§1393. Definitions and special rules — Inbound Citations
26 U.S.C. § 1393
Cited by 187 provisions in release 119-102.
Citations to §1393(a)(1)
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(a) From among the areas nominated for designation under this section, the appropriate Secretaries may designate empowerment zones and enterprise communities.
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(1) The appropriate Secretaries may designate in the aggregate 95 nominated areas as enterprise communities under this section, subject to the availability of eligible nominated areas. Of that number, not more than 65 may be designated in urban areas and not more than 30 may be designated in rural areas.
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(2) The appropriate Secretaries may designate in the aggregate 11 nominated areas as empowerment zones under this section, subject to the availability of eligible nominated areas. Of that number, not more than 8 may be designated in urban areas and not more than 3 may be designated in rural areas. If 8 empowerment zones are designated in urban areas, no less than 1 shall be designated in an urban area the most populous city of which has a population of 500,000 or less and no less than 1 shall be a nominated area which includes areas in 2 States and which has a population of 50,000 or less. The Secretary of Housing and Urban Development shall designate empowerment zones located in urban areas in such a manner that the aggregate population of all such zones does not exceed 1,000,000.
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(C) the date the appropriate Secretary revokes the designation.
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(2) The appropriate Secretary may revoke the designation under this section of an area if such Secretary determines that the local government or the State in which it is located—(A) has modified the boundaries of the area, or(B) is not complying substantially with, or fails to make progress in achieving the benchmarks set forth in, the strategic plan under subsection (f)(2).
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(3) such State or States and the local governments provide written assurances satisfactory to the appropriate Secretary that the strategic plan described in the application under subsection (f)(2) for such area will be implemented,
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(4) the appropriate Secretary determines that any information furnished is reasonably accurate, and
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(3) includes such other information as may be required by the appropriate Secretary.
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(1) In addition to the areas designated under subsection (a), the appropriate Secretaries may designate in the aggregate an additional 20 nominated areas as empowerment zones under this section, subject to the availability of eligible nominated areas. Of that number, not more than 15 may be designated in urban areas and not more than 5 may be designated in rural areas.
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(1) In addition to the areas designated under subsections (a) and (g), the appropriate Secretaries may designate in the aggregate an additional 9 nominated areas as empowerment zones under this section, subject to the availability of eligible nominated areas. Of that number, not more than seven may be designated in urban areas and not more than 2 may be designated in rural areas.
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(2) In determining whether a nominated area is eligible for designation as an enterprise community, the appropriate Secretary may, where necessary to carry out the purposes of this subchapter, reduce by 5 percentage points one of the following thresholds for not more than 10 percent of the population census tracts (or, if fewer, 5 population census tracts) in the nominated area:(A) The 20 percent threshold in subsection (a)(4)(A).(B) The 25 percent threshold in subsection (a)(4)(B).(C) The 35 percent threshold in subsection (a)(4)(C).If the appropriate Secretary elects to reduce the threshold under subparagraph (C), such Secretary may (in lieu of applying the preceding sentence) reduce by 10 percentage points the threshold under subparagraph (C) for 3 population census tracts.
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(c) From among the nominated areas eligible for designation under section 1391 by the appropriate Secretary, such appropriate Secretary shall make designations of empowerment zones and enterprise communities on the basis of—(1) the effectiveness of the strategic plan submitted pursuant to section 1391(f)(2) and the assurances made pursuant to section 1391(e)(3), and(2) criteria specified by the appropriate Secretary.
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(2) criteria specified by the appropriate Secretary.
Citations to §1393(a)(2)
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(C) the term “rural small business concern” means an eligible small business concern located in a rural area, as that term is defined in section 1393(a)(2) of title 26;
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(8) For purposes of this section, in the case of any project for residential rental property located in a rural area (as defined in section 520 of the Housing Act of 1949), any income limitation measured by reference to area median gross income shall be measured by reference to the greater of area median gross income or national non-metropolitan median income. The preceding sentence shall not apply with respect to any building if paragraph (1) of section 42(h) does not apply by reason of paragraph (4) thereof to any portion of the credit determined under this section with respect to such building.
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(C) which is engaged in furnishing electric energy, or providing telephone service, to persons in rural areas.
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(1) The appropriate Secretaries may designate in the aggregate 95 nominated areas as enterprise communities under this section, subject to the availability of eligible nominated areas. Of that number, not more than 65 may be designated in urban areas and not more than 30 may be designated in rural areas.
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(2) The appropriate Secretaries may designate in the aggregate 11 nominated areas as empowerment zones under this section, subject to the availability of eligible nominated areas. Of that number, not more than 8 may be designated in urban areas and not more than 3 may be designated in rural areas. If 8 empowerment zones are designated in urban areas, no less than 1 shall be designated in an urban area the most populous city of which has a population of 500,000 or less and no less than 1 shall be a nominated area which includes areas in 2 States and which has a population of 50,000 or less. The Secretary of Housing and Urban Development shall designate empowerment zones located in urban areas in such a manner that the aggregate population of all such zones does not exceed 1,000,000.
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(1) In addition to the areas designated under subsection (a), the appropriate Secretaries may designate in the aggregate an additional 20 nominated areas as empowerment zones under this section, subject to the availability of eligible nominated areas. Of that number, not more than 15 may be designated in urban areas and not more than 5 may be designated in rural areas.
