Page:United States Statutes at Large Volume 114 Part 5.djvu/643

 PUBLIC LAW 106-554—APPENDIX G 114 STAT. 2763A-603 "(B) any gain which is attributable to real property, or an intangible asset, which is not an integral part of an enterprise zone business. "(3) PURCHASE. —^A taxpayer shall be treated as having purchased any property if, but for paragraph (4), the unadjusted basis of such property in the hands of the taxpayer would be its cost (within the meaning of section 1012). "(4) BASIS ADJUSTMENTS.— If gain from any sale is not recognized by reason of subsection (a), such gain shall be applied to reduce (in the order acquired) the basis for determining gain or loss of any qualified empowerment zone asset which is purchased by the taxpayer during the 60-day period described in subsection (a). This paragraph shall not apply for purposes of section 1202. "(5) HOLDING PERIOD.— For purposes of determining whether the nonrecognition of gain under subsection (a) applies to any qualified empowerment zone asset which is sold— "(A) the taxpayer's holding period for such asset and the asset referred to in subsection (a)(1) shall be determined without regard to section 1223, and "(B) only the first year of the taxpayer's holding period for the asset referred to in subsection (a)(1) shall be taken into account for purposes of paragraphs (2)(A)(iii), (3)(C), and (4)(A)(iii) of section 1400F(b).". (b) CONFORMING AMENDMENTS.— (1) Paragraph (23) of section 1016(a) is amended— (A) by striking "or 1045" and inserting "1045, or 1397B", and (B) by striking "or 1045(b)(4)" and inserting "1045(b)(4), or 1397B(b)(4)". (2) Paragraph (15) of section 1223 is amended to read as follows: "(15) Except for purposes of sections 1202(a)(2), 1202(c)(2)(A), 1400B(b), and 1400F(b), in determining the period for which the taxpayer has held property the acquisition of which resulted under section 1045 or 139 7B in the nonrecognition of any part of the gain realized on the sale of other property, there shall be included the period for which such other property has been held as of the date of such sale.". (3) Paragraph (2) of section 1394(b) is amended— (A) by striking "section 1397C" and inserting "section 1397D", and (B) by striking "section 1397C(a)(2)" and inserting "section 1397D(a)(2)". (4) Paragraph (3) of section 1394(b) is amended— (A) by striking "section 1397B" each place it appears and inserting "section 1397C", and (B) by striking "section 1397B(d)" and inserting "section 1397C(d)". (5) Sections 1400(e) and 1400B(c) are each amended by striking "section 1397B" each place it appears and inserting "section 1397C".

