vom 0468 Computation of Investment Credit OMB No. 145.0155

> Attach to your tax return. q 9 8 6

Department of the Treasury > Schedule B (Business Energy Investment Credit) on back. Attachment
Internal Revenue Service (0) Sequence No. 24

Name(s) as shown on return’ Identifying number

Elections (Check the box(es) below that apply to you (See Instruction D).)

A. lelect to increase my qualified investment by all qualified progress expenditures (QPE) made this and alllatertaxyears . . . . - o
Enter total qualified progress expenditures included in column (4), Part Il PB... . 2.22.22. 2.. 2-2 0-22e ee eee ee eee eee ee eee eee eee eee ets
B_ I claim full credit on certain ships under section 46(g)(3) (See Instruction B for details) ._. : wee eee OO
GREE Qualified investment (Certain Transition Property, QPE Property, and Qualified Timber Property
tr proper 7 a @ @) “
seers | Betty ContorotherBass | AUCrtane | (Goumn'@estuma3)
New (a) 3-year 60
Regular Property () Other 100
Percentage Used © 3-year 60
Property @ Other 100
Section 48(q) Election to New ‘© 3-year 40
Reduce Credit (instead Property O ‘Other 80
of adjusting basis)
(partner, etc., of 1985-86 Used (g) 3-year 40
flow-through entity only) Property (hy Other 80
2 Nonrecovery property—Enter total qualified investment (See instructions for line2) . . . 2
3 > Total qualified investment in 10% Property—Add lines 1(a) ) through 1, and 2 Gee
instructions for special limits). . . 3
4 Regular credit—Multiply line 3 by 10% (. 10) rv 1986. 87 filers, see instructions for line 24) .. p4

5 Qualified rehabilitation expenditures (enter qualified investment and multiply by percentage shown): i
a Rehabilitation Property placed in service before 1-1-87:
(i) 30-year-old buildings
(ii) 40-year-old buildings .
(iii) Certified historic structures (attach NPS certificate) . . : 25% [Sali
Fiscal-year 1986-87 filers only: 7
b Transition Property and Certain Projects placed in service after 12-31-86:

15% [5a
20% [Sali

x

x

x

(i) 30-year-old buildings x 10%
(ii) 40-year-old buildings x 13%
(iii) Certified historic structures (attach NPS certificate) x 25%

¢ Rehabilitation Property (not shown above) placed in service after 12: 31-86:
(i) Pre-1936 buildings . x 10%
(ii) Certified historic structures (attach NPS cértificate) x 20%

6 Credit from cooperatives—Enter regular investment credit from cooperatives
7 Business energy investment credit—From line 7 of Schedule B (see back of this form) .
8 Current year investment credit—Add line 4 through line 7. .

Note: /f you have a 1986 jobs credit (Form 5884), credit for alcohol used as fuel (Form G76), research credit Form 765), low-income housing credit (Form 8586),
or employee stock ownership plan (ESOP) credit (Form 8007) in addition to your 1986 investment credit, or if you have a carryback or carryforward of any
general business credit, stop here and go to Form 3800, General Business Credit, to claim your 1986 investment credit. If you have only a 1986 investment
credit (which may include business energy investment credit), you may continue with lines 9 through 14 to claim your credit.

Ee. Liability Limitations
ja Individuals—From Form 1040, enter amount fromline45 |

* Corporations—From Form 1120, Schedule J, enter tax from line 3 (or Form 1120. A, Part |, line )
¢ Other filers—Enter income tax before credits from return .
10a Individuals—From Form 1040, enter credit from line 46, plus any “orphan drug and
nonconventional source fuel credits included on line 48 Lo:
b Corporations—From Form 1120, Schedule J, enter credits from lines 4(a) through 4(d) (Form 1120.4 filers, enter ze10) 10
¢ Other filers—See instructions for line 10c

11 Income tax liability as adjusted (subtract line 10 from line 9). rn Soe 11
12a Enter smaller of line 11 or $25,000 (See instructions forline12).. .. . 2... ss J2a

b Ifline 11 is more than $25,000—Enter 75% oftheexcess . . . . . Soe . [22d
13 Investment credit limitation—Add lines 12aand12b . . . . 13

14 Total allowed credit—Enter the smaller of line 8 or line 13—This is your General Business Credit for 1986. Enter here and
on Form 1040, line 47; Form 1120, Schedule J, line 4(e); Form 1120-A, Part |, line 2; or the proper line of other returns. | 14

