Page:United States Statutes at Large Volume 100 Part 3.djvu/515

 PUBLIC LAW 99-514—OCT. 22, 1986

100 STAT. 2323

shall prescribe the requirements of a normalization method of accounting for this section. "(2) MINING EXPLORATION AND DEVELOPMENT COSTS.—

"(A) IN GENERAL.—With respect to each mine or other natural deposit (other than an oil, gas, or geothermal well) of the taxpayer, the amount allowable as a deduction under section 616(a) or 617(a) (determined without regard to section 291(b)) in computing the regular tax for costs paid or incurred after December 31, 1986, shall be capitalized and amortized ratably over the 10-year period beginning with the taxable year in which the expenditures were made. "(B) Loss ALLOWED.—If a loss is sustained with respect to any property described in subparagraph (A), a deduction shall be allowed for the expenditures described in subparagraph (A) for the taxable year in which such loss is sustained in an amount equal to the lesser of— "(i) the amount allowable under section 165(a) for the expenditures if they had remained capitalized, or "(ii) the amount of such expenditures which have not previously been amortized under subparagraph (A). "(3) TREATMENT OF CERTAIN LONG-TERM CONTRACTS.—In the

case of any long-term contract entered into by the taxpayer on or after March 1, 1986, the taxable income from such contract shall be determined under the percentage of completion method of accounting (as modified by section 4600t))). "(4) ALTERNATIVE TAX NET OPERATING LOSS DEDUCTION.—The

alternative tax net operating loss deduction shall be allowed in lieu of the net operating loss deduction allowed under section 172. "(5) POLLUTION CONTROL FACILITIES.—In the case of any certified pollution control facility placed in service after December 31, 1986, the deduction allowable under section 169 (without regard to section 291) shall be determined under the alternative system of section 168(g). "(6) INSTALLMENT SALES OF CERTAIN PROPERTY.—In the case of any— "(A) disposition after March 1, 1986, of property described in section 1221(1), or "(B) other disposition if an obligation arising from such disposition would be an applicable installment obligation (as defined in section 453C(e)) to which section 453C applies, income from such disposition shall be determined without regard to the installment method under section 453 or 453A and all payments to be received for the disposition shall be deemed received in the taxable year of the disposition. This paragraph shall not apply to any disposition with respect to which an election is in effect under section 453C(e)(4). "(7) ADJUSTED BASIS.—The adjusted basis of any property to which paragraph (1) or (5) applies (or with respect to which there are any expenditures to which paragraph (2) or subsection 03)(2) applies) shall be determined on the basis of the treatment prescribed in paragraph (1), (2), or (5), or subsection (b)(2), whichever applies. "(b) ADJUSTMENTS APPLICABLE TO INDIVIDUALS.—In determining

the amount of the alternative minimum taxable income of any taxpayer (other than a corporation), the following treatment shall

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