In the current year, Paul Chaing (4522 Fargo Street, Geneva, IL 60134) acquires a qualifying historic structure for $350,000 (excluding the cost of the land) and plans to substantially rehabilitate the structure. He is planning to spend either $320,000 or $380,000 on rehabilitation expenditures. Write a letter to Paul and a memo for the tax files explaining, for the two alternative expenditures, (1) the computation that deter mines the rehabilitation expenditures tax credit available to Paul, (2) the effect of the credit on Paul's adjusted basis in the property, and (3) the cash-flow differences as a result of the tax consequences related to his expenditure choice.