AMENDMENTS RELATED TO THE TAXPAYER RELIEF ACT OF 1997.

SEC. 409. AMENDMENTS RELATED TO THE TAXPAYER RELIEF ACT OF 1997.(a) Amendments Related to Section 1055 of the Act.—(1) The last sentence of section 6411(a) is amended by striking “6611(f)(3)(B)” and inserting “6611(f)(4)(B)”.(2) Paragraph (4) of section 6601(d) is amended by striking “6611(f)(3)(A)” and inserting “6611(f)(4)(A)”.(b) Amendment Related to Section 1112 of the Act.—Subsection (c) of section 961 is amended to read as follows:“(c) Basis Adjustments in Stock Held by Foreign Corporations.—Under regulations prescribed by the Secretary, if a United States shareholder is treated under section 958(a)(2) as owning stock in a controlled foreign corporation which is owned by another controlled foreign corporation, then adjustments similar to the 119 STAT. 2636 adjustments provided by subsections (a) and (b) shall be made to—“(1) the basis of such stock, and“(2) the basis of stock in any other controlled foreign corporation by reason of which the United States shareholder is considered under section 958(a)(2) as owning the stock described in paragraph (1),but only for the purposes of determining the amount included under section 951 in the gross income of such United States shareholder (or any other United States shareholder who acquires from any person any portion of the interest of such United States shareholder by reason of which such shareholder was treated as owning such stock, but only to the extent of such portion, and subject to such proof of identity of such interest as the Secretary may prescribe by regulations). The preceding sentence shall not apply with respect to any stock to which a basis adjustment applies under subsection (a) or (b).”.(c) Amendment Related to Section 1144 of the Act.—Subparagraph (B) of section 6038B(a)(1) is amended by inserting “or” at the end.(d) Effective Date.—The amendments made by this section shall take effect as if included in the provisions of the Taxpayer Relief Act of 1997 to which they relate.