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(v) The Secretary of Agriculture may designate not more than 1 empowerment zone in a rural area without regard to clause (i) if such area satisfies emigration criteria specified by the Secretary of Agriculture.
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(ii) If a population census tract (or equivalent division under section 1392(b)(4)) in a rural area exceeds 1,000 square miles or includes a substantial amount of land owned by the Federal, State, or local government, the nominated area may exclude such excess square mileage or governmentally owned land and the exclusion of that area will not be treated as violating the continuous boundary requirement of section 1392(a)(3)(B).
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(1) In addition to the areas designated under subsections (a) and (g), the appropriate Secretaries may designate in the aggregate an additional 9 nominated areas as empowerment zones under this section, subject to the availability of eligible nominated areas. Of that number, not more than seven may be designated in urban areas and not more than 2 may be designated in rural areas.
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(B) in the case of a rural area, 30,000.
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(A) does not exceed 20 square miles if an urban area or 1,000 square miles if a rural area,
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(B) has a boundary which is continuous, or, except in the case of a rural area located in more than 1 State, consists of not more than 3 noncontiguous parcels,
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(ii) in the case of a rural area, is located entirely within no more than 3 contiguous States, and
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(i) $60,000,000 if such zone is in a rural area,
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(ii) For purposes of subparagraph (A)(ii), property shall be treated as substantially improved by the qualified opportunity fund only if, during any 30-month period beginning after the date of acquisition of such property, additions to basis with respect to such property in the hands of the qualified opportunity fund exceed an amount equal to the adjusted basis of such property (50 percent of such adjusted basis in the case of property in a qualified opportunity zone comprised entirely of a rural area (as defined in subsection (b)(2)(C)(ii))1 at the beginning of such 30-month period in the hands of the qualified opportunity fund.
Citations to §1393(a)(3)
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(II) is not an urban area.
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(ii) For purposes of clause (i)(II), the term “urban area” means a census tract (as defined by the Bureau of the Census) which, according to the most recent decennial census, has been designated as an urban area by the Secretary of Commerce.
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(1) The appropriate Secretaries may designate in the aggregate 95 nominated areas as enterprise communities under this section, subject to the availability of eligible nominated areas. Of that number, not more than 65 may be designated in urban areas and not more than 30 may be designated in rural areas.
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(2) The appropriate Secretaries may designate in the aggregate 11 nominated areas as empowerment zones under this section, subject to the availability of eligible nominated areas. Of that number, not more than 8 may be designated in urban areas and not more than 3 may be designated in rural areas. If 8 empowerment zones are designated in urban areas, no less than 1 shall be designated in an urban area the most populous city of which has a population of 500,000 or less and no less than 1 shall be a nominated area which includes areas in 2 States and which has a population of 50,000 or less. The Secretary of Housing and Urban Development shall designate empowerment zones located in urban areas in such a manner that the aggregate population of all such zones does not exceed 1,000,000.
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(1) In addition to the areas designated under subsection (a), the appropriate Secretaries may designate in the aggregate an additional 20 nominated areas as empowerment zones under this section, subject to the availability of eligible nominated areas. Of that number, not more than 15 may be designated in urban areas and not more than 5 may be designated in rural areas.
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(1) In addition to the areas designated under subsections (a) and (g), the appropriate Secretaries may designate in the aggregate an additional 9 nominated areas as empowerment zones under this section, subject to the availability of eligible nominated areas. Of that number, not more than seven may be designated in urban areas and not more than 2 may be designated in rural areas.
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(A) in the case of an urban area, the lesser of—(i) 200,000, or(ii) the greater of 50,000 or 10 percent of the population of the most populous city located within the nominated area, and
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(A) does not exceed 20 square miles if an urban area or 1,000 square miles if a rural area,
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(i) in the case of an urban area, is located entirely within no more than 2 contiguous States, and
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(ii) $130,000,000 if such zone is in an urban area and the zone has a population of less than 100,000, and
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(iii) $230,000,000 if such zone is in an urban area and the zone has a population of at least 100,000.
Citations to §1393(a)(4)
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(i) Section 1393(a)(4) shall not apply to an area nominated for designation under this subsection.
Citations to §1393(a)(4)(B)
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(B) substantially all of the services performed during such period by such employee for such employer are performed within an Indian reservation, and
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(2) An employee shall not be treated as a qualified employee for any taxable year of the employer if the total amount of the wages paid or incurred by such employer to such employee during such taxable year (whether or not for services within an Indian reservation) exceeds the amount determined at an annual rate of $30,000.
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(7) The term “Indian reservation” has the meaning given such term by section 168(j)(6).
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(1) For purposes of subsection (a), the applicable recovery period for qualified Indian reservation property shall be determined in accordance with the table contained in paragraph (2) in lieu of the table contained in subsection (c).
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(3) For purposes of determining alternative minimum taxable income under section 55, the deduction under subsection (a) for qualified Indian reservation property shall be determined under this section without regard to any adjustment under section 56.
