Internal Revenue Code:Sec. 280F. Limitation on depreciation for luxury automobiles; limitation where certain property used for personal purposes

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Contents


Location in Internal Revenue Code


     TITLE 26 - INTERNAL REVENUE CODE
      Subtitle A - Income Taxes
       CHAPTER 1 - NORMAL TAXES AND SURTAXES
        Subchapter B - Computation of Taxable Income
         PART IX - ITEMS NOT DEDUCTIBLE
       

Statute

    Sec. 280F. Limitation on depreciation for luxury automobiles;
        limitation where certain property used for personal purposes
 
    (a) Limitation on amount of depreciation for luxury automobiles
      (1) Depreciation
        (A) Limitation
          The amount of the depreciation deduction for any taxable year
        for any passenger automobile shall not exceed -
            (i) $2,560 for the 1st taxable year in the recovery period,
            (ii) $4,100 for the 2nd taxable year in the recovery
          period,
            (iii) $2,450 for the 3rd taxable year in the recovery
          period, and
            (iv) $1,475 for each succeeding taxable year in the
          recovery period.
        (B) Disallowed deductions allowed for years after recovery
            period
          (i) In general
            Except as provided in clause (ii), the unrecovered basis of
          any passenger automobile shall be treated as an expense for
          the 1st taxable year after the recovery period.  Any excess
          of the unrecovered basis over the limitation of clause (ii)
          shall be treated as an expense in the succeeding taxable
          year.
          (ii) $1,475 limitation
            The amount treated as an expense under clause (i) for any
          taxable year shall not exceed $1,475.
          (iii) Property must be depreciable
            No amount shall be allowable as a deduction by reason of
          this subparagraph with respect to any property for any
          taxable year unless a depreciation deduction would be
          allowable with respect to such property for such taxable
          year.
          (iv) Amount treated as depreciation deduction
            For purposes of this subtitle, any amount allowable as a
          deduction by reason of this subparagraph shall be treated as
          a depreciation deduction allowable under section 168.
        (C) Special rule for certain clean-fuel passenger automobiles
          (i) Modified automobiles
            In the case of a passenger automobile which is propelled by
          a fuel which is not a clean-burning fuel and to which is
          installed qualified clean-fuel vehicle property (as defined
          in section 179A(c)(1)(A)) for purposes of permitting such
          vehicle to be propelled by a clean burning fuel (as defined
          in section 179A(e)(1)), subparagraph (A) shall not apply to
          the cost of the installed qualified clean burning vehicle
          property.
          (ii) Purpose built passenger vehicles
            In the case of a purpose built passenger vehicle (as
          defined in section 4001(a)(2)(C)(ii)), each of the annual
          limitations specified in subparagraphs (A) and (B) shall be
          tripled.
          (iii) Application of subparagraph.--This 
          subparagraph shall apply to property placed in 
          service after August 5, 1997, and before January 1, 2007.                      
      (2) Coordination with reductions in amount allowable by reason of
          personal use, etc.
        This subsection shall be applied before -
          (A) the application of subsection (b), and
          (B) the application of any other reduction in the amount of
        any depreciation deduction allowable under section 168 by
        reason of any use not qualifying the property for such credit
        or depreciation deduction.
    (b) Limitation where business use of listed property not greater
        than 50 percent
      (1) Depreciation
        If any listed property is not predominantly used in a qualified
      business use for any taxable year, the deduction allowed under
      section 168 with respect to such property for such taxable year
      and any subsequent taxable year shall be determined under section
      168(g) (relating to alternative depreciation system).
      (2) Recapture
        (A) Where business use percentage does not exceed 50 percent
          If -
            (i) property is predominantly used in a qualified business
          use in a taxable year in which it is placed in service, and
            (ii) such property is not predominantly used in a qualified
          business use for any subsequent taxable year,
        then any excess depreciation shall be included in gross income
        for the taxable year referred to in clause (ii), and the
        depreciation deduction for the taxable year referred to in
        clause (ii) and any subsequent taxable years shall be
        determined under section 168(g) (relating to alternative
        depreciation system).
        (B) Excess depreciation
          For purposes of subparagraph (A), the term ''excess
        depreciation'' means the excess (if any) of -
            (i) the amount of the depreciation deductions allowable
          with respect to the property for taxable years before the 1st
