essary to prevent abuse of the require-
ments of this subparagraph, including 
abuse through—
‘‘(I) the use of special allocations 
of gains or losses, or 
‘‘(II) changes in ownership of 
partnership interests held by eligible 
taxpayers. 
‘‘(H) SPECIAL
RULES
FOR
MULTIPLE 
PROPERTIES.—
‘‘(i) IN
GENERAL.—An eligible tax-
payer or a qualifying partnership of which 
the eligible taxpayer is a partner may 
make a 1-time election to apply this para-
graph to more than 1 qualifying brownfield 
property by averaging the eligible remedi-
ation expenditures for all such properties 
acquired during the election period. If the 
eligible taxpayer or qualifying partnership 
makes such an election, the election shall 
apply to all qualified sales, exchanges, or 
other dispositions of qualifying brownfield 
properties the acquisition and transfer of 
which occur during the period for which 
the election remains in effect.
‘‘(ii) ELECTION.—An election under 
clause (i) shall be made with the eligible 
taxpayer’s or qualifying partnership’s time-
ly filed tax return (including extensions) 
for the first taxable year for which the tax-
payer or qualifying partnership intends to 
have the election apply. An election under 
clause (i) is effective for the period—
‘‘(I) beginning on the date which 
is the first day of the taxable year of 
the return in which the election is in-
cluded or a later day in such taxable 
year selected by the eligible taxpayer 
or qualifying partnership, and 
‘‘(II) ending on the date which is 
the earliest of a date of revocation se-
lected by the eligible taxpayer or 
qualifying partnership, the date which 
is 8 years after the date described in 
subclause (I), or, in the case of an 
election by a qualifying partnership of 
which the eligible taxpayer is a part-
ner, the date of the termination of the 
qualifying partnership.
‘‘(iii) REVOCATION.—An eligible tax-
payer or qualifying partnership may revoke 
an election under clause (i)(II) by filing a 
statement of revocation with a timely filed 
tax return (including extensions). A rev-
ocation is effective as of the first day of 
the taxable year of the return in which the 
revocation is included or a later day in 
such taxable year selected by the eligible 
taxpayer or qualifying partnership. Once 
an eligible taxpayer or qualifying partner-
ship revokes the election, the eligible tax-
payer or qualifying partnership is ineligible 
to make another election under clause (i) 
with respect to any qualifying brownfield 
property subject to the revoked election. 
‘‘(I) RECAPTURE.—If an eligible taxpayer 
excludes gain or loss from a sale, exchange, or 
other disposition of property to which an elec-
tion under subparagraph (H) applies, and such 
property fails to satisfy the requirements of this 
paragraph, the unrelated business taxable in-
come of the eligible taxpayer for the taxable 
year in which such failure occurs shall be deter-
mined by including any previously excluded gain
or loss from such sale, exchange, or other dis-
position allocable to such taxpayer, and interest 
shall be determined at the overpayment rate es-
tablished under section 6621 on any resulting 
tax for the period beginning with the due date 
of the return for the taxable year during which 
such sale, exchange, or other disposition oc-
curred, and ending on the date of payment of 
the tax. 
‘‘(J) RELATED PERSONS.—For purposes of 
this paragraph, a person shall be treated as re-
lated to another person if—
‘‘(i) such person bears a relationship 
to such other person described in section 
267(b) (determined without regard to 
paragraph 
(9) 
thereof), 
or 
section 
707(b)(1), determined by substituting ‘25 
percent’ for ‘50 percent’ each place it ap-
pears therein, and 
‘‘(ii) in the case such other person is 
a nonprofit organization, if such person 
controls directly or indirectly more than 25 
percent of the governing body of such or-
ganization.’’.
(b) EXCLUSION FROM DEFINITION
OF DEBT-FI-
NANCED PROPERTY.—Section 514(b)(1) of the Internal 
Revenue Code of 1986 (defining debt-financed property) 
is amended by striking ‘‘or’’ at the end of subparagraph 
(C), by striking the period at the end of subparagraph (D) 
and inserting ‘‘; or’’, and by inserting after subparagraph 
(D) the following new subparagraph: 
‘‘(E) any property the gain or loss from 
the sale, exchange, or other disposition of which 
would be excluded by reason of the provisions 
of section 512(b)(18) in computing the gross 
income of any unrelated trade or business.’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to any gain or loss on the sale, 
exchange, or other disposition of any property acquired by 
the taxpayer after the date of the enactment of this Act.
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