[Congressional Bills 110th Congress]
[From the U.S. Government Publishing Office]
[H.R. 7201 Introduced in House (IH)]
110th CONGRESS
2d Session
H. R. 7201
To amend the Internal Revenue Code of 1986 to provide incentives for
energy production and conservation, and for other purposes.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
September 28, 2008
Mr. Rangel introduced the following bill; which was referred to the
Committee on Ways and Means
_______________________________________________________________________
A BILL
To amend the Internal Revenue Code of 1986 to provide incentives for
energy production and conservation, and for other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE, ETC.
(a) Short Title.--This Act may be cited as the ``Energy Improvement
and Extension Act of 2008''.
(b) Reference.--Except as otherwise expressly provided, whenever in
this Act an amendment or repeal is expressed in terms of an amendment
to, or repeal of, a section or other provision, the reference shall be
considered to be made to a section or other provision of the Internal
Revenue Code of 1986.
(c) Table of Contents.--The table of contents for this Act is as
follows:
Sec. 1. Short title, etc.
TITLE I--ENERGY TAX INCENTIVES
Subtitle A--Energy Production Incentives
Part 1--Renewable Energy Incentives
Sec. 101. Renewable energy credit.
Sec. 102. Production credit for electricity produced from marine
renewables.
Sec. 103. Energy credit.
Sec. 104. Credit for residential energy efficient property.
Sec. 105. Special rule to implement FERC and State electric
restructuring policy.
Part 2--Carbon Mitigation Provisions
Sec. 111. Expansion and modification of advanced coal project
investment credit.
Sec. 112. Expansion and modification of coal gasification investment
credit.
Sec. 113. Temporary increase in coal excise tax.
Sec. 114. Special rules for refund of the coal excise tax to certain
coal producers and exporters.
Sec. 115. Carbon audit of the tax code.
Subtitle B--Transportation and Domestic Fuel Security Provisions
Sec. 121. Inclusion of cellulosic biofuel in bonus depreciation for
biomass ethanol plant property.
Sec. 122. Credits for biodiesel and renewable diesel.
Sec. 123. Clarification that credits for fuel are designed to provide
an incentive for United States production.
Sec. 124. Credit for new qualified plug-in electric drive motor
vehicles.
Sec. 125. Exclusion from heavy truck tax for idling reduction units and
advanced insulation.
Sec. 126. Transportation fringe benefit to bicycle commuters.
Sec. 127. Alternative fuel vehicle refueling property credit.
Sec. 128. Certain income and gains relating to alcohol fuels and
mixtures, biodiesel fuels and mixtures, and
alternative fuels and mixtures treated as
qualifying income for publicly traded
partnerships.
Subtitle C--Energy Conservation and Efficiency Provisions
Sec. 131. Credit for nonbusiness energy property.
Sec. 132. Energy efficient commercial buildings deduction.
Sec. 133. Modifications of energy efficient appliance credit for
appliances produced after 2007.
Sec. 134. Accelerated recovery period for depreciation of smart meters
and smart grid systems.
Sec. 135. Qualified green building and sustainable design projects.
TITLE II--REVENUE PROVISIONS
Sec. 201. Limitation of deduction for income attributable to domestic
production of oil, gas, or primary products
thereof.
Sec. 202. Elimination of the different treatment of foreign oil and gas
extraction income and foreign oil related
income for purposes of the foreign tax
credit.
Sec. 203. Broker reporting of customer's basis in securities
transactions.
Sec. 204. Increase and extension of Oil Spill Liability Trust Fund tax.
Sec. 205. Time for payment of corporate estimated taxes.
TITLE I--ENERGY TAX INCENTIVES
Subtitle A--Energy Production Incentives
PART 1--RENEWABLE ENERGY INCENTIVES
SEC. 101. RENEWABLE ENERGY CREDIT.
(a) Extension of Credit.--
(1) Wind facilities.--Paragraph (1) of section 45(d) is
amended by striking ``January 1, 2009'' and inserting ``January
1, 2010''.
(2) Other facilities.--Each of the following provisions of
section 45(d) is amended by striking ``January 1, 2009'' and
inserting ``October 1, 2011'':
(A) Clauses (i) and (ii) of paragraph (2)(A).
(B) Clauses (i)(I) and (ii) of paragraph (3)(A).
(C) Paragraph (4).
(D) Paragraph (5).
(E) Paragraph (6).
(F) Paragraph (7).
(G) Subparagraphs (A) and (B) of paragraph (9).
(b) Modification of Credit Phaseout.--
(1) Repeal of phaseout.--Subsection (b) of section 45 is
amended--
(A) by striking paragraph (1), and
(B) by striking ``the 8 cent amount in paragraph
(1),'' in paragraph (2) thereof.
(2) Limitation based on investment in facility.--Subsection
(b) of section 45 is amended by inserting before paragraph (2)
the following new paragraph:
``(1) Limitation based on investment in facility.--
``(A) In general.--In the case of any qualified
facility originally placed in service after December
31, 2009, the amount of the credit determined under
subsection (a) for any taxable year with respect to
electricity produced at such facility shall not exceed
the product of--
``(i) the applicable percentage with
respect to such facility, multiplied by
``(ii) the eligible basis of such facility.
``(B) Carryforward of unused limitation and excess
credit.--
``(i) Unused limitation.--If the limitation
imposed under subparagraph (A) with respect to
any facility for any taxable year exceeds the
prelimitation credit for such facility for such
taxable year, the limitation imposed under
subparagraph (A) with respect to such facility
for the succeeding taxable year shall be
increased by the amount of such excess.
``(ii) Excess credit.--If the prelimitation
credit with respect to any facility for any
taxable year exceeds the limitation imposed
under subparagraph (A) with respect to such
facility for such taxable year, the credit
determined under subsection (a) with respect to
such facility for the succeeding taxable year
(determined before the application of
subparagraph (A) for such succeeding taxable
year) shall be increased by the amount of such
excess. With respect to any facility, no amount
may be carried forward under this clause to any
taxable year beginning after the 10-year period
described in subsection (a)(2)(A)(ii) with
respect to such facility.
``(iii) Prelimitation credit.--The term
`prelimitation credit' with respect to any
facility for a taxable year means the credit
determined under subsection (a) with respect to
such facility for such taxable year, determined
without regard to subparagraph (A) and after
taking into account any increase for such
taxable year under clause (ii).
``(C) Applicable percentage.--For purposes of this
paragraph--
``(i) In general.--The term `applicable
percentage' means, with respect to any
facility, the appropriate percentage prescribed
by the Secretary for the month in which such
facility is originally placed in service.
``(ii) Method of prescribing applicable
percentage.--The applicable percentage
prescribed by the Secretary for any month under
clause (i) shall be the percentage which yields
over a 10-year period amounts of limitation
under subparagraph (A) which have a present
value equal to 35 percent of the eligible basis
of the facility.
``(iii) Method of discounting.--The present
value under clause (ii) shall be determined--
``(I) as of the last day of the 1st
year of the 10-year period referred to
in clause (ii),
``(II) by using a discount rate
equal to the greater of 110 percent of
the Federal long-term rate as in effect
under section 1274(d) for the month
preceding the month for which the
applicable percentage is being
prescribed, or 4.5 percent, and
``(III) by taking into account the
limitation under subparagraph (A) for
any year on the last day of such year.
``(D) Eligible basis.--For purposes of this
paragraph--
``(i) In general.--The term `eligible
basis' means, with respect to any facility, the
sum of--
``(I) the basis of such facility
determined as of the time that such
facility is originally placed in
service, and
``(II) the portion of the basis of
any shared qualified property which is
properly allocable to such facility
under clause (ii).
``(ii) Rules for allocation.--For purposes
of subclause (II) of clause (i), the basis of
shared qualified property shall be allocated
among all qualified facilities which are
projected to be placed in service and which
require utilization of such property in
proportion to projected generation from such
facilities.
``(iii) Shared qualified property.--For
purposes of this paragraph, the term `shared
qualified property' means, with respect to any
facility, any property described in section
168(e)(3)(B)(vi)--
``(I) which a qualified facility
will require for utilization of such
facility, and
``(II) which is not a qualified
facility.
``(iv) Special rule relating to geothermal
facilities.--In the case of any qualified
facility using geothermal energy to produce
electricity, the basis of such facility for
purposes of this paragraph shall be determined
as though intangible drilling and development
costs described in section 263(c) were
capitalized rather than expensed.
``(E) Special rule for first and last year of
credit period.--In the case of any taxable year any
portion of which is not within the 10-year period
described in subsection (a)(2)(A)(ii) with respect to
any facility, the amount of the limitation under
subparagraph (A) with respect to such facility shall be
reduced by an amount which bears the same ratio to the
amount of such limitation (determined without regard to
this subparagraph) as such portion of the taxable year
which is not within such period bears to the entire
taxable year.
``(F) Election to treat all facilities placed in
service in a year as 1 facility.--At the election of
the taxpayer, all qualified facilities which are part
of the same project and which are originally placed in
service during the same calendar year shall be treated
for purposes of this section as 1 facility which is
originally placed in service at the mid-point of such
year or the first day of the following calendar
year.''.
(c) Trash Facility Clarification.--Paragraph (7) of section 45(d)
is amended--
(1) by striking ``facility which burns'' and inserting
``facility (other than a facility described in paragraph (6))
which uses'', and
(2) by striking ``combustion''.
(d) Expansion of Biomass Facilities.--
(1) Open-loop biomass facilities.--Paragraph (3) of section
45(d) is amended by redesignating subparagraph (B) as
subparagraph (C) and by inserting after subparagraph (A) the
following new subparagraph:
``(B) Expansion of facility.--Such term shall
include a new unit placed in service after the date of
the enactment of this subparagraph in connection with a
facility described in subparagraph (A), but only to the
extent of the increased amount of electricity produced
at the facility by reason of such new unit.''.
(2) Closed-loop biomass facilities.--Paragraph (2) of
section 45(d) is amended by redesignating subparagraph (B) as
subparagraph (C) and inserting after subparagraph (A) the
following new subparagraph:
``(B) Expansion of facility.--Such term shall
include a new unit placed in service after the date of
the enactment of this subparagraph in connection with a
facility described in subparagraph (A)(i), but only to
the extent of the increased amount of electricity
produced at the facility by reason of such new unit.''.
(e) Modification of Rules for Hydropower Production.--Subparagraph
(C) of section 45(c)(8) is amended to read as follows:
``(C) Nonhydroelectric dam.--For purposes of
subparagraph (A), a facility is described in this
subparagraph if--
``(i) the hydroelectric project installed
on the nonhydroelectric dam is licensed by the
Federal Energy Regulatory Commission and meets
all other applicable environmental, licensing,
and regulatory requirements,
``(ii) the nonhydroelectric dam was placed
in service before the date of the enactment of
this paragraph and operated for flood control,
navigation, or water supply purposes and did
not produce hydroelectric power on the date of
the enactment of this paragraph, and
``(iii) the hydroelectric project is
operated so that the water surface elevation at
any given location and time that would have
occurred in the absence of the hydroelectric
project is maintained, subject to any license
requirements imposed under applicable law that
change the water surface elevation for the
purpose of improving environmental quality of
the affected waterway.
The Secretary, in consultation with the Federal Energy
Regulatory Commission, shall certify if a hydroelectric
project licensed at a nonhydroelectric dam meets the
criteria in clause (iii). Nothing in this section shall
affect the standards under which the Federal Energy
Regulatory Commission issues licenses for and regulates
hydropower projects under part I of the Federal Power
Act.''.
(f) Effective Date.--
(1) In general.--Except as otherwise provided in this
subsection, the amendments made by this section shall apply to
property originally placed in service after December 31, 2008.
(2) Repeal of credit phaseout.--The amendments made by
subsection (b)(1) shall apply to taxable years ending after
December 31, 2008.