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(A) The term “qualified Indian reservation property” means property which is property described in the table in paragraph (2) and which is—(i) used by the taxpayer predominantly in the active conduct of a trade or business within an Indian reservation,(ii) not used or located outside the Indian reservation on a regular basis,(iii) not acquired (directly or indirectly) by the taxpayer from a person who is related to the taxpayer (within the meaning of section 465(b)(3)(C)), and(iv) not property (or any portion thereof) placed in service for purposes of conducting or housing class I, II, or III gaming (as defined in section 4 of the Indian Regulatory Act (25 U.S.C. 2703)).
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(i) used by the taxpayer predominantly in the active conduct of a trade or business within an Indian reservation,
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(ii) not used or located outside the Indian reservation on a regular basis,
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(B) The term “qualified Indian reservation property” does not include any property to which the alternative depreciation system under subsection (g) applies, determined—(i) without regard to subsection (g)(7) (relating to election to use alternative depreciation system), and(ii) after the application of section 280F(b) (relating to listed property with limited business use).
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(i) Subparagraph (A)(ii) shall not apply to qualified infrastructure property located outside of the Indian reservation if the purpose of such property is to connect with qualified infrastructure property located within the Indian reservation.
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(ii) For purposes of this subparagraph, the term “qualified infrastructure property” means qualified Indian reservation property (determined without regard to subparagraph (A)(ii)) which—(I) benefits the tribal infrastructure,(II) is available to the general public, and(III) is placed in service in connection with the taxpayer’s active conduct of a trade or business within an Indian reservation.
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(III) is placed in service in connection with the taxpayer’s active conduct of a trade or business within an Indian reservation.
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(5) For purposes of this subsection, the rental to others of real property located within an Indian reservation shall be treated as the active conduct of a trade or business within an Indian reservation.
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(6) For purposes of this subsection, the term “Indian reservation” means a reservation, as defined in—(A) section 3(d) of the Indian Financing Act of 1974 (25 U.S.C. 1452(d)), or(B) section 4(10) of the Indian Child Welfare Act of 1978 (25 U.S.C. 1903(10)).For purposes of the preceding sentence, such section 3(d) shall be applied by treating the term “former Indian reservations in Oklahoma” as including only lands which are within the jurisdictional area of an Oklahoma Indian tribe (as determined by the Secretary of the Interior) and are recognized by such Secretary as eligible for trust land status under 25 CFR Part 151 (as in effect on the date of the enactment of this sentence).
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(ii) An area in an Indian reservation shall be treated as nominated by a State and a local government if it is nominated by the reservation governing body (as determined by the Secretary of the Interior).
Citations to §1393(a)(5)
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(i) such center complies with all applicable laws and regulations of a State or unit of local government, and
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(i) Subparagraph (C) shall not apply to the acquisition or rehabilitation of a building pursuant to a development plan of action sponsored by a State or local government or a qualified nonprofit organization (as defined in subsection (h)(5)(C)).
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(ii) which meets the requirements of all applicable laws and regulations of the State or local government in which it is located, including the licensing of the facility as a child care facility.
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(i) a Federal, State, or local government entity, or any political subdivision, agency, or instrumentality thereof,
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(II) proceeds of any issue of State or local government obligations used to provide financing for the project the interest on which is exempt from tax under section 103, and
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(4) For purposes of this section, any leave which is paid by a State or local government or required by State or local law—(A) except as provided in subparagraph (B), shall be taken into account in determining the amount of paid family and medical leave provided by the employer, and(B) shall not be taken into account in determining the amount of the paid family and medical leave credit under subsection (a).
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(ii) For purposes of this subparagraph, the term “zero-emission credit program” means any payments with respect to a qualified nuclear power facility as a result of any Federal, State or local government program for, in whole or in part, the zero-emission, zero-carbon, or air quality attributes of any portion of the electricity produced by such facility.
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(I) which is designated under a statute of the appropriate State or local government, if such statute is certified by the Secretary of the Interior to the Secretary as containing criteria which will substantially achieve the purpose of preserving and rehabilitating buildings of historic significance to the district, and
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(III) such financing is borrowed from a qualified person or represents a loan from any Federal, State, or local government or instrumentality thereof, or is guaranteed by any Federal, State, or local government.
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(B) For purposes of subparagraph (A), the term “qualified person” has the meaning given to such term by section 49(a)(1)(D)(iv); except that such term shall include any Federal, State, or local government or agency or instrumentality thereof.
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(B) The term “public utility” means a person engaged in the sale of electricity or natural gas to residential, commercial, or industrial customers for use by such customers. For purposes of the preceding sentence, the term “person” includes the Federal Government, a State or local government or any political subdivision thereof, or any instrumentality of any of the foregoing.
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(4) if such amount is paid by a Federal, State, or local government, or agency or instrumentality thereof, in connection with a qualified disaster in order to promote the general welfare,
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(4) with respect to amounts described in subsection (b)(4), a disaster which is determined by an applicable Federal, State, or local authority (as determined by the Secretary) to warrant assistance from the Federal, State, or local government or agency or instrumentality thereof.
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(A) the project is nominated by a State or local government within 180 days of the enactment of this subsection, and
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(B) such State or local government provides written assurances that the project will satisfy the eligibility criteria described in paragraph (4).
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(iii) The project receives specific State or local government resources which will support the project in an amount equal to at least $5,000,000. For purposes of the preceding sentence, the term “resources” includes tax abatement benefits and contributions in kind.
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(B) The term “local government” has the meaning given such term by section 1393(a)(5).
