Page:United States Statutes at Large Volume 100 Part 3.djvu/392

 100 STAT. 2200

PUBLIC LAW 99-514—OCT. 22, 1986 o

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amount equal to the outstanding balance of such loan from the eligible basis of the building for purposes of subsection "(C)

BELOW MARKET FEDERAL LOAN.—For purposes of

subparagraph (A), the term 'below market Federal loan' means any loan funded in whole or in part with Federal funds if the interest rate payable on such loan is less than the applicable Federal rate in effect under section 1274(d)(1) (as of the date on which the loan was made). "(3) LOW-INCOME UNIT.—

"(A) IN GENERAL.—The term 'low-income unit' means any unit in a building if— "(i) such unit is rent-restricted (as defined in subsection (g)(2)), and "(ii) the individuals occupying such unit meet the income limitation applicable under subsection (g)(l) to the project of which such building is a part. "(B) EXCEPTIONS.—A unit shall not be treated as a lowincome unit unless the unit is suitable for occupancy and used other than on a transient basis. "(C)

SPECIAL RULE FOR BUILDINGS HAVING 4 OR FEWER

UNITS.—In the case of any building which has 4 or fewer '' residential rental units, no unit in such building shall be treated as a low-income unit if the units in such building are owned by— "(i) any individual who occupies a residential unit in ^ - -^" such building, or "(ii) any person who is related (as defined in subsec'' tion (d)(2)(D)(iii)) to such individual. "(4) NEW BUILDING.—The term 'new building' means a building the original use of which begins with the taxpayer. "(5) EXISTING BUILDING.—The term 'existing building' means any building which is not a new building. "(j) RECAPTURE OF CREDIT.— "(1) IN GENERAL.—If^

"(A) as of the close of any taxable year in the compliance >• '* period, the amount of the qualified basis of any building with respect to the taxpayer is less than ' "(B) the amount of such basis as of the close of the preceding taxable year, then the taxpayer's tax under this chapter for the taxable year shall be increased by the credit recapture amount. "(2) CREDIT RECAPTURE AMOUNT.—For purposes of paragraph (1), the credit recapture amount is an amount equal to the sum of— "(A) the aggregate decrease in the credits allowed to the taxpayer under section 38 for all prior taxable years which would have resulted if the accelerated portion of the credit allowable by reason of this section were not allowed for all prior taxable years with respect to the excess of the amount described in paragraph dXB) over the amount described in paragraph (I)(A), plus "(B) interest at the overpayment rate established under section 6621 on the amount determined under subparagraph (A) for each prior taxable year for the period beginning on the due date for filing the return for the prior taxable year involved.

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