Page:United States Statutes at Large Volume 100 Part 3.djvu/1011

 PUBLIC LAW 99-514—OCT. 22, 1986

100 STAT. 2819

"(B) MID-MONTH CONVENTION FOR 19-YEAR REAL PROP-

ERTY.—In the case of 19-year real property, the amount of the deduction determined under any provision of this section (or for purposes of section 57(a)(12)(B) or 312(k)) for any taxable year shall be determined on the basis of the number of months (using a mid-month convention) in which the property is in service." • (ii) Subparagraph (B) of section 168(fK2) (relating to recovery property used predominantly outside the t"lavo United States) is amended to read as follows: "(B) REAL PROPERTY.—Except as provided in subpara-

graph (C), in the case of 19-year real property or low-income housing which, during the taxable year, is predominantly used outside the United States, the recovery deduction for the taxable year shall be, in lieu of the amount determined under subsection 03), the amount determined by applying to the unadjusted basis of such property the applicable percentage determined under tables prescribed by the Secretary. For purposes of the preceding sentence, in prescribing such tables, the Secretary shall— "(i) assign to the property described in this subparagraph a 35-year recovery period, and "(ii) assign percentages determined in accordance with the use of the method of depreciation described in section 167(j)(l)(B), switching to the method described in section 1670t)Xl) at a time to maximize the deduction allowable under subsection (a)."

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(B) MONTHLY CONVENTION FOR LOW-INCOME HOUSING.—

Subparagraph (B) of section 1680t)X4) (relating to low-income housing) is amended to read as follows: "(B) MONTHLY CONVENTION.—In the case of low-income housing, the amount of the deduction determined under any provision of this section (or for purposes of section 57(a)(12XB) or 312(k)) for any taxable year shall be determined on the basis of the number of months (treating all property placed in service or disposed of during any month as placed in service or disposed of on the first day of such month) in which the property is in service."

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(C) CONFORMING AMENDMENTS.—

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(i) Effective on and after the date of the enactment of this Act, clause (ii) of section 168(j)(2)(B) (relating to conventions) is amended to read as follows:

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"(ii) C R O S S REFERENCE.—

"For other applicable conventions, see paragraphs (2)(B) and (4)(B) of subsection (b)."

(ii) Subparagraph (A) of section 312(k)(3) is amended by striking out ", and rules similar to the rules under the next to the last sentence of section 1680t)X2XA) and section 168a)X2XB) shall apply". (3) MINIMUM TAX TREATMENT.—Subparagraph (B) of section

57(a)(12) (relating to 19-year real property and low-income housing) is amended by striking out so much of such subparagraph as precedes clause (i) thereof and inserting in lieu thereof the following: "(B) 19-YEAR REAL PROPERTY AND LOW-INCOME HOUSING.—

With respect to each recovery property which is 19-year

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