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(A) An issue shall not be treated as an issue described in subsection (a)(14) if the aggregate face amount of bonds issued by the State or local government pursuant thereto for a project (when added to the aggregate face amount of bonds previously so issued for such project) exceeds an amount designated by the Secretary as part of the designation.
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(2) which is built solely to comply with consent decrees or projects mandated by Federal, State, or local governments.
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(vii) For purposes of clauses (ii) and (iii), the term “securities” includes obligations of State and local governments, commodity futures contracts, shares of regulated investment companies and real estate investment trusts, and other investments constituting a security within the meaning of the Investment Company Act of 1940 (15 U.S.C. 80a–2(a)(36)).
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(ii) A cash or deferred arrangement shall not be treated as a qualified cash or deferred arrangement if it is part of a plan maintained by a State or local government or political subdivision thereof, or any agency or instrumentality thereof. This clause shall not apply to a rural cooperative plan or to a plan of an employer described in clause (iii).
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(II) is engaged primarily in providing electric service to the public in its area of service and which is exempt from tax under this subtitle or which is a State or local government (or an agency or instrumentality thereof), other than a municipality (or an agency or instrumentality thereof),
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(C) For purposes of paragraph (1)(D), the requirements of subparagraph (A)(i) (other than those relating to section 401(a)(17)) shall not apply to a governmental plan (within the meaning of section 414(d)) maintained by a State or local government or political subdivision thereof (or agency or instrumentality thereof).
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(i) a State or local government or political subdivision thereof, or any agency or instrumentality thereof, or
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(3) In the case of any repayment of contributions (including interest thereon) to the governmental plan with respect to an amount previously refunded upon a forfeiture of service credit under the plan or under another governmental plan maintained by a State or local government employer within the same State, any such repayment shall not be taken into account for purposes of this section.
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(ii) which is borrowed by the taxpayer from a qualified person or represents a loan from any Federal, State, or local government or instrumentality thereof, or is guaranteed by any Federal, State, or local government,
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(II) obligations of a State or local government which are not in default as to principal or interest, and
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(III) any amount paid or incurred to the extent such amount is reimbursed, funded, or otherwise subsidized by grants provided by the United States, a State, or a political subdivision of a State for use in connection with the property, proceeds of an issue of State or local government obligations used to provide financing for the property the interest of which is exempt from tax under section 103, or subsidized financing provided (directly or indirectly) under a Federal, State, or local program provided in connection with the property, or
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(3) deposits any amount in the general fund of the Treasury or in the general fund of any State or local government,
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(C) in the case of an interest in a qualified tuition program purchased by a State or local government (or agency or instrumentality thereof) or an organization described in section 501(c)(3) and exempt from taxation under section 501(a) as part of a scholarship program operated by such government or organization, the individual receiving such interest as a scholarship.
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(j) For purposes of this subtitle, if property is sold or otherwise transferred to the Federal Government, a State or local government, or an Indian tribal government to implement hazard mitigation under the Robert T. Stafford Disaster Relief and Emergency Assistance Act (as in effect on the date of the enactment of this subsection) or the National Flood Insurance Act (as in effect on such date), such sale or transfer shall be treated as an involuntary conversion to which this section applies.
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(C) Federal, State, or local government, or political subdivision thereof, but only if the improvement constitutes an addition to basis for the taxpayer; and
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(B) the termination date designated by the State and local governments as provided for in their nomination, or
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(2) The appropriate Secretary may revoke the designation under this section of an area if such Secretary determines that the local government or the State in which it is located—(A) has modified the boundaries of the area, or(B) is not complying substantially with, or fails to make progress in achieving the benchmarks set forth in, the strategic plan under subsection (f)(2).
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(1) the area is nominated by 1 or more local governments and the State or States in which it is located for designation under this section,
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(2) such State or States and the local governments have the authority—(A) to nominate the area for designation under this section, and(B) to provide the assurances described in paragraph (3),
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(3) such State or States and the local governments provide written assurances satisfactory to the appropriate Secretary that the strategic plan described in the application under subsection (f)(2) for such area will be implemented,
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(5) such State or States and local governments certify that no portion of the area nominated is already included in an empowerment zone or in an enterprise community or in an area otherwise nominated to be designated under this section.
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(ii) If a population census tract (or equivalent division under section 1392(b)(4)) in a rural area exceeds 1,000 square miles or includes a substantial amount of land owned by the Federal, State, or local government, the nominated area may exclude such excess square mileage or governmentally owned land and the exclusion of that area will not be treated as violating the continuous boundary requirement of section 1392(a)(3)(B).
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(ii) An area in an Indian reservation shall be treated as nominated by a State and a local government if it is nominated by the reservation governing body (as determined by the Secretary of the Interior).
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(iii) The term “applicable nominating jurisdiction” means, with respect to any empowerment zone or enterprise community, any local government that nominated such community for designation under section 1391.
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(A) Paragraph (1) shall apply to an empowerment zone facility bond only if such bond is designated for purposes of this subsection by the local government which nominated the area to which such bond relates.
Citations to §1393(a)(6)
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(1) The appropriate Secretaries may designate in the aggregate 95 nominated areas as enterprise communities under this section, subject to the availability of eligible nominated areas. Of that number, not more than 65 may be designated in urban areas and not more than 30 may be designated in rural areas.