          taxable year in which the property was not predominantly used
          in a qualified business use, over
            (ii) the amount which would have been so allowable if the
          property had not been predominantly used in a qualified
          business use for the taxable year in which it was placed in
          service.
      (3) Property predominantly used in qualified business use
        For purposes of this subsection, property shall be treated as
      predominantly used in a qualified business use for any taxable
      year if the business use percentage for such taxable year exceeds
      50 percent.
    (c) Treatment of leases
      (1) Lessor's deductions not affected
        This section shall not apply to any listed property leased or
      held for leasing by any person regularly engaged in the business
      of leasing such property.
      (2) Lessee's deductions reduced
        For purposes of determining the amount allowable as a deduction
      under this chapter for rentals or other payments under a lease
      for a period of 30 days or more of listed property, only the
      allowable percentage of such payments shall be taken into
      account.
      (3) Allowable percentage
        For purposes of paragraph (2), the allowable percentage shall
      be determined under tables prescribed by the Secretary. Such
      tables shall be prescribed so that the reduction in the deduction
      under paragraph (2) is substantially equivalent to the applicable
      restrictions contained in subsections (a) and (b).
      (4) Lease term
        In determining the term of any lease for purposes of paragraph
      (2), the rules of section 168(i)(3)(A) shall apply.
      (5) Lessee recapture
        Under regulations prescribed by the Secretary, rules similar to
      the rules of subsection (b)(3) shall apply to any lessee to which
      paragraph (2) applies.
    (d) Definitions and special rules
      For purposes of this section -
      (1) Coordination with section 179
        Any deduction allowable under section 179 with respect to any
      listed property shall be subject to the limitations of
      subsections (a) and (b), and the limitation of paragraph (3) of
      this subsection, in the same manner as if it were a depreciation
      deduction allowable under section 168.
      (2) Subsequent depreciation deductions reduced for deductions
          allocable to personal use
        Solely for purposes of determining the amount of the
      depreciation deduction for subsequent taxable years, if less than
      100 percent of the use of any listed property during any taxable
      year is use in a trade or business (including the holding for the
      production of income), all of the use of such property during
      such taxable year shall be treated as use so described.
      (3) Deductions of employee
        (A) In general
          Any employee use of listed property shall not be treated as
        use in a trade or business for purposes of determining the
        amount of any depreciation deduction allowable to the employee
        (or the amount of any deduction allowable to the employee for
        rentals or other payments under a lease of listed property)
        unless such use is for the convenience of the employer and
        required as a condition of employment.
        (B) Employee use
          For purposes of subparagraph (A), the term ''employee use''
        means any use in connection with the performance of services as
        an employee.
      (4) Listed property
        (A) In general
          Except as provided in subparagraph (B), the term ''listed
        property'' means -
            (i) any passenger automobile,
            (ii) any other property used as a means of transportation,
            (iii) any property of a type generally used for purposes of
          entertainment, recreation, or amusement,
            (iv) any computer or peripheral equipment (as defined in
          section 168(i)(2)(B)),
            (v) any cellular telephone (or other similar
          telecommunications equipment), and
            (vi) any other property of a type specified by the
          Secretary by regulations.
        (B) Exception for certain computers
          The term ''listed property'' shall not include any computer
        or peripheral equipment (as so defined) used exclusively at a
        regular business establishment and owned or leased by the
        person operating such establishment.  For purposes of the
        preceding sentence, any portion of a dwelling unit shall be
        treated as a regular business establishment if (and only if)
        the requirements of section 280A(c)(1) are met with respect to
        such portion.
        (C) Exception for property used in business of transporting
            persons or property
          Except to the extent provided in regulations, clause (ii) of
        subparagraph (A) shall not apply to any property substantially
        all of the use of which is in a trade or business of providing
        to unrelated persons services consisting of the transportation
        of persons or property for compensation or hire.
      (5) Passenger automobile
        (A) In general
          Except as provided in subparagraph (B), the term ''passenger
        automobile'' means any 4-wheeled vehicle -