For Paperwork Reduction Act Notice, see separate instructions. Form 3468 (1986)



Form 3468 (1986) Page 2
Schedule B.—Business Energy Investment Credit
1___Enteron lines 1(a) through 1(e) your qualified investment in business energy property.
(1) (2) @) (4) 6)
Type of Property Line Class of Property Code Basis Applicable Qualified Investment
or Life Years Percentage (Column 3 x column 4)
(a) 3-year 60
Recover
% () Other 100
(c) 3 or more but less than 5 33%
Nonrecovery (4) 5 or more but less than 7 66%
(e) 7 or more 100
2 Total qualified investment—Add lines 1(a) through 1(e), column (5) . noe .| 2
3 1986 credit (15% times the portion of the line 2 amount attributable to energy Property placed in
service by 12-31-86) . 3
4 1986-87 fiscal year filers Multiply the 3 portion of the line 2 amount attributable to property placed
in service after 12-31-86 by the following percentages:
a Solar energy property (12%) 4a
b Biomass and geothermal property (10%) | 4b |
c Ocean thermal property (15%) | 4c |
5 Certain other property (See instructions below for special limits):
a Certain long-term section 46(b)(2)(A)(i) projects underway by 12-31-82 (10%) . . 5a
b Hydroelectric generating property placed in service during the year (if docketed with the Federal
Energy Regulatory Commission by 12-31-85) (11%) . : Soe . 5b
6 Cooperative credit—Enter business energy investment credit from cooperatives | 6 |
7 Tentative business energy investment credit—Add lines 3 3 through 6. Enter here and on line 7 of
page 1 _ : _. _. . _. 1 7
Instructions for Schedule B Line 12 Type of { Property.— For If the installed capacity of hydroelectric
definition of recovery and nonrecovery generating property is more than 25
(Form 3468)

Note: Partners, shareholders, and
beneficiaries of FY 1985-86 partnerships,
S corporations, estates and trusts that
placed property in service before January
1, 1986, see the separate Instructions for
Form 3468, under Specific Instructions.

Energy property must meet the same
requirements as regular investment credit
property, except that the provisions of
sections 48(a)(1) and 48(a)(3) do not apply.
See the separate Instructions for Form
3468 for definitions and rules regarding
regular investment credit property.

Energy property must be acquired new.
See sections 46(b)(2) and 48(1)(1) through
(17) for details.

See section 48(I)(17) for special rules on
public utility property, and section 48(|)(11)
(as amended by the Crude Oil Windfall
Profit Tax Act of 1980) for special rules on
property financed by Industrial
Development Bonds.

Specific Instructions

One Credit Only.—If property qualifies as
more than one kind of energy property, you
may take only one credit for the property.

property, see the separate Instructions for
Form 3468.
Line 1—Column (2).—Use the code
letters from the following list to indicate the
kind of property for which you are claiming
a credit. If you enter more than one kind of
property on a line, enter the code letter for
each kind of property in column (2) and the
code letter and dollar amount of each kind
of property in the right hand margin.

The code letters are:
a. Biomass property
b. Hydroelectric generating property
c. Solar equipment (but not passive

solar equipment)
d. Ocean thermal equipment
e. Geothermal equipment
See sections 48(|)(4) and 48(!)(3)(A)(viii)
and (ix) for definitions and special rules tiiat
apply to these kinds of property.
Line 5.—The section 48(q)(4) election to
take a reduced credit instead of adjusting
the basis of the energy property on line 5 is
not available for property placed in service
after December 31, 1985, and you must
reduce the basis by the full amount of the
credit claimed.

megawatts, the 11% energy credit is
allowed for only part of the qualified
investment. See section 48(!)(13)(C).

On the dotted line for line 5b, enter the
megawatt capacity of the generator as
shown on the nameplate of the generator.

If you are a 1986-87 fiscal-year filer with
a tax year beginning before and ending after
July 1, 1987 (for a normal 12-month tax
year, this would be only years beginning
after July 31, 1986), the energy credit(s) on
lines 5a and 5b must be reduced by a
percentage figured from the following
formula:
number of months in your
tax year after June 1987
total number of months
in your tax year

Enter the reduced credit on lines 5a and
5b. Although the reduction may not be used
in the current year or carried back to a prior
year, it may be carried forward to your next
tax year,

35%

US. Government Printing Office: 1986-493-226 23.0916750