(3) Limitation based on investment in facility.--The
amendment made by subsection (b)(2) shall apply to property
originally placed in service after December 31, 2009.
(4) Trash facility clarification.--The amendments made by
subsection (c) shall apply to electricity produced and sold
after the date of the enactment of this Act.
(5) Expansion of biomass facilities.--The amendments made
by subsection (d) shall apply to property placed in service
after the date of the enactment of this Act.
SEC. 102. PRODUCTION CREDIT FOR ELECTRICITY PRODUCED FROM MARINE
RENEWABLES.
(a) In General.--Paragraph (1) of section 45(c) is amended by
striking ``and'' at the end of subparagraph (G), by striking the period
at the end of subparagraph (H) and inserting ``, and'', and by adding
at the end the following new subparagraph:
``(I) marine and hydrokinetic renewable energy.''.
(b) Marine Renewables.--Subsection (c) of section 45 is amended by
adding at the end the following new paragraph:
``(10) Marine and hydrokinetic renewable energy.--
``(A) In general.--The term `marine and
hydrokinetic renewable energy' means energy derived
from--
``(i) waves, tides, and currents in oceans,
estuaries, and tidal areas,
``(ii) free flowing water in rivers, lakes,
and streams,
``(iii) free flowing water in an irrigation
system, canal, or other man-made channel,
including projects that utilize nonmechanical
structures to accelerate the flow of water for
electric power production purposes, or
``(iv) differentials in ocean temperature
(ocean thermal energy conversion).
``(B) Exceptions.--Such term shall not include any
energy which is derived from any source which utilizes
a dam, diversionary structure (except as provided in
subparagraph (A)(iii)), or impoundment for electric
power production purposes.''.
(c) Definition of Facility.--Subsection (d) of section 45 is
amended by adding at the end the following new paragraph:
``(11) Marine and hydrokinetic renewable energy
facilities.--In the case of a facility producing electricity
from marine and hydrokinetic renewable energy, the term
`qualified facility' means any facility owned by the taxpayer--
``(A) which has a nameplate capacity rating of at
least 150 kilowatts, and
``(B) which is originally placed in service on or
after the date of the enactment of this paragraph and
before October 1, 2011.''.
(d) Credit Rate.--Subparagraph (A) of section 45(b)(4) is amended
by striking ``or (9)'' and inserting ``(9), or (11)''.
(e) Coordination With Small Irrigation Power.--Paragraph (5) of
section 45(d), as amended by section 101, is amended by striking
``October 1, 2011'' and inserting ``the date of the enactment of
paragraph (11)''.
(f) Effective Date.--The amendments made by this section shall
apply to electricity produced and sold after the date of the enactment
of this Act, in taxable years ending after such date.
SEC. 103. ENERGY CREDIT.
(a) Extension of Credit.--
(1) Solar energy property.--Paragraphs (2)(A)(i)(II) and
(3)(A)(ii) of section 48(a) are each amended by striking
``January 1, 2009'' and inserting ``January 1, 2017''.
(2) Fuel cell property.--Subparagraph (E) of section
48(c)(1) is amended by striking ``December 31, 2008'' and
inserting ``December 31, 2016''.
(3) Microturbine property.--Subparagraph (E) of section
48(c)(2) is amended by striking ``December 31, 2008'' and
inserting ``December 31, 2016''.
(b) Allowance of Energy Credit Against Alternative Minimum Tax.--
(1) In general.--Subparagraph (B) of section 38(c)(4) is
amended by redesignating clause (vi) as clause (vii), by
striking ``and'' at the end of clause (v), and by inserting
after clause (v) the following new clause:
``(vi) the credit determined under section
46 to the extent that such credit is
attributable to the energy credit determined
under section 48, and''.
(2) Technical amendment.--Clause (v) of section 38(c)(4)(B)
is amended by striking ``section 47 to the extent attributable
to'' and inserting ``section 46 to the extent that such credit
is attributable to the rehabilitation credit under section 47,
but only with respect to''.
(c) Energy Credit for Combined Heat and Power System Property.--
(1) In general.--Section 48(a)(3)(A) is amended by striking
``or'' at the end of clause (iii), by inserting ``or'' at the
end of clause (iv), and by adding at the end the following new
clause:
``(v) combined heat and power system
property,''.
(2) Combined heat and power system property.--Subsection
(c) of section 48 is amended--
(A) by striking ``Qualified Fuel Cell Property;
Qualified Microturbine Property'' in the heading and
inserting ``Definitions'', and
(B) by adding at the end the following new
paragraph:
``(3) Combined heat and power system property.--
``(A) Combined heat and power system property.--The
term `combined heat and power system property' means
property comprising a system--
``(i) which uses the same energy source for
the simultaneous or sequential generation of
electrical power, mechanical shaft power, or
both, in combination with the generation of
steam or other forms of useful thermal energy
(including heating and cooling applications),
``(ii) which produces--
``(I) at least 20 percent of its
total useful energy in the form of
thermal energy which is not used to
produce electrical or mechanical power
(or combination thereof), and
``(II) at least 20 percent of its
total useful energy in the form of
electrical or mechanical power (or
combination thereof),
``(iii) the energy efficiency percentage of
which exceeds 60 percent, and
``(iv) which is placed in service before
January 1, 2017.
``(B) Limitation.--
``(i) In general.--In the case of combined
heat and power system property with an
electrical capacity in excess of the applicable
capacity placed in service during the taxable
year, the credit under subsection (a)(1)
(determined without regard to this paragraph)
for such year shall be equal to the amount
which bears the same ratio to such credit as
the applicable capacity bears to the capacity
of such property.
``(ii) Applicable capacity.--For purposes
of clause (i), the term `applicable capacity'
means 15 megawatts or a mechanical energy
capacity of more than 20,000 horsepower or an
equivalent combination of electrical and
mechanical energy capacities.
``(iii) Maximum capacity.--The term
`combined heat and power system property' shall
not include any property comprising a system if
such system has a capacity in excess of 50
megawatts or a mechanical energy capacity in
excess of 67,000 horsepower or an equivalent
combination of electrical and mechanical energy
capacities.
``(C) Special rules.--
``(i) Energy efficiency percentage.--For
purposes of this paragraph, the energy
efficiency percentage of a system is the
fraction--
``(I) the numerator of which is the
total useful electrical, thermal, and
mechanical power produced by the system
at normal operating rates, and expected
to be consumed in its normal
application, and
``(II) the denominator of which is
the lower heating value of the fuel
sources for the system.
``(ii) Determinations made on btu basis.--
The energy efficiency percentage and the
percentages under subparagraph (A)(ii) shall be
determined on a Btu basis.
``(iii) Input and output property not
included.--The term `combined heat and power
system property' does not include property used
to transport the energy source to the facility
or to distribute energy produced by the
facility.
``(D) Systems using biomass.--If a system is
designed to use biomass (within the meaning of
paragraphs (2) and (3) of section 45(c) without regard
to the last sentence of paragraph (3)(A)) for at least
90 percent of the energy source--
``(i) subparagraph (A)(iii) shall not
apply, but
``(ii) the amount of credit determined
under subsection (a) with respect to such
system shall not exceed the amount which bears
the same ratio to such amount of credit
(determined without regard to this
subparagraph) as the energy efficiency
percentage of such system bears to 60
percent.''.
(3) Conforming amendment.--Section 48(a)(1) is amended by
striking ``paragraphs (1)(B) and (2)(B)'' and inserting
``paragraphs (1)(B), (2)(B), and (3)(B)''.
(d) Increase of Credit Limitation for Fuel Cell Property.--
Subparagraph (B) of section 48(c)(1) is amended by striking ``$500''
and inserting ``$1,500''.
(e) Public Utility Property Taken Into Account.--
(1) In general.--Paragraph (3) of section 48(a) is amended
by striking the second sentence thereof.
(2) Conforming amendments.--
(A) Paragraph (1) of section 48(c) is amended by
striking subparagraph (D) and redesignating
subparagraph (E) as subparagraph (D).
(B) Paragraph (2) of section 48(c) is amended by
striking subparagraph (D) and redesignating
subparagraph (E) as subparagraph (D).
(f) Effective Date.--
(1) In general.--Except as otherwise provided in this
subsection, the amendments made by this section shall take
effect on the date of the enactment of this Act.
(2) Allowance against alternative minimum tax.--The
amendments made by subsection (b) shall apply to credits
determined under section 46 of the Internal Revenue Code of
1986 in taxable years beginning after the date of the enactment
of this Act and to carrybacks of such credits.
(3) Combined heat and power and fuel cell property.--The
amendments made by subsections (c) and (d) shall apply to
periods after the date of the enactment of this Act, in taxable
years ending after such date, under rules similar to the rules
of section 48(m) of the Internal Revenue Code of 1986 (as in
effect on the day before the date of the enactment of the
Revenue Reconciliation Act of 1990).
(4) Public utility property.--The amendments made by
subsection (e) shall apply to periods after February 13, 2008,
in taxable years ending after such date, under rules similar to
the rules of section 48(m) of the Internal Revenue Code of 1986
(as in effect on the day before the date of the enactment of
the Revenue Reconciliation Act of 1990).
SEC. 104. CREDIT FOR RESIDENTIAL ENERGY EFFICIENT PROPERTY.
(a) Extension.--Section 25D(g) is amended by striking ``December
31, 2008'' and inserting ``December 31, 2016''.
(b) Removal of Limitation for Solar Electric Property.--
(1) In general.--Section 25D(b)(1), as amended by
subsections (c) and (d), is amended--
(A) by striking subparagraph (A), and
(B) by redesignating subparagraphs (B) through (E)
as subparagraphs (A) through and (D), respectively.
(2) Conforming amendment.--Section 25D(e)(4)(A), as amended
by subsections (c) and (d), is amended--
(A) by striking clause (i), and
(B) by redesignating clauses (ii) through (v) as
clauses (i) and (iv), respectively.
(c) Credit for Residential Wind Property.--
(1) In general.--Section 25D(a) is amended by striking
``and'' at the end of paragraph (2), by striking the period at
the end of paragraph (3) and inserting ``, and'', and by adding
at the end the following new paragraph:
``(4) 30 percent of the qualified small wind energy
property expenditures made by the taxpayer during such year.''.
(2) Limitation.--Section 25D(b)(1) is amended by striking
``and'' at the end of subparagraph (B), by striking the period
at the end of subparagraph (C) and inserting ``, and'', and by
adding at the end the following new subparagraph:
``(D) $500 with respect to each half kilowatt of
capacity (not to exceed $4,000) of wind turbines for
which qualified small wind energy property expenditures
are made.''.
(3) Qualified small wind energy property expenditures.--
(A) In general.--Section 25D(d) is amended by
adding at the end the following new paragraph:
``(4) Qualified small wind energy property expenditure.--
The term `qualified small wind energy property expenditure'
means an expenditure for property which uses a wind turbine to
generate electricity for use in connection with a dwelling unit
located in the United States and used as a residence by the
taxpayer.''.
(B) No double benefit.--Section 45(d)(1) is amended
by adding at the end the following new sentence: ``Such
term shall not include any facility with respect to
which any qualified small wind energy property
expenditure (as defined in subsection (d)(4) of section
25D) is taken into account in determining the credit
under such section.''.
(4) Maximum expenditures in case of joint occupancy.--
Section 25D(e)(4)(A) is amended by striking ``and'' at the end
of clause (ii), by striking the period at the end of clause
(iii) and inserting ``, and'', and by adding at the end the
following new clause:
``(iv) $1,667 in the case of each half
kilowatt of capacity (not to exceed $13,333) of
wind turbines for which qualified small wind
energy property expenditures are made.''.
