Page:United States Statutes at Large Volume 92 Part 3.djvu/197

 PUBLIC LAW 95-600—NOV. 6, 1978



92 STAT. 2829

"(ii) in connection with the rehabilitation of a qualified rehabilitated building. "(B) CERTAIN EXPENDITURES NOT INCLUDED.—The term 'qualified rehabilitation expenditure' does not include— "(i) PROPERTY OTHERWISE SECTION 38 PROPERTY.—Any

26 USC 38.

expenditure for property which constitutes section 38 property (determined without regard to subsection (a)(1)(E). "(ii) COST OF ACQUISITION.—The cost of acquiring any building or any interest therein. "(iii) ENLARGEMENTS.—Any expenditure attributable to the enlargement of the existing building. "(iv) CERTIFIED HISTORIC STRUCTURES.—Any expenditure attributable to the rehabilitation of a certified historic structure (within the meaning of section 191(d)(1)), unless the rehabilitation is a certified reha- 26 USC 191. bilitation (within the meaning of section 191(d)(4)). "(3) PROPERTY TREATED AS NEW SECTION 38 PROPERTY.—Prop-

erty which is treated as section 38 property by reason of subsection (a)(1)(E) shall be treated as new section 38 property." (c) TECHNICAL AMENDMENT.—Paragraph (8) of section 48(a) (relat- 26 USC 48. ing to amortized property) is amended by striking out "or 188" and inserting in lieu thereof "188, or 191". (d) EFFECTIVE DATE.—The amendments made by this section shall 26 USC 48 note. apply to taxable years ending after October 31, 1978; except that the amendment made by subsection (c) shall only apply with respect to property placed in service after such date. SEC. 316. TAX TREATMENT OF THE INVESTMENT CREDIT IN THE CASE OF COOPERATIVE ORGANIZATIONS.

(a) IN GENERAL.—Section 46 (relating to amount of credit) is 26 USC 46. amended by adding at the end thereof the following new subsection: "(h) SPECIAL RULES FOR COOPERATIVES.—In the case of a cooperative organization described in section 1381(a)— 26 USC 1381. "(1) that portion of the credit allowable to the organization under section 38 which the organization cannot use for the taxable year to which the qualified investment is attributable because of the limitation contained in subsection (a)(3) shall be allocated to the patrons of the organization, "(2) section 47 (relating to certain dispositions, etc., of section 26 USC 47. 38 property) shall be applied as if any allocated portion of the credit had been retained by the organization, and "(3) the idles necessary to carry out the purposes of this subsection shall be determined under regulations prescribed by the Secretary." (b) CONFORMING AMENDMENTS.—

(1) Paragraph (1) of section 46(e) (relating to limitations in case 26 USC 46. ofcertain persons) is amended— (A) by adding "and" at the end of subparagraph (A), (B) by striking out "and" at the end of subparagraph (B), and (C) by striking out subparagraph (C). (2) Paragraph (2) of section 46(e) is amended— (A) by adding "and" at the end of subparagraph (A), (B) by striking out, ", and" at the end of subparagraph (B) and inserting in lieu thereof a period, and (C) by striking out subparagraph (C).

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