; or . (b) Phaseout Subsection (b) of section 1402 of the Internal Revenue Code of 1986 is amended by adding at the end the following: Paragraph (1) shall apply only to taxable years beginning in calendar years for which the contribution and benefit base (as determined under section 230 of the Social Security Act) is less than $250,000. . (c) Effective date The amendments made by this section shall apply to net earnings from self-employment derived, and remuneration paid, on or after January 1 of the first calendar year that begins after the date of enactment of this Act. 8. Tax on investment gain (a) Increase in tax (1) In general Subsection (a) of section 1411 of the Internal Revenue Code of 1986 is amended by striking 3.8 percent each place it appears and inserting 16.2 percent . (2) Conforming amendment The heading for chapter 2A of the Internal Revenue Code of 1986 is amended by striking Unearned income medicare contribution and inserting Additional tax on unearned income in lieu of Social Security and Medicare taxes . (b) Inclusion of active trade or business income (1) In general Section 1411(c)(1)(A) of the Internal Revenue Code of 1986 is amended— (A) in clause (i), by striking , other than such income which is derived in the ordinary course of a trade or business not described in paragraph (2) , (B) in clause (ii), by striking described in paragraph (2) and inserting (determined under rules similar to the rules of paragraphs (5) and (6) of section 469(c)) , and (C) in clause (iii), by striking other than property held in a trade or business not described in paragraph (2) . (2) Denial of deduction for net operating losses Section 1411(c)(1)(B) of such Code is amended by inserting (other than the deduction for net operating losses provided in section 172) after net gain . (3) Conforming amendments (A) Section 1411(c) of such Code is amended by striking paragraphs (2), (3), and (4) and by redesignating paragraphs (5) and (6) as paragraphs (2) and (3), respectively. (B) Section 1411(c)(3) of such Code, as