(d) Credit for Geothermal Heat Pump Systems.--
(1) In general.--Section 25D(a), as amended by subsection
(c), is amended by striking ``and'' at the end of paragraph
(3), by striking the period at the end of paragraph (4) and
inserting ``, and'', and by adding at the end the following new
paragraph:
``(5) 30 percent of the qualified geothermal heat pump
property expenditures made by the taxpayer during such year.''.
(2) Limitation.--Section 25D(b)(1), as amended by
subsection (c), is amended by striking ``and'' at the end of
subparagraph (C), by striking the period at the end of
subparagraph (D) and inserting ``, and'', and by adding at the
end the following new subparagraph:
``(E) $2,000 with respect to any qualified
geothermal heat pump property expenditures.''.
(3) Qualified geothermal heat pump property expenditure.--
Section 25D(d), as amended by subsection (c), is amended by
adding at the end the following new paragraph:
``(5) Qualified geothermal heat pump property
expenditure.--
``(A) In general.--The term `qualified geothermal
heat pump property expenditure' means an expenditure
for qualified geothermal heat pump property installed
on or in connection with a dwelling unit located in the
United States and used as a residence by the taxpayer.
``(B) Qualified geothermal heat pump property.--The
term `qualified geothermal heat pump property' means
any equipment which--
``(i) uses the ground or ground water as a
thermal energy source to heat the dwelling unit
referred to in subparagraph (A) or as a thermal
energy sink to cool such dwelling unit, and
``(ii) meets the requirements of the Energy
Star program which are in effect at the time
that the expenditure for such equipment is
made.''.
(4) Maximum expenditures in case of joint occupancy.--
Section 25D(e)(4)(A), as amended by subsection (c), is amended
by striking ``and'' at the end of clause (iii), by striking the
period at the end of clause (iv) and inserting ``, and'', and
by adding at the end the following new clause:
``(v) $6,667 in the case of any qualified
geothermal heat pump property expenditures.''.
(e) Credit Allowed Against Alternative Minimum Tax.--
(1) In general.--Subsection (c) of section 25D is amended
to read as follows:
``(c) Limitation Based on Amount of Tax; Carryforward of Unused
Credit.--
``(1) Limitation based on amount of tax.--In the case of a
taxable year to which section 26(a)(2) does not apply, the
credit allowed under subsection (a) for the taxable year shall
not exceed the excess of--
``(A) the sum of the regular tax liability (as
defined in section 26(b)) plus the tax imposed by
section 55, over
``(B) the sum of the credits allowable under this
subpart (other than this section) and section 27 for
the taxable year.
``(2) Carryforward of unused credit.--
``(A) Rule for years in which all personal credits
allowed against regular and alternative minimum tax.--
In the case of a taxable year to which section 26(a)(2)
applies, if the credit allowable under subsection (a)
exceeds the limitation imposed by section 26(a)(2) for
such taxable year reduced by the sum of the credits
allowable under this subpart (other than this section),
such excess shall be carried to the succeeding taxable
year and added to the credit allowable under subsection
(a) for such succeeding taxable year.
``(B) Rule for other years.--In the case of a
taxable year to which section 26(a)(2) does not apply,
if the credit allowable under subsection (a) exceeds
the limitation imposed by paragraph (1) for such
taxable year, such excess shall be carried to the
succeeding taxable year and added to the credit
allowable under subsection (a) for such succeeding
taxable year.''.
(2) Conforming amendments.--
(A) Section 23(b)(4)(B) is amended by inserting
``and section 25D'' after ``this section''.
(B) Section 24(b)(3)(B) is amended by striking
``and 25B'' and inserting ``, 25B, and 25D''.
(C) Section 25B(g)(2) is amended by striking
``section 23'' and inserting ``sections 23 and 25D''.
(D) Section 26(a)(1) is amended by striking ``and
25B'' and inserting ``25B, and 25D''.
(f) Effective Date.--
(1) In general.--Except as provided in paragraph (2), the
amendments made by this section shall apply to taxable years
beginning after December 31, 2007.
(2) Solar electric property limitation.--The amendments
made by subsection (b) shall apply to property placed in
service after the date of the enactment of this Act, in taxable
years ending after such date.
(3) Application of egtrra sunset.--The amendments made by
subparagraphs (A) and (B) of subsection (e)(2) shall be subject
to title IX of the Economic Growth and Tax Relief
Reconciliation Act of 2001 in the same manner as the provisions
of such Act to which such amendments relate.
SEC. 105. SPECIAL RULE TO IMPLEMENT FERC AND STATE ELECTRIC
RESTRUCTURING POLICY.
(a) Extension for Qualified Electric Utilities.--
(1) In general.--Paragraph (3) of section 451(i) is amended
by inserting ``(before January 1, 2010, in the case of a
qualified electric utility)'' after ``January 1, 2008''.
(2) Qualified electric utility.--Subsection (i) of section
451 is amended by redesignating paragraphs (6) through (10) as
paragraphs (7) through (11), respectively, and by inserting
after paragraph (5) the following new paragraph:
``(6) Qualified electric utility.--For purposes of this
subsection, the term `qualified electric utility' means a
person that, as of the date of the qualifying electric
transmission transaction, is vertically integrated, in that it
is both--
``(A) a transmitting utility (as defined in section
3(23) of the Federal Power Act (16 U.S.C. 796(23)))
with respect to the transmission facilities to which
the election under this subsection applies, and
``(B) an electric utility (as defined in section
3(22) of the Federal Power Act (16 U.S.C. 796(22))).''.
(b) Extension of Period for Transfer of Operational Control
Authorized by FERC.--Clause (ii) of section 451(i)(4)(B) is amended by
striking ``December 31, 2007'' and inserting ``the date which is 4
years after the close of the taxable year in which the transaction
occurs''.
(c) Property Located Outside the United States Not Treated as
Exempt Utility Property.--Paragraph (5) of section 451(i) is amended by
adding at the end the following new subparagraph:
``(C) Exception for property located outside the
united states.--The term `exempt utility property'
shall not include any property which is located outside
the United States.''.
(d) Effective Dates.--
(1) Extension.--The amendments made by subsection (a) shall
apply to transactions after December 31, 2007.
(2) Transfers of operational control.--The amendment made
by subsection (b) shall take effect as if included in section
909 of the American Jobs Creation Act of 2004.
(3) Exception for property located outside the united
states.--The amendment made by subsection (c) shall apply to
transactions after the date of the enactment of this Act.
PART 2--CARBON MITIGATION PROVISIONS
SEC. 111. EXPANSION AND MODIFICATION OF ADVANCED COAL PROJECT
INVESTMENT CREDIT.
(a) Modification of Credit Amount.--Section 48A(a) is amended by
striking ``and'' at the end of paragraph (1), by striking the period at
the end of paragraph (2) and inserting ``, and'', and by adding at the
end the following new paragraph:
``(3) 30 percent of the qualified investment for such
taxable year in the case of projects described in clause (iii)
of subsection (d)(3)(B).''.
(b) Expansion of Aggregate Credits.--Section 48A(d)(3)(A) is
amended by striking ``$1,300,000,000'' and inserting
``$2,250,000,000''.
(c) Authorization of Additional Projects.--
(1) In general.--Subparagraph (B) of section 48A(d)(3) is
amended to read as follows:
``(B) Particular projects.--Of the dollar amount in
subparagraph (A), the Secretary is authorized to
certify--
``(i) $800,000,000 for integrated
gasification combined cycle projects the
application for which is submitted during the
period described in paragraph (2)(A)(i),
``(ii) $500,000,000 for projects which use
other advanced coal-based generation
technologies the application for which is
submitted during the period described in
paragraph (2)(A)(i), and
``(iii) $950,000,000 for advanced coal-
based generation technology projects the
application for which is submitted during the
period described in paragraph (2)(A)(ii).''.
(2) Application period for additional projects.--
Subparagraph (A) of section 48A(d)(2) is amended to read as
follows:
``(A) Application period.--Each applicant for
certification under this paragraph shall submit an
application meeting the requirements of subparagraph
(B). An applicant may only submit an application--
``(i) for an allocation from the dollar
amount specified in clause (i) or (ii) of
paragraph (3)(B) during the 3-year period
beginning on the date the Secretary establishes
the program under paragraph (1), and
``(ii) for an allocation from the dollar
amount specified in paragraph (3)(B)(iii)
during the 3-year period beginning at the
earlier of the termination of the period
described in clause (i) or the date prescribed
by the Secretary.''.
(3) Capture and sequestration of carbon dioxide emissions
requirement.--
(A) In general.--Section 48A(e)(1) is amended by
striking ``and'' at the end of subparagraph (E), by
striking the period at the end of subparagraph (F) and
inserting ``; and'', and by adding at the end the
following new subparagraph:
``(G) in the case of any project the application
for which is submitted during the period described in
subsection (d)(2)(A)(ii), the project includes
equipment which separates and sequesters at least 65
percent (70 percent in the case of an application for
reallocated credits under subsection (d)(4)) of such
project's total carbon dioxide emissions.''.
(B) Highest priority for projects which sequester
carbon dioxide emissions.--Section 48A(e)(3) is amended
by striking ``and'' at the end of subparagraph
(A)(iii), by striking the period at the end of
subparagraph (B)(iii) and inserting ``, and'', and by
adding at the end the following new subparagraph:
``(C) give highest priority to projects with the
greatest separation and sequestration percentage of
total carbon dioxide emissions.''.
(C) Recapture of credit for failure to sequester.--
Section 48A is amended by adding at the end the
following new subsection:
``(i) Recapture of Credit for Failure To Sequester.--The Secretary
shall provide for recapturing the benefit of any credit allowable under
subsection (a) with respect to any project which fails to attain or
maintain the separation and sequestration requirements of subsection
(e)(1)(G).''.
(4) Additional priority for research partnerships.--Section
48A(e)(3)(B), as amended by paragraph (3)(B), is amended--
(A) by striking ``and'' at the end of clause (ii),
(B) by redesignating clause (iii) as clause (iv),
and
(C) by inserting after clause (ii) the following
new clause:
``(iii) applicant participants who have a
research partnership with an eligible
educational institution (as defined in section
529(e)(5)), and''.
(5) Clerical amendment.--Section 48A(e)(3) is amended by
striking ``integrated gasification combined cycle'' in the
heading and inserting ``certain''.
(d) Disclosure of Allocations.--Section 48A(d) is amended by adding
at the end the following new paragraph:
``(5) Disclosure of allocations.--The Secretary shall, upon
making a certification under this subsection or section 48B(d),
publicly disclose the identity of the applicant and the amount
of the credit certified with respect to such applicant.''.
(e) Effective Dates.--
(1) In general.--Except as otherwise provided in this
subsection, the amendments made by this section shall apply to
credits the application for which is submitted during the
period described in section 48A(d)(2)(A)(ii) of the Internal
Revenue Code of 1986 and which are allocated or reallocated
after the date of the enactment of this Act.
(2) Disclosure of allocations.--The amendment made by
subsection (d) shall apply to certifications made after the
date of the enactment of this Act.
(3) Clerical amendment.--The amendment made by subsection
(c)(5) shall take effect as if included in the amendment made
by section 1307(b) of the Energy Tax Incentives Act of 2005.
SEC. 112. EXPANSION AND MODIFICATION OF COAL GASIFICATION INVESTMENT
CREDIT.
(a) Modification of Credit Amount.--Section 48B(a) is amended by
inserting ``(30 percent in the case of credits allocated under
subsection (d)(1)(B))'' after ``20 percent''.
(b) Expansion of Aggregate Credits.--Section 48B(d)(1) is amended
by striking ``shall not exceed $350,000,000'' and all that follows and
inserting ``shall not exceed--
``(A) $350,000,000, plus
``(B) $150,000,000 for qualifying gasification
projects that include equipment which separates and
sequesters at least 75 percent of such project's total
carbon dioxide emissions.''.