            (i) which is manufactured primarily for use on public
          streets, roads, and highways, and
            (ii) which is rated at 6,000 pounds unloaded gross vehicle
          weight or less.
        In the case of a truck or van, clause (ii) shall be applied by
        substituting ''gross vehicle weight'' for ''unloaded gross
        vehicle weight''.
        (B) Exception for certain vehicles
          The term ''passenger automobile'' shall not include -
            (i) any ambulance, hearse, or combination ambulance-hearse
          used by the taxpayer directly in a trade or business,
            (ii) any vehicle used by the taxpayer directly in the trade
          or business of transporting persons or property for
          compensation or hire, and
            (iii) under regulations, any truck or van.
      (6) Business use percentage
        (A) In general
          The term ''business use percentage'' means the percentage of
        the use of any listed property during any taxable year which is
        a qualified business use.
        (B) Qualified business use
          Except as provided in subparagraph (C), the term ''qualified
        business use'' means any use in a trade or business of the
        taxpayer.
        (C) Exception for certain use by 5-percent owners and related
            persons
          (i) In general
            The term ''qualified business use'' shall not include -
              (I) leasing property to any 5-percent owner or related
            person,
              (II) use of property provided as compensation for the
            performance of services by a 5-percent owner or related
            person, or
              (III) use of property provided as compensation for the
            performance of services by any person not described in
            subclause (II) unless an amount is included in the gross
            income of such person with respect to such use, and, where
            required, there was withholding under chapter 24.
          (ii) Special rule for aircraft
            Clause (i) shall not apply with respect to any aircraft if
          at least 25 percent of the total use of the aircraft during
          the taxable year consists of qualified business use not
          described in clause (i).
        (D) Definitions
          For purposes of this paragraph -
          (i) 5-percent owner
            The term ''5-percent owner'' means any person who is a
          5-percent owner with respect to the taxpayer (as defined in
          section 416(i)(1)(B)(i)).
          (ii) Related person
            The term ''related person'' means any person related to the
          taxpayer (within the meaning of section 267(b)).
      (7) Automobile price inflation adjustment
        (A) In general
          In the case of any passenger automobile placed in service
        after 1988, subsection (a) shall be applied by increasing each
        dollar amount contained in such subsection by the automobile
        price inflation adjustment for the calendar year in which such
        automobile is placed in service.  Any increase under the
        preceding sentence shall be rounded to the nearest multiple of
        $100 (or if the increase is a multiple of $50, such increase
        shall be increased to the next higher multiple of $100).
        (B) Automobile price inflation adjustment
          For purposes of this paragraph -
          (i) In general
            The automobile price inflation adjustment for any calendar
          year is the percentage (if any) by which -
              (I) the CPI automobile component for October of the
            preceding calendar year, exceeds
              (II) the CPI automobile component for October of 1987.
          (ii) CPI automobile component
            The term ''CPI automobile component'' means the automobile
          component of the Consumer Price Index for All Urban Consumers
          published by the Department of Labor.
      (8) Unrecovered basis
        For purposes of subsection (a)(2), the term ''unrecovered
      basis'' means the adjusted basis of the passenger automobile
      determined after the application of subsection (a) and as if all
      use during the recovery period were use in a trade or business
      (including the holding of property for the production of income).
      (9) All taxpayers holding interests in passenger automobile
          treated as 1 taxpayer
        All taxpayers holding interests in any passenger automobile
      shall be treated as 1 taxpayer for purposes of applying
      subsection (a) to such automobile, and the limitations of
      subsection (a) shall be allocated among such taxpayers in
      proportion to their interests in such automobile.
      (10) Special rule for property acquired in nonrecognition
          transactions
        For purposes of subsection (a)(2) any property acquired in a
      nonrecognition transaction shall be treated as a single property
      originally placed in service in the taxable year in which it was
      placed in service after being so acquired.
    (e) Regulations
      The Secretary shall prescribe such regulations as may be
    necessary or appropriate to carry out the purposes of this section,
    including regulations with respect to items properly included in,
    or excluded from, the adjusted basis of any listed property.
 

