holding period of such asset, and (ii) then by multiplying the amount allocated under clause (i) to days in such preceding taxable year by— (I) if such asset is a capital asset, the rate of tax in effect under section 1(h)(1)(D) for the taxable year of such transfer, or (II) if such asset is not a capital asset, the highest rate of tax in effect under section 1 for such taxable year. (B) Special rule for periods before becoming applicable taxpayer Notwithstanding subparagraph (A)(i), any gain allocated under such subparagraph to any taxable year preceding the first taxable year for which the taxpayer is treated as an applicable taxpayer shall be allocated to such first taxable year. (C) Increase in deemed tax amount by tax on net investment income If gain from a transfer to which this section applies for any taxable year is of a type taken into account in computing net investment income (as defined in section 1411), the deemed tax amount under this paragraph for any preceding taxable year to which such gain is allocated under subparagraph (A)(i) shall be increased by an amount equal to the amount of such allocated gain multiplied by the rate of tax in effect under section 1411(a)(1) for the taxable year of such transfer. (3) Computation of interest (A) In general The amount of interest referred to in paragraph (1) on any deemed tax amount determined under paragraph (2) for any preceding taxable year shall be determined for the period— (i) beginning on the due date for such preceding taxable year, and (ii) ending on the date on which the applicable transfer occurs, by using the rates determined under section 6621(b) (plus 1 percentage point), and the method applicable under section 6621, for underpayments of tax for such period. (B) Due date For purposes of this paragraph, the term due date means, with respect to any preceding taxable year, the date prescribed by law (determined without regard to extensions) for filing the return of the tax imposed by this chapter for such taxable year. (c) Special rule for