(c) Recapture of Credit for Failure To Sequester.--Section 48B is
amended by adding at the end the following new subsection:
``(f) Recapture of Credit for Failure to Sequester.--The Secretary
shall provide for recapturing the benefit of any credit allowable under
subsection (a) with respect to any project which fails to attain or
maintain the separation and sequestration requirements for such project
under subsection (d)(1).''.
(d) Selection Priorities.--Section 48B(d) is amended by adding at
the end the following new paragraph:
``(4) Selection priorities.--In determining which
qualifying gasification projects to certify under this section,
the Secretary shall--
``(A) give highest priority to projects with the
greatest separation and sequestration percentage of
total carbon dioxide emissions, and
``(B) give high priority to applicant participants
who have a research partnership with an eligible
educational institution (as defined in section
529(e)(5)).''.
(e) Effective Date.--The amendments made by this section shall
apply to credits described in section 48B(d)(1)(B) of the Internal
Revenue Code of 1986 which are allocated or reallocated after the date
of the enactment of this Act.
SEC. 113. TEMPORARY INCREASE IN COAL EXCISE TAX.
Paragraph (2) of section 4121(e) is amended--
(1) by striking ``January 1, 2014'' in subparagraph (A) and
inserting ``December 31, 2018'', and
(2) by striking ``January 1 after 1981'' in subparagraph
(B) and inserting ``December 31 after 2007''.
SEC. 114. SPECIAL RULES FOR REFUND OF THE COAL EXCISE TAX TO CERTAIN
COAL PRODUCERS AND EXPORTERS.
(a) Refund.--
(1) Coal producers.--
(A) In general.--Notwithstanding subsections (a)(1)
and (c) of section 6416 and section 6511 of the
Internal Revenue Code of 1986, if--
(i) a coal producer establishes that such
coal producer, or a party related to such coal
producer, exported coal produced by such coal
producer to a foreign country or shipped coal
produced by such coal producer to a possession
of the United States, or caused such coal to be
exported or shipped, the export or shipment of
which was other than through an exporter who
meets the requirements of paragraph (2),
(ii) such coal producer filed an excise tax
return on or after October 1, 1990, and on or
before the date of the enactment of this Act,
and
(iii) such coal producer files a claim for
refund with the Secretary not later than the
close of the 30-day period beginning on the
date of the enactment of this Act,
then the Secretary shall pay to such coal producer an
amount equal to the tax paid under section 4121 of such
Code on such coal exported or shipped by the coal
producer or a party related to such coal producer, or
caused by the coal producer or a party related to such
coal producer to be exported or shipped.
(B) Special rules for certain taxpayers.--For
purposes of this section--
(i) In general.--If a coal producer or a
party related to a coal producer has received a
judgment described in clause (iii), such coal
producer shall be deemed to have established
the export of coal to a foreign country or
shipment of coal to a possession of the United
States under subparagraph (A)(i).
(ii) Amount of payment.--If a taxpayer
described in clause (i) is entitled to a
payment under subparagraph (A), the amount of
such payment shall be reduced by any amount
paid pursuant to the judgment described in
clause (iii).
(iii) Judgment described.--A judgment is
described in this subparagraph if such
judgment--
(I) is made by a court of competent
jurisdiction within the United States,
(II) relates to the
constitutionality of any tax paid on
exported coal under section 4121 of the
Internal Revenue Code of 1986, and
(III) is in favor of the coal
producer or the party related to the
coal producer.
(2) Exporters.--Notwithstanding subsections (a)(1) and (c)
of section 6416 and section 6511 of the Internal Revenue Code
of 1986, and a judgment described in paragraph (1)(B)(iii) of
this subsection, if--
(A) an exporter establishes that such exporter
exported coal to a foreign country or shipped coal to a
possession of the United States, or caused such coal to
be so exported or shipped,
(B) such exporter filed a tax return on or after
October 1, 1990, and on or before the date of the
enactment of this Act, and
(C) such exporter files a claim for refund with the
Secretary not later than the close of the 30-day period
beginning on the date of the enactment of this Act,
then the Secretary shall pay to such exporter an amount equal
to $0.825 per ton of such coal exported by the exporter or
caused to be exported or shipped, or caused to be exported or
shipped, by the exporter.
(b) Limitations.--Subsection (a) shall not apply with respect to
exported coal if a settlement with the Federal Government has been made
with and accepted by, the coal producer, a party related to such coal
producer, or the exporter, of such coal, as of the date that the claim
is filed under this section with respect to such exported coal. For
purposes of this subsection, the term ``settlement with the Federal
Government'' shall not include any settlement or stipulation entered
into as of the date of the enactment of this Act, the terms of which
contemplate a judgment concerning which any party has reserved the
right to file an appeal, or has filed an appeal.
(c) Subsequent Refund Prohibited.--No refund shall be made under
this section to the extent that a credit or refund of such tax on such
exported or shipped coal has been paid to any person.
(d) Definitions.--For purposes of this section--
(1) Coal producer.--The term ``coal producer'' means the
person in whom is vested ownership of the coal immediately
after the coal is severed from the ground, without regard to
the existence of any contractual arrangement for the sale or
other disposition of the coal or the payment of any royalties
between the producer and third parties. The term includes any
person who extracts coal from coal waste refuse piles or from
the silt waste product which results from the wet washing (or
similar processing) of coal.
(2) Exporter.--The term ``exporter'' means a person, other
than a coal producer, who does not have a contract, fee
arrangement, or any other agreement with a producer or seller
of such coal to export or ship such coal to a third party on
behalf of the producer or seller of such coal and--
(A) is indicated in the shipper's export
declaration or other documentation as the exporter of
record, or
(B) actually exported such coal to a foreign
country or shipped such coal to a possession of the
United States, or caused such coal to be so exported or
shipped.
(3) Related party.--The term ``a party related to such coal
producer'' means a person who--
(A) is related to such coal producer through any
degree of common management, stock ownership, or voting
control,
(B) is related (within the meaning of section
144(a)(3) of the Internal Revenue Code of 1986) to such
coal producer, or
(C) has a contract, fee arrangement, or any other
agreement with such coal producer to sell such coal to
a third party on behalf of such coal producer.
(4) Secretary.--The term ``Secretary'' means the Secretary
of Treasury or the Secretary's designee.
(e) Timing of Refund.--With respect to any claim for refund filed
pursuant to this section, the Secretary shall determine whether the
requirements of this section are met not later than 180 days after such
claim is filed. If the Secretary determines that the requirements of
this section are met, the claim for refund shall be paid not later than
180 days after the Secretary makes such determination.
(f) Interest.--Any refund paid pursuant to this section shall be
paid by the Secretary with interest from the date of overpayment
determined by using the overpayment rate and method under section 6621
of the Internal Revenue Code of 1986.
(g) Denial of Double Benefit.--The payment under subsection (a)
with respect to any coal shall not exceed--
(1) in the case of a payment to a coal producer, the amount
of tax paid under section 4121 of the Internal Revenue Code of
1986 with respect to such coal by such coal producer or a party
related to such coal producer, and
(2) in the case of a payment to an exporter, an amount
equal to $0.825 per ton with respect to such coal exported by
the exporter or caused to be exported by the exporter.
(h) Application of Section.--This section applies only to claims on
coal exported or shipped on or after October 1, 1990, through the date
of the enactment of this Act.
SEC. 115. CARBON AUDIT OF THE TAX CODE.
(a) Study.--The Secretary of the Treasury shall enter into an
agreement with the National Academy of Sciences to undertake a
comprehensive review of the Internal Revenue Code of 1986 to identify
the types of and specific tax provisions that have the largest effects
on carbon and other greenhouse gas emissions and to estimate the
magnitude of those effects.
(b) Report.--Not later than 2 years after the date of enactment of
this Act, the National Academy of Sciences shall submit to Congress a
report containing the results of study authorized under this section.
(c) Authorization of Appropriations.--There is authorized to be
appropriated to carry out this section $1,500,000 for the period of
fiscal years 2009 and 2010.
Subtitle B--Transportation and Domestic Fuel Security Provisions
SEC. 121. INCLUSION OF CELLULOSIC BIOFUEL IN BONUS DEPRECIATION FOR
BIOMASS ETHANOL PLANT PROPERTY.
(a) In General.--Paragraph (3) of section 168(l) is amended to read
as follows:
``(3) Cellulosic biofuel.--The term `cellulosic biofuel'
means any liquid fuel which is produced from any
lignocellulosic or hemicellulosic matter that is available on a
renewable or recurring basis.''.
(b) Conforming Amendments.--Subsection (l) of section 168 is
amended--
(1) by striking ``cellulosic biomass ethanol'' each place
it appears and inserting ``cellulosic biofuel'',
(2) by striking ``Cellulosic Biomass Ethanol'' in the
heading of such subsection and inserting ``Cellulosic
Biofuel'', and
(3) by striking ``cellulosic biomass ethanol'' in the
heading of paragraph (2) thereof and inserting ``cellulosic
biofuel''.
(c) Effective Date.--The amendments made by this section shall
apply to property placed in service after the date of the enactment of
this Act, in taxable years ending after such date.
SEC. 122. CREDITS FOR BIODIESEL AND RENEWABLE DIESEL.
(a) In General.--Sections 40A(g), 6426(c)(6), and 6427(e)(5)(B) are
each amended by striking ``December 31, 2008'' and inserting ``December
31, 2009''.
(b) Increase in Rate of Credit.--
(1) Income tax credit.--Paragraphs (1)(A) and (2)(A) of
section 40A(b) are each amended by striking ``50 cents'' and
inserting ``$1.00''.
(2) Excise tax credit.--Paragraph (2) of section 6426(c) is
amended to read as follows:
``(2) Applicable amount.--For purposes of this subsection,
the applicable amount is $1.00.''.
(3) Conforming amendments.--
(A) Subsection (b) of section 40A is amended by
striking paragraph (3) and by redesignating paragraphs
(4) and (5) as paragraphs (3) and (4), respectively.
(B) Paragraph (2) of section 40A(f) is amended to
read as follows:
``(2) Exception.--Subsection (b)(4) shall not apply with
respect to renewable diesel.''.
(C) Paragraphs (2) and (3) of section 40A(e) are
each amended by striking ``subsection (b)(5)(C)'' and
inserting ``subsection (b)(4)(C)''.
(D) Clause (ii) of section 40A(d)(3)(C) is amended
by striking ``subsection (b)(5)(B)'' and inserting
``subsection (b)(4)(B)''.
(c) Uniform Treatment of Diesel Produced From Biomass.--Paragraph
(3) of section 40A(f) is amended--
(1) by striking ``diesel fuel'' and inserting ``liquid
fuel'',
(2) by striking ``using a thermal depolymerization
process'', and
(3) by striking ``or D396'' in subparagraph (B) and
inserting ``, D396, or other equivalent standard approved by
the Secretary''.
(d) Coproduction of Renewable Diesel With Petroleum Feedstock.--
(1) In general.--Paragraph (3) of section 40A(f) (defining
renewable diesel) is amended by adding at the end the following
flush sentence:
``Such term does not include any fuel derived from coprocessing
biomass with a feedstock which is not biomass. For purposes of
this paragraph, the term `biomass' has the meaning given such
term by section 45K(c)(3).''.
(2) Conforming amendment.--Paragraph (3) of section 40A(f)
is amended by striking ``(as defined in section 45K(c)(3))''.
(e) Eligibility of Certain Aviation Fuel.--Subsection (f) of
section 40A (relating to renewable diesel) is amended by adding at the
end the following new paragraph:
``(4) Certain aviation fuel.--
``(A) In general.--Except as provided in the last
three sentences of paragraph (3), the term `renewable
diesel' shall include fuel derived from biomass which
meets the requirements of a Department of Defense
specification for military jet fuel or an American
Society of Testing and Materials specification for
aviation turbine fuel.
