#a77;,b7 ) respect to su* int]e/ = all prec$+ p>tn]%ip taxable ye>s to :i* ?is section applies4 7#c7 ,allocation to items ( ga9 & loss 7,a7 ,net capital ga9 ,! am\nt treat$ z ord9>y income "u p>agraph 7#a77;,a7 %all be allocat$ ratably among ! items ( long-t]m capital ga9 tak5 into acc\nt 9 det]m9+ su* net capital ga94 7,b7 ,net capital loss ,! am\nt treat$ z ord9>y loss "u p>agraph 7#a77;,b7 %all be allocat$ ratably among ! items ( long-t]m capital loss & %ort-t]m capital loss tak5 into acc\nt 9 det]m9+ su* net capital loss4 7#d7 ,t]ms relat+ to capital ga9s & losses ,= purposes ( ?is section-- 7,a7 ,9 g5]al ,net capital ga91 long-t]m capital ga91 & long-t]m capital loss1 ) respect to any inve/m5t s]vices p>tn]%ip int]e/ = any taxable ye>1 %all be det]m9$ "u section #abbb1 except t su* section %all be appli$-- 7i7 )\t reg>d to ! re*>act]ization ( any item z ord9>y income or ord9>y loss "u ?is section1 7ii7 by only tak+ into acc\nt items ( ga9 & loss tak5 into acc\nt by ! hold] ( su* int]e/ "u section #gjb 7o!r ?an subsection 7a77#i7 !re(7 ) respect to su* int]e/ = su* taxable ye>1 & 7iii7 by treat+ prop]ty :i* is tak5 into acc\nt 9 det]m9+ ga9s & losses to :i* section #abca applies z capital assets held = m ?an #a ye>4 7,b7 ,net capital loss ,! t]m net capital loss means ! excess ( ! losses f sales or ex*anges ( capital assets ov] ! ga9s f su* sales or ex*anges4 ,rules simil> to ! rules ( clauses 7i7 ?r\gh 7iii7 ( subp>agraph 7,a7 %all apply = purposes ( ! prec$+ s5t5ce4 7#e7 ,special rule = divid5ds ,any divid5d allocat$ ) respect to any inve/m5t s]vices p>tn]%ip int]e/ %all n be treat$ z qualifi$ divid5d income = purposes ( section #a7;h74 7#f7 ,special rule = qualifi$ small bus9ess /ock ,section #abjb %all n apply to any ga9 f ! sale or ex*ange ( qualifi$ small bus9ess /ock 7z def9$ 9 section #abjb7;c77 allocat$ ) respect to any inve/m5t s]vices p>tn]%ip int]e/4 7b7 ,dispositions ( p>tn]%ip int]e/s 7#a7 ,ga9 7,a7 ,9 g5]al ,any ga9 on ! disposition ( an inve/m5t s]vices p>tn]%ip int]e/ %all be-- 7i7 treat$ z ord9>y income1 & 7ii7 recogniz$ not)/&+ any o!r provision ( ?is subtitle4 7,b7 ,gift & transf]s at dea? ,9 ! case ( a disposition ( an inve/m5t s]vices p>tn]%ip int]e/ by gift or by reason ( dea? ( ! taxpay]-- 7i7 subp>agraph 7,a7 %all n apply1 7ii7 su* int]e/ %all be treat$ z an inve/m5t s]vices p>tn]%ip int]e/ 9 ! h&s ( ! p]son acquir+ su* int]e/1 & 7iii7 any am\nt t w\ld h be5 treat$ z ord9>y income "u ?is subsection _h ! dec$5t sold su* int]e/ imm$iately be=e dea? %all be treat$ z an item ( income 9 respect ( a dec$5t "u section #fia4 7#b7 ,loss ,any loss on ! disposition ( an inve/m5t s]vices p>tn]%ip int]e/ %all be treat$ z an ord9>y loss to ! ext5t ( ! excess 7if any7 (-- 7,a7 ! aggregate am\nt treat$ z ord9>y income "u subsection 7a7 ) respect to su* int]e/ = all p>tn]%ip taxable ye>s to :i* ?is section applies1 ov] 7,b7 ! aggregate am\nt treat$ z ord9>y loss "u subsection 7a7 ) respect to su* int]e/ = all p>tn]%ip taxable ye>s to :i* ?is section applies4 7#c7 ,election ) respect to c]ta9 ex*anges ,p>agraph 7#a77;,a77ii7 %all n apply to ! contribution ( an inve/m5t s]vices p>tn]%ip int]e/ to a p>tn]%ip 9 ex*ange = an int]e/ 9 su* p>tn]%ip if-- 7,a7 ! taxpay] makes an irrevocable election to treat ! p>tn]%ip int]e/ receiv$ 9 ! ex*ange z an inve/m5t s]vices p>tn]%ip int]e/1 & 7,b7 ! taxpay] agrees to comply ) su* report+ & recordkeep+ requirem5ts z ! ,secret>y may prescribe4 7#d7 ,di/ributions ( p>tn]%ip prop]ty 7,a7 ,9 g5]al ,9 ! case ( any di/ribution ( prop]ty by a p>tn]%ip ) respect to any inve/m5t s]vices p>tn]%ip int]e/ held by a p>tn]1 ! p>tn] receiv+ su* prop]ty %all recognize ga9 equal to ! excess 7if any7 (-- 7i7 ! fair m>ket value ( su* prop]ty at ! "t ( su* di/ribution1 ov] 7ii7 ! adju/$ basis ( su* prop]ty 9 ! h&s ( su* p>tn] 7det]m9$ )\t reg>d to subp>agraph 7,c774 7,b7 ,treatm5t ( ga9 z ord9>y income ,any ga9 recogniz$ by su* p>tn] "u subp>agraph 7,a7 %all be treat$ z ord9>y income to ! same ext5t & 9 ! same mann] z ! increase 9 su* p>tn]'s di/ributive %>e ( ! taxable income ( ! p>tn]%ip w\ld be treat$ "u subsection 7a7 if1 imm$iately prior to ! di/ribution1 ! p>tn]%ip _h sold ! di/ribut$ prop]ty at fair m>ket value & all ( ! ga9 f su* disposition 7 allocat$ to su* p>tn]4 ,= purposes ( apply+ subsection 7a77#b71 any ga9 treat$ z ord9>y income "u ?is subp>agraph %all be treat$ z an am\nt treat$ z ord9>y income "u subsection 7a77#a77;,a74 7,c7 ,adju/m5t ( basis ,9 ! case ( a di/ribution to :i* subp>agraph 7,a7 applies1 ! basis ( ! di/ribut$ prop]ty 9 ! h&s ( ! di/ributee p>tn] %all be ! fair m>ket value ( su* prop]ty4 7,d7 ,special rules ) respect to m]g]s1 divisions1 & te*nical t]m9ations ,9 ! case ( a taxpay] :i* satisfies requirem5ts simil> to ! requirem5ts ( subp>agraphs 7,a7 & 7,b7 ( p>agraph 7#c71 ?is p>agraph & p>agraph 7#a77;,a77ii7 %all n apply to ! di/ribution ( a p>tn]%ip int]e/ if su* di/ribution is 9 connection ) a contribution 7or deem$ contribution7 ( any prop]ty ( ! p>tn]%ip to :i* section #gba applies pursuant to a transaction describ$ 9 p>agraph 7#a77;,b7 or 7#b7 ( section #gjh7;b74 7c7 ,inve/m5t s]vices p>tn]%ip int]e/ ,= purposes ( ?is section-- 7#a7 ,9 g5]al ,! t]m inve/m5t s]vices p>tn]%ip int]e/ means any int]e/ 9 an inve/m5t p>tn]%ip acquir$ or held by any p]son 9 connection ) ! conduct ( a trade or bus9ess describ$ 9 p>agraph 7#b7 by su* p]son 7or any p]son relat$ to su* p]son74 ,an int]e/ 9 an inve/m5t p>tn]%ip held by any p]son-- 7,a7 %all n be treat$ z an inve/m5t s]vices p>tn]%ip int]e/ = any p]iod be=e ! fir/ date on :i* x is s held 9 connection ) su* a trade or bus9ess1 7,b7 %all n cease to be an inve/m5t s]vices p>tn]%ip int]e/ m]ely because su* p]son holds su* int]e/ o!r ?an 9 connection ) su* a trade or bus9ess1 & 7,c7 %all be treat$ z an inve/m5t s]vices p>tn]%ip int]e/ if acquir$ f a relat$ p]son 9 ^: h&s su* int]e/ 0 an inve/m5t s]vices p>tn]%ip int]e/4 7#b7 ,bus9esses to :i* ?is section applies ,a trade or bus9ess is describ$ 9 ?is p>agraph if su* trade or bus9ess prim>ily involves ! p]=mance ( any ( ! foll[+ s]vices ) respect to assets held 7directly or indirectly7 by "o or m inve/m5t p>tn]%ips ref]r$ to 9 