Amount of retail enterprise credit.

(i) The amount of retail enterprise credit which a taxpayer is allowed is a percentage of qualified rehabilitation expenditures attributable to that part of a qualified rehabilitated building employed by the taxpayer in the retail sales activity of the retail enterprise. Such percentage is determined in accordance with the following table:

(ii) The amount of qualified rehabilitation expenditures to be used in computing the retail enterprise credit is determined by adding:

(a) the portion of such expenditures directly attributable to that part of a qualified rehabilitated building employed by the taxpayer in the retail sales activity of the retail enterprise; and

(b) the portion of such expenditures indirectly attributable to that part of a qualified rehabilitated building employed by the taxpayer in the retail sales activity of the retail enterprise determined by multiplying:

(1) the qualified rehabilitation expenditures such as a new roof, heating system or aluminum siding, equally attributable to all areas of the qualified rehabilitated building; by

(2) a fraction, the numerator of which is the total square feet of area of that part of the qualified rehabilitated building employed by the taxpayer in the retail sales activity and the denominator of which is the total square feet of area of the entire qualified rehabilitated building.

(iii)

(a) With respect to a qualified rehabilitated building which is depreciable pursuant to section 167 of the Internal Revenue Code, and which is disposed of or otherwise ceases to qualify for the retail enterprise credit prior to the end of the taxable year in which such credit is to be taken, a retail enterprise credit will be allowed for the period the property qualified for such credit. The amount of the retail enterprise credit which will be allowed is that portion of the retail enterprise credit attributable to such property which would have been allowed, multiplied by a fraction, the numerator of which is the total number of months the property qualified for such credit and the denominator of which is the total number of months of useful life of the property.

(b) With respect to any recovery property to which section 168 of the Internal Revenue Code applies which is a qualified rehabilitated building, and which is disposed of or otherwise ceases to qualify for the retail enterprise credit prior to the end of the taxable year in which such credit is to be taken, a retail enterprise credit will be allowed for the period the property qualified for such credit. The amount of the retail enterprise credit which will be allowed is that portion of the retail enterprise credit attributable to such property which would have been allowed, multiplied by a fraction, the numerator of which is the total number of months the property qualified for such credit and the denominator of which is the total number of months over which the taxpayer chooses to deduct the property under section 168 of the Internal Revenue Code.

(c) For recomputation of the retail enterprise credit on property that is disposed of or that otherwise ceases to qualify after the end of the taxable year in which such credit was taken, see paragraph (i)(2) of this section.