``(B) Application of mixture credits.--In the case
of fuel which is treated as renewable diesel solely by
reason of subparagraph (A), subsection (b)(1) and
section 6426(c) shall be applied with respect to such
fuel by treating kerosene as though it were diesel
fuel.''.
(f) Effective Date.--
(1) In general.--Except as otherwise provided in this
subsection, the amendments made by this section shall apply to
fuel produced, and sold or used, after December 31, 2008.
(2) Coproduction of renewable diesel with petroleum
feedstock.--The amendments made by subsection (c) shall apply
to fuel produced, and sold or used, after February 13, 2008.
SEC. 123. CLARIFICATION THAT CREDITS FOR FUEL ARE DESIGNED TO PROVIDE
AN INCENTIVE FOR UNITED STATES PRODUCTION.
(a) Alcohol Fuels Credit.--Subsection (d) of section 40 is amended
by adding at the end the following new paragraph:
``(7) Limitation to alcohol with connection to the united
states.--No credit shall be determined under this section with
respect to any alcohol which is produced outside the United
States for use as a fuel outside the United States. For
purposes of this paragraph, the term `United States' includes
any possession of the United States.''.
(b) Biodiesel Fuels Credit.--Subsection (d) of section 40A is
amended by adding at the end the following new paragraph:
``(5) Limitation to biodiesel with connection to the united
states.--No credit shall be determined under this section with
respect to any biodiesel which is produced outside the United
States for use as a fuel outside the United States. For
purposes of this paragraph, the term `United States' includes
any possession of the United States.''.
(c) Excise Tax Credit.--
(1) In general.--Section 6426 is amended by adding at the
end the following new subsection:
``(i) Limitation to Fuels With Connection to the United States.--
``(1) Alcohol.--No credit shall be determined under this
section with respect to any alcohol which is produced outside
the United States for use as a fuel outside the United States.
``(2) Biodiesel and alternative fuels.--No credit shall be
determined under this section with respect to any biodiesel or
alternative fuel which is produced outside the United States
for use as a fuel outside the United States.
For purposes of this subsection, the term `United States' includes any
possession of the United States.''.
(2) Conforming amendment.--Subsection (e) of section 6427
is amended by redesignating paragraph (5) as paragraph (6) and
by inserting after paragraph (4) the following new paragraph:
``(5) Limitation to fuels with connection to the united
states.--No amount shall be payable under paragraph (1) or (2)
with respect to any mixture or alternative fuel if credit is
not allowed with respect to such mixture or alternative fuel by
reason of section 6426(i).''.
(d) Effective Date.--The amendments made by this section shall
apply to claims for credit or payment made on or after May 15, 2008.
SEC. 124. CREDIT FOR NEW QUALIFIED PLUG-IN ELECTRIC DRIVE MOTOR
VEHICLES.
(a) In General.--Section 30 is amended to read as follows:
``SEC. 30. NEW QUALIFIED PLUG-IN ELECTRIC DRIVE MOTOR VEHICLES.
``(a) Allowance of Credit.--There shall be allowed as a credit
against the tax imposed by this chapter for the taxable year an amount
equal to the sum of the credit amounts determined under subsection (b)
with respect to each new qualified plug-in electric drive motor vehicle
placed in service by the taxpayer during the taxable year.
``(b) Per Vehicle Dollar Limitation.--
``(1) In general.--The amount determined under this
subsection with respect to any new qualified plug-in electric
drive motor vehicle is the sum of the amounts determined under
paragraphs (2) and (3) with respect to such vehicle.
``(2) Base amount.--The amount determined under this
paragraph is $3,000.
``(3) Battery capacity.--In the case of a vehicle which
draws propulsion energy from a battery with not less than 5
kilowatt hours of capacity, the amount determined under this
paragraph is $200, plus $200 for each kilowatt hour of capacity
in excess of 5 kilowatt hours. The amount determined under this
paragraph shall not exceed $2,000.
``(c) Application With Other Credits.--
``(1) Business credit treated as part of general business
credit.--So much of the credit which would be allowed under
subsection (a) for any taxable year (determined without regard
to this subsection) that is attributable to property of a
character subject to an allowance for depreciation shall be
treated as a credit listed in section 38(b) for such taxable
year (and not allowed under subsection (a)).
``(2) Personal credit.--
``(A) In general.--For purposes of this title, the
credit allowed under subsection (a) for any taxable
year (determined after application of paragraph (1))
shall be treated as a credit allowable under subpart A
for such taxable year.
``(B) Limitation based on amount of tax.--In the
case of a taxable year to which section 26(a)(2) does
not apply, the credit allowed under subsection (a) for
any taxable year (determined after application of
paragraph (1)) shall not exceed the excess of--
``(i) the sum of the regular tax liability
(as defined in section 26(b)) plus the tax
imposed by section 55, over
``(ii) the sum of the credits allowable
under subpart A (other than this section and
sections 23 and 25D) and section 27 for the
taxable year.
``(d) New Qualified Plug-In Electric Drive Motor Vehicle.--For
purposes of this section--
``(1) In general.--The term `new qualified plug-in electric
drive motor vehicle' means a motor vehicle--
``(A) the original use of which commences with the
taxpayer,
``(B) which is acquired for use or lease by the
taxpayer and not for resale,
``(C) which is made by a manufacturer,
``(D) which has a gross vehicle weight rating of
less than 14,000 pounds,
``(E) which has received a certificate of
conformity under the Clean Air Act and meets or exceeds
the Bin 5 Tier II emission standard established in
regulations prescribed by the Administrator of the
Environmental Protection Agency under section 202(i) of
the Clean Air Act for that make and model year vehicle,
and
``(F) which is propelled to a significant extent by
an electric motor which draws electricity from a
battery which--
``(i) has a capacity of not less than 4
kilowatt hours, and
``(ii) is capable of being recharged from
an external source of electricity.
``(2) Exception.--The term `new qualified plug-in electric
drive motor vehicle' shall not include any vehicle which is not
a passenger automobile or light truck if such vehicle has a
gross vehicle weight rating of less than 8,500 pounds.
``(3) Motor vehicle.--The term `motor vehicle' means any
vehicle which is manufactured primarily for use on public
streets, roads, and highways (not including a vehicle operated
exclusively on a rail or rails) and which has at least 4
wheels.
``(4) Other terms.--The terms `passenger automobile',
`light truck', and `manufacturer' have the meanings given such
terms in regulations prescribed by the Administrator of the
Environmental Protection Agency for purposes of the
administration of title II of the Clean Air Act (42 U.S.C. 7521
et seq.).
``(5) Battery capacity.--The term `capacity' means, with
respect to any battery, the quantity of electricity which the
battery is capable of storing, expressed in kilowatt hours, as
measured from a 100 percent state of charge to a 0 percent
state of charge.
``(e) Limitation on Number of New Qualified Plug-In Electric Drive
Motor Vehicles Eligible for Credit.--
``(1) In general.--In the case of a new qualified plug-in
electric drive motor vehicle sold during the phaseout period,
only the applicable percentage of the credit otherwise
allowable under subsection (a) shall be allowed.
``(2) Phaseout period.--For purposes of this subsection,
the phaseout period is the period beginning with the second
calendar quarter following the calendar quarter which includes
the first date on which the number of new qualified plug-in
electric drive motor vehicles manufactured by the manufacturer
of the vehicle referred to in paragraph (1) sold for use in the
United States after the date of the enactment of this section,
is at least 60,000.
``(3) Applicable percentage.--For purposes of paragraph
(1), the applicable percentage is--
``(A) 50 percent for the first 2 calendar quarters
of the phaseout period,
``(B) 25 percent for the 3d and 4th calendar
quarters of the phaseout period, and
``(C) 0 percent for each calendar quarter
thereafter.
``(4) Controlled groups.--Rules similar to the rules of
section 30B(f)(4) shall apply for purposes of this subsection.
``(f) Special Rules.--
``(1) Basis reduction.--The basis of any property for which
a credit is allowable under subsection (a) shall be reduced by
the amount of such credit (determined without regard to
subsection (c)).
``(2) Recapture.--The Secretary shall, by regulations,
provide for recapturing the benefit of any credit allowable
under subsection (a) with respect to any property which ceases
to be property eligible for such credit.
``(3) Property used outside united states, etc., not
qualified.--No credit shall be allowed under subsection (a)
with respect to any property referred to in section 50(b)(1) or
with respect to the portion of the cost of any property taken
into account under section 179.
``(4) Election not to take credit.--No credit shall be
allowed under subsection (a) for any vehicle if the taxpayer
elects to not have this section apply to such vehicle.
``(5) Property used by tax-exempt entity; interaction with
air quality and motor vehicle safety standards.--Rules similar
to the rules of paragraphs (6) and (10) of section 30B(h) shall
apply for purposes of this section.''.
(b) Coordination With Alternative Motor Vehicle Credit.--Section
30B(d)(3) is amended by adding at the end the following new
subparagraph:
``(D) Exclusion of plug-in vehicles.--Any vehicle
with respect to which a credit is allowable under
section 30 (determined without regard to subsection (c)
thereof) shall not be taken into account under this
section.''.
(c) Credit Made Part of General Business Credit.--Section 38(b) is
amended by striking ``plus'' at the end of paragraph (32), by striking
the period at the end of paragraph (33) and inserting ``, plus'', and
by adding at the end the following new paragraph:
``(34) the portion of the new qualified plug-in electric
drive motor vehicle credit to which section 30(c)(1)
applies.''.
(d) Conforming Amendments.--
(1)(A) Section 24(b)(3)(B), as amended by section 104, is
amended by striking ``and 25D'' and inserting ``25D, and 30''.
(B) Section 25(e)(1)(C)(ii) is amended by inserting ``30,''
after ``25D,''.
(C) Section 25B(g)(2), as amended by section 104, is
amended by striking ``and 25D'' and inserting ``, 25D, and
30''.
(D) Section 26(a)(1), as amended by section 104, is amended
by striking ``and 25D'' and inserting ``25D, and 30''.
(E) Section 1400C(d)(2) is amended by striking ``and 25D''
and inserting ``25D, and 30''.
(2) Section 30B(h)(1) is amended by striking ``section
30(c)(2)'' and inserting ``section 30(d)(3)''.
(3)(A) Section 53(d)(1)(B) is amended by striking clause
(iii) and redesignating clause (iv) as clause (iii).
(B) Subclause (II) of section 53(d)(1)(B)(iii), as so
redesignated, is amended by striking ``increased in the manner
provided in clause (iii)''.
(4) Section 55(c)(3) is amended by striking ``30(b)(3),''.
(5) Section 1016(a)(25) is amended by striking ``section
30(d)(1)'' and inserting ``section 30(f)(1)''.
(6) Section 6501(m) is amended by striking ``section
30(d)(4)'' and inserting ``section 30(f)(4)''.
(7) The item in the table of sections for subpart B of part
IV of subchapter A of chapter 1 is amended to read as follows:
``Sec. 30. New qualified plug-in electric drive motor vehicles.''.
(e) Treatment of Alternative Motor Vehicle Credit as a Personal
Credit.--
(1) In general.--Paragraph (2) of section 30B(g) is amended
to read as follows:
``(2) Personal credit.--The credit allowed under subsection
(a) for any taxable year (after application of paragraph (1))
shall be treated as a credit allowable under subpart A for such
taxable year.''.
(2) Conforming amendments.--
(A) Subparagraph (A) of section 30C(d)(2) is
amended by striking ``sections 27, 30, and 30B'' and
inserting ``section 27''.
(B) Paragraph (3) of section 55(c) is amended by
striking ``30B(g)(2),''.
(f) Effective Date.--
(1) In general.--Except as otherwise provided in this
subsection, the amendments made by this section shall apply to
taxable years beginning after December 31, 2008.
