Page:United States Statutes at Large Volume 99 Part 1.djvu/533

 PUBLIC LAW 99-121—OCT. 11, 1985

99 STAT. 511

(A) the taxpayer or a qualified person entered into a binding contract to purchase or construct such property before May 9, 1985, or (B) construction of such property was commenced by or for the taxpayer or a qualified person before May 9, 1985. For purposes of this paragraph, the term "qualified person" means any person whose rights in such a contract or such property are transferred to the taxpayer, but only if such property is not placed in service before such rights are transferred to the taxpayer. (3) SPECIAL RULE FOR COMPONENTS.—For purposes of applying

section 168(f)(l)(B) of the Internal Revenue Code of 1954 (as amended by section 103) to components placed in service after December 31, 1986, property to which paragraph (2) of this subsection applies shall be treated as placed in service by the taxpayer before May 9, 1985. (4) TECHNICAL CORRECTION.—The amendment made by paragraph (6) of section 103(b) shall apply as if included in the amendments made by section 111 of the Tax Reform Act of 1984. 98 Stat. 631. (5) SPECIAL RULE FOR LEASING OF QUALIFIED REHABILITATED

BUILDINGS.—The amendment made by paragraph (5) of section 103(b) to section 48(g)(2)(B)(v) of the Internal Revenue Code of 1954 shall not apply to leases entered into before May 22, 1985, but only if the lessee signed the lease before May 17, 1985. TITLE II—AMENDMENTS TO BELOW-MARKET INTEREST RULES SEC. 201. CERTAIN LOANS TO QUALIFIED CONTINUING CARE FACILITIES EXEMPT FROM BELOW-MARKET INTEREST RATE RULES. (a) IN GENERAL.—Section 7872 of the Internal Revenue Code of 1954 (relating to treatment of loans with below-market interest rates) is amended by redesignating subsection (g) as subsection (h) and by inserting after subsection (f) the following new subsection:

98 Stat. 699. 26 USC 7872.

"(g) EXCEPTION FOR CERTAIN LOANS TO QUALIFIED CONTINUING CARE FACILITIES.—

"(1) IN GENERAL.—This section shall not apply for any cal- Contracts. endar year to any below-market loan made by a lender to a qualified continuing care facility pursuant to a continuing care contract if the lender (or the lender's spouse) attains age 65 before the close of such year. "(2) $90,000 LIMIT.—Paragraph (1) shall apply only to the extent that the aggregate outstanding amount of any loan to which such paragraph applies (determined without regard to this paragraph), when added to the aggregate outstanding amount of all other previous loans between the lender (or the lender's spouse) and any qualified continuing care facility to which paragraph (1) applies, does not exceed $90,000. "(3) CONTINUING CARE CONTRACT.—For purposes of this section, the term 'continuing care contract' means a written contract between an individual and a qualified continuing care facility under which— "(A) the individual or individual's spouse may use a qualified continuing care facility for their life or lives, "(B) the individual or individual's spouse— "(i) will first—

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