Page 16

131 STAT. 2068 PUBLIC LAW 115–97—DEC. 22, 2017 ‘‘(4) QUALIFIED COOPERATIVE DIVIDEND.—The term ‘quali- fied cooperative dividend’ means any patronage dividend (as defined in section 1388(a)), any per-unit retain allocation (as defined in section 1388(f)), and any qualified written notice of allocation (as defined in section 1388(c)), or any similar amount received from an organization described in subpara- graph (B)(ii), which— ‘‘(A) is includible in gross income, and ‘‘(B) is received from— ‘‘(i) an organization or corporation described in section 501(c)(12) or 1381(a), or ‘‘(ii) an organization which is governed under this title by the rules applicable to cooperatives under this title before the enactment of subchapter T. ‘‘(5) QUALIFIED PUBLICLY TRADED PARTNERSHIP INCOME.— The term ‘qualified publicly traded partnership income’ means, with respect to any qualified trade or business of a taxpayer, the sum of— ‘‘(A) the net amount of such taxpayer’s allocable share of each qualified item of income, gain, deduction, and loss (as defined in subsection (c)(3) and determined after the application of subsection (c)(4)) from a publicly traded part- nership (as defined in section 7704(a)) which is not treated as a corporation under section 7704(c), plus ‘‘(B) any gain recognized by such taxpayer upon disposi- tion of its interest in such partnership to the extent such gain is treated as an amount realized from the sale or exchange of property other than a capital asset under sec- tion 751(a). ‘‘(f) SPECIAL RULES.— ‘‘(1) APPLICATION TO PARTNERSHIPS AND S CORPORATIONS.— ‘‘(A) IN GENERAL.—In the case of a partnership or S corporation— ‘‘(i) this section shall be applied at the partner or shareholder level, ‘‘(ii) each partner or shareholder shall take into account such person’s allocable share of each qualified item of income, gain, deduction, and loss, and ‘‘(iii) each partner or shareholder shall be treated for purposes of subsection (b) as having W–2 wages and unadjusted basis immediately after acquisition of qualified property for the taxable year in an amount equal to such person’s allocable share of the W–2 wages and the unadjusted basis immediately after acquisition of qualified property of the partnership or S corporation for the taxable year (as determined under regulations prescribed by the Secretary). For purposes of clause (iii), a partner’s or shareholder’s allocable share of W–2 wages shall be determined in the same manner as the partner’s or shareholder’s allocable share of wage expenses. For purposes of such clause, part- ner’s or shareholder’s allocable share of the unadjusted basis immediately after acquisition of qualified property shall be determined in the same manner as the partner’s or shareholder’s allocable share of depreciation. For pur- poses of this subparagraph, in the case of an S corporation, VerDate Sep 11 2014 10:09 Oct 18, 2018 Jkt 079139 PO 00097 Frm 00016 Fmt 6580 Sfmt 6581 E:\PUBLAW\PUBL097.115 PUBL097 dkrause on DSKBC28HB2PROD with PUBLAWS