(2) Treatment of alternative motor vehicle credit as
personal credit.--The amendments made by subsection (e) shall
apply to taxable years beginning after December 31, 2007.
(g) Application of EGTRRA Sunset.--The amendment made by subsection
(d)(1)(A) shall be subject to title IX of the Economic Growth and Tax
Relief Reconciliation Act of 2001 in the same manner as the provision
of such Act to which such amendment relates.
SEC. 125. EXCLUSION FROM HEAVY TRUCK TAX FOR IDLING REDUCTION UNITS AND
ADVANCED INSULATION.
(a) In General.--Section 4053 is amended by adding at the end the
following new paragraphs:
``(9) Idling reduction device.--Any device or system of
devices which--
``(A) is designed to provide to a vehicle those
services (such as heat, air conditioning, or
electricity) that would otherwise require the operation
of the main drive engine while the vehicle is
temporarily parked or remains stationary using one or
more devices affixed to a tractor or truck, and
``(B) is determined by the Administrator of the
Environmental Protection Agency, in consultation with
the Secretary of Energy and the Secretary of
Transportation, to reduce idling of such vehicle at a
motor vehicle rest stop or other location where such
vehicles are temporarily parked or remain stationary.
``(10) Advanced insulation.--Any insulation that has an R
value of not less than R35 per inch.''.
(b) Effective Date.--The amendment made by this section shall apply
to sales or installations after the date of the enactment of this Act.
SEC. 126. TRANSPORTATION FRINGE BENEFIT TO BICYCLE COMMUTERS.
(a) In General.--Paragraph (1) of section 132(f) is amended by
adding at the end the following:
``(D) Any qualified bicycle commuting
reimbursement.''.
(b) Limitation on Exclusion.--Paragraph (2) of section 132(f) is
amended by striking ``and'' at the end of subparagraph (A), by striking
the period at the end of subparagraph (B) and inserting ``, and'', and
by adding at the end the following new subparagraph:
``(C) the applicable annual limitation in the case
of any qualified bicycle commuting reimbursement.''.
(c) Definitions.--Paragraph (5) of section 132(f) is amended by
adding at the end the following:
``(F) Definitions related to bicycle commuting
reimbursement.--
``(i) Qualified bicycle commuting
reimbursement.--The term `qualified bicycle
commuting reimbursement' means, with respect to
any calendar year, any employer reimbursement
during the 15-month period beginning with the
first day of such calendar year for reasonable
expenses incurred by the employee during such
calendar year for the purchase of a bicycle and
bicycle improvements, repair, and storage, if
such bicycle is regularly used for travel
between the employee's residence and place of
employment.
``(ii) Applicable annual limitation.--The
term `applicable annual limitation' means, with
respect to any employee for any calendar year,
the product of $20 multiplied by the number of
qualified bicycle commuting months during such
year.
``(iii) Qualified bicycle commuting
month.--The term `qualified bicycle commuting
month' means, with respect to any employee, any
month during which such employee--
``(I) regularly uses the bicycle
for a substantial portion of the travel
between the employee's residence and
place of employment, and
``(II) does not receive any benefit
described in subparagraph (A), (B), or
(C) of paragraph (1).''.
(d) Constructive Receipt of Benefit.--Paragraph (4) of section
132(f) is amended by inserting ``(other than a qualified bicycle
commuting reimbursement)'' after ``qualified transportation fringe''.
(e) Effective Date.--The amendments made by this section shall
apply to taxable years beginning after December 31, 2008.
SEC. 127. ALTERNATIVE FUEL VEHICLE REFUELING PROPERTY CREDIT.
(a) Increase in Credit Amount.--Section 30C is amended--
(1) by striking ``30 percent'' in subsection (a) and
inserting ``50 percent'',
(2) by striking ``$30,000'' in subsection (b)(1) and
inserting ``$50,000'', and
(3) by striking ``$1,000'' in subsection (b)(2) and
inserting ``$2,000''.
(b) Extension of Credit.--Subsection (g) of section 30C is amended
to read as follows:
``(g) Termination.--This section shall not apply to any property
placed in service after--
``(1) December 31 2017, in the case of property relating to
natural gas, compressed natural gas, or liquified natural gas,
and which is not of a character subject to an allowance for
depreciation,
``(2) December 31, 2014, in the case of--
``(A) property relating to hydrogen, and
``(B) property relating to natural gas, compressed
natural gas, or liquified natural gas, and which is of
a character subject to an allowance for depreciation,
and
``(3) December 31, 2010, in any other case.''.
(c) Effective Date.--The amendments made by this section shall
apply to property placed in service after the date of the enactment of
this Act, in taxable years ending after such date.
SEC. 128. CERTAIN INCOME AND GAINS RELATING TO ALCOHOL FUELS AND
MIXTURES, BIODIESEL FUELS AND MIXTURES, AND ALTERNATIVE
FUELS AND MIXTURES TREATED AS QUALIFYING INCOME FOR
PUBLICLY TRADED PARTNERSHIPS.
(a) In General.--Subparagraph (E) of section 7704(d)(1) is amended
by inserting ``, or the transportation or storage of any fuel described
in subsection (b), (c), (d), or (e) of section 6426, or any alcohol
fuel defined in section 6426(b)(4)(A) or any biodiesel fuel as defined
in section 40A(d)(1)'' after ``timber)''.
(b) Effective Date.--The amendment made by this section shall apply
to taxable years beginning after the date of the enactment of this Act.
Subtitle C--Energy Conservation and Efficiency Provisions
SEC. 131. CREDIT FOR NONBUSINESS ENERGY PROPERTY.
(a) Extension of Credit.--Section 25C(g) is amended by striking
``placed in service after December 31, 2007'' and inserting ``placed in
service--
``(1) after December 31, 2007, and before January 1, 2009,
or
``(2) after December 31, 2009.''.
(b) Qualified Biomass Fuel Property.--
(1) In general.--Section 25C(d)(3) is amended--
(A) by striking ``and'' at the end of subparagraph
(D),
(B) by striking the period at the end of
subparagraph (E) and inserting ``, and'', and
(C) by adding at the end the following new
subparagraph:
``(F) a stove which uses the burning of biomass
fuel to heat a dwelling unit located in the United
States and used as a residence by the taxpayer, or to
heat water for use in such a dwelling unit, and which
has a thermal efficiency rating of at least 75
percent.''.
(2) Biomass fuel.--Section 25C(d) is amended by adding at
the end the following new paragraph:
``(6) Biomass fuel.--The term `biomass fuel' means any
plant-derived fuel available on a renewable or recurring basis,
including agricultural crops and trees, wood and wood waste and
residues (including wood pellets), plants (including aquatic
plants), grasses, residues, and fibers.''.
(c) Coordination With Credit for Qualified Geothermal Heat Pump
Property Expenditures.--
(1) In general.--Paragraph (3) of section 25C(d), as
amended by subsection (b), is amended by striking subparagraph
(C) and by redesignating subparagraphs (D), (E), and (F) as
subparagraphs (C), (D), and (E), respectively.
(2) Conforming amendment.--Subparagraph (C) of section
25C(d)(2) is amended to read as follows:
``(C) Requirements and standards for air
conditioners and heat pumps.--The standards and
requirements prescribed by the Secretary under
subparagraph (B) with respect to the energy efficiency
ratio (EER) for central air conditioners and electric
heat pumps--
``(i) shall require measurements to be
based on published data which is tested by
manufacturers at 95 degrees Fahrenheit, and
``(ii) may be based on the certified data
of the Air Conditioning and Refrigeration
Institute that are prepared in partnership with
the Consortium for Energy Efficiency.''.
(d) Effective Date.--The amendments made by this section shall
apply to expenditures made after December 31, 2008.
SEC. 132. ENERGY EFFICIENT COMMERCIAL BUILDINGS DEDUCTION.
Subsection (h) of section 179D is amended by striking ``December
31, 2008'' and inserting ``December 31, 2013''.
SEC. 133. MODIFICATIONS OF ENERGY EFFICIENT APPLIANCE CREDIT FOR
APPLIANCES PRODUCED AFTER 2007.
(a) In General.--Subsection (b) of section 45M is amended to read
as follows:
``(b) Applicable Amount.--For purposes of subsection (a)--
``(1) Dishwashers.--The applicable amount is--
``(A) $45 in the case of a dishwasher which is
manufactured in calendar year 2008 or 2009 and which
uses no more than 324 kilowatt hours per year and 5.8
gallons per cycle, and
``(B) $75 in the case of a dishwasher which is
manufactured in calendar year 2008, 2009, or 2010 and
which uses no more than 307 kilowatt hours per year and
5.0 gallons per cycle (5.5 gallons per cycle for
dishwashers designed for greater than 12 place
settings).
``(2) Clothes washers.--The applicable amount is--
``(A) $75 in the case of a residential top-loading
clothes washer manufactured in calendar year 2008 which
meets or exceeds a 1.72 modified energy factor and does
not exceed a 8.0 water consumption factor,
``(B) $125 in the case of a residential top-loading
clothes washer manufactured in calendar year 2008 or
2009 which meets or exceeds a 1.8 modified energy
factor and does not exceed a 7.5 water consumption
factor,
``(C) $150 in the case of a residential or
commercial clothes washer manufactured in calendar year
2008, 2009, or 2010 which meets or exceeds 2.0 modified
energy factor and does not exceed a 6.0 water
consumption factor, and
``(D) $250 in the case of a residential or
commercial clothes washer manufactured in calendar year
2008, 2009, or 2010 which meets or exceeds 2.2 modified
energy factor and does not exceed a 4.5 water
consumption factor.
``(3) Refrigerators.--The applicable amount is--
``(A) $50 in the case of a refrigerator which is
manufactured in calendar year 2008, and consumes at
least 20 percent but not more than 22.9 percent less
kilowatt hours per year than the 2001 energy
conservation standards,
``(B) $75 in the case of a refrigerator which is
manufactured in calendar year 2008 or 2009, and
consumes at least 23 percent but no more than 24.9
percent less kilowatt hours per year than the 2001
energy conservation standards,
``(C) $100 in the case of a refrigerator which is
manufactured in calendar year 2008, 2009, or 2010, and
consumes at least 25 percent but not more than 29.9
percent less kilowatt hours per year than the 2001
energy conservation standards, and
``(D) $200 in the case of a refrigerator
manufactured in calendar year 2008, 2009, or 2010 and
which consumes at least 30 percent less energy than the
2001 energy conservation standards.''.
(b) Eligible Production.--
(1) Similar treatment for all appliances.--Subsection (c)
of section 45M is amended--
(A) by striking paragraph (2),
(B) by striking ``(1) In general'' and all that
follows through ``the eligible'' and inserting ``The
eligible'',
(C) by moving the text of such subsection in line
with the subsection heading, and
(D) by redesignating subparagraphs (A) and (B) as
paragraphs (1) and (2), respectively, and by moving
such paragraphs 2 ems to the left.
(2) Modification of base period.--Paragraph (2) of section
45M(c), as amended by paragraph (1), is amended by striking
``3-calendar year'' and inserting ``2-calendar year''.
(c) Types of Energy Efficient Appliances.--Subsection (d) of
section 45M (defining types of energy efficient appliances) is amended
to read as follows:
``(d) Types of Energy Efficient Appliance.--For purposes of this
section, the types of energy efficient appliances are--
``(1) dishwashers described in subsection (b)(1),
``(2) clothes washers described in subsection (b)(2), and
``(3) refrigerators described in subsection (b)(3).''.
(d) Aggregate Credit Amount Allowed.--
(1) Increase in limit.--Paragraph (1) of section 45M(e) is
amended to read as follows:
``(1) Aggregate credit amount allowed.--The aggregate
amount of credit allowed under subsection (a) with respect to a
taxpayer for any taxable year shall not exceed $75,000,000
reduced by the amount of the credit allowed under subsection
(a) to the taxpayer (or any predecessor) for all prior taxable
years beginning after December 31, 2007.''.