Sources

    (Added Pub. L. 98-369, div.  A, title I, Sec. 179(a), July 18,
    1984, 98 Stat. 713; amended Pub. L. 99-44, Sec. 4, May 24, 1985, 99
    Stat. 78; Pub. L. 99-514, title II, Sec. 201(d)(4), title XVIII,
    Sec. 1812(e)(1)(A), (C), (2)-(5), Oct. 22, 1986, 100 Stat. 2139,
    2836, 2837; Pub. L. 100-647, title I, Sec. 1002(a)(10), (b)(2),
    1018(u)(3), Nov. 10, 1988, 102 Stat. 3354, 3357, 3590; Pub. L.
    101-239, title VII, Sec. 7643(a), Dec. 19, 1989, 103 Stat. 2381;
    Pub. L. 101-508, title XI, Sec. 11813(b)(13)(A)-(E), Nov. 5, 1990,
    104 Stat. 1388-554, 1388-555; Pub. L. 104-188, title I, Sec.
    1702(h)(5), Aug. 20, 1996, 110 Stat. 1874; Pub. L. 105-34, title
    IX, Sec. 971(a), Aug. 5, 1997, 111 Stat. 897; Pub. L. 105-206,
    title VI, Sec. 6009(c), July 22, 1998, 112 Stat. 812.)
 

