Determination of deduction eligible income

(a) Sales or other dispositions of certain property (1) In general Section 250(b)(3)(A)(i) is amended— (A) by striking and at the end of subclause (V), (B) by striking over at the end of subclause (VI) and inserting and, and (C) by adding at the end the following new subclause: (VII) except as otherwise provided by the Secretary, any income and gain from the sale or other disposition (including pursuant to the deemed sale or other deemed disposition or a transaction subject to section 367(d)) of— (aa) intangible property (as defined in section 367(d)(4)), and (bb) any other property of a type that is subject to depreciation, amortization, or depletion by the seller, over. (2) Conforming amendment Section 250(b)(5)(E) is amended by inserting (other than paragraph (3)(A)(i)(VII)) after For purposes of this subsection. (3) Effective date The amendments made by this subsection shall apply to sales or other dispositions (including pursuant to deemed sales or other deemed dispositions or a transaction subject to section 367(d) of the Internal Revenue Code of 1986) occurring after June 16, 2025. (b) Expense apportionment limited to properly allocable expenses (1) In general Section 250(b)(3)(A)(ii) is amended to read as follows: (ii) expenses and deductions (including taxes), other than interest expense and research or experimental expenditures, properly allocable to such gross income.. (2) Effective date The amendment made by this subsection shall apply to taxable years beginning after December 31, 2025.