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TITLE 26-INTERNAL REVENUE CODE tion] shall apply to the determination of the allowabi- lity of the deduction of interest paid or incurred with respect to indebtedness Incurred after October 9, 1969." § 280. Certain expenditures incurred in production of films, books, records, or similar property (a) General rule Except in the case of a corporation (other than an electing small business corporation (as defined in section 1371(b)) or a personal hold- ing company (as defined in section 542)) and except in the case of production costs which are charged to capital account, amounts attribut- able to the production of a film, sound record- ing, book, or similar property which are other- wise deductible under this chapter shall be al- lowed as deductions only in accordance with the provisions of subsection (b). (b) Proration of production cost over income period Amounts referred to in subsection (a) are de- ductible only for those taxable years ending during the period during which the taxpayer reasonably may be expected to receive substan- tially all of the income he will receive from any such film, sound recording, book, or similar property. The amount deductible for any such taxable year is an amount which bears the same ratio to the sum of all such amounts (at- tributable to such film, sound recording, book, or similar property) as the income received from the property for that taxable year bears to the sum of the income the taxpayer may rea- sonably be expected to receive during such period. (c) Definitions For purposes of this section- (1) Film The term "film" means any motion picture film or video tape. (2) Sound recording The term "sound recording" means works that result from the fixation of a series of musical, spoken, or other sounds, regardless of the nature of the material objects, such as discs, tapes, or other phonorecordings, in which such sounds are embodied. (Added Pub. L. 94-455, title II, § 210(a), Oct. 4, 1976, 90 Stat. 1544.) EFFECTIVE DATE Section 210(c) of Pub. L. 94-455 provided that: "The amendment made by this section [enacting this sec- tion and amending the analysis of sections preceding section 261 of this title] applies to amounts paid or in- curred after December 31, 1975, with respect to prop- erty the principal production of which begins after December 31, 1975." § 280A. Disallowance of certain expenses in connec- tion with business use of home, rental of vaca- tion homes, etc. (a) General rule Except as otherwise provided in this section, in the case of a taxpayer who is an individual or an electing small business corporation, no de- duction otherwise allowable under this chapter shall be allowed with respect to the use of a dwelling unit which Is used by the taxpayer during the taxable year as a residence. (b) Exception for interest, taxes, casualty losses, etc. Subsection (a) shall not apply to any deduc- tion allowable to the taxpayer without regard to its connection with his trade or business (or with his income-producing activity). (c) Exceptions for certain business or rental use; limitation on deductions for such use (1) Certain business use Subsection (a) shall not apply to any item to the extent such item is allocable to a por- tion of the dwelling unit which is exclusively used on a regular basis- (A) as the taxpayer's principal place of business, (B) as a place of business which is used by patients, clients, or customers in meeting or dealing with the taxpayer in the normal course of his trade or business, or (C) in the case of a separate structure which is not attached to the dwelling unit, in connection with the taxpayer's trade or business. In the case of an employee, the preceding sentence shall apply only if the exclusive use referred to in the preceding sentence is for the convenience of his employer. (2) Certain storage use Subsection (a) shall not apply to any item to the extent such item is allocable to space within the dwelling unit which is used on a regular basis as a storage unit for the inven- tory of the taxpayer held for use in the tax- payer's trade or business of selling products at retail or wholesale, but only if the dwelling unit is the sole fixed location of such trade or business. (3) Rental use Subsection (a) shall not apply to any item which is attributable to the rental of the dwelling unit or portion thereof (determined after the application of subsection (e)). (4) Limitation on deductions In the case of a use described in paragraph (1) or (2), and in the case of a use described in paragraph (3) where the dwelling unit is used by the taxpayer during the taxable year as a residence, the deductions allowed under this chapter for the taxable year by reason of being attributed to such use shall not exceed the excess of- (A) the gross income derived from such use for the taxable year, over (B) the deductions allocable to such use which are allowable under this chapter for the taxable year whether or not such unit (or portion thereof) was so used. (d) Use as residence (1) In general For purposes of this section, a taxpayer uses a dwelling unit during the taxable year as a residence if he uses such unit (or portion thereof) for personal purposes for a number of days which exceeds the greater of- (A) 14 days, or (B) 10 percent of the number of days during such year for which such unit is rented at a fair rental. For purposes of subparagraph (B), a unit shall not be treated as rented at a fair rental § 280 Page 226