Text: H.R.5369 — 101st Congress (1989-1990)All Information (Except Text)

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HR 5369 IH
101st CONGRESS
2d Session
 H. R. 5369
To amend the Internal Revenue Code of 1986 to provide a fixed rate of
interest on the postponed estate tax attributable to a reversionary or
remainder interest in property included in the estate.
IN THE HOUSE OF REPRESENTATIVES
July 25, 1990
Mr. SCHULZE (for himself, Mr. ANTHONY, Mrs. BOGGS, and Mr. MURTHA) introduced
the following bill; which was referred to the Committee on Ways and Means
A BILL
To amend the Internal Revenue Code of 1986 to provide a fixed rate of
interest on the postponed estate tax attributable to a reversionary or
remainder interest in property included in the estate.
  Be it enacted by the Senate and House of Representatives of the United
  States of America in Congress assembled,
SECTION 1. RATE OF INTEREST ON ESTATE TAX ATTRIBUTABLE TO REVERSIONARY OR
REMAINDER INTERESTS IN PROPERTY.
  (a) IN GENERAL- Section 6601 of the Internal Revenue Code of 1986 (relating
  to interest on underpayment, nonpayment, or extension of time for payment,
  of tax) is amended by redesignating subsection (k) as subsection (l)
  and by inserting after subsection (j) the following new subsection:
  `(k) RATE OF INTEREST ON PORTION OF ESTATE TAX POSTPONED UNDER SECTION
  6163(a)-
  `(1) IN GENERAL- If the time for payment of an amount of tax imposed
  by chapter 11 is postponed as provided in section 6163(a), interest on
  the amount so postponed shall (in lieu of the annual rate provided by
  subsection (a)) be paid at the discount rate (and compounded annually)
  for the period of the postponement under section 6163(a).
  `(2) DISCOUNT RATE- For purposes of paragraph (1), the term `discount rate'
  means the rate used for purposes of chapter 11 to value the reversionary
  or remainder interest in property included in the gross estate.'
  (b) EFFECTIVE DATE-
  (1) IN GENERAL- The amendment made by this section shall apply to interest
  on taxes the payment of which is postponed until after October 6, 1988,
  under section 6163 of the Internal Revenue Code of 1986 but only if the
  value of the reversionary and remainder interests in property included in
  the gross estate exceeds 45 percent of the value of the gross estate.
  (2) EXCEPTION FOR INTEREST PAID ON OR BEFORE OCTOBER 6, 1988- The interest
  required to be paid with respect to an estate tax postponed under section
  6163 of such Code after the application of the amendment made by this
  section shall not be less than the interest paid on or before October 6,
  1988, with respect to the estate tax so postponed.
  (3) EXCEPTION FOR INTEREST FOR PERIOD TO WHICH 4 PERCENT RATE APPLIED-
  The amendment made by this section shall not apply to interest for periods
  to which section 6601(b) of the Internal Revenue Code of 1954 applied
  (as in effect before its repeal by Public Law 93-625).
  (4) STATUTE OF LIMITATIONS- If refund or credit of any overpayment of tax
  resulting from the application of the amendment made by this section is
  prevented at any time before the close of the 90-day period beginning on
  the date of the enactment of this Act by the operation of any law or rule
  of law (including res judicata), refund or credit of such overpayment (to
  the extent attributable to such amendment) may, nevertheless, be made or
  allowed if claim therefor is filed before the close of such 90-day period.
SEC. 2. LIMITATION ON ESTATES ELIGIBLE TO POSTPONE PAYMENT OF TAX BY REASON
OF INCLUDIBLE REVERSIONARY OR REMAINDER INTEREST.
  (a) IN GENERAL- Subsection (a) of section 6163 of the Internal Revenue
  Code of 1986 is amended--
  (1) by striking `the gross estate,' and inserting `the gross estate and
  the value of such interests exceed 45 percent of the value of the gross
  estate,', and
  (2) by striking `such interest' and inserting `such interests'.
  (b) EFFECTIVE DATE- The amendment made by this section shall apply to
  estates with respect to which an election is made under section 6163(a)
  of the Internal Revenue Code of 1986 after the date of the enactment of
  this Act.

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