TREATMENT OF TIMBER GAINS.

SEC. 334. TREATMENT OF TIMBER GAINS. (a) [26 U.S.C. 1201] In General.—Section 1201(b) is amended to read as follows: “(b) Special Rate for Qualified Timber Gains.— “(1) In general.—If, for any taxable year beginning in 2016, a corporation has both a net capital gain and qualified timber gain— “(A) subsection (a) shall apply to such corporation for the taxable year without regard to whether the applicable tax rate exceeds 35 percent, and “(B) the tax computed under subsection (a)(2) shall be equal to the sum of— “(i) 23.8 percent of the least of— “(I) qualified timber gain, “(II) net capital gain, or “(III) taxable income, plus “(ii) 35 percent of the excess (if any) of taxable income over the sum of the amounts for which a tax was determined under subsection (a)(1) and clause (i). “(2) Qualified timber gain.—For purposes of this section, the term ‘qualified timber gain’ means, with respect to any taxpayer for any taxable year, the excess (if any) of— “(A) the sum of the taxpayer’s gains described in subsections (a) and (b) of section 631 for such year, over “(B) the sum of the taxpayer’s losses described in such subsections for such year. For purposes of subparagraphs (A) and (B), only timber held more than 15 years shall be taken into account.” . (b) [26 U.S.C. 55] Conforming Amendment.—Section 55(b) is amended by striking paragraph (4). (c) [26 U.S.C. 55 note] Effective Date.—The amendments made by this section shall apply to taxable years beginning after December 31, 2015.