may reasonably be expected to be completed in phases set forth in architectural plans and specifications completed before the conversion begins, clause (i) shall be applied by substituting 60-month period for 24-month period . (iii) Lessees The Secretary shall prescribe by regulation rules for applying this subparagraph to lessees. (C) Reconstruction Conversion includes reconstruction. (D) Residential conversion requirements (i) In general A building meets the requirements of this subparagraph if— (I) 20 percent or more of the residential units are both rent-restricted and occupied by individuals whose income is 80 percent or less of area median gross income, or (II) such building is subject to a written binding State or local agreement with respect to the provision or financing of affordable housing and such agreement is documented in such form and manner as the Secretary may provide. (ii) Rent and income limitation For purposes of this subparagraph, rules similar to the rules of subsection (g) of section 42 shall apply to determine whether a unit is rent-restricted, treatment of units occupied by individuals whose incomes rise above the limit, and the treatment of units where Federal rental assistance is reduced as tenant’s income increases. (2) Qualified conversion expenditures defined (A) In general For purposes of subsection (a), the term qualified conversion expenditures means any amount properly chargeable to capital account— (i) for property for which depreciation is allowable under section 168 and which is— (I) nonresidential real property (as defined in section 168), (II) residential rental property (as defined in section 168), or (III) an addition or improvement to property described in clause (i) or (ii), and (ii) in connection with the conversion of a qualified converted building. (B) Certain expenditures not included The term qualified conversion expenditures does not include— (i) Straight line depreciation must be used Any expenditure with respect to which the taxpayer does not use the straight