(2) Exception for certain refrigerator and clothes
washers.--Paragraph (2) of section 45M(e) is amended to read as
follows:
``(2) Amount allowed for certain refrigerators and clothes
washers.--Refrigerators described in subsection (b)(3)(D) and
clothes washers described in subsection (b)(2)(D) shall not be
taken into account under paragraph (1).''.
(e) Qualified Energy Efficient Appliances.--
(1) In general.--Paragraph (1) of section 45M(f) (defining
qualified energy efficient appliance) is amended to read as
follows:
``(1) Qualified energy efficient appliance.--The term
`qualified energy efficient appliance' means--
``(A) any dishwasher described in subsection
(b)(1),
``(B) any clothes washer described in subsection
(b)(2), and
``(C) any refrigerator described in subsection
(b)(3).''.
(2) Clothes washer.--Section 45M(f)(3) is amended by
inserting ``commercial'' before ``residential'' the second
place it appears.
(3) Top-loading clothes washer.--Subsection (f) of section
45M is amended by redesignating paragraphs (4), (5), (6), and
(7) as paragraphs (5), (6), (7), and (8), respectively, and by
inserting after paragraph (3) the following new paragraph:
``(4) Top-loading clothes washer.--The term `top-loading
clothes washer' means a clothes washer which has the clothes
container compartment access located on the top of the machine
and which operates on a vertical axis.''.
(4) Replacement of energy factor.--Section 45M(f)(6), as
redesignated by paragraph (3), is amended to read as follows:
``(6) Modified energy factor.--The term `modified energy
factor' means the modified energy factor established by the
Department of Energy for compliance with the Federal energy
conservation standard.''.
(5) Gallons per cycle; water consumption factor.--Section
45M(f), as amended by paragraph (3), is amended by adding at
the end the following:
``(9) Gallons per cycle.--The term `gallons per cycle'
means, with respect to a dishwasher, the amount of water,
expressed in gallons, required to complete a normal cycle of a
dishwasher.
``(10) Water consumption factor.--The term `water
consumption factor' means, with respect to a clothes washer,
the quotient of the total weighted per-cycle water consumption
divided by the cubic foot (or liter) capacity of the clothes
washer.''.
(f) Effective Date.--The amendments made by this section shall
apply to appliances produced after December 31, 2007.
SEC. 134. ACCELERATED RECOVERY PERIOD FOR DEPRECIATION OF SMART METERS
AND SMART GRID SYSTEMS.
(a) In General.--Section 168(e)(3)(D) is amended by striking
``and'' at the end of clause (i), by striking the period at the end of
clause (ii) and inserting a comma, and by inserting after clause (ii)
the following new clauses:
``(iii) any qualified smart electric meter,
and
``(iv) any qualified smart electric grid
system.''.
(b) Definitions.--Section 168(i) is amended by inserting at the end
the following new paragraph:
``(18) Qualified smart electric meters.--
``(A) In general.--The term `qualified smart
electric meter' means any smart electric meter which is
placed in service by a taxpayer who is a supplier of
electric energy or a provider of electric energy
services.
``(B) Smart electric meter.--For purposes of
subparagraph (A), the term `smart electric meter' means
any time-based meter and related communication
equipment which is capable of being used by the
taxpayer as part of a system that--
``(i) measures and records electricity
usage data on a time-differentiated basis in at
least 24 separate time segments per day,
``(ii) provides for the exchange of
information between supplier or provider and
the customer's electric meter in support of
time-based rates or other forms of demand
response,
``(iii) provides data to such supplier or
provider so that the supplier or provider can
provide energy usage information to customers
electronically, and
``(iv) provides net metering.
``(19) Qualified smart electric grid systems.--
``(A) In general.--The term `qualified smart
electric grid system' means any smart grid property
used as part of a system for electric distribution grid
communications, monitoring, and management placed in
service by a taxpayer who is a supplier of electric
energy or a provider of electric energy services.
``(B) Smart grid property.--For the purposes of
subparagraph (A), the term `smart grid property' means
electronics and related equipment that is capable of--
``(i) sensing, collecting, and monitoring
data of or from all portions of a utility's
electric distribution grid,
``(ii) providing real-time, two-way
communications to monitor or manage such grid,
and
``(iii) providing real time analysis of and
event prediction based upon collected data that
can be used to improve electric distribution
system reliability, quality, and
performance.''.
(c) Continued Application of 150 Percent Declining Balance
Method.--Paragraph (2) of section 168(b) is amended by striking ``or''
at the end of subparagraph (B), by redesignating subparagraph (C) as
subparagraph (D), and by inserting after subparagraph (B) the following
new subparagraph:
``(C) any property (other than property described
in paragraph (3)) which is a qualified smart electric
meter or qualified smart electric grid system, or''.
(d) Effective Date.--The amendments made by this section shall
apply to property placed in service after the date of the enactment of
this Act.
SEC. 135. QUALIFIED GREEN BUILDING AND SUSTAINABLE DESIGN PROJECTS.
(a) In General.--Paragraph (8) of section 142(l) is amended by
striking ``September 30, 2009'' and inserting ``September 30, 2012''.
(b) Treatment of Current Refunding Bonds.--Paragraph (9) of section
142(l) is amended by striking ``October 1, 2009'' and inserting
``October 1, 2012''.
(c) Accountability.--The second sentence of section 701(d) of the
American Jobs Creation Act of 2004 is amended by striking ``issuance,''
and inserting ``issuance of the last issue with respect to such
project,''.
TITLE II--REVENUE PROVISIONS
SEC. 201. LIMITATION OF DEDUCTION FOR INCOME ATTRIBUTABLE TO DOMESTIC
PRODUCTION OF OIL, GAS, OR PRIMARY PRODUCTS THEREOF.
(a) In General.--Section 199(d) is amended by redesignating
paragraph (9) as paragraph (10) and by inserting after paragraph (8)
the following new paragraph:
``(9) Special rule for taxpayers with oil related qualified
production activities income.--
``(A) In general.--If a taxpayer has oil related
qualified production activities income for any taxable
year beginning after 2009, the amount otherwise
allowable as a deduction under subsection (a) shall be
reduced by 3 percent of the least of--
``(i) the oil related qualified production
activities income of the taxpayer for the
taxable year,
``(ii) the qualified production activities
income of the taxpayer for the taxable year, or
``(iii) taxable income (determined without
regard to this section).
``(B) Oil related qualified production activities
income.--For purposes of this paragraph, the term `oil
related qualified production activities income' means
for any taxable year the qualified production
activities income which is attributable to the
production, refining, processing, transportation, or
distribution of oil, gas, or any primary product
thereof during such taxable year.
``(C) Primary product.--For purposes of this
paragraph, the term `primary product' has the same
meaning as when used in section 927(a)(2)(C), as in
effect before its repeal.''.
(b) Conforming Amendment.--Section 199(d)(2) (relating to
application to individuals) is amended by striking ``subsection
(a)(1)(B)'' and inserting ``subsections (a)(1)(B) and (d)(9)(A)(iii)''.
(c) Effective Date.--The amendments made by this section shall
apply to taxable years beginning after December 31, 2008.
SEC. 202. ELIMINATION OF THE DIFFERENT TREATMENT OF FOREIGN OIL AND GAS
EXTRACTION INCOME AND FOREIGN OIL RELATED INCOME FOR
PURPOSES OF THE FOREIGN TAX CREDIT.
(a) In General.--Subsections (a) and (b) of section 907 (relating
to special rules in case of foreign oil and gas income) are amended to
read as follows:
``(a) Reduction in Amount Allowed as Foreign Tax Under Section
901.--In applying section 901, the amount of any foreign oil and gas
taxes paid or accrued (or deemed to have been paid) during the taxable
year which would (but for this subsection) be taken into account for
purposes of section 901 shall be reduced by the amount (if any) by
which the amount of such taxes exceeds the product of--
``(1) the amount of the combined foreign oil and gas income
for the taxable year,
``(2) multiplied by--
``(A) in the case of a corporation, the percentage
which is equal to the highest rate of tax specified
under section 11(b), or
``(B) in the case of an individual, a fraction the
numerator of which is the tax against which the credit
under section 901(a) is taken and the denominator of
which is the taxpayer's entire taxable income.
``(b) Combined Foreign Oil and Gas Income; Foreign Oil and Gas
Taxes.--For purposes of this section--
``(1) Combined foreign oil and gas income.--The term
`combined foreign oil and gas income' means, with respect to
any taxable year, the sum of--
``(A) foreign oil and gas extraction income, and
``(B) foreign oil related income.
``(2) Foreign oil and gas taxes.--The term `foreign oil and
gas taxes' means, with respect to any taxable year, the sum
of--
``(A) oil and gas extraction taxes, and
``(B) any income, war profits, and excess profits
taxes paid or accrued (or deemed to have been paid or
accrued under section 902 or 960) during the taxable
year with respect to foreign oil related income
(determined without regard to subsection (c)(4)) or
loss which would be taken into account for purposes of
section 901 without regard to this section.''.
(b) Recapture of Foreign Oil and Gas Losses.--Paragraph (4) of
section 907(c) (relating to recapture of foreign oil and gas extraction
losses by recharacterizing later extraction income) is amended to read
as follows:
``(4) Recapture of foreign oil and gas losses by
recharacterizing later combined foreign oil and gas income.--
``(A) In general.--The combined foreign oil and gas
income of a taxpayer for a taxable year (determined
without regard to this paragraph) shall be reduced--
``(i) first by the amount determined under
subparagraph (B), and
``(ii) then by the amount determined under
subparagraph (C).
The aggregate amount of such reductions shall be
treated as income (from sources without the United
States) which is not combined foreign oil and gas
income.
``(B) Reduction for pre-2009 foreign oil extraction
losses.--The reduction under this paragraph shall be
equal to the lesser of--
``(i) the foreign oil and gas extraction
income of the taxpayer for the taxable year
(determined without regard to this paragraph),
or
``(ii) the excess of--
``(I) the aggregate amount of
foreign oil extraction losses for
preceding taxable years beginning after
December 31, 1982, and before January
1, 2009, over
``(II) so much of such aggregate
amount as was recharacterized under
this paragraph (as in effect before and
after the date of the enactment of the
Energy Improvement and Extension Act of
2008) for preceding taxable years
beginning after December 31, 1982.
``(C) Reduction for post-2008 foreign oil and gas
losses.--The reduction under this paragraph shall be
equal to the lesser of--
``(i) the combined foreign oil and gas
income of the taxpayer for the taxable year
(determined without regard to this paragraph),
reduced by an amount equal to the reduction
under subparagraph (A) for the taxable year, or
``(ii) the excess of--
``(I) the aggregate amount of
foreign oil and gas losses for
preceding taxable years beginning after
December 31, 2008, over
``(II) so much of such aggregate
amount as was recharacterized under
this paragraph for preceding taxable
years beginning after December 31,
2008.
``(D) Foreign oil and gas loss defined.--
``(i) In general.--For purposes of this
paragraph, the term `foreign oil and gas loss'
means the amount by which--
``(I) the gross income for the
taxable year from sources without the
United States and its possessions
(whether or not the taxpayer chooses
the benefits of this subpart for such
taxable year) taken into account in
determining the combined foreign oil
and gas income for such year, is
exceeded by
``(II) the sum of the deductions
properly apportioned or allocated
thereto.
``(ii) Net operating loss deduction not
taken into account.--For purposes of clause
(i), the net operating loss deduction allowable
for the taxable year under section 172(a) shall
not be taken into account.
