Page:United States Statutes at Large Volume 114 Part 5.djvu/639

 PUBLIC LAW 106-554^APPENDIX G 114 STAT. 2763A-599 "(2) a renewal community business shall be treated as an enterprise zone business, and "(3) qualified renewal property shall be treated as qualified zone property. "(b) QUALIFIED RENEWAL PROPERTY. — For purposes of this section— "(1) IN GENERAL.— The term 'qualified renewal property' means any property to which section 168 applies (or would apply but for section 179) if— "(A) such property was acquired by the taxpayer by purchase (as defined in section 179(d)(2)) after December 31, 2001, and before January 1, 2010, and "(B) such property would be qualified zone property (as defined in section 1397D) if references to renewal communities were substituted for references to empowerment zones in section 1397D. "(2) CERTAIN RULES TO APPLY. —The rules of subsections (a)(2) and (b) of section 1397D shall apply for purposes of this section.". (b) EXCEPTION FOR COMMERCIAL REVITALIZATION DEDUCTION FROM PASSIVE LOSS RULES. — (1) Paragraph (3) of section 469(i) is amended by redesignating subparagraphs (C), (D), and (E) as subparagraphs (D), (E), and (F), respectively, and by inserting after subparagraph (B) the following new subparagraph: "(C) EXCEPTION FOR COMMERCIAL REVITALIZATION DEDUCTION. — Subparagraph (A) shall not apply to any portion of the passive activity loss for any taxable year which is attributable to the commercial revitalization deduction under section 14001.". (2) Subparagraph (E) of section 469(i)(3), as redesignated by subparagraph (A), is amended to read as follows: "(E) ORDERING RULES TO REFLECT EXCEPTIONS AND SEPARATE PHASE-OUTS.— I f subparagraph (B), (C), or (D) applies for a taxable year, paragraph (1) shall be applied— "(i) first to the portion of the passive activity loss to which subparagraph (C) does not apply, "(ii) second to the portion of the passive activity credit to which subparagraph (B) or (D) does not apply, "(iii) third to the portion of such credit to which subparagraph (B) applies, "(iv) fourth to the portion of such loss to which subparagraph (C) applies, and "(v) then to the portion of such credit to which subparagraph (D) applies. ". (3)(A) Subparagraph (B) of section 469(i)(6) is amended by striking "or" at the end of clause (i), by striking the period at the end of clause (ii) and inserting ", or", and by adding at the end the following new clause: "(iii) any deduction under section 14001 (relating to commercial revitalization deduction).". (B) The heading for such subparagraph (B) is amended by striking "OR REHABILITATION CREDIT" and inserting ", REHABILITATION CREDIT, OR COMMERCIAL REVITALIZATION DEDUCTION". (c) AUDIT AND REPORT.— Not later than January 31 of 2004, 2007, and 2010, the Comptroller General of the United States

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