Page:United States Statutes at Large Volume 115 Part 1.djvu/74

 115 STAT. 52 PUBLIC LAW 107-16^JUNE 7, 2001 Regulations. Applicability. "(3) RECAPTURE EVENT DEFINED.— For purposes of this subsection, the term 'recapture event' means— "(A) CESSATION OF OPERATION.— The cessation of the operation of the faciHty as a quahfied child care faciHty. "(B) CHANGE IN OWNERSHIP.— "(i) IN GENERAL.— Except as provided in clause (ii), the disposition of a taxpayer's interest in a qualified child care facility with respect to which the credit described in subsection (a) was allowable. "(ii) AGREEMENT TO ASSUME RECAPTURE LIABILITY.—Clause (i) shall not apply if the person acquiring such interest in the facility agrees in writing to assume the recapture liability of the person disposing of such interest in effect immediately before such disposition. In the event of such an assumption, the person acquiring the interest in the facility shall be treated as the taxpayer for purposes of assessing any recapture liability (computed as if there had been no change in ownership). "(4) SPECIAL RULES.— "(A) TAX BENEFIT RULE.—The tax for the taxable year shall be increased under paragraph (1) only with respect to credits allowed by reason of this section which were used to reduce tax liability. In the case of credits not so used to reduce tax liability, the carryforwards and carrybacks under section 39 shall be appropriately adjusted. "(B) No CREDITS AGAINST TAX. — Any increase in tax under this subsection shall not be treated as a tax imposed by this chapter for purposes of determining the amount of any credit under subpart A, B, or D of this part. "(C) No RECAPTURE BY REASON OF CASUALTY LOSS.— The increase in tax under this subsection shall not apply to a cessation of operation of the facility as a qualified child care facility by reason of a casualty loss to the extent such loss is restored by reconstruction or re^aaement within a reasonable period established by the Secretary. "(e) SPECIAL RULES. —For purposes of this section— "(1) AGGREGATION RULES.— All persons which are treated as a single employer under subsections (a) and (b) of section 52 shall be treated as a single taxpayer. " (2) PASS-THRU IN THE CASE OF ESTATES AND TRUSTS.— Under regulations prescribed by the Secretary, rules similar to the rules of subsection (d) of section 52 shall apply. " (3) ALLOCATION IN THE CASE OF PARTNERSHIPS.— In the case of partnerships, the credit shall be allocated among partners under regulations prescribed by the Secretary. " (f) No DOUBLE BENEFIT. — "(1) REDUCTION IN BASIS.— For purposes of this subtitle— "(A) IN GENERAL. —I f a credit is determined under this section with respect to any property by reason of expenditures described in subsection (c)(1)(A), the basis of such property shall be reduced by the amount of the credit so determined. "(B) CERTAIN DISPOSITIONS. — If, during any taxable year, there is a recapture amount determined with respect to any property the basis of which was reduced under

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