p>agraph 7#a73 7,a7 ,advis+ z to ! advisability ( inve/+ 91 pur*as+1 or sell+ any specifi$ asset4 7,b7 ,manag+1 acquir+1 or dispos+ ( any specifi$ asset4 7,c7 ,arrang+ f9anc+ ) respect to acquir+ specifi$ assets4 7,d7 ,any activity 9 support ( any s]vice describ$ 9 subp>agraphs 7,a7 ?r\gh 7,c74 7#c7 ,inve/m5t p>tn]%ip 7,a7 ,9 g5]al ,! t]m inve/m5t p>tn]%ip means any p>tn]%ip if1 at ! end ( any two consecutive cal5d> qu>t]s end+ aft] ! date ( enactm5t ( ?is section-- 7i7 sub/antially all ( ! assets ( ! p>tn]%ip are specifi$ assets 7det]m9$ )\t reg>d to any section #aig intangible )9 ! mean+ ( section #aig7;d771 & 7ii7 less ?an #ge p]c5t ( ! capital ( ! p>tn]%ip is attributable to qualifi$ capital int]e/s :i* con/itute prop]ty held 9 connection ) a trade or bus9ess ( ! own] ( su* int]e/4 7,b7 ,look-?r\gh ( c]ta9 :olly own$ entities = purposes ( det]m9+ assets ( ! p>tn]%ip 7i7 ,9 g5]al ,= purposes ( det]m9+ ! assets ( a p>tn]%ip "u subp>agraph 7,a77i7-- 7,i7 any int]e/ 9 a specifi$ entity %all n be treat$ z an asset ( su* p>tn]%ip1 & 7,,ii7 su* p>tn]%ip %all be treat$ z hold+ its proportionate %>e ( ea* ( ! assets ( su* specifi$ entity4 7ii7 ,specifi$ entity ,= purposes ( clause 7i71 ! t]m specifi$ entity means1 ) respect to any p>tn]%ip 7h]eaft] ref]r$ to z ! upp]-ti] p>tn]%ip71 any p]son :i* engages 9 ! same trade or bus9ess z ! upp]-ti] p>tn]%ip & is-- 7,i7 a p>tn]%ip all ( ! capital & pr(its int]e/s ( :i* are held directly or indirectly by ! upp]-ti] p>tn]%ip1 or 7,,ii7 a =eign corporation :i* does n engage 9 a trade or bus9ess 9 ! ,unit$ ,/ates & all ( ! /ock ( :i* is held directly or indirectly by ! upp]-ti] p>tn]%ip4 7,c7 ,special rules = det]m9+ if prop]ty held 9 connection ) trade or bus9ess 7i7 ,9 g5]al ,except z o!rwise provid$ by ! ,secret>y1 solely = purposes ( det]m9+ :e!r any int]e/ 9 a p>tn]%ip con/itutes prop]ty held 9 connection ) a trade or bus9ess "u subp>agraph 7,a77ii7-- 7,i7 a trade or bus9ess ( any p]son closely relat$ to ! own] ( su* int]e/ %all be treat$ z a trade or bus9ess ( su* own]1 7,,ii7 su* int]e/ %all be treat$ z held by a p]son 9 connection ) a trade or bus9ess dur+ any taxable ye> if su* int]e/ 0 s held by su* p]son dur+ any #c taxable ye>s prec$+ su* taxable ye>1 & 7,,iii7 p>agraph 7#e77;,b7 %all n apply4 7ii7 ,closely relat$ p]sons ,= purposes ( clause 7i77,i71 a p]son %all be treat$ z closely relat$ to ano!r p]son if1 tak+ into acc\nt ! rules ( section #bfg7;c71 ! relation%ip betwe5 su* p]sons is describ$ 9-- 7,i7 p>agraph 7#a7 or 7#i7 ( section #bfg7;b71 or 7,,ii7 section #bfg7;b77#d71 b solely 9 ! case ( a tru/ ) respect to :i* ea* curr5t b5efici>y is ! grantor or a p]son ^: relation%ip to ! grantor is describ$ 9 p>agraph 7#a7 or 7#i7 ( section #bfg7;b74 7,d7 ,anti-abuse rules ,! ,secret>y may issue regulations or o!r guidance :i* prev5t ! avoidance ( ! purposes ( subp>agraph 7,a71 includ+ regulations or o!r guidance :i* treat conv]tible & cont+5t debt 7& o!r debt hav+ ! attributes ( equity7 z a capital int]e/ 9 ! p>tn]%ip4 7,e7 ,controll$ gr\ps ( entities 7i7 ,9 g5]al ,9 ! case ( a controll$ gr\p ( entities1 if an int]e/ 9 ! p>tn]%ip receiv$ 9 ex*ange = a contribution to ! capital ( ! p>tn]%ip by any memb] ( su* controll$ gr\p w\ld 79 ! h&s ( su* memb]7 con/itute prop]ty held 9 connection ) a trade or bus9ess1 !n any int]e/ 9 su* p>tn]%ip held by any memb] ( su* gr\p %all be treat$ = purposes ( subp>agraph 7,a7 z con/itut+ 79 ! h&s ( su* memb]7 prop]ty held 9 connection ) a trade or bus9ess4 7ii7 ,controll$ gr\p ( entities ,= purposes ( clause 7i71 ! t]m controll$ gr\p ( entities means a controll$ gr\p ( corporations z def9$ 9 section #aefc7;a77#a71 appli$ )\t reg>d to subsections 7a77#d7 & 7b77#b7 ( section #aefc4 ,a p>tn]%ip or any o!r entity 7o!r ?an a corporation7 %all be treat$ z a memb] ( a controll$ gr\p ( entities if su* entity is controll$ 7)9 ! mean+ ( section #ied7;d77#c77 by memb]s ( su* gr\p 7includ+ any entity treat$ z a memb] ( su* gr\p by reason ( ?is s5t5ce74 7,f7 ,special rule = corporations ,= purposes ( ?is p>agraph1 9 ! case ( a corporation1 ! det]m9ation ( :e!r prop]ty is held 9 connection ) a trade or bus9ess %all be det]m9$ z if ! taxpay] 7 an individual4 7#d7 ,specifi$ asset ,! t]m specifi$ asset means securities 7z def9$ 9 section #dge7;c77#b7 )\t reg>d to ! la/ s5t5ce !re(71 real e/ate held = r5tal or inve/m5t1 int]e/s 9 p>tn]%ips1 commodities 7z def9$ 9 section #dge7;e77#b771 ca% or ca% equival5ts1 or options or d]ivative contracts ) respect to any ( ! =ego+4 7#e7 ,relat$ p]sons 7,a7 ,9 g5]al ,a p]son %all be treat$ z relat$ to ano!r p]son if ! relation%ip betwe5 su* p]sons is describ$ 9 section #bfg7;b7 or #gjg7;b74 7,b7 ,attribution ( p>tn] s]vices ,any s]vice describ$ 9 p>agraph 7#b7 :i* is provid$ by a p>tn] ( a p>tn]%ip %all be treat$ z also provid$ by su* p>tn]%ip4 7d7 ,exception = c]ta9 capital int]e/s 7#a7 ,9 g5]al ,9 ! case ( any portion ( an inve/m5t s]vices p>tn]%ip int]e/ :i* is a qualifi$ capital int]e/1 all items ( ga9 & loss 7& any divid5ds7 :i* are allocat$ to su* qualifi$ capital int]e/ %all n be tak5 into acc\nt "u subsection 7a7 if-- 7,a7 allocations ( items are made by ! p>tn]%ip to su* qualifi$ capital int]e/ 9 ! same mann] z su* allocations are made to o!r qualifi$ capital int]e/s held by p>tn]s :o d n provide any s]vices describ$ 9 subsection 7c77#b7 & :o are n relat$ to ! p>tn] hold+ ! qualifi$ capital int]e/1 & 7,b7 ! allocations made to su* o!r int]e/s are significant comp>$ to ! allocations made to su* qualifi$ capital int]e/4 7#b7 ,au?ority to provide exceptions to allocation requirem5ts ,to ! ext5t provid$ by ! ,secret>y 9 regulations or o!r guidance-- 7,a7 ,allocations to portion ( qualifi$ capital int]e/ ,p>agraph 7#a7 may be appli$ sep>ately ) respect to a portion ( a qualifi$ capital int]e/4 7,b7 ,no or insignificant allocations to nons]vice provid]s ,9 any case 9 :i* ! requirem5ts ( p>agraph 7#a77;,b7 are n satisfi$1 items ( ga9 & loss 7& any divid5ds7 %all n be tak5 into acc\nt "u subsection 7a7 to ! ext5t t su* items are prop]ly allocable "u su* regulations or o!r guidance to qualifi$ capital int]e/s4 7,c7 ,allocations to s]vice provid]s' qualifi$ capital int]e/s :i* are less ?an o!r allocations ,allocations %all n be treat$ z fail+ to meet ! requirem5t ( p>agraph 7#a77;,a7 m]ely because ! allocations to ! qualifi$ capital int]e/ repres5t a l[] return ?an ! allocations made to ! o!r qualifi$ capital int]e/s ref]r$ to 9 su* p>agraph4 7#c7 ,special rule = *anges 9 s]vices & capital contributions ,9 ! case ( an int]e/ 9 a p>tn]%ip :i* 0 n an inve/m5t s]vices p>tn]%ip int]e/ & :i*1 by reason ( a *ange 9 ! s]vices ) respect to assets held 7directly or indirectly7 by ! p>tn]%ip or by reason ( a *ange 9 ! capital contributions to su* p>tn]%ip1 becomes an inve/m5t s]vices p>tn]%ip int]e/1 ! qualifi$ capital int]e/ ( ! hold] ( su* p>tn]%ip int]e/ imm$iately aft] su* *ange %all n1 = purposes ( ?is subsection1 be less ?an ! fair m>ket value ( su* int]e/ 7det]m9$ imm$iately be=e su* *ange74 7#d7 ,special rule = ti]$ p>tn]%ips ,except z o!rwise provid$ by ! ,secret>y1 9 ! case ( ti]$ p>tn]%ips1 all items :i* are allocat$ 9 a mann] :i* meets ! requirem5ts ( p>agraph 7#a7 to qualifi$ capital int]e/s 9 a l[]-ti] p>tn]%ip %all reta9 su* "* to ! ext5t allocat$ on ! basis ( qualifi$ capital int]e/s 9 any upp]-ti] p>tn]%ip4 7#e7 ,exception = no-self-*>g$ c>ry & managem5t fee provisions ,except z o!rwise provid$ by ! ,secret>y1 an int]e/ %all n fail to be treat$ z satisfy+ ! requirem5t ( p>agraph 7#a77;,a7 m]ely because ! allocations made by ! p>tn]%ip to su* int]e/ d n reflect ! co/ ( s]vices describ$ 9 subsection 7c77#b7 :i* are provid$ 7directly or indirectly7 to ! p>tn]%ip by ! hold] ( su* int]e/ 7or a relat$ p]son74 7#f7 ,special rule = dispositions ,9 ! case ( any inve/m5t s]vices p>tn]%ip int]e/ any portion ( :i* is a qualifi$ capital int]e/1 subsection 7b7 %all n apply to s mu* ( any ga9 or loss z be>s ! same proportion to ! entire am\nt ( su* ga9 or loss z-- 7,a7 ! di/ributive %>e ( ga9 or loss t w\ld h be5 allocat$ to ! qualifi$ capital int]e/ 7consi/5t ) ! requirem5ts ( p>agraph 7#a77 if ! p>tn]%ip _h sold all ( its assets at fair m>ket value imm$iately be=e ! disposition1 be>s to 7,b7 ! di/ributive %>e ( ga9 or loss t w\ld h be5 s allocat$ to ! inve/m5t s]vices p>tn]%ip int]e/ ( :i* su* qualifi$ capital int]e/ is a "p4 7#g7 ,qualifi$ capital int]e/ ,= purposes ( ?is section-- 7,a7 ,9 g5]al ,! t]m qualifi$ capital int]e/ means s mu* ( a p>tn]'s int]e/ 9 ! capital ( ! p>tn]%ip z is attributable to-- 7i7 ! fair m>ket value ( any money or o!r prop]ty contribut$ to ! p>tn]%ip 9 ex*ange = su* int]e/ 7det]m9$ )\t reg>d to section #geb7;a771 7ii7 any am\nts :i* h be5 includ$ 9 gross income "u section #hc ) respect to ! transf] ( su* int]e/1 & 7iii7 ! excess 7if any7 (-- 7,i7 any items ( income & ga9 tak5 into acc\nt "u section #gjb ) respect to su* int]e/1 ov] 7,,ii7 any items ( d$uction & loss s tak5 into acc\nt4 7,b7 ,adju/m5t to qualifi$ capital int]e/ 7i7 ,di/ributions & losses ,! qualifi$ capital int]e/ %all be r$uc$ by di/ributions f ! p>tn]%ip ) respect to su* int]e/ & by ! excess 7if any7 ( ! am\nt describ$ 9 subp>agraph 7,a77iii77,,ii7 ov] ! am\nt describ$ 9 subp>agraph 7,a77iii77,i74 7ii7 ,special rule = contributions ( prop]ty ,9 ! case ( any contribution ( prop]ty describ$ 9 subp>agraph 7,a77i7 ) respect to :i* ! fair m>ket value ( su* prop]ty is n equal to ! adju/$ basis ( su* prop]ty imm$iately be=e su* contribution1 prop] adju/m5ts %all be made to ! qualifi$ capital int]e/ to take into acc\nt su* diff]5ce consi/5t ) su* regulations or o!r guidance z ! ,secret>y may provide4 7,c7 ,te*nical t]m9ations1 etc41 disreg>d$ ,no increase or decrease 9 ! qualifi$ capital int]e/ ( any p>tn] %all result f a t]m9ation1 m]g]1 consolidation1 or division describ$ 9 section #gjh1 or any simil> transaction4 7#h7 ,treatm5t ( c]ta9 loans 7,a7 ,proce$s ( p>tn]%ip loans n treat$ z qualifi$ capital int]e/ ( s]vice provid+ p>tn]s ,= purposes ( ?is subsection1 an inve/m5t s]vices p>tn]%ip int]e/ %all n be treat$ z a qualifi$ capital int]e/ to ! ext5t t su* int]e/ is acquir$ 9 connection ) ! proce$s ( any loan or o!r advance made or gu>ante$1 directly or indirectly1 by any o!r p>tn] or ! p>tn]%ip 7or any p]son relat$ to any su* o!r p>tn] or ! p>tn]%ip74 ,! prec$+ s5t5ce %all n apply to ! ext5t ! loan or o!r advance is repaid be=e ! date ( ! enactm5t ( ?is section unless su* repaym5t is made ) ! proce$s ( a loan or o!r advance describ$ 9 ! prec$+ s5t5ce4 7,b7 ,r$uction 9 allocations to qualifi$ capital int]e/s = loans f nons]vice-provid+ p>tn]s to ! p>tn]%ip ,= purposes ( ?is subsection1 any loan or o!r advance to ! p>tn]%ip made or gu>ante$1 directly or indirectly1 by a p>tn] n provid+ s]vices describ$ 9 subsection 7c77#b7 to ! p>tn]%ip 7or any p]son relat$ to su* p>tn]7 %all be tak5 into acc\nt 9 det]m9+ ! qualifi$ capital int]e/s ( ! p>tn]s 9 ! p>tn]%ip4 7#i7 ,special rule = qualifi$ family p>tn]%ips 7,a7 ,9 g5]al ,9 ! case ( any specifi$ family p>tn]%ip int]e/1 p>agraph 7#a77;,a7 %all be appli$ )\t reg>d to ! phrase & :o are n relat$ to ! p>tn] hold+ ! qualifi$ capital int]e/4 7,b7 ,specifi$ family p>tn]%ip int]e/ ,= purposes ( ?is p>agraph1 ! t]m specifi$ family p>tn]%ip int]e/ means any inve/m5t s]vices p>tn]%ip int]e/ if-- 7i7 su* int]e/ is an int]e/ 9 a qualifi$ family p>tn]%ip1 7ii7 su* int]e/ is held by a natural p]son or by a tru/ ) respect to :i* ea* b5efici>y is a grantor or a p]son ^: relation%ip to ! grantor is describ$ 9 section #bfg7;b77#a71 & 7iii7 all o!r int]e/s 9 su* qualifi$ family p>tn]%ip ) respect to :i* significant allocations are made 7)9 ! mean+ ( p>agraph 7#a77;,b7 & 9 comp>ison to ! allocations made to ! int]e/ describ$ 9 clause 7ii77 are held by p]sons :o-- 7,i7 are relat$ to ! natural p]son or tru/ ref]r$ to 9 clause 7ii71 or 7,,ii7 provide s]vices describ$ 9 subsection 7c77#b74 7,c7 ,qualifi$ family p>tn]%ip ,= purposes ( ?is p>agraph1 ! t]m qualifi$ family p>tn]%ip means any p>tn]%ip if-- 7i7 all ( ! capital & pr(its int]e/s ( su* p>tn]%ip are held by-- 7,i7 specifi$ family memb]s1 7,,ii7 any p]son closely relat$ 7)9 ! mean+ ( subsection 7c77#c77;,c77ii77 to a specifi$ family memb]1 or 7,,iii7 any o!r p]son 7n describ$ 9 subclause 7,i7 or 7,,ii77 if su* int]e/ is an inve/m5t s]vices p>tn]%ip int]e/ ) respect to su* p]son1 & 7ii7 su* p>tn]%ip