SPECIAL RULE FOR BANK REQUIRED TO CHANGE FROM THE RESERVE METHOD OF ACCOUNTING ON BECOMING S CORPORATION.

SEC. 8233. SPECIAL RULE FOR BANK REQUIRED TO CHANGE FROM THE RESERVE METHOD OF ACCOUNTING ON BECOMING S CORPORATION.(a) In General.—Section 1361, as amended by this Act, is amended by adding at the end the following new subsection:“(g) Special Rule for Bank Required To Change From the Reserve Method of Accounting on Becoming S Corporation.—In the case of a bank which changes from the reserve method of accounting for bad debts described in section 585 or 593 for its first taxable year for which an election under section 1362(a) is in effect, the bank may elect to take into account any adjustments under section 481 by reason of such change for the taxable year immediately preceding such first taxable year.”.(b) Effective Date.—The amendments made by this section shall apply to taxable years beginning after December 31, 2006.