Miscellaneous

                                 AMENDMENTS
      2002 - Pub. L. 107-147, Sec. 602(b)amended Sec. 280F(a)(1)(C)
      by adding a new (iii).  Sec. 602(b)(2)amended Sec. 971(b)of 
      the Taxpayer Relief Act of 1997 by striking "and before 
      January 1, 2005".
      1998 - Subsec. (a)(1)(C)(ii). Pub. L. 105-206 substituted
    ''subparagraphs (A) and (B)'' for ''subparagraph (A)''.
      1997 - Subsec. (a)(1)(C). Pub. L. 105-34 added subpar. (C).
      1996 - Subsec. (a). Pub. L. 104-188 struck out ''investment tax
    credit and'' after ''amount of'' in heading.
      1990 - Pub. L. 101-508, Sec. 11813(b)(13)(E), struck out
    ''investment tax credit and'' after ''Limitation on'' in section
    catchline.
      Subsec. (a)(1). Pub. L. 101-508, Sec. 11813(b)(13)(A)(i),
    redesignated par. (2) as (1) and struck out former par. (1)
    ''Investment tax credit'' which read as follows: ''The amount of
    the credit determined under section 46(a) for any passenger
    automobile shall not exceed $675.''
      Subsec. (a)(2). Pub. L. 101-508, Sec. 11813(b)(13)(A)(i),
    redesignated par. (3) as (2). Former par. (2) redesignated (1).
      Subsec. (a)(2)(B). Pub. L. 101-508, Sec. 11813(b)(13)(A)(ii),
    struck out ''the credit determined under section 46(a) or'' after
    ''the amount of''.
      Subsec. (a)(3). Pub. L. 101-508, Sec. 11813(b)(13)(A)(i),
    redesignated par. (3) as (2).
      Subsec. (a)(4). Pub. L. 101-508, Sec. 11813(b)(13)(A)(i), struck
    out par. (4) ''Special rule where election of reduced credit in
    lieu of the basis adjustment'' which read as follows: ''In the case
    of any election under section 48(q)(4) with respect to any
    passenger automobile, the limitation of paragraph (1) applicable to
    such passenger automobile shall be 2/3 of the amount which would be
    so applicable but for this paragraph.''
      Subsec. (b). Pub. L. 101-508, Sec. 11813(b)(13)(B), redesignated
    pars. (2) to (4) as (1) to (3), respectively, and struck out former
    par. (1) ''Investment tax credit'' which read as follows: ''For
    purposes of this subtitle, any listed property shall not be treated
    as section 38 property for any taxable year unless such property is
    predominantly used in a qualified business use for such taxable
    year.''
      Subsec. (c)(1). Pub. L. 101-508, Sec. 11813(b)(13)(C), struck out
    ''credits and'' after ''Lessor's'' in heading.
      Subsec. (d)(3)(A). Pub. L. 101-508, Sec. 11813(b)(13)(D), struck
    out ''the amount of any credit allowable under section 38 to the
    employee or'' after ''of determining''.
      1989 - Subsec. (d)(4)(A)(v), (vi). Pub. L. 101-239 added cl. (v)
    and redesignated former cl. (v) as (vi).
      1988 - Subsec. (b)(3)(B)(i). Pub. L. 100-647, Sec. 1018(u)(3),
    substituted ''depreciation deductions'' for ''recovery
    deductions''.
      Subsec. (d)(1). Pub. L. 100-647, Sec. 1002(b)(2), substituted
    ''subsections (a) and (b), and the limitation of paragraph (3) of
    this subsection,'' for ''subsections (a) and (b)''.
      Subsec. (d)(3)(A). Pub. L. 100-647, Sec. 1002(a)(10), substituted
    ''depreciation deduction'' for ''recovery deduction''.
      1986 - Subsec. (a)(2)(A). Pub. L. 99-514, Sec. 201(d)(4)(A)(i),
    (K), substituted ''depreciation deduction'' for ''recovery
    deduction'' in introductory provisions and substituted cls. (i) to
    (iv) for former cls. (i) and (ii) which read as follows:
      ''(i) $3,200 for the first taxable year in the recovery period,
    and
      ''(ii) $4,800 for each succeeding taxable year in the recovery
    period.''
      Subsec. (a)(2)(B). Pub. L. 99-514, Sec. 201(d)(4)(A)(ii), (K),
    substituted ''$1,475'' for ''$4,800'' in heading and text of cl.
    (ii), and ''depreciation deduction'' for ''recovery deduction'' in
    heading and text of cl. (iv).
      Subsec. (a)(3)(B). Pub. L. 99-514, Sec. 201(d)(4)(K), substituted
    ''depreciation deduction'' for ''recovery deduction'' in two
    places.
      Subsec. (b)(2). Pub. L. 99-514, Sec. 201(d)(4)(J), substituted
    ''section 168(g) (relating to alternative depreciation system)''
    for ''the straight line method over the earnings and profits life
    for such property''.
      Subsec. (b)(3)(A). Pub. L. 99-514, Sec. 201(d)(4)(B), (K),
    substituted ''depreciation deduction'' for ''recovery deduction''
    and ''section 168(g) (relating to alternative depreciation
    system)'' for ''the straight line method over the earnings and
    profits life'' in closing provisions.
      Subsec. (b)(4). Pub. L. 99-514, Sec. 201(d)(4)(C), in amending
    par. (4) generally, struck out heading ''Definitions'',
    redesignated as par. (4) former subpar. (A) heading and text,
    substituted ''For purposes of this section, property'' for
    ''Property'', and struck out former subpar. (B) definition of
    straight line method over earnings and profits life.
      Subsec. (c)(4). Pub. L. 99-514, Sec. 201(d)(4)(D), substituted
    ''section 168(i)(3)(A)'' for ''section 168(j)(6)(B)''.
