LIMITATION ON CARRYOVERS OF UNUSED CREDITS AND CAPITAL LOSSES.

SEC. 302. LIMITATION ON CARRYOVERS OF UNUSED CREDITS AND CAPITAL LOSSES. (a) Limitation on Carryovers—Part V of subchapter C of chapter 1 (relating to carryovers) is amended by adding at the end thereof the following new section: “SEC. 383. SPECIAL LIMITATIONS ON CARRYOVERS OF UNUSED INVESTMENT CREDITS, WORK INCENTIVE PROGRAM CREDITS, FOREIGN TAXES, AND CAPITAL LOSSES.“If— “(1) the ownership and business of a corporation are changed in the manner described in section 382(a) (1), or “(2) in the case of a reorganization specified in paragraph (2) of section 381(a), there is a change in ownership described in section 382(b) (1) (B), then the limitations provided in section 382 in such cases with respect to the carryover of net operating losses shall apply in the same manner, as provided under regulations prescribed by the Secretary or his delegate, with respect to any unused investment credit of the corporation which can otherwise be carried forward under section 46(b), to any unused work incentive program credit of the corporation which can otherwise lie carried forward under section 50A(b), to any excess foreign taxes of the corporation which can otherwise be carried for-ward under section 904(d), and to any net capital loss of the corporation which can otherwise be carried forward under section 1212.” (b) Clerical Amendment—The table of sections of such part V is amended by adding at the end thereof the following new item: “Sec. 383. Special limitations on carryovers of unused investment credits, work incentive program credits, foreign taxes, and capital losses.” (c) Effective Date—The amendments made by this section shall be applicable only with respect to reorganizations and other changes in ownership occurring after the date of enactment of this Act pursuant to a plan of reorganization or contract entered into on or after September 29, 1971.