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PUBLIC LAW 103-66—AUG. 10, 1993 107 STAT. 505 (B) Paragraph (8) of section 954(b) is amended by 26 use 954. striking "(1)/'. (b) TREATMENT OF SHIPPING INCOME.—Subsection (f) of section 954 is amended by adding at the end thereof the following new sentence: "Except as provided in paragraph (1), such term shall not include any dividend or interest income which is foreign per- sonal holding company income (as defined in subsection (c)).". (c) EFFECTIVE DATE.—The amendments made by this section 26 use 904 note. shall apply to taxable years beginning after December 31, 1992. SEC. 13236. MODIFICATIONS OF ACCURACY-RELATED PENALTY. (a) THRESHOLD REQUIREMENT.—Clause (ii) of section 6662(eXlXB) (relating to substantial valuation misstatement imder chapter 1) is amended to read as follows: ''(ii) the net section 482 transfer price adjustment for the taxable year exceeds the lesser of $5,000,000 or 10 percent of the taxpayer's gross receipts." (b) CERTAIN ADJUSTMENTS EXCLUDED IN DETERMINING THRESH- OLD.—Subparagraph (B) of section 6662(eX3) is amended to read as follows: **(B) CERTAIN ADJUSTMENTS EXCLUDED IN DETERMINING THRESHOLD.—For purposes of determining whether the threshold requirements of paragraph (lXB)(ii) are met, the following shall be excluded: "(i) Any portion of the net increase in taxable income referred to in subparagraph (A) which is attrib- utable to any redetermination of a price if— ''(I) it is established that the taxpayer deter- mined such price in accordance with a specific pricing method set forth in the regulations pre- scribed under section 482 and that the taxpayer's vise of such method was reasonable, "(II) the taxpayer has documentation (which was in existence as of the time of filing the return) which sets forth the determination of such price in accordance with such a method and which estab- lishes that the use of such method was reasonable, and "(III) the taxpayer provides such documenta- tion to the Secretary within 30 days of a request for such documentation. "(ii) Any portion of the net increase in taxable income referred to in subparagraph (A) which is attrib- utable to a redetermination of price where such price was not determined in accordance with such a specific pricing method if— "(I) the taxpayer establishes that none of such pricing methods was likely to result in a price that would clearly reflect income, the taxpayer used another pricing method to determine such price, and such other pricing method was likely to result in a price that would clearly reflect income, "(II) the taxpayer has documentation (which was in existence as of the time of filing the return) which sets forth the determination of such price in accordance with such other method and which