Page:United States Statutes at Large Volume 111 Part 1.djvu/892

 Ill STAT. 868 PUBLIC LAW 105-34—AUG. 5, 1997 individual may not be treated as a first-time homebuyer with respect to any other principal residence. "(3) PRINCIPAL RESIDENCE.—The term 'principal residence' has the same meaning as when used in section 121. "(d) CARRYOVER OF CREDIT. —I f the credit allowable under subsection (a) exceeds the limitation imposed by section 26(a) for such taxable year reduced by the sum of the credits allowable under subpart A of part IV of subchapter A (other than this section), such excess shall be carried to the succeeding taxable year and added to the credit allowable under subsection (a) for such taxable year. "(e) SPECIAL RULES. —For purposes of this section— " (1) ALLOCATION OF DOLLAR LIMITATION. — "(A) MARRIED INDIVIDUALS FILING SEPARATELY. — In the case of a married individual filing a separate return, subsection (a) shall be applied by substituting '$2,500' for '$5,000 '. "(B) OTHER TAXPAYERS. —If 2 or more individuals who are not married purchase a principal residence, the amount of the credit allowed under subsection (a) shall be allocated among such individuals in such manner as the Secretary may prescribe, except that the total amount of the credits allowed to all such individuals shall not exceed $5,000. "(2) PURCHASE.— "(A) IN GENERAL.— The term 'purchase' means any acquisition, but only if— "(i) the property is not acquired from a person whose relationship to the person acquiring it would result in the disallowance of losses under section 267 or 707(b) (but, in applying section 267(b) and (c) for purposes of this section, paragraph (4) of section 267(c) shall be treated as providing that the family of an individual shall include only his spouse, ancestors, and lineal descendants), and "(ii) the basis of the property in the hands of the person acquiring it is not determined— "(I) in whole or in part by reference to the adjusted basis of such property in the hands of the person from whom acquired, or "(II) under section 1014(a) (relating to property acquired from a decedent). "(B) CONSTRUCTION.— A residence which is constructed by the taxpayer shall be treated as purchased by the taxpayer. "(3) PURCHASE PRICE.—The term 'purchase price' means the adjusted basis of the principal residence on the date of acquisition (within the meaning of section 72(t)(8)(D)(iii)). "(f) REPORTING.—I f the Secretary requires information reporting under section 6045 by a person described in subsection (e)(2) thereof to verify the eligibility of taxpayers for the credit allowable by this section, the exception provided by section 6045(e)(5) shall not apply. " (g) CREDIT TREATED AS NONREFUNDABLE PERSONAL CREDIT. — For purposes of this title, the credit allowed by this section shall be treated as a credit allowable under subpart A of part IV of subchapter A of this chapter.

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