      Subsec. (d)(1). Pub. L. 99-514, Sec. 201(d)(4)(E), substituted
    ''depreciation deduction'' for ''recovery deduction''.
      Subsec. (d)(2). Pub. L. 99-514, Sec. 1812(e)(5), substituted ''is
    use described in'' for ''is not use described in''.
      Pub. L. 99-514, Sec. 201(d)(4)(F), substituted ''depreciation
    deduction'' for ''recovery deduction'' and ''use in a trade or
    business (including the holding for the production of income)'' for
    ''use described in section 168(c)(1) (defining recovery
    property)''.
      Subsec. (d)(3)(A). Pub. L. 99-514, Sec. 1812(e)(2), inserted
    ''(or the amount of any deduction allowable to the employee for
    rentals or other payments under a lease of listed property)''.
      Subsec. (d)(4)(A)(iv). Pub. L. 99-514, Sec. 201(d)(4)(G),
    substituted ''section 168(i)(2)(B)'' for ''section 168(j)(5)(D)''.
      Subsec. (d)(4)(B). Pub. L. 99-514, Sec. 1812(e)(3), inserted
    ''and owned or leased by the person operating such establishment''.
      Subsec. (d)(4)(C). Pub. L. 99-514, Sec. 1812(e)(4), added subpar.
    (C).
      Subsec. (d)(5)(A). Pub. L. 99-514, Sec. 1812(e)(1)(A), (C),
    substituted ''unloaded gross vehicle weight'' for ''gross vehicle
    weight'' in cl. (ii) and inserted at end ''In the case of a truck
    or van, clause (ii) shall be applied by substituting 'gross vehicle
    weight' for 'unloaded gross vehicle weight'.''
      Subsec. (d)(8). Pub. L. 99-514, Sec. 201(d)(4)(H), amended par.
    (8) generally.  Prior to amendment, par. (8) read as follows: ''For
    purposes of subsection (a)(2), the term ''unrecovered basis'' means
    the excess (if any) of -
        ''(A) the unadjusted basis (as defined in section 168(d)(1)(A))
      of the passenger automobile, over
        ''(B) the amount of the recovery deductions which would have
      been allowable for taxable years in the recovery period
      determined after the application of subsection (a) and as if all
      use during the recovery period were use described in section
      168(c)(1).''
      Subsec. (d)(10). Pub. L. 99-514, Sec. 201(d)(4)(I), struck out
    '', notwithstanding any regulations prescribed under section
    168(f)(7),'' after ''For purposes of subsection (a)(2)''.
      1985 - Subsec. (a)(1). Pub. L. 99-44, Sec. 4(a)(1), substituted
    ''$675'' for ''$1,000''.
      Subsec. (a)(2)(A)(i). Pub. L. 99-44, Sec. 4(a)(2)(A), substituted
    ''$3,200'' for ''$4,000''.
      Subsec. (a)(2)(A)(ii), (B)(ii). Pub. L. 99-44, Sec. 4(a)(2)(B),
    substituted ''$4,800'' for ''$6,000'' wherever appearing in text
    and heading.
      Subsec. (d)(7)(A). Pub. L. 99-44, Sec. 4(b)(1), inserted ''placed
    in service after 1988'' after ''passenger automobile''.
      Subsec. (d)(7)(B)(i). Pub. L. 99-44, Sec. 4(b)(3), struck out
    last sentence which directed that in the case of calendar year
    1984, the automobile price inflation adjustment would be zero.
      Subsec. (d)(7)(B)(i)(II). Pub. L. 99-44, Sec. 4(b)(2),
    substituted ''1987'' for ''1983''.
                      EFFECTIVE DATE OF 1998 AMENDMENT
      Amendment by Pub. L. 105-206 effective, except as otherwise
    provided, as if included in the provisions of the Taxpayer Relief
    Act of 1997, Pub. L. 105-34, to which such amendment relates, see
    section 6024 of Pub. L. 105-206, set out as a note under section 1
    of this title.
                      EFFECTIVE DATE OF 1997 AMENDMENT
      Section 971(b) of Pub. L. 105-34 provided that: ''The amendments
    made by this section (amending this section) shall apply to
    property placed in service after the date of enactment of this Act
    (Aug. 5, 1997) and before January 1, 2005.''
                      EFFECTIVE DATE OF 1996 AMENDMENT
      Amendment by Pub. L. 104-188 effective, except as otherwise
    expressly provided, as if included in the provision of the Revenue
    Reconciliation Act of 1990, Pub. L. 101-508, title XI, to which
    such amendment relates, see section 1702(i) of Pub. L. 104-188, set
    out as a note under section 38 of this title.
                      EFFECTIVE DATE OF 1990 AMENDMENT
      Amendment by Pub. L. 101-508 applicable to property placed in
    service after Dec. 31, 1990, but not applicable to any transition
    property (as defined in section 49(e) of this title), any property
    with respect to which qualified progress expenditures were
    previously taken into account under section 46(d) of this title,
    and any property described in section 46(b)(2)(C) of this title, as
    such sections were in effect on Nov. 4, 1990, see section 11813(c)
    of Pub. L. 101-508, set out as a note under section 29 of this
    title.
                      EFFECTIVE DATE OF 1989 AMENDMENT
      Section 7643(b) of Pub. L. 101-239 provided that: ''The amendment
    made by subsection (a) (amending this section) shall apply to
    property placed in service or leased in taxable years beginning
    after December 31, 1989.''
                      EFFECTIVE DATE OF 1988 AMENDMENT
      Amendment by Pub. L. 100-647 effective, except as otherwise
