HR 544 IH

To amend the Internal Revenue Code of 1986 to increase the small issuer exemption from pro rata allocation of interest expense of financial institutions to tax-exempt interest.

February 3, 1999

Mr. HAYWORTH (for himself and Mr. LEWIS of Georgia) introduced the following bill; which was referred to the Committee on Ways and Means

To amend the Internal Revenue Code of 1986 to increase the small issuer exemption from pro rata allocation of interest expense of financial institutions to tax-exempt interest.

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

SECTION 1. INCREASE IN SMALL ISSUER EXEMPTION FROM PRO RATA ALLOCATION OF INTEREST EXPENSE OF FINANCIAL INSTITUTIONS TO TAX-EXEMPT INTEREST.

(a) IN GENERAL- Subparagraphs (C) and (D) of section 265(b)(3) of the Internal Revenue Code of 1986 (pro rata allocation of interest expense of financial institutions to tax-exempt interest) are each amended by striking `$10,000,000' each place it appears and inserting `$25,000,000'.

(b) EFFECTIVE DATE- The amendment made by subsection (a) shall apply to bonds issued after the date of the enactment of this Act.

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