Sec. 3642. Hedging provisions

367 words·~2 min read·/bill/113/hr/1/ih/section-3642

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Subparagraph

(G)of section 856(c)(5) is amended by striking and at the end of clause (i), by striking the period at the end of clause

(ii)and inserting , and , and by adding at the end the following new clause: if— a real estate investment trust enters into one or more positions described in clause

(i)with respect to indebtedness described in clause

(i)or one or more positions described in clause

(ii)with respect to property which generates income or gain described in paragraph

(2)or (3), any portion of such indebtedness is extinguished or any portion of such property is disposed of, and in connection with such extinguishment or disposition, such trust enters into one or more transactions which would be hedging transactions described in subparagraph

(B)or

(C)of section 1221(b)(2) with respect to any position referred to in subclause

(I)if such position were ordinary property, any income of such trust from any position referred to in subclause

(I)and from any transaction referred to in subclause

(III)(including gain from the termination of any such position or transaction) shall not constitute gross income under paragraphs

(2)and

(3)to the extent that such transaction hedges such position. . Subparagraph

(G)of section 856(c)(5), as amended by subsection (a), is amended by striking and at the end of clause (ii), by striking the period at the end of clause

(iii)and inserting , and , and by adding at the end the following new clause: clauses (i), (ii), and

(iii)shall not apply with respect to any transaction unless such transaction satisfies the identification requirement described in section 1221(b)(3)(A) (determined after taking into account any curative provisions provided under the regulations referred to therein). . Subparagraph

(G)of section 856(c)(5) is amended— by striking which is clearly identified pursuant to section 1221(a)(7) in clause (i), and by striking , but only if such transaction is clearly identified as such before the close of the day on which it was acquired, originated, or entered into (or such other time as the Secretary may prescribe) in clause (ii). The amendments made by this section shall apply to taxable years beginning after December 31, 2014.