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(2) The appropriate Secretaries may designate in the aggregate 11 nominated areas as empowerment zones under this section, subject to the availability of eligible nominated areas. Of that number, not more than 8 may be designated in urban areas and not more than 3 may be designated in rural areas. If 8 empowerment zones are designated in urban areas, no less than 1 shall be designated in an urban area the most populous city of which has a population of 500,000 or less and no less than 1 shall be a nominated area which includes areas in 2 States and which has a population of 50,000 or less. The Secretary of Housing and Urban Development shall designate empowerment zones located in urban areas in such a manner that the aggregate population of all such zones does not exceed 1,000,000.
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(1) demonstrates that the nominated area satisfies the eligibility criteria described in section 1392,
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(A) describes the coordinated economic, human, community, and physical development plan and related activities proposed for the nominated area,
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(C) identifies the amount of State, local, and private resources that will be available in the nominated area and the private/public partnerships to be used, which may include participation by, and cooperation with, universities, medical centers, and other private and public entities,
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(F) does not include any action to assist any establishment in relocating from one area outside the nominated area to the nominated area, except that assistance for the expansion of an existing business entity through the establishment of a new branch, affiliate, or subsidiary is permitted if—(i) the establishment of the new branch, affiliate, or subsidiary will not result in a decrease in employment in the area of original location or in any other area where the existing business entity conducts business operations, and(ii) there is no reason to believe that the new branch, affiliate, or subsidiary is being established with the intention of closing down the operations of the existing business entity in the area of its original location or in any other area where the existing business entity conducts business operation, and
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(1) In addition to the areas designated under subsection (a), the appropriate Secretaries may designate in the aggregate an additional 20 nominated areas as empowerment zones under this section, subject to the availability of eligible nominated areas. Of that number, not more than 15 may be designated in urban areas and not more than 5 may be designated in rural areas.
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(i) A nominated area shall be eligible for designation under this subsection only if the poverty rate for each population census tract within the nominated area is not less than 20 percent and the poverty rate for at least 90 percent of the population census tracts within the nominated area is not less than 25 percent.
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(iii) Clause (i) shall not apply to up to 3 noncontiguous parcels in a nominated area which may be developed for commercial or industrial purposes. The aggregate area of noncontiguous parcels to which the preceding sentence applies with respect to any nominated area shall not exceed 2,000 acres.
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(ii) If a population census tract (or equivalent division under section 1392(b)(4)) in a rural area exceeds 1,000 square miles or includes a substantial amount of land owned by the Federal, State, or local government, the nominated area may exclude such excess square mileage or governmentally owned land and the exclusion of that area will not be treated as violating the continuous boundary requirement of section 1392(a)(3)(B).
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(1) In addition to the areas designated under subsections (a) and (g), the appropriate Secretaries may designate in the aggregate an additional 9 nominated areas as empowerment zones under this section, subject to the availability of eligible nominated areas. Of that number, not more than seven may be designated in urban areas and not more than 2 may be designated in rural areas.
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(a) A nominated area shall be eligible for designation under section 1391 only if it meets the following criteria:(1) The nominated area has a maximum population of—(A) in the case of an urban area, the lesser of—(i) 200,000, or(ii) the greater of 50,000 or 10 percent of the population of the most populous city located within the nominated area, and(B) in the case of a rural area, 30,000.(2) The nominated area is one of pervasive poverty, unemployment, and general distress.(3) The nominated area—(A) does not exceed 20 square miles if an urban area or 1,000 square miles if a rural area,(B) has a boundary which is continuous, or, except in the case of a rural area located in more than 1 State, consists of not more than 3 noncontiguous parcels,(i) in the case of an urban area, is located entirely within no more than 2 contiguous States, and(ii) in the case of a rural area, is located entirely within no more than 3 contiguous States, and(D) does not include any portion of a central business district (as such term is used for purposes of the most recent Census of Retail Trade) unless the poverty rate for each population census tract in such district is not less than 35 percent (30 percent in the case of an enterprise community).(4) The poverty rate—(A) for each population census tract within the nominated area is not less than 20 percent,(B) for at least 90 percent of the population census tracts within the nominated area is not less than 25 percent, and(C) for at least 50 percent of the population census tracts within the nominated area is not less than 35 percent.
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(1) The nominated area has a maximum population of—(A) in the case of an urban area, the lesser of—(i) 200,000, or(ii) the greater of 50,000 or 10 percent of the population of the most populous city located within the nominated area, and(B) in the case of a rural area, 30,000.
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(ii) the greater of 50,000 or 10 percent of the population of the most populous city located within the nominated area, and
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(2) The nominated area is one of pervasive poverty, unemployment, and general distress.
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(3) The nominated area—(A) does not exceed 20 square miles if an urban area or 1,000 square miles if a rural area,(B) has a boundary which is continuous, or, except in the case of a rural area located in more than 1 State, consists of not more than 3 noncontiguous parcels,(i) in the case of an urban area, is located entirely within no more than 2 contiguous States, and(ii) in the case of a rural area, is located entirely within no more than 3 contiguous States, and(D) does not include any portion of a central business district (as such term is used for purposes of the most recent Census of Retail Trade) unless the poverty rate for each population census tract in such district is not less than 35 percent (30 percent in the case of an enterprise community).
