Additions
(i) Additions. The amounts of the following items that were included in the computation of the taxpayer's tentative taxable income (if any) are added to tentative taxable income to determine ATI (A) Any business interest expense, other than disallowed business interest expense carryforwards; (B) Any net operating loss deduction under section 172; (C) Any deduction under section 199A; (D) Subject to paragraph (b)(1)(iii) of this section, for taxable years beginning before January 1, 2022, any depreciation under section 167, section 168, or section 168 of the Internal Revenue Code (Code) of 1954 (former section 168); (E) Subject to paragraph (b)(1)(iii) of this section, for taxable years beginning before January 1, 2022, any amortization of intangibles (for example, under section 167 or 197) and other amortized expenditures (for example, under section 174(b), 195(b)(1)(B), 248, or 1245(a)(2)(C)); (F) Subject to paragraph (b)(1)(iii) of this section, for taxable years beginning before January 1, 2022, any depletion under section 611; (G) Any deduction for a capital loss carryback or carryover; and (H) Any deduction or loss that is not properly allocable to a non-excepted trade or business (for rules governing the allocation of items to an excepted trade or business, see 1.163(j)-1(b)(44) and 1.163(j)-10). (ii) Subtractions. The amounts of the following items (if any) are subtracted from the taxpayer's tentative taxable income to determine ATI (A) Any business interest income that was included in the computation of the taxpayer's tentative taxable income; (B) Any floor plan financing interest expense for the taxable year that was included in the computation of the taxpayer's tentative taxable income; (C) With respect to the sale or other disposition of property, the greater of the allowed or allowable depreciation, amortization, or depletion of the property, as provided under section 1016(a)(2), for the taxpayer (or, if the taxpayer is a member of a consolidated group, the consolidated group) for the taxable years beginning after December 31, 2017, and before January 1, 2022, with respect to such property; (D) With respect to the sale or other disposition of stock of a member of a consolidated group by another member, the investment adjustments under 1.1502-32 with respect to such stock that are attributable to deductions described in paragraph (b)(1)(ii)(C) of this section; (E) With respect to the sale or other disposition of an interest in a partnership, the taxpayer's distributive share of deductions described in paragraph (b)(1)(ii)(C) of this section with respect to property held by the partnership at the time of such sale or other disposition to the extent such deductions were allowable under section 704(d); (F) Any income or gain that is not properly allocable to a non-excepted trade or business (for rules governing the allocation of items to an excepted trade or business, see 1.163(j)-1(b)(44) and 1.163(j)-10)) and that was included in the computation of the taxpayer's tentative taxable income; and (G) An amount equal to the sum of any specified deemed inclusions that were included in the computation of the taxpayer's tentative taxable income, reduced by the portion of the deduction allowed under section 250(a) by reason of the specified deemed inclusions. For this purpose, a specified deemed inclusion is the inclusion of an amount by a United States shareholder (as defined in section 951(b)) in gross income under section 78, 951(a), or 951A(a) with respect to an applicable CFC (as defined in 1.163(j)-1(b)(2)) that is properly allocable to a non-excepted trade or business. Furthermore, a specified deemed inclusion includes any amounts included in a domestic partnership's gross income under section 951(a) or 951A(a) with respect to an applicable CFC to the extent such amounts are attributable to investment income of the partnership and are allocated to a domestic C corporation that is a direct (or indirect partner) and treated as properly allocable to a non-excepted trade or business of the domestic C corporation under 1.163(j)-4(b)(3) and 1.163(j)-10. To determine the amount of a specified deemed inclusion described in this paragraph (b)(1)(ii)(G), the portion of a United States shareholder's inclusion under section 951A(a) treated as being with respect to an applicable CFC is determined under section 951A(f)(2) and 1.951A-6(b)(2). (iii) Depreciation, amortization, or depletion capitalized under section 263A. For purposes of paragraph (b)(1)(i) of this section, amounts of depreciation, amortization, or depletion that are capitalized under section 263A during the taxable year are deemed to be included in the computation of the taxpayer's tentative taxable income for such taxable year, regardless of the period in which the capitalized amount is recovered. See Example 3 in 1.163(j)-2(h)(3). (iv) Application of 1.163(j)-1(b)(1)(ii)(C), (D), and (E)(A) Sale or other disposition(1) In general. For purposes of paragraphs (b)(1)(ii)(C), (D), and (E) and paragraphs (b)(1)(iv)(B) and (E) of this section, except as otherwise provided in this paragraph (b)(1)(iv)(A), the term sale or other disposition does not include a transfer of an asset to an acquiring corporation in a transaction to which section 381(a) applies.