does n hold itself out to ! public z an inve/m5t advisor4 7,d7 ,specifi$ family memb]s ,= purposes ( subp>agraph 7,c71 individuals %all be treat$ z specifi$ family memb]s if su* individuals w\ld be treat$ z "o p]son "u ! rules ( section #acfa7;c77#a7 if ! applicable date 7)9 ! mean+ ( subp>agraph 7,b77iii7 !re(7 7 ! late/ (-- 7i7 ! date ( ! e/abli%m5t ( ! p>tn]%ip1 7ii7 ! e>lie/ date t ! common ance/or holds a capital or pr(its int]e/ 9 ! p>tn]%ip1 or 7iii7 ! date ( ! enactm5t ( ?is section4 7e7 ,o!r income & ga9 9 connection ) inve/m5t managem5t s]vices 7#a7 ,9 g5]al ,if-- 7,a7 a p]son p]=ms 7directly or indirectly7 inve/m5t managem5t s]vices = any inve/m5t entity1 7,b7 su* p]son holds 7directly or indirectly7 a disqualifi$ int]e/ ) respect to su* entity1 & 7,c7 ! value ( su* int]e/ 7or paym5ts !reund]7 is sub/antially relat$ to ! am\nt ( income or ga9 7:e!r or n realiz$7 f ! assets ) respect to :i* ! inve/m5t managem5t s]vices are p]=m$1 any income or ga9 ) respect to su* int]e/ %all be treat$ z ord9>y income4 ,rules simil> to ! rules ( subsections 7a77#e7 & 7d7 %all apply = purposes ( ?is subsection4 7#b7 ,def9itions ,= purposes ( ?is subsection-- 7,a7 ,disqualifi$ int]e/ 7i7 ,9 g5]al ,! t]m disqualifi$ int]e/ means1 ) respect to any inve/m5t entity-- 7,i7 any int]e/ 9 su* entity o!r ?an indebt$ness1 7,,ii7 conv]tible or cont+5t debt ( su* entity1 7,,iii7 any option or o!r "r to acquire prop]ty describ$ 9 subclause 7,i7 or 7,,ii71 & 7,,iv7 any d]ivative in/rum5t ent]$ into 7directly or indirectly7 ) su* entity or any inve/or 9 su* entity4 7ii7 ,exceptions ,su* t]m %all n include-- 7,i7 a p>tn]%ip int]e/1 7,,ii7 except z provid$ by ! ,secret>y1 any int]e/ 9 a taxable corporation1 & 7,,iii7 except z provid$ by ! ,secret>y1 /ock 9 an ,s corporation4 7,b7 ,taxable corporation ,! t]m taxable corporation means-- 7i7 a dome/ic ,c corporation1 or 7ii7 a =eign corporation sub/antially all ( ! income ( :i* is-- 7,i7 effectively connect$ ) ! conduct ( a trade or bus9ess 9 ! ,unit$ ,/ates1 or 7,,ii7 subject to a compreh5sive =eign income tax 7z def9$ 9 section #deg;,a7d77#b774 7,c7 ,inve/m5t managem5t s]vices ,! t]m inve/m5t managem5t s]vices means a sub/antial quantity ( any ( ! s]vices describ$ 9 subsection 7c77#b74 7,d7 ,inve/m5t entity ,! t]m inve/m5t entity means any entity :i*1 if x 7 a p>tn]%ip1 w\ld be an inve/m5t p>tn]%ip4 7f7 ,exception = dome/ic ,c corporations ,except z o!rwise provid$ by ! ,secret>y1 9 ! case ( a dome/ic ,c corporation-- 7#a7 subsections 7a7 & 7b7 %all n apply to any item allocat$ to su* corporation ) respect to any inve/m5t s]vices p>tn]%ip int]e/ 7or to any ga9 or loss ) respect to ! disposition ( su* an int]e/71 & 7#b7 subsection 7e7 %all n apply4 7g7 ,regulations ,! ,secret>y %all prescribe su* regulations or o!r guidance z is necess>y or appropriate to c>ry out ! purposes ( ?is section1 includ+ regulations or o!r guidance to-- 7#a7 require su* report+ & recordkeep+ by any p]son 9 su* mann] & at su* "t z ! ,secret>y may prescribe = purposes ( enabl+ ! p>tn]%ip to meet ! requirem5ts ( section #fjca ) respect to any item describ$ 9 section #gjb7;a77#i71 7#b7 provide modifications to ! application ( ?is section 7includ+ treat+ relat$ p]sons z n relat$ to "o ano!r7 to ! ext5t su* modification is consi/5t ) ! purposes ( ?is section1 7#c7 prev5t ! avoidance ( ! purposes ( ?is section 7includ+ ?r\gh ! use ( qualifi$ family p>tn]%ips71 & 7#d7 coord9ate ?is section ) ! o!r provisions ( ?is title4 7h7 ,cross ref]5ce ,= #dj-p]c5t p5alty on c]ta9 und]paym5ts due to ! avoidance ( ?is section1 see section #fffb4 4 7b7 ,application ( section #gea to indirect dispositions ( inve/m5t s]vices p>tn]%ip int]e/s 7#a7 ,9 g5]al ,subsection 7a7 ( section #gea is am5d$ by /rik+ or at ! end ( p>agraph 7#a71 by ins]t+ or at ! end ( p>agraph 7#b71 & by ins]t+ aft] p>agraph 7#b7 ! foll[+ new p>agraph3 7#c7 inve/m5t s]vices p>tn]%ip int]e/s held by ! p>tn]%ip1 4 7#b7 ,c]ta9 di/ributions treat$ z sales or ex*anges ,subp>agraph 7,a7 ( section #gea7;b77#a7 is am5d$ by /rik+ or at ! end ( clause 7i71 by ins]t+ or at ! end ( clause 7ii71 & by ins]t+ aft] clause 7ii7 ! foll[+ new clause3 7iii7 inve/m5t s]vices p>tn]%ip int]e/s held by ! p>tn]%ip1 4 7#c7 ,application ( special rules 9 ! case ( ti]$ p>tn]%ips ,subsection 7f7 ( section #gea is am5d$-- 7,a7 by /rik+ or at ! end ( p>agraph 7#a71 by ins]t+ or at ! end ( p>agraph 7#b71 & by ins]t+ aft] p>agraph 7#b7 ! foll[+ new p>agraph3 7#c7 an inve/m5t s]vices p>tn]%ip int]e/ held by ! p>tn]%ip1 1 & 7,b7 by /rik+ p>tn]4 & ins]t+ p>tn] 7o!r ?an a p>tn]%ip 9 :i* x holds an inve/m5t s]vices p>tn]%ip int]e/744 7#d7 ,inve/m5t s]vices p>tn]%ip int]e/s2 qualifi$ capital int]e/s ,section #gea is am5d$ by add+ at ! end ! foll[+ new subsection3 7g7 ,inve/m5t s]vices p>tn]%ip int]e/s ,= purposes ( ?is section-- 7#a7 ,9 g5]al ,! t]m inve/m5t s]vices p>tn]%ip int]e/ has ! mean+ giv5 su* t]m by section #gaj7;c74 7#b7 ,adju/m5ts = qualifi$ capital int]e/s ,! am\nt to :i* subsection 7a7 applies by reason ( p>agraph 7#c7 !re( %all n include s mu* ( su* am\nt z is attributable to any portion ( ! inve/m5t s]vices p>tn]%ip int]e/ :i* is a qualifi$ capital int]e/ 7det]m9$ "u rules simil> to ! rules ( section #gaj7;d774 7#c7 ,exception = publicly trad$ p>tn]%ips ,except z o!rwise provid$ by ! ,secret>y1 9 ! case ( an ex*ange ( an int]e/ 9 a publicly trad$ p>tn]%ip 7z def9$ 9 section #ggjd7 to :i* subsection 7a7 applies-- 7,a7 ?is section %all be appli$ )\t reg>d to subsections 7a77#c71 7b77#a77;,a77iii71 & 7f77#c71 & 7,b7 su* p>tn]%ip %all be treat$ z own+ its proportionate %>e ( ! prop]ty ( any o!r p>tn]%ip 9 :i* x is a p>tn]4 7#d7 ,recognition ( ga9s ,any ga9 ) respect to :i* subsection 7a7 applies by reason ( p>agraph 7#c7 !re( %all be recogniz$ not)/&+ any o!r provision ( ?is title4 7#e7 ,coord9ation ) inv5tory items ,an inve/m5t s]vices p>tn]%ip int]e/ held by ! p>tn]%ip %all n be treat$ z an inv5tory item ( ! p>tn]%ip4 7#f7 ,prev5tion ( d\ble c\nt+ ,"u regulations or o!r guidance prescrib$ by ! ,secret>y1 subsection 7a77#c7 %all n apply ) respect to any am\nt to :i* section #gaj applies4 7#g7 ,valuation me?ods ,! ,secret>y %all prescribe regulations or