85 STAT. ]
PUBLIC LAW 92-178-DEC. 10, 1971
507
ber 31, 1970. The amendments made by subsection (c)(1) shall apply to taxable years ending after August 15, 1971. SEC. 107. TREATMENT OF CASUALTIES AND CERTAIN REPLACEMENTS. (a)
CASUALTIES TREATED AS DISPOSITIONS.—
(1) Sections 46(c)(4) (relating to certain replacements of section 38 property) and 47 (a)(4) (relating to property destroyed by casualty, etc.) are hereby repealed. (2) The repeals made by paragraph (1) shall apply to casualties and thefts occurring after August 15, 1971. (b)
Repeals. 76 stau 9^63.^^ ' Effective date,
CERTAIN REPLACEMENTS DURING TERMINATION PERIOD.—
(1) Section 4 7 (a)(5) (relating to certain property replaced Repeal. after April 18, 1969) is hereby repealed. (2) The repeal made by paragraph (1) shall not apply if replacement property described in subparagraph (B) of such section 47(a)(5) is not property described in section 50 of the Internal Revenue Code of 1954. ^nte. p. 498. SEC. 108. AVAILABILITY OF CREDIT TO CERTAIN LESSORS. (a) IN GENERAL.—Section 46(d) (relating to limitations with ^^ ^'^** ^^^' respect to certain persons) is amended by adding at the end thereof the following new paragraph: "(3) NONCORPORATE LESSORS.—^A credit shall be allowed by section 38 to a person which is not a corporation with respect to property of which such person is the lessor only if— " (A) the property subject to the lease has been manufactured or produced by the lessor, or " (B) the term of the lease (taking into account options to renew) is less than 50 percent of the useful life of the property, and for the period consisting of the first 12 months after the date on which the property is transferred to the lessee the sum of the deductions with respect to such property which are allowable to the lessor solely by reason of section 162 (other than rents and reimbursed amounts with ^^^ ^*7ro^^' respect to such property) exceeds 15 percent of the rental income produced by such property. I n the case of property of which a partnership is the lessor, the credit otherwise allowable under section 38 with respect to such property to any partner which is a corporation shall be allowed notwithstanding the first sentence of this paragraph. For purposes of this paragraph, an electing small business corj^oration (as defined in section 1371) shall be treated as a person which is ^2 Stat. leso; j_
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7 8 S t a t * 112«
not a corporation. (b) CREDIT MAY B E USED BY LESSEE.—Section 48(d) (relating to
certain leased property) is amended by striking out "section 4 6 (d) " and inserting in lieu thereof "section 46(d)(1)". (c) CERTAIN PROPERTY LEASED FOR SHORT TERM.—Section 48(d) (relating to investment credit for certain leased property) is amended to read as follows: " (d) CERTAIN LEASED PROPERTY.— "(1) GENERAL RULE.—A person (other than a person referred
to in section 46(d)(1)) who is a lessor of property may (at such time, in such manner, and subject to such conditions as are provided by regulations prescribed by the Secretary or his delegate) elect with respect to any new section 38 property (other than property described in paragraph (4)) to treat the lessee as having acquired such property for an amount equal to— " (A) except as provided in subparagraph (B), the fair market value of such property, or " (B) if the property is leased by a corporation which is a component member of a controlled group (within the meaning
i^fra.
7 6 Stat. 967;
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