Sec. 5. Withholding of tax on nonresident aliens
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(1)of section 871(a) (relating to income not connected with United States business) is amended— by striking and at the end of subparagraph (C), by inserting and at the end of subparagraph (D), and by inserting after subparagraph
(D)the following new subparagraph: the gross amount of winnings from each wager placed over the Internet with a person required to be licensed under section 5382 of chapter 53 of title 31, United States Code (as such terms are defined in section 6050X(d)(2)), . Section 871(j) (relating to exemption for certain gambling winnings) is amended by inserting before the period at the end the following: or to any bets or wagers placed over the Internet (as such terms are defined in section 6050X(d)(2)) . The first sentence of subsection
(b)of section 1441 (relating to withholding of tax on nonresident aliens) is amended by inserting after gains subject to tax under section 871(a)(1)(D), the following: the gross amount of winnings from wagers placed over the Internet described in section 871(a)(1)(E), . Subsection
(a)of section 861 is amending by inserting at the end thereof the following new paragraph: Any Internet gambling winnings received from an Internet gambling licensee (as defined by section 4491(d)(1)). . The amendments made by this section shall apply to bets or wagers placed after the date of the enactment of this Act.