o!r guidance :i* provide ! acceptable me?ods = valu+ inve/m5t s]vices p>tn]%ip int]e/s = purposes ( ?is section4 4 7c7 ,treatm5t = purposes ( section #ggjd ,subsection 7d7 ( section #ggjd is am5d$ by add+ at ! end ! foll[+ new p>agraph3 7#f7 ,income f c]ta9 c>ri$ int]e/s n qualifi$ 7,a7 ,9 g5]al ,specifi$ c>ri$ int]e/ income %all n be treat$ z qualify+ income4 7,b7 ,specifi$ c>ri$ int]e/ income ,= purposes ( ?is p>agraph-- 7i7 ,9 g5]al ,! t]m specifi$ c>ri$ int]e/ income means-- 7,i7 any item ( income or ga9 allocat$ to an inve/m5t s]vices p>tn]%ip int]e/ 7z def9$ 9 section #gaj7;c77 held by ! p>tn]%ip1 7,,ii7 any ga9 on ! disposition ( an inve/m5t s]vices p>tn]%ip int]e/ 7z s def9$7 or a p>tn]%ip int]e/ to :i* 79 ! h&s ( ! p>tn]%ip7 section #gea applies1 & 7,,iii7 any income or ga9 tak5 into acc\nt by ! p>tn]%ip "u subsection 7b77#d7 or 7e7 ( section #gaj4 7ii7 ,exception = qualifi$ capital int]e/s ,a rule simil> to ! rule ( section #gaj7;d7 %all apply = purposes ( clause 7i74 7,c7 ,coord9ation ) o!r provisions ,subp>agraph 7,a7 %all n apply to any item describ$ 9 p>agraph 7#a77;,e7 7or s mu* ( p>agraph 7#a77;,f7 z relates to p>agraph 7#a77;,e774 7,d7 ,special rules = c]ta9 p>tn]%ips 7i7 ,c]ta9 p>tn]%ips own$ by real e/ate inve/m5t tru/s ,subp>agraph 7,a7 %all n apply 9 ! case ( a p>tn]%ip :i* meets ea* ( ! foll[+ requirem5ts3 7,i7 ,su* p>tn]%ip is treat$ z publicly trad$ "u ?is section solely by reason ( int]e/s 9 su* p>tn]%ip be+ conv]tible into int]e/s 9 a real e/ate inve/m5t tru/ :i* is publicly trad$4 7,,ii7 ,fifty p]c5t or m ( ! capital & pr(its int]e/s ( su* p>tn]%ip are own$1 directly or indirectly1 at all times dur+ ! taxable ye> by su* real e/ate inve/m5t tru/ 7det]m9$ ) ! application ( section #bfg7;c774 7,,iii7 ,su* p>tn]%ip meets ! requirem5ts ( p>agraphs 7#b71 7#c71 & 7#d7 ( section #hef7;c74 7ii7 ,c]ta9 p>tn]%ips own+ o!r publicly trad$ p>tn]%ips ,subp>agraph 7,a7 %all n apply 9 ! case ( a p>tn]%ip :i* meets ea* ( ! foll[+ requirem5ts3 7,i7 ,sub/antially all ( ! assets ( su* p>tn]%ip consi/ ( int]e/s 9 "o or m publicly trad$ p>tn]%ips 7det]m9$ )\t reg>d to subsection 7b77#b774 7,,ii7 ,sub/antially all ( ! income ( su* p>tn]%ip is ord9>y income or section #abca ga9 7z def9$ 9 section #abca7;a77#c774 7,e7 ,transitional rule ,subp>agraph 7,a7 %all n apply to any taxable ye> ( ! p>tn]%ip beg9n+ be=e ! date :i* is #aj ye>s aft] ! date ( ! enactm5t ( ?is p>agraph4 4 7d7 ,imposition ( p5alty on und]paym5ts 7#a7 ,9 g5]al ,subsection 7b7 ( section #fffb is am5d$ by ins]t+ aft] p>agraph 7#g7 ! foll[+ new p>agraph3 7#h7 ,! application ( section #gaj7;e7 or ! regulations or o!r guidance prescrib$ "u section #gaj7;g7 to prev5t ! avoidance ( ! purposes ( section #gaj4 4 7#b7 ,am\nt ( p5alty 7,a7 ,9 g5]al ,section #fffb is am5d$ by add+ at ! end ! foll[+ new subsection3 7k7 ,increase 9 p5alty 9 case ( prop]ty transf]r$ = inve/m5t managem5t s]vices ,9 ! case ( any portion ( an und]paym5t to :i* ?is section applies by reason ( subsection 7b77#h71 subsection 7a7 %all be appli$ ) respect to su* portion by sub/itut+ #dj p]c5t = #bj p]c5t4 4 7,b7 ,con=m+ am5dm5t ,subp>agraph 7,b7 ( section #fffb;,a7e77#b7 is am5d$ by /rik+ or 7i7 & ins]t+ 1 7i71 or 7k74 7#c7 ,special rules = application ( reasonable cause exception ,subsection 7c7 ( section #fffd is am5d$-- 7,a7 by r$esignat+ p>agraphs 7#c7 & 7#d7 z p>agraphs 7#d7 & 7#e71 respectively2 7,b7 by /rik+ p>agraph 7#c7 9 p>agraph 7#e77;,a71 z s r$esignat$1 & ins]t+ p>agraph 7#d72 & 7,c7 by ins]t+ aft] p>agraph 7#b7 ! foll[+ new p>agraph3 7#c7 ,special rule = und]paym5ts attributable to inve/m5t managem5t s]vices 7,a7 ,9 g5]al ,p>agraph 7#a7 %all n apply to any portion ( an und]paym5t to :i* section #fffb applies by reason ( subsection 7b77#h7 unless-- 7i7 ! relevant facts affect+ ! tax treatm5t ( ! item are adequately disclos$1 7ii7 !re is or 0 sub/antial au?ority = su* treatm5t1 & 7iii7 ! taxpay] reasonably believ$ t su* treatm5t 0 m likely ?an n ! prop] treatm5t4 7,b7 ,rules relat+ to reasonable belief ,rules simil> to ! rules ( subsection 7d77#c7 %all apply = purposes ( subp>agraph 7,a77iii74 4 7e7 ,income & loss f inve/m5t s]vices p>tn]%ip int]e/s tak5 into acc\nt 9 det]m9+ net e>n+s f self-,employm5t 7#a7 ,int]nal ,rev5ue ,code 7,a7 ,9 g5]al ,section #adjb7;a7 is am5d$ by /rik+ & at ! end ( p>agraph 7#af71 by /rik+ ! p]iod at ! end ( p>agraph 7#ag7 & ins]t+ 2 &1 & by ins]t+ aft] p>agraph 7#ag7 ! foll[+ new p>agraph3 7#ah7 not)/&+ ! prec$+ provisions ( ?is subsection1 9 ! case ( any individual engag$ 9 ! trade or bus9ess ( provid+ s]vices describ$ 9 section #gaj7;c77#b7 ) respect to any entity1 inve/m5t s]vices p>tn]%ip income or loss 7z def9$ 9 subsection 7m77 ( su* individual ) respect to su* entity %all be tak5 into acc\nt 9 det]m9+ ! net e>n+s f self-employm5t ( su* individual4 4 7,b7 ,inve/m5t s]vices p>tn]%ip income or loss ,section #adjb is am5d$ by add+ at ! end ! foll[+ new subsection3 7m7 ,inve/m5t s]vices p>tn]%ip income or loss ,= purposes ( subsection 7a7-- 7#a7 ,9 g5]al ,! t]m inve/m5t s]vices p>tn]%ip income or loss means1 ) respect to any inve/m5t s]vices p>tn]%ip int]e/ 7z def9$ 9 section #gaj7;c77 or disqualifi$ int]e/ 7z def9$ 9 section #gaj7;e771 ! net (-- 7,a7 ! am\nts treat$ z ord9>y income or ord9>y loss "u subsections 7b7 & 7e7 ( section #gaj ) respect to su* int]e/1 7,b7 all items ( income1 ga91 loss1 & d$uction allocat$ to su* int]e/1 & 7,c7 ! am\nts treat$ z realiz$ f ! sale or ex*ange ( prop]ty o!r ?an a capital asset "u section #gea ) respect to su* int]e/4 7#b7 ,exception = qualifi$ capital int]e/s ,a rule simil> to ! rule ( section #gaj7;d7 %all apply = purposes ( apply+ p>agraph 7#a77;,b74 4 7#b7 ,social ,security ,act ,section #baa7;a7 ( ! ,social ,security ,act is am5d$ by /rik+ & at ! end ( p>agraph 7#ae71 by /rik+ ! p]iod at ! end ( p>agraph 7#af7 & ins]t+ 2 &1 & by ins]t+ aft] p>agraph 7#af7 ! foll[+ new p>agraph3 7#ag7 ,not)/&+ ! prec$+ provisions ( ?is subsection1 9 ! case ( any individual engag$ 9 ! trade or bus9ess ( provid+ s]vices describ$ 9 section #gaj7;c77#b7 ( ! ,int]nal ,rev5ue ,code ( #aihf ) respect to any entity1 inve/m5t s]vices p>tn]%ip income or loss 7z def9$ 9 section #adjb7m7 ( su* ,code7 %all be tak5 into acc\nt 9 det]m9+ ! net e>n+s f self-employm5t ( su* individual4 4 7f7 ,sep>ate acc\nt+ by p>tn] ,section #gjb7;a7 is am5d$ by /rik+ & at ! end ( p>agraph 7#g71 by /rik+ ! p]iod at ! end ( p>agraph 7#h7 & ins]t+ 1 &1 & by ins]t+ aft] p>agraph 7#h7 ! foll[+3 7#i7 any am\nt treat$ z ord9>y income or loss "u subsection 7a71 7b71 or 7e7 ( section #gaj4 4 7g7 ,con=m+ am5dm5ts 7#a7 ,subsection 7d7 ( section #gca is am5d$ by ins]t+ section #gaj7;b77#d7 7relat+ to di/ributions ( p>tn]%ip prop]ty71 aft] to ! ext5t o!rwise provid$ by4 7#b7 ,section #gda is am5d$ by ins]t+ or section #gaj 7relat+ to special rules = p>tn]s provid+ inve/m5t managem5t s]vices to p>tn]%ips7 be=e ! p]iod at ! end4 7#c7 ,! table ( sections = "p ,i ( sub*apt] ,k ( *apt] #a is am5d$ by add+ at ! end ! foll[+ new item3 ,sec4 #gaj4 ,special rules = p>tn]s provid+ inve/m5t managem5t s]vices to p>tn]%ips4 4 7h7 ,effective date 7#a7 ,9 g5]al ,except z o!rwise provid$ 9 ?is subsection1 ! am5dm5ts made by ?is section %all apply to taxable ye>s end+ aft] ! date ( ! enactm5t ( ?is ,act4 7#b7 ,p>tn]%ip taxable ye>s :i* include effective date ,9 apply+ section #gaj7;a7 ( ! ,int]nal ,rev5ue ,code ( #aihf 7z add$ by ?is section7 9 ! case ( any p>tn]%ip taxable ye> :i* includes ! date ( ! enactm5t ( ?is ,act1 ! am\nt ( ! net capital ga9 ref]r$ to 9 su* section %all be treat$ z be+ ! less] ( ! net capital ga9 = ! entire p>tn]%ip taxable ye> or ! net capital ga9 det]m9$ by only tak+ into acc\nt items attributable to ! portion ( ! p>tn]%ip taxable ye> :i* is aft] su* date4 7#c7 ,dispositions ( p>tn]%ip int]e/s 7,a7 ,9 g5]al ,section #gaj7;b7 ( su* ,code 7z add$ by ?is section7 %all apply to dispositions & di/ributions aft] ! date ( ! enactm5t ( ?is ,act4 7,b7 ,indirect dispositions ,! am5dm5ts made by subsection 7b7 %all apply to transactions aft] ! date ( ! enactm5t ( ?is ,act4 7#d7 ,o!r income & ga9 9 connection ) inve/m5t managem5t s]vices ,section #gaj7;e7 ( su* ,code 7z add$ by ?is section7 %all take effect on ! date ( ! enactm5t ( ?is ,act4 #ejf4 ,consi/5t treatm5t ( /ock options by corporations 7a7 ,consi/5t treatm5t = wage d$uction 7#a7 ,9 g5]al ,section #hc7;h7 is am5d$-- 7,a7 by /rik+ ,9 ! case ( & ins]t+3 7#a7 ,9 g5]al ,9 ! case ( 1 & 7,b7 by add+ at ! end ! foll[+ new p>agraph3 7#b7 ,/ock options ,9 ! case ( prop]ty transf]r$ to a p]son 9 connection ) a /ock option1 any d$uction relat$ to su* /ock option %all be all[$ only "u section #afb7q7 & p>agraph 7#a7 %all n apply4 4 7#b7 ,treatm5t ( comp5sation paid ) /ock options ,section #afb is am5d$ by r$esignat+ subsection 7q7 z subsection 7r7 & by ins]t+ aft] subsection 7p7 ! foll[+ new subsection3 7q7 ,treatm5t ( comp5sation paid ) /ock options 7#a7 ,9 g5]al ,9 ! case ( comp5sation = p]sonal s]vices t is paid ) /ock options1 ! d$uction "u subsection 7a77#a7 %all n exce$ ! am\nt ! taxpay] has treat$ z comp5sation co/ ) respect to su* /ock options = ! purpose ( asc]ta9+ income1 pr(it1 or loss 9 a report or /atem5t to %>ehold]s1 p>tn]s1 or o!r proprietors 7or to b5efici>ies71 & %all be tak5 into acc\nt 9 ! same p]iod t su* comp5sation co/ is recogniz$ = su* purpose4 7#b7 ,special rules = controll$ gr\ps ,! ,secret>y may prescribe rules = ! application ( p>agraph 7#a7 9 cases :]e ! /ock option is grant$ by-- 7,a7 a p>5t or subsidi>y corporation 7)9 ! mean+ ( section #dbd7 ( ! taxpay]1 or 7,b7 ano!r corporation4 4 7b7 ,consi/5t treatm5t = rese>* tax cr$it ,section #da7;b77#b77;,d7 is am5d$ by ins]t+ at ! end ! foll[+ new clause3 7iv7 ,special rule = /ock options ,! am\nt :i* may be treat$ z wages = any taxable ye> 9 connection ) ! issuance ( a /ock option %all n exce$ ! am\nt all[$ = su* taxable ye> z a comp5sation d$uction "u section #afb7q7 ) respect to su* /ock option4 4 7c7 ,application ( am5dm5ts ,! am5dm5ts made by ?is section %all apply to /ock options ex]cis$ aft] ! date ( ! enactm5t ( ?is ,act1 except t-- 7#a7 su* am5dm5ts %all n apply to /ock options t 7 grant$ be=e su* date & t ve/$ 9 taxable p]iods beg9n+ on or be=e ,june #ae1 #bjje1 7#b7 = /ock options t 7 grant$ be=e su* date ( enactm5t & ve/$ dur+ taxable p]iods beg9n+ aft] ,june #ae1 #bjje1 & end+ be=e su* date ( enactm5t1 a d$uction "u section #afb7q7 ( ! ,int]nal ,rev5ue ,code ( #aihf 7z add$ by subsection 7a77#b77 %all be all[$ 9 ! fir/ taxable p]iod ( ! taxpay] t ends aft] su* date ( enactm5t1 7#c7 = public entities report+ z small bus9ess issu]s & = nonpublic entities requir$ to file public reports ( f9ancial condition1 p>agraphs 7#a7 & 7#b7 %all be appli$ by sub/itut+ ,decemb] #ae1 #bjje = ,june #ae1 #bjje1 & 7#d7 no d$uction %all be all[$ "u section #hc7;h7 or section #afb7q7 ( su* ,code ) respect to any /ock option ! ve/+ date ( :i* is *ang$ to accel]ate ! "t at :i* ! option may be ex]cis$ 9 ord] to avoid ! applicability ( su* am5dm5ts4 #ejg4 ,application ( executive pay d$uction limit 7a7 ,9 g5]al ,subp>agraph 7,b7 ( section #afb7m77#d71 z r$esignat$ by p>agraphs 7#a77;,a7 & 7#b77;,a7 ( section #ejc7;b7 ( ?is ,act1 is am5d$ to read z foll[s3 7,b7 ,/ock option comp5sation ,! t]m applicable employee remun]ation %all include any comp5sation d$uct$ "u subsection 7q74 4 7b7 ,effective date ,! am5dm5t made by ?is section %all apply to /ock options ex]cis$ or grant$ aft] ! date ( ! enactm5t ( ?is ,act4 #ejh4 ,modifications to rules relat+ to inv]t$ corporations 7a7 ,9 g5]al ,subsection 7b7 ( section #ghgd ( ! ,int]nal ,rev5ue ,code ( #aihf is am5d$ to read z foll[s3 7b7 ,inv]t$ corporations treat$ z dome/ic corporations 7#a7 ,9 g5]al ,not)/&+ section #ggja7;a77#d71 a =eign corporation %all be treat$ = purposes ( ?is title z a dome/ic corporation if-- 7,a7 su* corporation w\ld be a surrogate =eign corporation if subsection 7a77#b7 7 appli$ by sub/itut+ #hj p]c5t = #fj p]c5t1 or 7,b7 su* corporation is an inv]t$ dome/ic corporation4 7#b7 ,inv]t$ dome/ic corporation ,= purposes ( ?is subsection1 a =eign corporation %all be treat$ z an inv]t$ dome/ic corporation if1 pursuant to a plan 7or a s]ies ( relat$ transactions7-- 7,a7 ! entity completes aft] ,febru>y #aj1 #bjaf1 ! direct or indirect acquisition (-- 7i7 sub/antially all ( ! prop]ties held directly or indirectly by a