FOREIGN PERSONAL HOLDING COMPANIES.

SEC. 33. FOREIGN PERSONAL HOLDING COMPANIES. (a) Adjustments to Taxable Income for Charitable Contributions.— (1) The first sentence of section 556 (b) (2) relating to adjustments to taxable income to determine undistributed foreign personal holding company income) is amended to read as follows: “The deduction for charitable contributions provided under section 170 shall be allowed, but in computing such deduction the limitations in section 170 (b) (1) (A) and (B) shall apply, and section 170 (b) (2) shall not apply.” (2) The second sentence of section 556 (b) (2) is amended by striking out “the taxable income computed with the adjustments provided in section 170 (b) (2)” and inserting in lieu thereof “the taxable income computed with the adjustments (other than the 5-percent limitation) provided in the first sentence of section 170 (b) (2)”. (b) Special Deductions Disallowed.— (1) Section 556 (b) (3) (relating to adjustments to taxable income to determine undistributed foreign personal holding company income) is amended by striking out “sections 242 and 248” and inserting in lieu thereof “section 248”. (2) The amendment made by paragraph (1) shall apply only with respect to taxable years ending after December 31, 1957. (c) Net Operating Loss.— (1) Section 556 (b) (4) (relating to adjustments to taxable income to determine undistributed foreign personal holding company income) is amended by inserting before the period at the end thereof “computed without the deductions provided in part VIII (except section 248) of subchapter B”. (2) The amendment made by paragraph (1) shall apply with respect to adjustments under section 556 (b) (4) of the Internal Revenue Code of 1954 for taxable years ending after December 31, 1957. (d) Cross Reference.— (1) Part III of subchapter G of chapter 1 (relating to foreign personal holding companies) is amended by adding at the end thereof the following new section: “SEC. 558. RETURNS OF OFFICERS, DIRECTORS, AND SHAREHOLDERS OF FOREIGN PERSONAL HOLDING COMPANIES. “For provisions relating to returns of officers, directors, and shareholders of foreign personal holding companies, see section 6035.” (2) The table of sections for such part III is amended by adding at the end thereof the following: “Sec. 558. Returns of officers, directors, and shareholders of foreign personal holding companies.”