excessive credit transfer

(2) Excessive credit transfer (A) In general In the case of any portion of an eligible credit which is transferred to a transferee taxpayer pursuant to subsection (a) which the Secretary determines constitutes an excessive credit transfer, the tax imposed on the transferee taxpayer by chapter 1 (regardless of whether such entity would otherwise be subject to tax under such chapter) for the taxable year in which such determination is made shall be increased by an amount equal to the sum of— (i) the amount of such excessive credit transfer, plus (ii) an amount equal to 20 percent of such excessive credit transfer. (B) Reasonable cause Subparagraph (A)(ii) shall not apply if the transferee taxpayer demonstrates to the satisfaction of the Secretary that the excessive credit transfer resulted from reasonable cause. (C) Excessive credit transfer defined For purposes of this paragraph, the term “excessive credit transfer” means, with respect to a facility or property for which an election is made under subsection (a) for any taxable year, an amount equal to the excess of— (i) the amount of the eligible credit claimed by the transferee taxpayer with respect to such facility or property for such taxable year, over (ii) the amount of such credit which, without application of this section, would be otherwise allowable under this title with respect to such facility or property for such taxable year.

Source

26 USC § 6418(g)(2)


Scoping language

For purposes of this paragraph
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