PUBLIC LAW 99-514—OCT. 22, 1986
100 STAT. 2243
(3) COORDINATION WITH CREDIT.—No low-income housing credit shall be determined under section 42 of the Internal Revenue Code of 1986 with respect to any project with respect to which any person has been allowed any benefit under this section. SEC. 503. EXTENSION OF AT RISK LIMITATIONS TO REAL PROPERTY.
(a) IN GENERAL.—Paragraph (3) of section 465(c) (relating to activities to which section applies) is amended by striking out subparagraph (D) and by redesignating subparagraph (E) as subparagraph (D). (b) QUALIFIED NONRECOURSE FINANCING TREATED AS AN AMOUNT
AT RISK.—Section 465(b) (relating to amounts considered at risk) is amended by adding at the end thereof the following new paragraph: "(6) QUALIFIED NONRECOURSE FINANCING TREATED AS AMOUNT
AT RISK.—For purposes of this section— "(A) IN GENERAL.—Notwithstanding any other provision of this subsection, in the case of an activity of holding real ^ property, a taxpayer shall be considered at risk with I respect to the taxpayer's share of any qualified nonrecourse financing which is secured by real property used in such ,, activity. " "(B) QUALIFIED NONRECOURSE FINANCING.—For purposes of this paragraph, the term 'qualified nonrecourse financing' means any financing— "(i) which is borrowed by the taxpayer with respect to the activity of holding real property, "(ii) which is borrowed by the taxpayer from a qualified person or represents a loan from any Federal, State, or local government or instrumentality thereof, or is guaranteed by any Federal, State, or local government, "(iii) except to the extent provided in regulations, with respect to which no person is personally liable for repayment, and "(iv) which is not convertible debt. "(C) SPECIAL RULE FOR PARTNERSHIPS.—In the case of a ,, partnership, a partner's share of any qualified nonrecourse financing of such partnership shall be determined on the basis of the partner's share of liabilities of such partnership incurred in connection with such financing (within the meaning of section 752). ^ "(D) QUALIFIED PERSON DEFINED.—For purposes of this [^ paragraph— rl "(i) IN GENERAL.—The term 'qualified person'has the meaning given such term by section 46(c)(8)(D)(iv). "
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"(ii) CERTAIN COMMERCIALLY REASONABLE FINANCING FROM RELATED PERSONS.—For purposes of clause (i),
section 46(c)(8)(D)(iv) shall be applied without regard to subclause (I) thereof (relating to financing from related persons) if the financing from the related person is commercially reasonable and on substantially the same terms as loans involving unrelated persons. "(E) ACTIVITY OF HOLDING REAL PROPERTY.—For purposes
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of this paragraph— "(i) INCIDENTAL PERSONAL PROPERTY AND SERVICES.—
The activity of holding real property includes the hold-
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