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created when V&M Management filed for bankruptcy and the S
corporation status was not otherwise terminated, the passthrough
treatment of V&M Management’s income realized during bankruptcy
is correctly imputed to petitioner.
B. Low-Income Housing Credit
Petitioner argues in the alternative that if the S
corporation status of V&M Management is not terminated by the
filing of a bankruptcy petition, he is entitled to low-income
housing credits which offset his income tax liability generated
from the sale of Mandela Apartments. Section 38 provides for a
general business credit, which includes a low-income housing
credit. Section 42 describes the method and manner taxpayers
must use to compute their low-income housing credit. Petitioner
failed to claim the credit while V&M Management owned the
property for which he seeks the credit. Only now, after the
purported qualifying property has been sold, does petitioner seek
a credit.
Petitioner’s failure to comply with any of the procedures
and requirements stated in the statutes and regulations granting
the low-income housing credit makes him ineligible for it. To be
eligible for low-income housing credits, a taxpayer must first
obtain permission from the appropriate State or local agency.
See sec. 42(h); sec. 1.42-1T(a)(2), Temporary Income Tax Regs.,
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