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(A) for each population census tract within the nominated area is not less than 20 percent,
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(B) for at least 90 percent of the population census tracts within the nominated area is not less than 25 percent, and
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(C) for at least 50 percent of the population census tracts within the nominated area is not less than 35 percent.
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(2) In determining whether a nominated area is eligible for designation as an enterprise community, the appropriate Secretary may, where necessary to carry out the purposes of this subchapter, reduce by 5 percentage points one of the following thresholds for not more than 10 percent of the population census tracts (or, if fewer, 5 population census tracts) in the nominated area:(A) The 20 percent threshold in subsection (a)(4)(A).(B) The 25 percent threshold in subsection (a)(4)(B).(C) The 35 percent threshold in subsection (a)(4)(C).If the appropriate Secretary elects to reduce the threshold under subparagraph (C), such Secretary may (in lieu of applying the preceding sentence) reduce by 10 percentage points the threshold under subparagraph (C) for 3 population census tracts.
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(3) A nominated area may not include a noncontiguous parcel unless such parcel separately meets (subject to paragraphs (1) and (2)) the criteria set forth in subsection (a)(4).
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(c) From among the nominated areas eligible for designation under section 1391 by the appropriate Secretary, such appropriate Secretary shall make designations of empowerment zones and enterprise communities on the basis of—(1) the effectiveness of the strategic plan submitted pursuant to section 1391(f)(2) and the assurances made pursuant to section 1391(e)(3), and(2) criteria specified by the appropriate Secretary.
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(d) A nominated area in Alaska or Hawaii shall be treated as meeting the requirements of paragraphs (2), (3), and (4) of subsection (a) if for each census tract or block group within such area 20 percent or more of the families have income which is 50 percent or less of the statewide median family income (as determined under section 143).
Citations to §1393(b)
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(9) the empowerment zone employment credit determined under section 1396(a),
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(A) In the case of the empowerment zone employment credit—(i) this section and section 39 shall be applied separately with respect to such credit, and(ii) for purposes of applying paragraph (1) to such credit—(I) 75 percent of the tentative minimum tax shall be substituted for the tentative minimum tax under subparagraph (A) thereof, and(II) the limitation under paragraph (1) (as modified by subclause (I)) shall be reduced by the credit allowed under subsection (a) for the taxable year (other than the empowerment zone employment credit and the specified credits).
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(II) the limitation under paragraph (1) (as modified by subclause (I)) shall be reduced by the credit allowed under subsection (a) for the taxable year (other than the empowerment zone employment credit and the specified credits).
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(B) For purposes of this paragraph, the term “empowerment zone employment credit” means the portion of the credit under subsection (a) which is attributable to the credit determined under section 1396 (relating to empowerment zone employment credit).
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(A) is within an empowerment zone the designation of which is in effect under section 1391, and
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(ii) as having his principal place of abode within an empowerment zone, enterprise community, renewal community, or rural renewal county.
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(B) In the case of a designated community resident, the term “qualified wages” shall not include wages paid or incurred for services performed while the individual’s principal place of abode is outside an empowerment zone, enterprise community, renewal community, or rural renewal county.
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(iv) who is certified by the designated local agency as having his principal place of abode within an empowerment zone, enterprise community, or renewal community.
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(A) Within 60 days after the end of the application period described in paragraph (3)(A), the Secretary, after consultation with the Administrator of the Environmental Protection Agency, shall designate qualified green building and sustainable design projects. At least one of the projects designated shall be located in, or within a 10-mile radius of, an empowerment zone as designated pursuant to section 1391, and at least one of the projects designated shall be located in a rural State. No more than one project shall be designated in a State. A project shall not be designated if such project includes a stadium or arena for professional sports exhibitions or games.
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(6) the empowerment zone employment credit determined under section 1396(a),
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(D) The District of Columbia Enterprise Zone shall not be treated as an empowerment zone for purposes of this paragraph.
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(a) From among the areas nominated for designation under this section, the appropriate Secretaries may designate empowerment zones and enterprise communities.
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(1) The appropriate Secretaries may designate in the aggregate 95 nominated areas as enterprise communities under this section, subject to the availability of eligible nominated areas. Of that number, not more than 65 may be designated in urban areas and not more than 30 may be designated in rural areas.
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(2) The appropriate Secretaries may designate in the aggregate 11 nominated areas as empowerment zones under this section, subject to the availability of eligible nominated areas. Of that number, not more than 8 may be designated in urban areas and not more than 3 may be designated in rural areas. If 8 empowerment zones are designated in urban areas, no less than 1 shall be designated in an urban area the most populous city of which has a population of 500,000 or less and no less than 1 shall be a nominated area which includes areas in 2 States and which has a population of 50,000 or less. The Secretary of Housing and Urban Development shall designate empowerment zones located in urban areas in such a manner that the aggregate population of all such zones does not exceed 1,000,000.
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(i) in the case of an empowerment zone, December 31, 2025, or
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(ii) in the case of an enterprise community, the close of the 10th calendar year beginning on or after such date of designation,
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(5) such State or States and local governments certify that no portion of the area nominated is already included in an empowerment zone or in an enterprise community or in an area otherwise nominated to be designated under this section.
