Page:United States Statutes at Large Volume 90 Part 2.djvu/65

 PUBLIC LAW 94-455—OCT. 4, 1976

90 STAT. 1533

1954, the amendments made by this section shall not apply Ante, p. 1531. to— (i) deductions for depreciation or amortization with respect to property the principal production of which began before September 11, 1975, and for the purchase of which there was on September 11, 1975, and at all times thereafter a binding contract, and (ii) deductions attributable to producing or distributing property the principal production of which began before September 11, 1975. (B) EXCEPTION FOR CERTAIN AGREEMEXTS W^HERE PRINCIPAL

PHOTOGRAPHY BEGIN BEFORE 1976.—In the case of any activity described in section 4 6 5 (c)(1)(A) of the I n t e r n a l Revenue Code of 1954, the amendments made by this section shall not apply to deductions attributable to the producing of a film the principal photography of which began on or before December 31, 1975, if— (i) on September 10, 1975, there was an agreement with the director or a principal motion picture star, or on or before September 10, 1975, there had been expended (or committed to the production) an amount not less than the lower of $100,000 or 10 percent of the estimated costs of producing the film, and (ii) the production takes place in the United States. Subparagraph (A) shall apply only to taxpayers who held their interests on September 10, 1975. Subparagraph (B) shall apply only to taxpayers who held their interests on December 31, 1975. (3)

SPECIAL TRANSITIONAL RULES FOR LEASING ACTIVITIES.— (A) RULE FOR LEASES OTHER THAN OPERATING LEASES. I N

the case of any activity described in section 465(c)(1)(B) of the I n t e r n a l Revenue Code of 1954, the amendments made by this section shall not apply with respect to— (i) leases entered into before January 1, 1976, and (ii) leases where the property was ordered by the lessor or lessee before January 1, 1976. (B)

HOLDING OF INTERESTS FOR PURPOSES OF SUBPARAGRAPH

(A). — Subparagraph (A) shall apply only to taxpayers who held their interests in the property on December 31, 1975. (C)

SPECIAL RULE FOR OPERATING LEASES.—In the case of a

lease described in section 46(e)(3)(B) of the I n t e r n a l Revenue Code of 1954— (i) subparagraph (A) shall be applied by substituting "May 1, 1976" for " January 1, 1976" each place it appears therein, and ' (ii) subparagraph (B) shall be applied by substituting " April 30, 1976" for "December 31, 1975". SEC. 205. GAIN FROM DISPOSITION OF INTEREST IN OIL OR GAS PROPERTY. (a) RECAPTURE RULES. — Part IV of subchapter P of chapter 1 (relating to special rules for determining capital gains and losses) is amended by adding at the end thereof the following new section: "SEC. 1254. GAIN FROM DISPOSITION OF INTEREST IN OIL OR GAS 26 USC 1254. PROPERTY. "(a)

GENERAL RULE. —

"(1)

ORDINARY INCOME.—If oil or gas property is disposed

of after December 31, 1975, the lower of—

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