EXECUTOR OF ESTATE AND BENEFICIARIES TREATED AS RELATED PERSONS FOR DISALLOWANCE OF LOSSES, ETC.

SEC. 1308. EXECUTOR OF ESTATE AND BENEFICIARIES TREATED AS RELATED PERSONS FOR DISALLOWANCE OF LOSSES, ETC. (a) Disallowance of Losses.—Subsection (b) of section 267 (relating to losses, expenses, and interest with respect to transactions between related taxpayers) is amended by striking “or” at the end of paragraph (11), by striking the period at the end of paragraph (12) and inserting or”, and by adding at the end the following new paragraph: “(13) Except in the case of a sale or exchange in satisfaction of a pecuniary bequest, an executor of an estate and a beneficiary of such estate.”. (b) Ordinary Income From Gain From Sale of Depreciable Property.—Subsection (b) of section 1239 is amended by striking the period at the end of paragraph (2) and inserting “, and” and by adding at the end the following new paragraph:111 STAT. 1042 “(3) except in the case of a sale or exchange in satisfaction of a pecuniary bequest, an executor of an estate and a beneficiary of such estate.”. (c) Effective Date.—The amendments made by this section shall apply to taxable years beginning after the date of the enactment of this Act.