Sec. 502. Reduced recognition period for built-in gains of S corporations made permanent
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(7)of section 1374(d) of the Internal Revenue Code of 1986 is amended to read as follows: The term recognition period means the 5-year period beginning with the 1st day of the 1st taxable year for which the corporation was an S corporation. For purposes of applying this section to any amount includible in income by reason of distributions to shareholders pursuant to section 593(e), the preceding sentence shall be applied without regard to the phrase 5-year . If an S corporation sells an asset and reports the income from the sale using the installment method under section 453, the treatment of all payments received shall be governed by the provisions of this paragraph applicable to the taxable year in which such sale was made. . The amendment made by this section shall apply to taxable years beginning after December 31, 2013.