USE OF PASSIVE ACTIVITY LOSS AND AT-RISK AMOUNTS BY QUALIFIED SUBCHAPTER S TRUST INCOME BENEFICIARIES.

SEC. 236. USE OF PASSIVE ACTIVITY LOSS AND AT-RISK AMOUNTS BY QUALIFIED SUBCHAPTER S TRUST INCOME BENEFICIARIES.(a) In General.—Section 1361(d)(1) (relating to special rule for qualified subchapter S trust) is amended—(1) by striking “and” at the end of subparagraph (A), (2) by striking the period at the end of subparagraph (B) and inserting “, and”, and(3) by adding at the end the following new subparagraph:“(C) for purposes of applying sections 465 and 469 to the beneficiary of the trust, the disposition of the S corporation stock by the trust shall be treated as a disposition by such beneficiary.”.(b) Effective Date.—The amendments made by this section shall apply to transfers made after December 31, 2004. 118 STAT. 1436