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TITLE 26-INTERNAL REVENUE CODE (D) Railroad property defined For purposes of this paragraph, the term "railroad property" means section 38 prop- erty used by the taxpayer directly in con- nection with the trade or business carried on by the taxpayer of operating a railroad (including a railroad switching or terminal company). (9) Alternative limitation in the case of certain air- lines (A) In general If, for a taxable year ending after calen- dar year 1976 and before calendar year 1983, the amount of the qualified invest- ment of the taxpayer which is attributable to airline property is 25 percent or more of his aggregate qualified investment, then subparagraph (C) of paragraph (3) of this subsection shall be applied by substituting for 50 percent his applicable percentage for such year. (B) Applicable percentage The applicable percentage of any taxpay- er for any taxable year under this para- graph is- (1) 50 percent, plus (ii) that portion of the tentative per- centage for the taxable year which the taxpayer's amount of qualified invest- ment which is airline property bears to his aggregate qualified investment. If the proportion referred to in clause (ii) is 75 percent or more, the applicable percent- age of the taxpayer for the year shall be 50 percent plus the tentative percentage for such year. (C) Tentative percentage For purposes of subparagraph (B), the tentative percentage shall be determined under the following table: If the taxable The tentative year ends in: percentage is: 1977 or 1978 ................................................ 50 1979 .............................................................. 4 0 1980 .............................................................. 30 1981 ............................ 20 1982 .............................................................. 10 (D) Airline property defined For purposes of this paragraph, the term "airline property" means section 38 proper- ty used by the taxpayer directly in connec- tion with the trade or business carried on by the Taxpayer of the furnishing or sale of transportation as a common carrier by air subject to the jurisdiction of the Civil Aero- nautics Board or the Federal Aviation Ad- ministration. (b) Carryback and carryover of unused credits (1) In general If the sum of the amount of the investment credit carryovers to the taxable year under subsection (a)(1)(A) plus the amount deter- mined under subsection (a)(1)(B) for the tax- able year exceeds the amount of the limita- tion imposed by subsection (a)(3) for such taxable year (hereinafter in this subsection referred to as the "unused credit year"), such excess attributable to the amount determined under subsection (a)(1)(B) shall be- (A) an investment credit carryback to each of the 3 taxable years preceding the unused credit year, and (B) an investment credit carryover to each of the 7 taxable years following the unused credit year, and, subject to the limitations imposed by paragraphs (2) and (3), shall be taken Into ac- count under the provisions of subsection (a)(1) in the manner provided In such subsec- tion. The entire amount of the unused credit for an unused credit year shall be carried to the earliest of the 10 taxable years to which (by reason of subparagraphs (A) and (B)) such credit may be carried and then to each of the other 9 taxable years to the extent, be- cause of the limitations imposed by para- graphs (2) and (3), such unused credit may not be taken Into account under subsection (a)(1) for a prior taxable year to which such unused credit may be carried. In the case of an unused credit for an unused credit year ending before January 1, 1971, which is an in- vestment credit carryover to a taxable year beginning after December 31, 1970 (deter- mined without regard to this sentence), this paragraph shall be applied- (C) by substituting "10 taxable years" for "7 taxable years" in subparagraph (D), and by substituting "13 taxable years" for "10 taxable years", and "12 taxable years" for "9 taxable years" in the preceding sentence, and (D) by carrying such an investment credit carryover to a later taxable year (than the taxable year to which it would, but for this subparagraph, be carried) to which it may be carried if, because of the amendments made by section 802(b)(2) of the Tax Reform Act of 1976, carrying such car- ryover to the taxable year to which it would, but for this subparagraph, be carried would cause a portion of an unused credit from an unused credit year ending after De- cember 31, 1970 to expire, (2) Limitation on carrybacks The amount of the unused credit which may be taken into account under subsection (a)(1) for any preceding taxable year shall not exceed the amount by which the limita- tion imposed by subsection (a)(3) for such taxable year exceeds the sum of- (A) the amounts determined under sub- paragraphs (A) and (B) of subsection (a)(1) for such taxable year, plus (B) the amounts which (by reascn of this subsection) are carried back to such taxable year and are attributable to taxable years preceding the unused credit year. (3) Limitation on carryovers The amount of the unused credit which may be taken into account under subsection (a)(1)(A) for any succeeding taxable year shall not exceed the amount by which the limitation imposed by subsection (a)(3) for such taxable year exceeds the sum of the amounts which, by reason of this subsection, are carried to such taxable year and are at- tributable to taxable years preceding the unused credit year. Page 54