102 STAT. 3380	PUBLIC LAW 100-647—NOV. 10, 1988
obligation or below market Federal loan used to provide
construction financing for any building if—
"(i) such obligation or loan (when issued or made)
identified the building for which the proceeds of such
obligation or loan would be used, and
"(ii) such obligation is redeemed, and such loan is
repaid, before such building is placed in service."
(D) Subparagraph (D) of section 42(i)(2) of the 1986 Code is
amended by striking out "subparagraph (A)" and inserting in
lieu thereof "this paragraph".
(20)	Paragraph (4) of section 42(j) of the 1986 Code is amended
by adding at the end thereof the following new subparagraph:
"(F) No RECAPTURE WHERE DE MINIMIS CHANGES IN FLOOR
space.—The Secretary may provide that the increase in tax
under this subsection shall not apply with respect to any
building if—
"(i) such increase results from a de minimis change
in the floor space fraction under subsection (c)(l), and
"(ii) the building is a qualified low-income building
after such change.
(21)	Clause (i) of section 42QX6XB) of the 1986 Code is amended
to read as follows:
"(i) more than Yz the capital interests, and more than
1A the profit interests, in which are owned by a group
of 35 or more partners each of whom is a natural
person or an estate, and".
(22)	Paragraph  (6) of section 42(j) of the  1986  Code is
amended—
 (A)	by inserting "(or interest therein)" after "build-
ing" in the heading, and
 (B)	by inserting or an interest therein" after "disposition
of a building" in the text.
(23)	Subparagraph (B) of section 42(k)(2) of the 1986 Code is
amended by inserting before the period at the end thereof the
following:  ', except that this subparagraph shall not apply in
the case of a federally assisted building described in subsection
(dX6XB)if~
"(i) a security interest in such building is not per-
mitted by a Federal agency holding or insuring the
mortgage secured by such building, and
"(ii) the proceeds from the financing (if any) are
applied to acquire or improve such building."
(24XA) Subsection (1) of section 42 of the 1986 Code is amended
by redesignating paragraph (2) as paragraph (3) and by insert-
mf after paragraph (1) the following new paragraph:
(2) annual reports to the secretary.—-The Secretary may
require taxpayers to submit an information return (at such time
and in such form and manner as the Secretary prescribes) for
each taxable year setting forth—
"(A) the qualified basis for the taxable year of each
qualified low-income building of the taxpayer,
"(B) the information described in paragraph (IXC) for the
taxable year, and
"(C) such other information as the Secretary may require.
The penalty under section 66520') shall apply to any failure to
submit the return required by the Secretary under the preced-
ing sentence on the date prescribed therefor."