Page:United States Statutes at Large Volume 95.djvu/239

 PUBLIC LAW 97-34-AUG. 13, 1981

95 STAT. 213

"(ii) OPERATING RULES.— "(I) PERIOD ELECTED BY TAXPAYER.—Except as pro-

vided in subclause (II), the taxpayer may elect under clause (i) for any taxable year only a single recovery period for recovery property described in this paragraph which is placed in service during such taxable year, which has the same present class life, and which is in the same class under subsection (c)(2). The period so elected shall not be shorter than such present class life. "(H) REAL PROPERTY.—In the case of 15-year real property, the election under clause (i) shall be made on a property-by-property basis.

"(D) DETERMINATION OP PROPERTY USED PREDOMINANTLY OUTSIDE THE UNITED STATES.—For purposes of this para-

graph, under regulations prescribed by the Secretary, rules similar to the rules under section 48(a)(2) (including the 26 USC 48. exceptions under subparagraph (B)) shall be applied in determining whether property is used predominantly outside the United States. "(E) CONVENTION.—Under regulations prescribed by the Secretary, the half year convention shall apply for purposes of any determination under subparagraph (C) (other than any aetermination with respect to 15-year real property). "(8) RRB REPLACEMENT PROPERTY.—

"(A) IN GENERAL.—In the case of RRB replacement property placed in service before January 1, 1985, the recovery deduction for the taxable year shall be, in lieu of the amount determined under subsection (b), the amount determined by applying to the unadjusted basis of such property the applicable percentage determined under tables prescribed by the Secretary. For purposes of the preceding sentence, in prescribing such tables, the Secretary shall— "(i) use the recovery period determined in accordance with the following table: "If the year property is placed in service is: 1981 1982 1983 1984

The recovery period is: 1 2 3 4

and "(ii) assign percentages determined in accordance with use of the method of depreciation described in section 167(b)(2), switching to the method described in section 167(b)(3) at a time to maximize the deduction allowable under subsection (a) (taking into account the half-year convention). "(B) RRB REPLACEMENT PROPERTY DEFINED.—For purposes of this section, the term 'RRB replacement property' means replacement track material (including rail, ties, other track material, and ballast) installed by a railroad (including a railroad switching or terminal company) if— "(i) the replacement is made pursuant to a scheduled pr<}gram for replacement.

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