DEDUCTIONS FOR ATTENDING FOREIGN CONVENTIONS.

SEC. 602. DEDUCTIONS FOR ATTENDING FOREIGN CONVENTIONS. (a) Nondeductibility of Certain Expenses.— Section 274 (relating to disallowance of certain entertainment, etc., expenses) is amended by redesignating subsection (h) as subsection (i) and by inserting after subsection (g) the following new subsection: “(h) Foreign Conventions.— “(1) Deductions with respect to not more than 2 foreign conventions per year aliowed.— If any individual attends more than 2 foreign conventions during his taxable year— “(A) he shall select not more than 2 of such conventions to be taken into account for purposes of this subsection, and “(B) no deduction allocable to his attendance at any foreign convention during such taxable year (other than a foreign convention selected under subparagraph (A)) shall be allowed under section 162 or 212. “(2) Deductible transportation cost cannot exceed cost of coach or economy air fare.— In the case of any foreign convention, no deduction for the expenses of transportation outside the United States to and from the site of such convention shall be allowed under section 162 or 212 in an amount which exceeds the lowest coach or economy rate at the time of travel charged by a commercial airline for transportation to and from such site during the calendar month in which such convention begins. If there is no such coach or economy rate, the preceding sentence, shall be applied by substituting ‘first class’ for ‘coach or economy’. “(3) Transportation costs deductible in full only if at least one-half of the days are devoted to business related activities.— In the case of any foreign convention, a deduction for the full expenses of transportation (determined after the application of paragraph (2)) to and from the site of such convention shall be allowed only if more than one-half of the total days of the trip, excluding the days of transportation to and from the site of such convention, are devoted to business related activities. If less than one-half of the total days of the trip, excluding the days of transportation to and from the site of the convention, are devoted to business related activities, no deduction for the expenses of transportation shall be allowed which exceeds the percentage of the days of the trip devoted to business related activities. 90 STAT. 1573 “(4) Deductions for subsistence expenses not allowed unless the individual attend two-thirds of business activities.— In the case of any foreign convention, no deduction for subsistence expenses shall be allowed except as follows: “(A) a deduction for a full day of subsistence expenses while at the convention shall be allowed if there are at least 6 hours of scheduled business activities during such day and the individual attending the convention has attended at least two-thirds of these activities, and “(B) a deduction for one-half day of subsistence, expenses while at the convention shall be allowed if there are at least 3 hours of scheduled business activities during such day and the individual attending the convention has attended at least-two-thirds of these activities. Notwithstanding subparagraphs (A) and (B), a deduction for subsistence expenses for all of the days or half days, as the case may be, of the convention shall be allowed if the individual attending the convention has attended at least two-thirds of the scheduled business activities, and each such full day consists of at least 6 hours of scheduled business activities and each such half day consists of at least 3 hours of scheduled business activities. “(5) Deductible subsistence costs cannot exceed per diem rate for united states civil servants.— In the case of any foreign convention, no deduction for subsistence expenses while at the convention or traveling to or from such convention shall be allowed at a rate in excess of the dollar per diem rate for the site of the convention which has been established under section 5702(a) of title 5 of the United States (’ode and which is in effect for the calendar month in which the convention begins. “(6) Definitions and special rules.— For purposes of this subsection— “(A) Foreign convention defined.— The term ‘foreign convention’ means any convention, seminar, or similar meeting held outside the United States, its possessions, and the Trust Territory of the Pacific. “(B) Subsistence expenses defined.— The term ‘subsistence expenses’ means lodging, meals, and other necessary expenses for the personal sustenance and comfort of the traveler. Such term includes tips and taxi and other local transportation expenses, “(C) Allocation of expenses in certain cases.— In any case where the transportation expenses or the subsistence expenses are not separately stated, or where there is reason to believe that the stated charge for transportation expenses or subsistence expenses or both does not properly reflect the amounts properly allocable to such purposes, all amounts paid for transportation expenses and subsistence expenses shall be treated as having been paid solely for subsistence expenses. “(D) Subsection to apply’ to employer as well as to traveler.— This subsection shall apply to deductions otherwise allowable under section 162 or 212 to any person, whether or not such person is the individual attending the foreign convention. For purposes of the preceding sentence such person shall be treated, with respect to each individual, as having selected the same 2 foreign conventions as were selected by such individual. 90 STAT. 1574 “(7) Reporting requirements.— No deduction shall be allowed under section 162 or 212 for transportation or subsistence expenses allocable to attendance at a foreign convention unless the tax-payer claiming the deduction attaches to the return of tax on which the deduction is claimed— “(A) a written statement signed by the individual attending the convention which includes— “(i) information with respect to the total days of the trip, excluding the days of transportation to and from the site of such convention, and the number of hours of each day of the trip which such individual devoted to scheduled business activities, “(ii) a program of the scheduled business activities of the convention, and “(iii) such other information as may be required in regulations prescribed by the Secretary; and “(B) a written statement signed by an officer of the organization or group sponsoring the convention which includes— “(i) a schedule of the business activities of each day of the convention, “(ii) the number of hours which the individual attending the convention attended such scheduled business activities, and “(iii) such other information as may be required in regulations prescribed by the Secretary. (b) Effective Date.— The amendments made by this section shall apply to conventions beginning after December 31, 1976.