    provided, as if included in the provision of the Tax Reform Act of
    1986, Pub. L. 99-514, to which such amendment relates, see section
    1019(a) of Pub. L. 100-647, set out as a note under section 1 of
    this title.
                      EFFECTIVE DATE OF 1986 AMENDMENT
      Amendment by section 201(d)(4) of Pub. L. 99-514 applicable to
    property placed in service after Dec. 31, 1986, in taxable years
    ending after such date, with exceptions, see sections 203 and 204
    of Pub. L. 99-514, set out as a note under section 168 of this
    title.
      Amendment by section 201(d)(4) of Pub. L. 99-514 not applicable
    to any property placed in service before Jan. 1, 1994, if such
    property placed in service as part of specified rehabilitations,
    and not applicable to certain additional rehabilitations, see
    section 251(d)(2), (3) of Pub. L. 99-514, set out as a note under
    section 46 of this title.
      Amendment by section 1812(e)(1)(A), (C), (2)-(5) of Pub. L.
    99-514 effective, except as otherwise provided, as if included in
    the provisions of the Tax Reform Act of 1984, Pub. L. 98-369, div.
    A, to which such amendment relates, see section 1881 of Pub. L.
    99-514, set out as a note under section 48 of this title.
                      EFFECTIVE DATE OF 1985 AMENDMENT
      Section 6(e) of Pub. L. 99-44 provided that:
      ''(1) Except as provided in paragraph (2), the amendments made by
    section 4 (amending this section) shall apply to -
        ''(A) property placed in service after April 2, 1985, in
      taxable years ending after such date, and
        ''(B) property leased after April 2, 1985, in taxable years
      ending after such date.
      ''(2) The amendments made by section 4 (amending this section)
    shall not apply to any property -
        ''(A) acquired by the taxpayer pursuant to a binding contract
      in effect on April 1, 1985, and at all times thereafter, but only
      if the property is placed in service before August 1, 1985, or
        ''(B) of which the taxpayer is the lessee, but only if the
      lease is pursuant to a binding contract in effect on April 1,
      1985, and at all times thereafter, and only if the taxpayer first
      uses such property under the lease before August 1, 1985.''
                               EFFECTIVE DATE
      Section 179(d) of Pub. L. 98-369 provided that:
      ''(1) In general. -
        ''(A) Except as provided in subparagraph (B), the amendments
      made by subsections (a) and (c) (enacting this section) shall
      apply to -
          ''(i) property placed in service after June 18, 1984, in
        taxable years ending after such date, and
          ''(ii) property leased after June 18, 1984, in taxable years
        ending after such date.
        ''(B) The amendments made by subsections (a) and (c) shall not
      apply to any property -
          ''(i) acquired by the taxpayer pursuant to a binding contract
        in effect on June 18, 1984, and at all times thereafter (or
        under construction on such date) but only if the property is
        placed in service before January 1, 1985 (January 1, 1987, in
        the case of 15-year real property), or
          ''(ii) of which the taxpayer is the lessee but only if the
        lease is pursuant to a binding contract in effect on June 18,
        1984, and at all times thereafter and only if the taxpayer
        first uses such property under the lease before January 1, 1985
        (January 1, 1987, in the case of 15-year real property).
      For purposes of the preceding sentence, the term '15-year real
      property' includes 18-year real property.
      ''(2) Compliance provisions. - The amendments made by subsection
    (b) (amending sections 274, 6653, and 6695 of this title) shall
    apply to taxable years beginning after December 31, 1984.''
                             SAVINGS PROVISION
      For provisions that nothing in amendment by Pub. L. 101-508 be
    construed to affect treatment of certain transactions occurring,
    property acquired, or items of income, loss, deduction, or credit
    taken into account prior to Nov. 5, 1990, for purposes of
    determining liability for tax for periods ending after Nov. 5,
    1990, see section 11821(b) of Pub. L. 101-508, set out as a note
    under section 29 of this title.
             PLAN AMENDMENTS NOT REQUIRED UNTIL JANUARY 1, 1989
      For provisions directing that if any amendments made by subtitle
    A or subtitle C of title XI (Sec. 1101-1147 and 1171-1177) or title
    XVIII (Sec. 1800-1899A) of Pub. L. 99-514 require an amendment to
    any plan, such plan amendment shall not be required to be made
    before the first plan year beginning on or after Jan. 1, 1989, see
    section 1140 of Pub. L. 99-514, as amended, set out as a note under
    section 401 of this title.
 

References

                   SECTION REFERRED TO IN OTHER SECTIONS
      This section is referred to in sections 168, 274 of this title.
 

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