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(1) In addition to the areas designated under subsection (a), the appropriate Secretaries may designate in the aggregate an additional 20 nominated areas as empowerment zones under this section, subject to the availability of eligible nominated areas. Of that number, not more than 15 may be designated in urban areas and not more than 5 may be designated in rural areas.
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(v) The Secretary of Agriculture may designate not more than 1 empowerment zone in a rural area without regard to clause (i) if such area satisfies emigration criteria specified by the Secretary of Agriculture.
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(D) Subsection (e)(5) shall not apply to any enterprise community designated under subsection (a) that is also nominated for designation under this subsection.
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(1) In addition to the areas designated under subsections (a) and (g), the appropriate Secretaries may designate in the aggregate an additional 9 nominated areas as empowerment zones under this section, subject to the availability of eligible nominated areas. Of that number, not more than seven may be designated in urban areas and not more than 2 may be designated in rural areas.
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(4) The number of areas which may be designated as empowerment zones under this subsection shall be increased by 1 for each area which ceases to be an empowerment zone by reason of section 1400E(e).1 Each additional area designated by reason of the preceding sentence shall have the same urban or rural character as the area it is replacing.
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(D) does not include any portion of a central business district (as such term is used for purposes of the most recent Census of Retail Trade) unless the poverty rate for each population census tract in such district is not less than 35 percent (30 percent in the case of an enterprise community).
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(2) In determining whether a nominated area is eligible for designation as an enterprise community, the appropriate Secretary may, where necessary to carry out the purposes of this subchapter, reduce by 5 percentage points one of the following thresholds for not more than 10 percent of the population census tracts (or, if fewer, 5 population census tracts) in the nominated area:(A) The 20 percent threshold in subsection (a)(4)(A).(B) The 25 percent threshold in subsection (a)(4)(B).(C) The 35 percent threshold in subsection (a)(4)(C).If the appropriate Secretary elects to reduce the threshold under subparagraph (C), such Secretary may (in lieu of applying the preceding sentence) reduce by 10 percentage points the threshold under subparagraph (C) for 3 population census tracts.
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(c) From among the nominated areas eligible for designation under section 1391 by the appropriate Secretary, such appropriate Secretary shall make designations of empowerment zones and enterprise communities on the basis of—(1) the effectiveness of the strategic plan submitted pursuant to section 1391(f)(2) and the assurances made pursuant to section 1391(e)(3), and(2) criteria specified by the appropriate Secretary.
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(A) the references to empowerment zones shall be treated as including references to enterprise communities, and
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(I) Except as provided in subclause (II), references in section 1397C to empowerment zones shall be treated as including references to enterprise communities.
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(II) For purposes of subsections (b)(6) and (c)(5) of section 1397C, an employee shall be treated as a resident of an empowerment zone if such employee is a resident of an empowerment zone, an enterprise community, or a qualified low-income community within an applicable nominating jurisdiction.
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(iii) A business shall not fail to be treated as an enterprise zone business for any taxable year beginning after the testing period by reason of failing to meet any requirement of subsection (b) or (c) of section 1397C if at least 35 percent of the employees of such business for such year are residents of an empowerment zone, an enterprise community, or a qualified low-income community within an applicable nominating jurisdiction. The preceding sentence shall not apply to any business which is not a qualified business by reason of paragraph (1), (4), or (5) of section 1397C(d).
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(iii) The term “applicable nominating jurisdiction” means, with respect to any empowerment zone or enterprise community, any local government that nominated such community for designation under section 1391.
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(A) $3,000,000 with respect to any 1 empowerment zone or enterprise community, or
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(B) $20,000,000 with respect to all empowerment zones and enterprise communities.
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(A) substantially all of the facility with respect to which the financing was provided ceases to be used in an empowerment zone or enterprise community, or
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(3) Paragraphs (1) and (2) shall not apply solely by reason of the termination or revocation of a designation as an empowerment zone or an enterprise community.
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(1) In the case of an empowerment zone facility bond—(A) such bond shall not be treated as a private activity bond for purposes of section 146, and(B) subsection (c) of this section shall not apply.
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(A) Paragraph (1) shall apply to an empowerment zone facility bond only if such bond is designated for purposes of this subsection by the local government which nominated the area to which such bond relates.
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(B) The aggregate face amount of bonds which may be designated under subparagraph (A) with respect to any empowerment zone shall not exceed—(i) $60,000,000 if such zone is in a rural area,(ii) $130,000,000 if such zone is in an urban area and the zone has a population of less than 100,000, and(iii) $230,000,000 if such zone is in an urban area and the zone has a population of at least 100,000.
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(3) For purposes of this subsection, the term “empowerment zone facility bond” means any bond which would be described in subsection (a) if—(A) in the case of obligations issued before January 1, 2002, only empowerment zones designated under section 1391(g) were taken into account under sections 1397C and 1397D, and(B) in the case of obligations issued after December 31, 2001, all empowerment zones (other than the District of Columbia Enterprise Zone) were taken into account under sections 1397C and 1397D.
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(A) in the case of obligations issued before January 1, 2002, only empowerment zones designated under section 1391(g) were taken into account under sections 1397C and 1397D, and
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(B) in the case of obligations issued after December 31, 2001, all empowerment zones (other than the District of Columbia Enterprise Zone) were taken into account under sections 1397C and 1397D.
