76 STAT. ]
PUBLIC LAW 87-834-OCT. 16, 1962
For purposes of this paragraph, the useful life of any property shall be determined as of the time such property is placed in service by the taxpayer. "(3)
PUBLIC UTILITY PROPERTY.—
" (A) I n the case of section 38 property which is public Ante, p.962. utility property, the amount of the qualified investment shall be 3/7 of the amount determined under paragraph (1). " (B) For purposes of subparagraph (A), the term 'public utility property' means property used predominantly m the trade or business of the furnishing or sale of— " (i) electrical energy, water, or sewage disposal services, i) gas through a local distribution system, "(iii telephone service, or [iii) "(iv) telegraph service by means of domestic telegraph operations (as defined in section 222(a)(5) of the Communications Act of 1934, as amended; 47 U.S.C. sec. 222(a)(5)), 57 Stat. 5. if the rates for such furnishing or sale, as the case may be, have been established or approved by a State or political subdivision thereof, by an agency or instrumentality of the United States, or by a public service or public utility commission or other similar body of any State or political subdivision thereof. " (4) CERTAIN REPLACEMENT PROPERTY.—For purposes of paragraph (1), if section 38 property is placed in service by the taxpayer to replace property which was— " (A) destroyed or damaged by fire, storm, shipwreck, or other casualty, or " (B) stolen, the basis of such section 38 property (in the case of new section 38 property), or the cost of such section 38 property (in the case of used section 38 property), which (but for this paragraph) would be taken into account under paragraph (1) shall be reduced by an amount equal to the amount received by the taxpayer as compensation, by insurance or otherwise, for the property so destroyed, damaged, or stolen, or to the adjusted basis of such property, whichever is the lesser. No reduction in basis or cost shall be made under the preceding sentence in any case in which the reduction in qualified investment attributable to the substitution required by section 47(a)(1) with respect to the Post, p. 966. property so destroyed, damaged, or stolen (determined without regard to section 47(a)(4)) is greater than the reduction described in the preceding sentence. "(d)
LIMITATIONS W I T H RESPECT TO CERTAIN PERSONS.—
"(1) IN GENERAL.—In the case of— "TA) an organization to which section 593 applies. Post, p. 977. " (B) a regulated investment company or a real estate investment trust subject to taxation under subchapter M (sec. 851 and following), and " (C) a cooperative organization described in section 1381(a), the qualified investment and the $25,000 amount specified under subparagraphs (A) and (B) of subsection (a)(2) shall equal such person's ratable share of such items. " (2) RATABLE SHARE.—For purposes of paragraph (1), the
ratable share of any person for any taxable year of the items described therein shall oe— " (A) in the case of an organization referred to in paragraph (1)(A), 50 percent thereof,
965
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