Sec. 3431. Termination of private activity bonds

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Paragraph

(1)of section 103(b) is amended— by striking which is not a qualified bond (within the meaning of section 141) , and by striking in the heading thereof. which is not a qualified bond Section 141 is amended by striking subsection (e). Subpart A of part IV of subchapter B of chapter 1 is amended by striking sections 142, 143, 144, 145, 146, and 147 (and by striking each of the items relating to such sections in the table of sections for such subpart). Section 25 is amended by adding at the end the following new subsection: Any reference to section 143, 144, or 146 shall be treated as a reference to such section as in effect before its repeal by the Tax Reform Act of 2014 . . Section 26(b)(2) is amended by striking subparagraph (D). Section 141(b) is amended by striking paragraphs

(5)and

(9)and by redesignating paragraphs (6), (7), and

(8)as paragraphs (5), (6), and (7), respectively. Section 141(d) is amended by striking paragraph

(5)and by redesignating paragraphs

(6)and

(7)as paragraphs

(5)and (6). Section 148(b)(2)(E) is amended by striking in the case of a bond other than a private activity bond, . Section 148(b)(3) is amended to read as follows: The term investment property does not include any tax-exempt bond. . Section 148(f)(3) is amended by striking or is a private activity bond in the fourth sentence. Section 148(f)(4) is amended— by striking (determined in accordance with section 147(b)(2)(A)) in the flush matter following subparagraph (A)(ii), by striking the last sentence of subparagraph (D)(v), and by adding at the end the following new subparagraph: For purposes of this paragraph, the average maturity of any issue shall be determined by taking into account the respective issue prices of the bonds issued as part of such issue. . Section 148(f)(4)(A) is amended in the flush matter after clause

(ii)by striking In the case of an issue no bond of which is a private activity bond, clause and inserting Clause . Section 148(f)(4)(B)(ii) is amended— by striking subclause (II), and by striking and all that follows through certain bonds.— issue described in subclause

(II)and inserting . certain bonds.— In the case of an issue no bond of which is a tax or revenue anticipation bond Section 148(f)(4)(C)(iv) is amended to read as follows: For purposes of this subparagraph, the term construction issue means any issue if at least 75 percent of the available construction proceeds of such issue are to be used for construction expenditures with respect to property which is to be owned by a governmental unit. . Section 148(f)(4)(C) is amended by redesignating clauses

(v)through

(xvii)as clauses

(viii)through (xx), respectively, and by inserting after clause

(iv)the following new clauses: For purposes of this subparagraph, the term construction includes reconstruction and rehabilitation. For purposes of this subparagraph, property leased by a governmental unit shall be treated as owned by such governmental unit if— the lessee makes an irrevocable election (binding on the lessee and all successors in interest under the lease) not to claim depreciation or an investment credit with respect to such property, the lease term (as defined in section 168(h)(1)) is not more than 80 percent of the reasonably expected economic life of the property, and the lessee has no option to purchase the property other than at fair market value (as of the time such option is exercised). For purposes of clause (vi), the reasonably expected economic life of any facility shall be determined as of the later of— the date on which the bonds are issued, or the date on which the facility is placed in service (or expected to be placed in service). . Section 148(f)(4)(D) is amended by striking subparagraph (C)(iv) each place it appears and inserting subparagraph (C)(v) . Section 148(f)(4)(D)(i) is amended— by striking subclause (II), by striking (other than private activity bonds) in subclause (IV), and by redesignating subclauses

(III)and

(IV)(as amended by subparagraph (B)) as subclauses

(II)and (III). Section 148(f)(4)(D)(ii) is amended by striking subclause

(IV)both places it appears and inserting subclause

(III). Section 148(f)(4)(D)(iii) is amended by striking subclause

(IV)and inserting subclause

(III). Section 148(f)(4)(D)(iv)(II) is amended by striking clause (i)(IV) and inserting clause (i)(III) . Section 148(f)(4)(D)(vi) is amended by striking the last sentence. Section 148(f)(7) is amended by striking subparagraph

(A)and by redesignating subparagraphs

(B)and

(C)as subparagraphs

(A)and (B). Section 149(b)(3) is amended— by striking subparagraph

(C)and by redesignating subparagraphs

(D)and

(E)as subparagraphs

(C)and (D), and by striking subparagraph

(E)in subparagraph (A)(iv) and inserting subparagraph

(D). Section 149(e)(2) is amended— by striking subparagraphs (C), (D), and

(F)and by redesignating subparagraphs

(E)and

(G)as subparagraphs

(C)and (D), respectively, and by striking the second sentence. Section 149(f)(6) is amended— by striking subparagraph (B), and by striking For purposes of this subsection and all that follows through The term and inserting the following: For purposes of this subsection, the term . Section 150 is amended by striking subsections

(b)and

(c)and by redesignating subsections

(d)and

(e)as subsections

(b)and (c), respectively. Section 150(e)(3) is amended to read as follows: A bond shall not be treated as part of an issue which meets the requirements of paragraph

(1)unless such bond satisfies the requirements of section 147(f)(2) (as in effect before its repeal by the Tax Reform Act of 2014 ). . Section 269A(b)(3) is amended by striking 144(a)(3) and inserting 414(n)(6)(A) . Section 414(m)(5) is amended by striking section 144(a)(3) and inserting subsection (n)(6)(A) . Section 414(n)(6)(A) is amended to read as follows: A person is a related person to another person if— the relationship between such persons would result in a disallowance of losses under section 267 or 707(b), or such persons are members of the same controlled group of corporations (as defined in section 1563(a), except that more than 50 percent shall be substituted for at least 80 percent each place it appears therein). . Section 6045(e)(4)(B) is amended by inserting (as in effect before its repeal by the after Tax Reform Act of 2014 ) section 143(m)(3) . Section 6654(f)(1) is amended by inserting (as in effect before its repeal by the after Tax Reform Act of 2014 ) section 143(m) . Section 7871(c) is amended— by striking paragraphs

(2)and (3), and by striking and all that follows through tax-exempt bonds.— Subsection

(a)of section 103 and inserting the following: . tax-exempt bonds.— Subsection

(a)of section 103 The amendments made by this section shall apply to bonds issued after December 31, 2014.