Page:United States Statutes at Large Volume 100 Part 3.djvu/457

 PUBLIC LAW 99-514—OCT. 22, 1986

100 STAT. 2265

subparagraph (G) of section 368(a)(1) or any exchange of debt for stock in a title 11 or similar case (as defined in section 368(a)(3)(A)), the value under subsection (e) shall be the value of the new loss corporation immediately after the ownership change. "(7)

COORDINATION WITH ALTERNATIVE MINIMUM TAX.—The

Secretary shall by regulation provide for the application of this section to the alternative tax net operating loss deduction under section 56(d). "(m) REGULATIONS.—The Secretary shall prescribe such regulations as may be necessary or appropriate to carry out the purposes of this section and section 383, including (but not limited to) regulations— "(1) providing for the application of this section and section 383 where an ownership change with respect to the old loss corporation is followed by an ownership change with respect to the new loss corporation, and "(2) providing for the application of this section and section 383 in the case of a short taxable year, "(3) providing for such adjustments to the application of this section and section 383 as is necessary to prevent the avoidance of the purposes of this section and section 383, including the avoidance of such purposes through the use of related persons, pass-thru entities, or other intermediaries, "(4) providing for the treatment of corporate contractions as redemptions for purposes of subsections (e)(2) and (h)(3)(A), and "(5) providing for the application of subsection (g)(4) where there is only 1 corporation involved." (b) AMENDMENT OF SECTION 383.—Section 383 (relating to special limitations on unused investment credits, etc.) is amended to read as follows: "SEC. 383. SPECIAL LIMITATIONS ON CERTAIN EXCESS CREDITS, ETC. "(a) EXCESS CREDITS.—

"(1) IN GENERAL.—Under regulations, if an ownership change occurs with respect to a corporation, the amount of any excess credit for any taxable year which may be used in any postchange year shall be limited to an amount determined on the basis of the tax liability which is attributable to so much of the taxable income as does not exceed the section 382 limitation for such post-change year to the extent available after the application of section 382 and subsections (b) and (c) of this section. "(2) EXCESS CREDIT.—For purposes of paragraph (1), the term 'excess credit' means— "(A) any unused general business credit of the corporation under section 39, and "(B) any unused minimum tax credit of the corporation under section 53. "(b) LIMITATION ON NET CAPITAL Loss.—If an ownership change occurs with respect to a corporation, the amount of any net capital loss under section 1212 for any taxable year before the 1st postchange year which may be used in any post-change year shall be limited under regulations which shall be based on the principles applicable under section 382. Such regulations shall provide that any such net capital loss used in a post-change year shall reduce the section 382 limitation which is applied to pre-change losses under section 382 for such year.

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