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(a) For purposes of section 38, the amount of the empowerment zone employment credit determined under this section with respect to any employer for any taxable year is the applicable percentage of the qualified zone wages paid or incurred during the calendar year which ends with or within such taxable year.
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(A) substantially all of the services performed during such period by such employee for such employer are performed within an empowerment zone in a trade or business of the employer, and
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(B) the principal place of abode of such employee while performing such services is within such empowerment zone.
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(b) Rules similar to the rules under section 179(d)(10) shall apply with respect to any qualified zone property which ceases to be used in an empowerment zone by an enterprise zone business.
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(a) In the case of any sale of a qualified empowerment zone asset held by the taxpayer for more than 1 year and with respect to which such taxpayer elects the application of this section, gain from such sale shall be recognized only to the extent that the amount realized on such sale exceeds—(1) the cost of any qualified empowerment zone asset (with respect to the same zone as the asset sold) purchased by the taxpayer during the 60-day period beginning on the date of such sale, reduced by(2) any portion of such cost previously taken into account under this section.
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(1) the cost of any qualified empowerment zone asset (with respect to the same zone as the asset sold) purchased by the taxpayer during the 60-day period beginning on the date of such sale, reduced by
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(A) The term “qualified empowerment zone asset” means any property which would be a qualified community asset (as defined in section 1400F)1 if in section 1400F1—(i) references to empowerment zones were substituted for references to renewal communities,(ii) references to enterprise zone businesses (as defined in section 1397C) were substituted for references to renewal community businesses,(iii) the date of the enactment of this paragraph were substituted for “December 31, 2001” each place it appears, and(iv) the day after the date set forth in section 1391(d)(1)(A)(i) were substituted for “January 1, 2010” each place it appears.
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(i) references to empowerment zones were substituted for references to renewal communities,
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(4) If gain from any sale is not recognized by reason of subsection (a), such gain shall be applied to reduce (in the order acquired) the basis for determining gain or loss of any qualified empowerment zone asset which is purchased by the taxpayer during the 60-day period described in subsection (a). This paragraph shall not apply for purposes of section 1202.
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(5) For purposes of determining whether the nonrecognition of gain under subsection (a) applies to any qualified empowerment zone asset which is sold, the taxpayer’s holding period for such asset and the asset referred to in subsection (a)(1) shall be determined without regard to section 1223.
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(1) every trade or business of such entity is the active conduct of a qualified business within an empowerment zone,
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(3) a substantial portion of the use of the tangible property of such entity (whether owned or leased) is within an empowerment zone,
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(5) a substantial portion of the services performed for such entity by its employees are performed in an empowerment zone,
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(6) at least 35 percent of its employees are residents of an empowerment zone,
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(1) at least 50 percent of the total gross income of such individual from such business is derived from the active conduct of such business in an empowerment zone,
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(2) a substantial portion of the use of the tangible property of such individual in such business (whether owned or leased) is within an empowerment zone,
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(4) a substantial portion of the services performed for such individual in such business by employees of such business are performed in an empowerment zone,
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(5) at least 35 percent of such employees are residents of an empowerment zone,
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(2) The rental to others of real property located in an empowerment zone shall be treated as a qualified business if and only if—(A) the property is not residential rental property (as defined in section 168(e)(2)), and(B) at least 50 percent of the gross rental income from the real property is from enterprise zone businesses.For purposes of subparagraph (B), the lessor of the property may rely on a lessee’s certification that such lessee is an enterprise zone business.
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(3) The rental to others of tangible personal property shall be treated as a qualified business if and only if at least 50 percent of the rental of such property is by enterprise zone businesses or by residents of an empowerment zone.
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(f) For purposes of this section, if—(1) a business entity or proprietorship uses real property located within an empowerment zone,(2) the business entity or proprietorship also uses real property located outside the empowerment zone,(3) the amount of real property described in paragraph (1) is substantial compared to the amount of real property described in paragraph (2), and(4) the real property described in paragraph (2) is contiguous to part or all of the real property described in paragraph (1),then all the services performed by employees, all business activities, all tangible property, and all intangible property of the business entity or proprietorship that occur in or is located on the real property described in paragraphs (1) and (2) shall be treated as occurring or situated in an empowerment zone.
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(1) a business entity or proprietorship uses real property located within an empowerment zone,
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(2) the business entity or proprietorship also uses real property located outside the empowerment zone,
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(A) such property was acquired by the taxpayer by purchase (as defined in section 179(d)(2)) after the date on which the designation of the empowerment zone took effect,
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(B) the original use of which in an empowerment zone commences with the taxpayer, and
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(C) substantially all of the use of which is in an empowerment zone and is in the active conduct of a qualified business by the taxpayer in such zone.
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(2) In the case of any property which is substantially renovated by the taxpayer, the requirements of subparagraphs (A) and (B) of paragraph (1) shall be treated as satisfied. For purposes of the preceding sentence, property shall be treated as substantially renovated by the taxpayer if, during any 24-month period beginning after the date on which the designation of the empowerment zone took effect, additions to basis with respect to such property in the hands of the taxpayer exceed the greater of (i) an amount equal to the adjusted basis at the beginning of such 24-month period in the hands of the taxpayer, or (ii) $5,000.