dome/ic corporation1 or 7ii7 sub/antially all ( ! assets (1 or sub/antially all ( ! prop]ties con/itut+ a trade or bus9ess (1 a dome/ic p>tn]%ip1 & 7,b7 aft] ! acquisition1 m ?an #ej p]c5t ( ! /ock 7by vote or value7 ( ! entity is held-- 7i7 9 ! case ( an acquisition ) respect to a dome/ic corporation1 by =m] %>ehold]s ( ! dome/ic corporation by reason ( hold+ /ock 9 ! dome/ic corporation1 or 7ii7 9 ! case ( an acquisition ) respect to a dome/ic p>tn]%ip1 by =m] p>tn]s ( ! dome/ic p>tn]%ip by reason ( hold+ a capital or pr(its int]e/ 9 ! dome/ic p>tn]%ip4 7#c7 ,exception = corporations ) sub/antial bus9ess activities 9 =eign c\ntry ( organization ,a =eign corporation describ$ 9 p>agraph 7#b7 %all n be treat$ z an inv]t$ dome/ic corporation if aft] ! acquisition ! exp&$ affiliat$ gr\p :i* includes ! entity has sub/antial bus9ess activities 9 ! =eign c\ntry 9 :i* or "u ! law ( :i* ! entity is creat$ or organiz$ :5 comp>$ to ! total bus9ess activities ( su* exp&$ affiliat$ gr\p4 ,= purposes ( subsection 7a77#b77;,b77iii7 & ! prec$+ s5t5ce1 ! t]m sub/antial bus9ess activities %all h ! mean+ giv5 su* t]m "u regulations 9 effect on ,febru>y #aj1 #bjaf1 except t ! ,secret>y may issue regulations increas+ ! ?re%old p]c5t 9 any ( ! te/s "u su* regulations = det]m9+ if bus9ess activities con/itute sub/antial bus9ess activities = purposes ( ?is p>agraph4 4 7b7 ,con=m+ am5dm5ts 7#a7 ,clause 7i7 ( section #ghgd7;a77#b77;,b7 ( su* ,code is am5d$ by /rik+ aft] ,m>* #d1 #bjjc1 & ins]t+ aft] ,m>* #d1 #bjjc1 & be=e ,febru>y #aa1 #bjaf14 7#b7 ,subsection 7c7 ( section #ghgd ( su* ,code is am5d$-- 7,a7 9 p>agraph 7#b7-- 7i7 by /rik+ subsection 7a77#b77;,b77ii7 & ins]t+ subsections 7a77#b77;,b77ii7 & 7b77#b77;,b71 & 7ii7 by ins]t+ or 7b77#b77;,a7 aft] 7a77#b77;,b77i7 9 subp>agraph 7,b71 7,b7 9 p>agraph 7#c71 by ins]t+ or 7b77#b77;,b71 z ! case may be1 aft] 7a77#b77;,b77ii71 7,c7 9 p>agraph 7#e71 by /rik+ subsection 7a77#b77;,b77ii7 & ins]t+ subsections 7a77#b77;,b77ii7 & 7b77#b77;,b71 & 7,d7 9 p>agraph 7#f71 by ins]t+ or inv]t$ dome/ic corporation1 z ! case may be1 aft] surrogate =eign corporation4 7c7 ,effective date ,! am5dm5ts made by ?is section %all apply to taxable ye>s end+ aft] ,febru>y #aj1 #bjaf4 #eji4 ,modifications ( =eign tax cr$it rules applicable to major integrat$ oil companies :i* are dual capacity taxpay]s 7a7 ,9 g5]al ,section #ija ( ! ,int]nal ,rev5ue ,code ( #aihf is am5d$ by r$esignat+ subsection 7n7 z subsection 7o7 & by ins]t+ aft] subsection 7m7 ! foll[+ new subsection3 7n7 ,special rules relat+ to major integrat$ oil companies :i* are dual capacity taxpay]s 7#a7 ,g5]al rule ,not)/&+ any o!r provision ( ?is *apt]1 any am\nt paid or accru$ by a dual capacity taxpay] :i* is a major integrat$ oil company 7)9 ! mean+ ( section #afg7;h77#e77 to a =eign c\ntry or possession ( ! ,unit$ ,/ates = any p]iod %all n be consid]$ a tax-- 7,a7 if1 = su* p]iod1 ! =eign c\ntry or possession does n impose a g5]ally applicable income tax1 or 7,b7 to ! ext5t su* am\nt exce$s ! am\nt 7det]m9$ 9 accordance ) regulations7 :i*-- 7i7 is paid by su* dual capacity taxpay] pursuant to ! g5]ally applicable income tax impos$ by ! c\ntry or possession1 or 7ii7 w\ld be paid if ! g5]ally applicable income tax impos$ by ! c\ntry or possession 7 applicable to su* dual capacity taxpay]4 ,no?+ 9 ?is p>agraph %all be con/ru$ to imply ! prop] treatm5t ( any su* am\nt n 9 excess ( ! am\nt det]m9$ "u subp>agraph 7,b74 7#b7 ,dual capacity taxpay] ,= purposes ( ?is subsection1 ! t]m dual capacity taxpay] means1 ) respect to any =eign c\ntry or possession ( ! ,unit$ ,/ates1 a p]son :o-- 7,a7 is subject to a levy ( su* c\ntry or possession1 & 7,b7 receives 7or w receive7 directly or indirectly a specific economic b5efit 7z det]m9$ 9 accordance ) regulations7 f su* c\ntry or possession4 7#c7 ,g5]ally applicable income tax ,= purposes ( ?is subsection-- 7,a7 ,9 g5]al ,! t]m g5]ally applicable income tax means an income tax 7or a s]ies ( income taxes7 :i* is g5]ally impos$ "u ! laws ( a =eign c\ntry or possession on income d]iv$ f ! conduct ( a trade or bus9ess )9 su* c\ntry or possession4 7,b7 ,exceptions ,su* t]m %all n include a tax unless x has sub/antial application1 by its t]ms & 9 practice1 to-- 7i7 p]sons :o are n dual capacity taxpay]s1 & 7ii7 p]sons :o are citiz5s or resid5ts ( ! =eign c\ntry or possession4 4 7b7 ,effective ,date 7#a7 ,9 g5]al ,! am5dm5ts made by ?is section %all apply to taxes paid or accru$ 9 taxable ye>s beg9n+ aft] ! date ( ! enactm5t ( ?is ,act4 7#b7 ,contr>y treaty obligations upheld ,! am5dm5ts made by ?is section %all n apply to ! ext5t contr>y to any treaty obligation ( ! ,unit$ ,/ates4 #eaj4 ,limitation on section #aii d$uction attributable to oil1 natural gas1 or prim>y products !re( 7a7 ,d5ial ( d$uction ,p>agraph 7#d7 ( section #aii7;c7 ( ! ,int]nal ,rev5ue ,code ( #aihf is am5d$ by add+ at ! end ! foll[+ new subp>agraph3 7,e7 ,special rule = c]ta9 oil & gas income ,9 ! case ( any taxpay] :o is a major integrat$ oil company 7)9 ! mean+ ( section #afg7;h77#e77 = ! taxable ye>1 ! t]m dome/ic production gross receipts %all n include gross receipts f ! production1 ref9+1 process+1 transportation1 or di/ribution ( oil1 gas1 or any prim>y product 7)9 ! mean+ ( subsection 7d77#i77 !re(4 4 7b7 ,effective date ,! am5dm5t made by ?is section %all apply to taxable ye>s beg9n+ aft] ,decemb] #ca1 #bjae4 #eaa4 ,limitation on d$uction = intangible drill+ & developm5t co/s2 amortization ( disall[$ am\nts 7a7 ,9 g5]al ,section #bfc7;c7 ( ! ,int]nal ,rev5ue ,code ( #aihf is am5d$ to read z foll[s3 7c7 ,intangible drill+ & developm5t co/s 9 ! case ( oil & gas wells & geo!rmal wells 7#a7 ,9 g5]al ,not)/&+ subsection 7a71 & except z provid$ 9 subsection 7i71 regulations %all be prescrib$ by ! ,secret>y "u ?is subtitle correspond+ to ! regulations :i* grant$ ! option to d$uct z exp5ses intangible drill+ & developm5t co/s 9 ! case ( oil & gas wells & :i* 7 recogniz$ & approv$ by ! ,congress 9 ,h\se ,concurr5t ,resolution #ej1 ,sev5ty-n9? ,congress4 ,su* regulations %all also grant ! option to d$uct z exp5ses intangible drill+ & developm5t co/s 9 ! case ( wells drill$ = any geo!rmal deposit 7z def9$ 9 