MITIGATION OF EFFECT OF STATUTE OF LIMITATIONS.

SEC 211. MITIGATION OF EFFECT OF STATUTE OF LIMITATIONS. (a) Amendment of Section 3801 (b).— Section 3801 (b) (relating to circumstances of adjustment) is hereby amended by inserting after paragraph (5) the following new paragraphs: “(6) Disallows a deduction or credit which should have been allowed to, but was not allowed to, the taxpayer for another taxable year, or to a related taxpayer; but this paragraph shall apply only if (A) the determination became final on or after June 1, 1952, and (B) credit or refund of the overpayment attributable to the deduction or credit which should have been allowed to the taxpayer or related taxpayer was not barred, by any law or rule of law, at the time the taxpayer first maintained before the Secretary or the Tax Court of the United States, in writing, that he was entitled to such deduction or credit in the taxable year for which it is so disallowed; or “(7) Requires the exclusion from gross income of an item which is includible in the gross income of the taxpayer for another taxable year or in the gross income of a related taxpayer; but this paragraph shall apply only if (A) the determination became final on or after June 1, 1952, and (B) assessment of deficiency under section 272 (a) by the Secretary for such other taxable year or against such related taxpayer was not barred, by any law or rule of law, at the time the Secretary first maintained in a notice of deficiency sent pursuant to section 272 (a) or before the Tax Court of the United States, that such item should be included in the gross income of the taxpayer for the taxable year to which the determination relates—”. (b) Technical Amendments.— (1) Paragraph (5) of section 3801 (b) is hereby amended by striking out “transaction—” and inserting in lieu thereof “transaction; or”. (2) The second sentence of section 3801 (b) is hereby amended by striking out “Such” and inserting in lieu thereof “Except in cases described in paragraphs (6) and (7), such”. (c) Effective Date.— The amendments made by subsections (a) and (b) shall be effective as if included in the Internal Revenue Code at the time of its enactment. In any case in which the determination referred to in paragraph (6) or (7) of section 3801 (b), as amended by subsection (a) of this section, became final lief ore the date of the enactment of this Act, the one-year period described in section 3801 (c) shall be extended to include the one-year period beginning with the date of the enactment of this Act.