Income Tax Regulations — 1100
unt for F in subsection (2) in respect of the class, unless no amount in respect of the property would be so included if the property were not accelerated investment incentive property of the taxpayer. Expenditures excluded from D.1 (2.021) For the purposes of subsection (2), in respect of property of a class in Schedule II that is reaccelerated investment incentive property of a taxpayer solely because of subparagraph 1104(4.01)(b)(i), (a) amounts incurred by any person or partnership in respect of the property are not to be included in determining the amount for D.1 in subsection (2) in respect of the class (i) if the amounts are incurred before 2025, unless (A) the property was acquired after 2024 by a person or partnership from another person or partnership (referred to in this subparagraph as the “transferee” and the “transferor”, respectively), (B) the transferee was either (I) the taxpayer, or (II) a person or partnership that does not deal at arm’s length with the taxpayer, and (C) the transferor (I) dealt at arm’s length with the transferee, and (II) held the property as inventory, and (ii) if the amounts are incurred after 2024 and amounts are deemed to have been deducted under paragraph 20(1)(a) or subsection 20(16) of the Act, in respect of those amounts incurred, under paragraph 1104(4.11)(b); and (b) any amount excluded from the amount determined for D.1 in subsection (2) in respect of the class because of paragraph (a) is to be included in determining the amount for F in subsection (2) in respect of the class, unless no amount in respect of the property would be so included if the property were not reaccelerated investment incentive property of the taxpayer. (2.1) Where a taxpayer has, after November 12, 1981 and before 1983, acquired or incurred a capital cost in respect of a property of a class in Schedule II and (a) he was obligated to acquire the property under the terms of an agreement in writing entered into before November 13, 1981 (or, where the property is a property described in Class 31 in Schedule II, before 1982), (b) he or a person with whom he was not dealing at arm’s length commenced the construction, manufacture or production of the property before November 13, 1981 (or, where the property is a property described in Class 31 in Schedule II, before 1982), (c) he or a person with whom he was not dealing at arm’s length had made arrangements, evidenced in writing for the construction, manufacture or production of the property that were substantially advanced before November 13, 1981 and the construction, manufacture or production commenced before June 1, 1982, or (d) he was obligated to acquire the property under the terms of an agreement in writing entered into before June 1, 1982 where arrangements, evidenced in writing, for the acquisition or leasing of the property were substantially advanced before November 13, 1981, the following rules apply: (e) no amount shall be included under paragraph (2)(a) in respect of the property; (f) where the property is a property to which paragraph (1)(b) applies, that paragraph shall be read, in respect of the property, as “such amount, not exceeding the amount for the year calculated in accordance with Schedule III, as he may claim in respect of the capital cost to him of property of Class 13 in Schedule II”; (g) where the property is a property of a class to which paragraph (1)(t) or (ta) applies, the property shall be deemed to be designated property of the class; and (h) where the property is a property described in paragraph (1)(v), subparagraph (iv) thereof shall be read, in respect of the property, as “33 1/3 per cent of the capital cost thereof to him, and”. (2.2) Where a property of a class in Schedule II is acquired by a taxpayer (a) in the course of a reorganization in respect of which, if a dividend were received by a corporation in the course of the reorganization, subsection 55(2) of the Act would not be applicable to the dividend by reason of the