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(b)For purposes of this section—
(1)The term “required distribution” means, with respect to any calendar year, the sum of—
(A)98 percent of the regulated investment company’s ordinary income for such calendar year, plus
(B)98.2 percent of the regulated investment company’s capital gain net income for the 1-year period ending on October 31 of such calendar year.
(2)The amount determined under paragraph (1) for any calendar year shall be increased by the excess (if any) of—
(A)the grossed up required distribution for the preceding calendar year, over
(B)the distributed amount for such preceding calendar year.
(3)The grossed up required distribution for any calendar year is the required distribution for such year determined—
(A)with the application of paragraph (2) to such taxable year, and
(B)by substituting “100 percent” for each percentage set forth in paragraph (1).
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