section #fac7;e77#b77 to ! same ext5t & 9 ! same mann] z su* exp5ses are d$uctible 9 ! case ( oil & gas wells4 ,?is subsection %all n apply ) respect to any co/s to :i* any d$uction is all[$ "u section #ei7;e7 or #bia4 7#b7 ,exclusion 7,a7 ,9 g5]al ,?is subsection %all n apply to am\nts paid or incurr$ by a taxpay] 9 any taxable ye> 9 :i* su* taxpay] is a major integrat$ oil company 7)9 ! mean+ ( section #afg7;h77#e774 7,b7 ,amortization ( am\nts n all[able z d$uctions "u subp>agraph 7,a7 ,! am\nt n all[able z a d$uction = any taxable ye> by reason ( subp>agraph 7,a7 %all be all[able z a d$uction ratably ov] ! #fj-mon? p]iod beg9n+ ) ! mon? 9 :i* ! co/s are paid or incurr$4 ,= purposes ( section #abed1 any d$uction "u ?is subp>agraph %all be treat$ z a d$uction "u ?is subsection4 4 7b7 ,effective date ,! am5dm5t made by ?is section %all apply to am\nts paid or incurr$ 9 taxable ye>s beg9n+ aft] ,decemb] #ca1 #bjae4 #eab4 ,limitation on p]c5tage depletion all[ance = oil & gas wells 7a7 ,9 g5]al ,section #fac;,a ( ! ,int]nal ,rev5ue ,code ( #aihf is am5d$ by add+ at ! end ! foll[+ new subsection3 7f7 ,application ) respect to major integrat$ oil companies ,9 ! case ( any taxable ye> 9 :i* ! taxpay] is a major integrat$ oil company 7)9 ! mean+ ( section #afg7;h77#e771 ! all[ance = p]c5tage depletion %all be z]o4 4 7b7 ,effective date ,! am5dm5t made by ?is section %all apply to taxable ye>s beg9n+ aft] ,decemb] #ca1 #bjae4 #eac4 ,limitation on d$uction = t]ti>y injectants 7a7 ,9 g5]al ,section #aic ( ! ,int]nal ,rev5ue ,code ( #aihf is am5d$ by add+ at ! end ! foll[+ new subsection3 7d7 ,application ) respect to major integrat$ oil companies 7#a7 ,9 g5]al ,?is section %all n apply to am\nts paid or incurr$ by a taxpay] 9 any taxable ye> 9 :i* su* taxpay] is a major integrat$ oil company 7)9 ! mean+ ( section #afg7;h77#e774 7#b7 ,amortization ( am\nts n all[able z d$uctions "u p>agraph 7#a7 ,! am\nt n all[able z a d$uction = any taxable ye> by reason ( p>agraph 7#a7 %all be all[able z a d$uction ratably ov] ! #fj-mon? p]iod beg9n+ ) ! mon? 9 :i* ! co/s are paid or incurr$4 4 7b7 ,effective date ,! am5dm5t made by ?is section %all apply to am\nts paid or incurr$ 9 taxable ye>s beg9n+ aft] ,decemb] #ca1 #bjae4 #ead4 ,modification ( def9ition ( major integrat$ oil company 7a7 ,9 g5]al ,p>agraph 7#e7 ( section #afg7;h7 ( ! ,int]nal ,rev5ue ,code ( #aihf is am5d$ by add+ at ! end ! foll[+ new subp>agraph3 7,c7 ,c]ta9 successors 9 int]e/ ,= purposes ( ?is p>agraph1 ! t]m major integrat$ oil company includes any successor 9 int]e/ ( a company t 0 describ$ 9 subp>agraph 7,b7 9 any taxable ye>1 if su* successor controls m ?an #ej p]c5t ( ! crude oil production or natural gas production ( su* company4 4 7b7 ,con=m+ am5dm5ts 7#a7 ,9 g5]al ,subp>agraph 7,b7 ( section #afg7;h77#e7 ( ! ,int]nal ,rev5ue ,code ( #aihf is am5d$ by ins]t+ except z provid$ 9 subp>agraph 7,c71 aft] ,= purposes ( ?is p>agraph14 7#b7 ,taxable ye>s te/$ ,clause 7iii7 ( section #afg7;h77#e77;,b7 ( su* ,code is am5d$-- 7,a7 by /rik+ does n apply by reason ( p>agraph 7#d7 ( section #fac;,a7d7 & ins]t+ did n apply by reason ( p>agraph 7#d7 ( section #fac;,a7d7 = any taxable ye> aft] #bjjd1 & 7,b7 by /rik+ does n apply 9 subclause 7,,ii7 & ins]t+ did n apply = ! taxable ye>4 7c7 ,effective date ,! am5dm5ts made by ?is section %all apply to taxable ye>s beg9n+ aft] ,decemb] #ca1 #bjae4 #eae4 ,repeal ( out] ,cont95tal ,%elf deep wat] & deep gas royalty relief 7a7 ,9 g5]al ,sections #cdd & #cde ( ! ,en]gy ,policy ,act ( #bjje 7#db ,u4,s4,c4 #aeijd1 #aeije7 are repeal$4 7b7 ,adm9i/ration ,! ,secret>y ( ! ,int]ior %all n be requir$ to provide = royalty relief 9 ! lease sale t]ms beg9n+ ) ! fir/ lease sale held on or aft] ! date ( enactm5t ( ?is ,act = :i* a f9al notice ( sale has n be5 publi%$4 #eaf4 ,coord9ation ( ,am]ican ,opportunity ,cr$it & ,lifetime ,le>n+ ,cr$it ) ,pell ,grants n us$ = qualifi$ tuition & relat$ exp5ses 7a7 ,9 g5]al ,section #be;,a7g77#b7 ( ! ,int]nal ,rev5ue ,code ( #aihf is am5d$ to read z foll[s3 7#b7 ,adju/m5t = c]ta9 s*ol>%ips1 etc 7,a7 ,9 g5]al ,! am\nt ( qualifi$ tuition & relat$ exp5ses o!rwise tak5 into acc\nt "u subsection 7a7 ) respect to an individual = an academic p]iod %all be r$uc$ 7be=e ! application ( subsections 7b71 7c71 & 7d77 by ! sum ( any am\nts paid = ! b5efit ( su* individual :i* are allocable to su* p]iod z-- 7i7 a qualifi$ s*ol>%ip :i* is excludable f gross income "u section #aag1 7ii7 an educational assi/ance all[ance "u *apt] #cj1 #ca1 #cb1 #cd1 or #ce ( title #ch1 ,unit$ ,/ates ,code1 or "u *apt] #afjf ( title #aj1 ,unit$ ,/ates ,code1 & 7iii7 a paym5t 7o!r ?an a gift1 beque/1 devise1 or inh]itance )9 ! mean+ ( section #ajb7;a77 = su* individual's educational exp5ses1 or attributable to su* individual's enrollm5t at an eligible educational in/itution1 :i* is excludable f gross income "u any law ( ! ,unit$ ,/ates4 7,b7 ,coord9ation ) pell grants n us$ = qualifi$ tuition & relat$ exp5ses ,= purposes ( subp>agraph 7,a71 ! am\nt ( any ,f$]al ,pell ,grant "u section #dja ( ! ,high] ,education ,act ( #aife 7#bj ,u4,s4,c4 #ajgj;a7 %all be r$uc$ 7b n bel[ z]o7 by ! am\nt ( exp5ses 7o!r ?an qualifi$ tuition & relat$ exp5ses7 :i* are tak5 into acc\nt 9 det]m9+ ! co/ ( att5dance 7z def9$ 9 section #dgb ( ! ,high] ,education ,act ( #aife1 z 9 effect on ! date ( ! enactm5t ( ?is subp>agraph7 ( su* individual at an eligible educational in/itution = ! academic p]iod = :i* ! cr$it "u ?is section is be+ det]m9$4 4 7b7 ,effective date ,! am5dm5t made by ?is section %all apply to taxable ye>s beg9n+ aft] ,decemb] #ca1 #bjae4 #eag4 ,expansion ( ,pell ,grant exclusion f gross income 7a7 ,9 g5]al ,p>agraph 7#a7 ( section #aag7;b7 ( ! ,int]nal ,rev5ue ,code ( #aihf is am5d$-- 7#a7 by /rik+ ! p]iod at ! end & ins]t+ 1 or1 7#b7 by /rik+ receiv$ by an individual z a s*ol>%ip & ins]t+ ! foll[+3 receiv$ by an individual-- 7,a7 z a s*ol>%ip 1 & 7#c7 by add+ at ! end ! foll[+ new subp>agraph3 7,b7 z a ,f$]al ,pell ,grant "u section #dja ( ! ,high] ,education ,act ( #aife 7#bj ,u4,s4,c4 #ajgj;a74 4 7b7 ,effective date ,! am5dm5ts made by ?is section %all apply to taxable ye>s beg9n+ aft] ,decemb] #ca1 #bjae4