Pub. L. 91-518, tit. IX, sec. 901

Sec. 901. (a) Part VIII of subchapter B of chapter 1 of the Internal Revenue Code of 1954 (relating to special deductions for corporations) is amended by adding at the end thereof the following new section: “SEC. 250. CERTAIN PAYMENTS TO THE NATIONAL RAILROAD PASSENGER CORPORATION. “(a) General Rule.— If— “(1) any corporation which is a common carrier by railroad (as defined in section 1(3) of the Interstate Commerce Act (49 U.S.C. 1(3))) makes a payment in cash, rail passenger equipment, or services to the National Railroad Passenger Corporation (hereinafter in this section referred to as the ‘Passenger Corporation’) pursuant, to a contract entered into under section 401(a) of the Rail Passenger Service Act of 1970, and “(2) no stock in the Passenger Corporation is issued at any time to such corporation in connection with any contract entered into under such section 401(a), then the amount of such payment shall (subject to subsection (c)) be allowed as a deduction for the taxable year in which it is made. “(b) When Payment Is Made.— Under regulations prescribed by the Secretary or his delegate, a payment in rail passenger equipment shall be treated as made when title to the equipment is transferred, and a payment in services shall be treated as made when the services are rendered, “(c) Effect of Certain Subsequent Acquisitions of Stock.— “(1) Disallowance of deductions.— If any deduction has been allowed under subsection (a) to a corporation and such corporation (or a successor corporation) acquires any stock in the Passenger Corporation (other than in a transaction described in section 374 or 381) before the close of the 36-month period which begins with the day on which the last payment is made to the Passenger Corporation pursuant to the contract entered into under such section 401 (a), then such deduction shall be disallowed (as of the close of the taxable year for which it was allowed under subsection (a)). “(2) Collection of deficiency.— If any deduction is disallowed by reason of paragraph (1), then the periods of limitation provided in sections 6501 and 6502 on the making of an assessment and the collection by levy or a proceeding in court shall, with respect to any deficiency (including interest and additions to the tax) resulting from such a disallowance, include one year following the date on which the person acquiring the stock which results in the disallowance (in accordance with regulations prescribed by the Secretary or his delegate) notifies the Secretary or his delegate of such acquisition; and such assessment and col-84 Stat. 1342lection may be made notwithstanding any provision of law or ride of law which otherwise would prevent such assessment and collection. “(d) Members of Controlled Group.— Under regulations prescribed by the Secretary or his delegate, if a corporation is a member of a controlled group of corporations (within the meaning of section 1563), subsections (a)(2) and (c) shall be applied by treating all members of such control led group as one corporation.” (b) The table of sections for such part VIII is amended by adding at the end thereof the following: “Sec. 250. Certain payments to the National Railroad Passenger Corporation.”. (c) The amendments made by this section shall apply to taxable years ending after the date of the enactment of this Act.