ability of the person disposing of the 
qualified property. In the event of 
such an assumption, the person ac-
quiring the qualified property shall be 
treated as the taxpayer for purposes 
of assessing any recapture liability 
(computed as if there had been no 
change in ownership). 
‘‘(III) SPECIAL
RULE
FOR
TAX 
EXEMPT
ENTITIES.—Subclause (II) 
shall not apply to any tax exempt en-
tity (as defined in section 168(h)(2)). 
‘‘(iii) SPECIAL RULES.— 
‘‘(I) TAX
BENEFIT
RULE.—The 
tax for the taxable year shall be in-
creased under paragraph (1) only with 
respect to credits allowed by reason of 
this section which were used to reduce 
tax liability. In the case of credits not 
so used to reduce tax liability, the 
carryforwards and carrybacks under 
section 39 shall be appropriately ad-
justed. 
‘‘(II) 
NO
CREDITS
AGAINST 
TAX.—Any increase in tax under this 
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subsection shall not be treated as a 
tax imposed by this chapter for pur-
poses of determining the amount of 
any credit under this chapter or for 
purposes of section 55. 
‘‘(III) NO RECAPTURE BY REA-
SON
OF
CASUALTY
LOSS.—The in-
crease in tax under this subsection 
shall not apply to a cessation of oper-
ation of the property as qualified 
property by reason of a casualty loss 
to the extent such loss is restored by 
reconstruction or replacement within a 
reasonable period established by the 
Secretary. 
‘‘(d) DENIAL OF DOUBLE BENEFIT.—For purposes 
of this subtitle— 
‘‘(1) BASIS ADJUSTMENTS.— 
‘‘(A) IN GENERAL.—If a credit is deter-
mined under this section for any expenditure 
with respect to any property, the increase in the 
basis of such property which would (but for this 
subsection) result from such expenditure shall 
be reduced by the amount of the credit so al-
lowed. 
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‘‘(B) CERTAIN DISPOSITIONS.—If, during 
any taxable year, there is a recapture amount 
determined with respect to any property the 
basis of which was reduced under subparagraph 
(A), the basis of such property (immediately be-
fore the event resulting in such recapture) shall 
be increased by an amount equal to such recap-
ture amount. For purposes of the preceding 
sentence, the term ‘recapture amount’ means 
any 
increase 
in 
tax 
(or 
adjustment 
in 
carrybacks or carryovers) determined under 
subsection (c). 
‘‘(2) OTHER DEDUCTIONS AND CREDITS.—No 
deduction or credit shall be allowed under this chap-
ter for any expense taken into account under this 
section. 
‘‘(e) REGULATIONS.—The Secretary shall prescribe 
such regulations as may be appropriate to carry out this 
section. 
‘‘(f) TERMINATION.—This section shall not apply to 
any taxable year beginning after December 31, 2017.’’. 
(b) CREDIT MADE PART OF GENERAL BUSINESS 
CREDIT.—Subsection (b) of section 38 of such Code (re-
lating to current year business credit) is amended by strik-
ing ‘‘plus’’ at the end of paragraph (30), by striking the 
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period at the end of paragraph (31) and inserting ‘‘, plus’’, 
and by adding at the end thereof the following new para-
graph: 
‘‘(32) Corrosion prevention and mitigation cred-
it determined under section 45O(a).’’. 
(c) CLERICAL AMENDMENT.—The table of sections 
for subpart D of part IV of subchapter A of chapter 1 
of such Code is amended by inserting after the item relat-
ing to section 45N the following new item: 
‘‘Sec. 45O. Corrosion prevention and mitigation measures.’’. 
(d) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years beginning after 
December 31, 2007. 
Æ 
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