CREDITS FOR DIVIDENDS RECEIVED AND FOR PARTIALLY TAX-EXEMPT INTEREST IN CASE OF NONRESIDENT ALIENS.

SEC. 41. CREDITS FOR DIVIDENDS RECEIVED AND FOR PARTIALLY TAX-EXEMPT INTEREST IN CASE OF NONRESIDENT ALIENS. (a) Minimum Tax.— Section 871 (b) (relating to tax on certain nonresident alien individuals) is amended— (1) by striking out the semicolon at the end of paragraph (2) and inserting in lieu thereof a period; (2) by striking out paragraph (3); and (3) by adding at the end thereof the following new sentences: “If (without regard to this sentence) the amount of the taxes imposed in the case of such an individual under section 1 or under section 1201 (b), minus the sum of the credits under sections 34 and 35, is an amount which is less than 30 percent of the sum of— “(A) the aggregate amount received from the sources specified in subsection (a) (1), plus “(B) the amount, determined under subsection (a) (2), by which gains from sales or exchanges of capital assets exceed losses from such sales or exchanges, then this subsection shall not apply and subsection (a) shall apply. For purposes of this subsection, the term ‘aggregate amount received from the sources specified in subsection (a) (1)’ shall be applied without any exclusion under section 116.” (b) Credit for Partially Tax-Exempt Interest.—Section 35 (relating to credit for partially tax-exempt interest received by individuals) is amended by redesignating subsection (c) as subsection (d) and by inserting after subsection (b) the following new subsection: “(c) Certain Nonresident Aliens Ineligible for Credit.—No credit shall be allowed under subsection (a) to a nonresident alien individual with respect to whom a tax is imposed for the taxable year under section 871 (a).” (c) Effective Date.—The amendments made by this section shall apply only with respect to taxable years beginning after December 31, 1957.