96 STAT. 444
PUBLIC LAW 97-248—SEPT. 3, 1982 "(I)
N E W SECTION 38 PROPERTY DEFINED,—The
term 'new section 38 property' has the meaning given such term by section 4803). "(II) LESSEE LIMITATION NOT TO APPLY TO CERTAIN 26 USC 2032A.
FARM PROPERTY.—Clause (ii) shall not apply to any property which is used for farming purposes (within the meaning of section 2032A(e)(5)) and which is placed in service during the calendar year but only if the cost basis of such property, when added to the cost basis of other finance lease property used for such purpose does not exceed $150,000 (determined under rules similar to the rules of section 209(d)(1)(B) of the Tax Equity and Fiscal Responsibility Act of 1982). "(Ill) PROPERTY PLACED IN SERVICE.—For purposes of this title (other than clause (i), any finance lease property shall be deemed originally placed in service not earlier than the date such property is used under the lease. "(C) AGREEMENTS MUST MEET CERTAIN REQUIREMENTS.—
The requirements of this subparagraph are met with respect to any agreement if— "(i) LESSOR REQUIREMENT.—Any lessor under the agreement must be— "(I) a corporation (other than an electing small business corporation within the meaning of section 1371(b) or a personal holding company within the meaning of section 542(a)), "(II) a partnership all of the partners of which are corporations described in subclause (I), or "(III) a grantor trust with respect to which the grantor and all the beneficiaries of the trust are described in subclause (I) or (II). "(ii) CHARACTERIZATION OF AGREEMENT.—The parties
to the agreement characterize such agreement as a lease. "(iii) AGREEMENT CONTAINS CERTAIN PROVISIONS.— The agreement contains the provision described in clause (i) or (ii) of subparagraph (A), or both. "(iv) AGREEMENT OTHERWISE LEASE, ETC.—For purposes of this title (determined without regard to the provisions described in clause (iii)), the agreement would be treated as a lease and the lessor under the agreement would be treated as the owner of the property. "(D) PARAGRAPH NOT TO APPLY TO AGREEMENTS BETWEEN
RELATED PERSONS.—This paragraph shall not apply to any agreement if the lessor and lessee are both persons who are members of the same affiliated group (within the meaning of subsection (a) of section 1504 and determined without regard to subsection (b) of section 1504). '(E) NONQUAUFIED TAX-EXEMPT ORGANIZATION.—
"(i) IN GENERAL.—The term 'nonqualified tax-exempt organization' means, with respect to any agreement to which subparagraph (A) applies, any organization (or predecessor organization which was engaged in substantially similar activities) which was exempt from
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