graph (3) and inserting ‘‘, and’’, and by adding at the
end thereof the following new paragraph:
‘‘(4) the investment credit.’’
(b) AMOUNT OF CREDIT.—Section 48 of such Code
is amended by adding at the end thereof the following new
subsection:
‘‘(c) INVESTMENT CREDIT.—
‘‘(1) IN GENERAL.—For purposes of section 46,
the investment credit for any taxable year is an
amount equal to 25 percent of the qualified invest-
ment for such taxable year.
‘‘(2) QUALIFIED INVESTMENT.—
‘‘(A) IN GENERAL.—For purposes of para-
graph (1), the qualified investment for any tax-
able year is the aggregate of—
‘‘(i) the applicable percentage of the
basis of each new investment credit prop-
erty placed in service by the taxpayer dur-
ing such taxable year, plus
‘‘(ii) the applicable percentage of the
cost of each used investment credit prop-
erty placed in service by the taxpayer dur-
ing such taxable year.
‘‘(B) 
APPLICABLE
PERCENTAGE.—For
purposes of subparagraph (A), the applicable
percentage for any property shall be determined
under paragraphs (2) and (7) of section 46(c)
(as in effect on the day before the date of the
enactment of the Revenue Reconciliation Act of
1990).
‘‘(C) CERTAIN RULES RELATING TO NEW
AND USED PROPERTY MADE APPLICABLE.—The
provisions of subsections (b) and (c) of section
48 (as in effect on the day before the date of
the enactment of the Revenue Reconciliation
Act of 1990) shall apply for purposes of this
paragraph.
‘‘(D) TEMPORARY
DURATION
OF
CRED-
IT.—For purposes of this subsection, property
shall be treated as investment credit property
only—
‘‘(i) in any case in which the rules of
paragraph (6) do not apply to such prop-
erty, only if—
‘‘(I) the construction, reconstruc-
tion, or erection of the property is
completed by the taxpayer during the
18-month period beginning on the
date of enactment of this subsection,
but only to the extent of the basis at-
tributable to the construction, recon-
struction, or erection during such pe-
riod, or
‘‘(II) acquired by the taxpayer
during such period and placed in serv-
ice during such period, or
‘‘(ii) to which the rules of paragraph
(6) apply, but only to the extent of the
qualified investment with respect to quali-
fied progress expenditures made during
such period.
‘‘(3) INVESTMENT
CREDIT
PROPERTY.—For
purposes of this subsection, the term ‘investment
credit property’ means—
‘‘(A) tangible personal property, or
‘‘(B) other tangible property (not including
a building and its structural components) but
only if such property—
‘‘(i) is used as an integral part of
manufacturing, production, or extraction
or of furnishing transportation, commu-
nications, electrical energy, gas, water, or
sewage disposal services, or
‘‘(ii) constitutes a research facility
used in connection with any of the activi-
ties referred to in clause (i), or
‘‘(iii) constitutes a facility used in
connection with any of the activities re-
ferred to in clause (i) for the bulk storage
of fungible commodities (including com-
modities in a liquid or gaseous state), or
‘‘(C) elevators and escalators, but only if—
‘‘(i) the construction, reconstruction,
or erection of the elevator or escalator is
completed by the taxpayer, or
‘‘(ii) the original use of such elevator
or escalator commences with the taxpayer,
or
‘‘(D) single purpose agricultural or horti-
cultural structures; or
‘‘(E) a storage facility (not including a
building and its structural components) used in
connection with the distribution of petroleum or
any primary product of petroleum.
Such term includes only property to which section
168 applies without regard to any useful life and
any other property with respect to which deprecia-
tion (or amortization in lieu of depreciation) is al-
lowable and having a useful life (determined as of
the time such property is placed in service) of 3
years or more.
‘‘(4) EXCLUSION OF OTHER PROPERTY.—Rules
similar to the rules of paragraphs (6), (7), and (10)
of section 48(a) (as in effect on the day before the
date of the enactment of the Revenue Reconciliation
Act of 1990) shall apply.
‘‘(5) COORDINATION WITH OTHER CREDITS.—
This subsection shall not apply to any property to
which the energy credit or rehabilitation credit
would apply unless the taxpayer elects to waive the
application of such credits to such property.
‘‘(6) CERTAIN PROGRESS EXPENDITURE RULES
MADE APPLICABLE.—Rules similar to rules of sub-
section (c)(4) and (d) of section 46 (as in effect on
the day before the date of the enactment of the Rev-
enue Reconciliation Act of 1990) shall apply for pur-
poses of this subsection.
‘‘(7) CERTAIN RULES RELATING TO VESSELS
MADE APPLICABLE.—Rules similar to rules of sub-
section (g) of section (46) (as in effect on the day
before the date of the enactment of the Revenue
Reconciliation Act of 1990) shall apply for purposes
of this subsection.’’
(c) APPLICATION OF OTHER RULES.—
(1) AT RISK RULES.—Subparagraph (C) of sec-
tion 49(a)(1) of such Code is amended by striking
‘‘and’’ at the end of clause (ii), by striking the pe-
riod at the end of clause (iii) and inserting ‘‘, and’’,
and by adding at the end thereof the following new
clause:
‘‘(iv) the basis of any new investment
credit property and the cost of any used
investment credit property.’’
(2) RECAPTURE RULES.—
(A) Subparagraph (E) of section 50(a)(2)
of such Code is amended by inserting ‘‘or
48(c)(9)’’ before the period at the end thereof.
(B) Paragraph (5) of section 50(a) of such
Code is amended by adding at the end thereof
the following new subparagraph:
‘‘(D) SPECIAL RULES FOR CERTAIN PROP-
ERTY.—In the case of any investment credit
property which is 3-year property (within the
meaning of section 168(e))—
‘‘(i) the percentage set forth in clause
(ii) of the table contained in paragraph
(1)(B) shall be 66 percent,
‘‘(ii) the percentage set forth in clause
(iii) of such table shall be 33 percent, and
‘‘(iii) clauses (iv) and (v) of such table
shall not apply.’’
(d) CONFORMING AMENDMENTS.—
(1) Section 39(d) of such Code is amended by
adding at the end the following new paragraph:
‘‘(11) INVESTMENT TAX CREDIT.—No portion
of the unused business credit which is attributable to
the credit determined under section 48(c) (relating
to investment credit) may be carried to any taxable
year ending before the date of enactment of this
paragraph.’’
(2) Section 1033(g)(3)(A) of such Code is
amended by inserting ‘‘with respect to which the in-
vestment credit determined under section 48(c) is or
has been claimed or,’’ before ‘‘with respect to
which’’.
(3)(A) The section heading for section 48 of
such Code is amended to read as follows:
‘‘SEC. 48. OTHER CREDITS.’’
(B) The table of sections for subpart E of part
IV of subchapter A of chapter 1 of such Code is
amended by striking the item relating to section 48
and inserting the following:
‘‘Sec. 48. Other credits.’’
(e) EFFECTIVE DATE.—The amendments made by
this section shall apply to periods after the date of the
enactment of this Act under rules similar to the rules of
section 48(m) of the Internal Revenue Code of 1986 (as
in effect on the day before the date of the enactment of
the Revenue Reconciliation Act of 1990).
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