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(2) Special rule for amounts not
allowable as deductions under paragraph
(1).--
* * * * * * *
(B) Mineral exploration and
development costs.-–In the case of any
amount not allowable as a deduction
under section 616(a) or 617 for any
taxable year by reason of paragraph
(1)--
(i) the applicable percent-
age of the amount not so allow-
able as a deduction shall be
allowable as a deduction for the
taxable year in which the costs
are paid or incurred and in each
of the 4 succeeding taxable
years, and
(ii) in the case of a
deposit located in the United
States, such costs shall be
treated, for purposes of
determining the amount of the
credit allowable under section
38 for the taxable year in which
paid or incurred, as qualified
investment (within the meaning
of subsections (c) and (d) of
section 46) with respect to
property placed in service
during such year.
(3) Applicable percentage.-–For
purposes of paragraph (2)(B), the term
“applicable percentage” means the
percentage determined in accordance with
the following table:
Applicable
Taxable Year: Percentage:
1.................................15
2.................................22
3.................................21
4.................................21
5.................................21
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