PUBLIC LAW 97-248—SEPT. 3, 1982
96 STAT. 429
"(1) the amount of the credit determined under section 46(a)(2) for any taxable year exceeds the limitation provided by 26 USC 46. section 46(a)(3) for such taxable year, and "(2) the amount of such excess has not, after the application of section 46(b), been allowed to the taxpayer as a credit under section 38 for any taxable year, then an amount equal to 50 percent of the amount of such excess (to the extent attributable to property the basis of which is reduced under section 48(q)) not so allowed as a credit shall be allowed to the Ante, p. 427. taxpayer as a deduction for the first taxable year following the last taxable year in which such excess could under section 46(b) have been allowed as a credit. "(b) TAXPAYERS DYING OR CEASING TO EXIST.—If a taxpayer dies or ceases to exist prior to the first taxable year following the last taxable year in which the excess described in subsection (a) could under section 46(b) have been allowed as a credit, the amount described in subsection (a), or the proper portion thereof, shall, under regulations prescribed by the Secretary, be allowed to the taxpayer as a deduction for the taxable year in which such death or cessation occurs. "(c) SPECIAL RULE FOR QUALIFIED REHABILITATED BUILDINGS.—In
the case of any credit to which section 48(q)(3) applies, subsection (a) shall be applied without regard to the phrase '50 percent of." (3) BASIS ADJUSTMENT NOT TAKEN INTO ACCOUNT FOR PURPOSES OF EARNINGS AND PROFITS.—Section 312(k) (relating to effect of
26 USC 312.
depreciation on earnings and profits) is amended by adding at the end thereof the following new paragraph: "(5) BASIS ADJUSTMENT NOT TAKEN INTO ACCOUNT.—In comput-
ing the earnings and profits of a corporation for any taxable year, the allowance for depreciation (and amortization, if any) shall be computed without regard to any basis adjustment under section 48(q)." (4) SPECIAL RULES FOR CERTAIN LEASED PROPERTY.—Section
48(d) (relating to certain leased property) is amended by adding 26 USC 48. at the end thereof the following new paragraph: "(5) COORDINATION WITH BASIS ADJUSTMENT.—In the case of any property with respect to which an election is made under this subsection— "(A) subsection (q) (other than paragraph (4)) shall not apply with respect to such property, "(B) the lessee of such property shall include ratably in gross income over the shortest recovery period which could be applicable under section 168 with respect to such property an amount equal to 50 percent of the amount of the credit allowable under section 38 to the lessee with respect to such property, and "(C) in the case of a disposition of such property to which section 47 applies, this paragraph shall be applied in accordance with regulations prescribed by the Secretary." (5) CONFORMING AMENDMENTS.—
(A) Section 48(g) (relating to special rules for qualified rehabilitated buildings) is amended by striking out paragraph (5). (B) Paragraph (24) of section 1016(a) (relating to adjust- 95 Stat. 239. ments to basis) is amended by striking out "section 48(g)(5)" and inserting in lieu thereof "section 48(q)"
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