EXCESS NONCASH INCOME.

SEC. 1259. EXCESS NONCASH INCOME. Section 857(e)(2) (relating to determination of amount of excess noncash income) is amended— (1) by striking subparagraph (B), (2) by striking the period at the end of subparagraph (C) and inserting a comma, (3) by redesignating subparagraph (C) (as amended by paragraph (2)) as subparagraph (B), and (4) by adding at the end the following new subparagraphs: “(C) the amount (if any) by which— “(i) the amounts includible in gross income with respect to instruments to which section 860E(a) or 1272 applies, exceed “(ii) the amount of money and the fair market value of other property received during the taxable year under such instruments, and “(D) amounts includible in income by reason of cancellation of indebtedness.”.