``(iii) Expropriation and casualty losses
not taken into account.--For purposes of clause
(i), there shall not be taken into account--
``(I) any foreign expropriation
loss (as defined in section 172(h) (as
in effect on the day before the date of
the enactment of the Revenue
Reconciliation Act of 1990)) for the
taxable year, or
``(II) any loss for the taxable
year which arises from fire, storm,
shipwreck, or other casualty, or from
theft,
to the extent such loss is not compensated for
by insurance or otherwise.
``(iv) Foreign oil extraction loss.--For
purposes of subparagraph (B)(ii)(I), foreign
oil extraction losses shall be determined under
this paragraph as in effect on the day before
the date of the enactment of the Energy
Improvement and Extension Act of 2008.''.
(c) Carryback and Carryover of Disallowed Credits.--Section 907(f)
(relating to carryback and carryover of disallowed credits) is
amended--
(1) by striking ``oil and gas extraction taxes'' each place
it appears and inserting ``foreign oil and gas taxes'', and
(2) by adding at the end the following new paragraph:
``(4) Transition rules for pre-2009 and 2009 disallowed
credits.--
``(A) Pre-2009 credits.--In the case of any unused
credit year beginning before January 1, 2009, this
subsection shall be applied to any unused oil and gas
extraction taxes carried from such unused credit year
to a year beginning after December 31, 2008--
``(i) by substituting `oil and gas
extraction taxes' for `foreign oil and gas
taxes' each place it appears in paragraphs (1),
(2), and (3), and
``(ii) by computing, for purposes of
paragraph (2)(A), the limitation under
subparagraph (A) for the year to which such
taxes are carried by substituting `foreign oil
and gas extraction income' for `foreign oil and
gas income' in subsection (a).
``(B) 2009 credits.--In the case of any unused
credit year beginning in 2009, the amendments made to
this subsection by the Energy Improvement and Extension
Act of 2008 shall be treated as being in effect for any
preceding year beginning before January 1, 2009, solely
for purposes of determining how much of the unused
foreign oil and gas taxes for such unused credit year
may be deemed paid or accrued in such preceding
year.''.
(d) Conforming Amendment.--Section 6501(i) is amended by striking
``oil and gas extraction taxes'' and inserting ``foreign oil and gas
taxes''.
(e) Effective Date.--The amendments made by this section shall
apply to taxable years beginning after December 31, 2008.
SEC. 203. BROKER REPORTING OF CUSTOMER'S BASIS IN SECURITIES
TRANSACTIONS.
(a) In General.--
(1) Broker reporting for securities transactions.--Section
6045 is amended by adding at the end the following new
subsection:
``(g) Additional Information Required in the Case of Securities
Transactions, etc.--
``(1) In general.--If a broker is otherwise required to
make a return under subsection (a) with respect to the gross
proceeds of the sale of a covered security, the broker shall
include in such return the information described in paragraph
(2).
``(2) Additional information required.--
``(A) In general.--The information required under
paragraph (1) to be shown on a return with respect to a
covered security of a customer shall include the
customer's adjusted basis in such security and whether
any gain or loss with respect to such security is long-
term or short-term (within the meaning of section
1222).
``(B) Determination of adjusted basis.--For
purposes of subparagraph (A)--
``(i) In general.--The customer's adjusted
basis shall be determined--
``(I) in the case of any security
(other than any stock for which an
average basis method is permissible
under section 1012), in accordance with
the first-in first-out method unless
the customer notifies the broker by
means of making an adequate
identification of the stock sold or
transferred, and
``(II) in the case of any stock for
which an average basis method is
permissible under section 1012, in
accordance with the broker's default
method unless the customer notifies the
broker that he elects another
acceptable method under section 1012
with respect to the account in which
such stock is held.
``(ii) Exception for wash sales.--Except as
otherwise provided by the Secretary, the
customer's adjusted basis shall be determined
without regard to section 1091 (relating to
loss from wash sales of stock or securities)
unless the transactions occur in the same
account with respect to identical securities.
``(3) Covered security.--For purposes of this subsection--
``(A) In general.--The term `covered security'
means any specified security acquired on or after the
applicable date if such security--
``(i) was acquired through a transaction in
the account in which such security is held, or
``(ii) was transferred to such account from
an account in which such security was a covered
security, but only if the broker received a
statement under section 6045A with respect to
the transfer.
``(B) Specified security.--The term `specified
security' means--
``(i) any share of stock in a corporation,
``(ii) any note, bond, debenture, or other
evidence of indebtedness,
``(iii) any commodity, or contract or
derivative with respect to such commodity, if
the Secretary determines that adjusted basis
reporting is appropriate for purposes of this
subsection, and
``(iv) any other financial instrument with
respect to which the Secretary determines that
adjusted basis reporting is appropriate for
purposes of this subsection.
``(C) Applicable date.--The term `applicable date'
means--
``(i) January 1, 2011, in the case of any
specified security which is stock in a
corporation (other than any stock described in
clause (ii)),
``(ii) January 1, 2012, in the case of any
stock for which an average basis method is
permissible under section 1012, and
``(iii) January 1, 2013, or such later date
determined by the Secretary in the case of any
other specified security.
``(4) Treatment of s corporations.--In the case of the sale
of a covered security acquired by an S corporation (other than
a financial institution) after December 31, 2011, such S
corporation shall be treated in the same manner as a
partnership for purposes of this section.
``(5) Special rules for short sales.--In the case of a
short sale, reporting under this section shall be made for the
year in which such sale is closed.''.
(2) Broker information required with respect to options.--
Section 6045, as amended by subsection (a), is amended by
adding at the end the following new subsection:
``(h) Application to Options on Securities.--
``(1) Exercise of option.--For purposes of this section, if
a covered security is acquired or disposed of pursuant to the
exercise of an option that was granted or acquired in the same
account as the covered security, the amount received with
respect to the grant or paid with respect to the acquisition of
such option shall be treated as an adjustment to gross proceeds
or as an adjustment to basis, as the case may be.
``(2) Lapse or closing transaction.--In the case of the
lapse (or closing transaction (as defined in section
1234(b)(2)(A))) of an option on a specified security or the
exercise of a cash-settled option on a specified security,
reporting under subsections (a) and (g) with respect to such
option shall be made for the calendar year which includes the
date of such lapse, closing transaction, or exercise.
``(3) Prospective application.--Paragraphs (1) and (2)
shall not apply to any option which is granted or acquired
before January 1, 2013.
``(4) Definitions.--For purposes of this subsection, the
terms `covered security' and `specified security' shall have
the meanings given such terms in subsection (g)(3).''.
(3) Extension of period for statements sent to customers.--
(A) In general.--Subsection (b) of section 6045 is
amended by striking ``January 31'' and inserting
``February 15''.
(B) Statements related to substitute payments.--
Subsection (d) of section 6045 is amended--
(i) by striking ``at such time and'', and
(ii) by inserting after ``other item.'' the
following new sentence: ``The written statement
required under the preceding sentence shall be
furnished on or before February 15 of the year
following the calendar year in which the
payment was made.''.
(C) Other statements.--Subsection (b) of section
6045 is amended by adding at the end the following:
``In the case of a consolidated reporting statement (as
defined in regulations) with respect to any customer,
any statement which would otherwise be required to be
furnished on or before January 31 of a calendar year
with respect to any item reportable to the taxpayer
shall instead be required to be furnished on or before
February 15 of such calendar year if furnished with
such consolidated reporting statement.''.
(b) Determination of Basis of Certain Securities on Account by
Account or Average Basis Method.--Section 1012 is amended--
(1) by striking ``The basis of property'' and inserting the
following:
``(a) In General.--The basis of property'',
(2) by striking ``The cost of real property'' and inserting
the following:
``(b) Special Rule for Apportioned Real Estate Taxes.--The cost of
real property'', and
(3) by adding at the end the following new subsections:
``(c) Determinations by Account.--
``(1) In general.--In the case of the sale, exchange, or
other disposition of a specified security on or after the
applicable date, the conventions prescribed by regulations
under this section shall be applied on an account by account
basis.
``(2) Application to certain regulated investment
companies.--
``(A) In general.--Except as provided in
subparagraph (B), any stock for which an average basis
method is permissible under section 1012 which is
acquired before January 1, 2012, shall be treated as a
separate account from any such stock acquired on or
after such date.
``(B) Election for treatment as single account.--If
a regulated investment company elects to have this
subparagraph apply with respect to one or more of its
stockholders--
``(i) subparagraph (A) shall not apply with
respect to any stock in such company held by
such stockholders, and
``(ii) all stock in such company which is
held by such stockholders shall be treated as
covered securities described in section
6045(g)(3) without regard to the date of the
acquisition of such stock.
A rule similar to the rule of the preceding sentence
shall apply with respect to a broker holding such stock
as a nominee.
``(3) Definitions.--For purposes of this section, the terms
`specified security' and `applicable date' shall have the
meaning given such terms in section 6045(g).
``(d) Average Basis for Stock Acquired Pursuant to a Periodic Stock
Investment Plan.--
``(1) In general.--In the case of any stock acquired after
December 31, 2010, in connection with a periodic stock
investment plan, the basis of such stock while held as part of
such plan shall be determined using one of the methods which
may be used for determining the basis of stock in a regulated
investment company.
``(2) Treatment after transfer.--In the case of the
transfer to another account of stock to which paragraph (1)
applies, such stock shall have a cost basis in such other
account equal to its basis in the periodic stock investment
plan immediately before such transfer (properly adjusted for
any fees or other charges taken into account in connection with
such transfer).
``(3) Separate accounts; election for treatment as single
account.--Rules similar to the rules of subsection (c)(2) shall
apply for purposes of this subsection.
``(4) Periodic stock investment plan.--For purposes of this
subsection--
``(A) In general.--The term `periodic stock
investment plan' means--
``(i) any stock purchase plan, and
``(ii) any dividend reinvestment plan.
``(B) Stock purchase plan.--The term `stock
purchase plan' means any arrangement under which
identical stock is periodically purchased pursuant to a
written plan.
``(C) Dividend reinvestment plan.--
``(i) In general.--The term `dividend
reinvestment plan' means any arrangement under
which dividends on any stock are reinvested in
stock identical to the stock with respect to
which the dividends are paid.
``(ii) Initial stock acquisition treated as
acquired in connection with plan.--Stock shall
be treated as acquired in connection with a
dividend reinvestment plan if such stock is
acquired pursuant to such plan or if the
dividends paid on such stock are subject to
such plan.''.
(c) Information by Transferors to Aid Brokers.--
(1) In general.--Subpart B of part III of subchapter A of
chapter 61 is amended by inserting after section 6045 the
following new section:
``SEC. 6045A. INFORMATION REQUIRED IN CONNECTION WITH TRANSFERS OF
COVERED SECURITIES TO BROKERS.
``(a) Furnishing of Information.--Every applicable person which
transfers to a broker (as defined in section 6045(c)(1)) a security
which is a covered security (as defined in section 6045(g)(3)) in the
hands of such applicable person shall furnish to such broker a written
statement in such manner and setting forth such information as the
Secretary may by regulations prescribe for purposes of enabling such
broker to meet the requirements of section 6045(g).
``(b) Applicable Person.--For purposes of subsection (a), the term
`applicable person' means--
``(1) any broker (as defined in section 6045(c)(1)), and
``(2) any other person as provided by the Secretary in
regulations.
``(c) Time for Furnishing Statement.--Except as otherwise provided
by the Secretary, any statement required by subsection (a) shall be
furnished not later than 15 days after the date of the transfer
described in such subsection.''.
(2) Assessable penalties.--Paragraph (2) of section 6724(d)
is amended by redesignating subparagraphs (I) through (DD) as
subparagraphs (J) through (EE), respectively, and by inserting
after subparagraph (H) the following new subparagraph:
``(I) section 6045A (relating to information
required in connection with transfers of covered
securities to brokers),''.
(3) Clerical amendment.--The table of sections for subpart
B of part III of subchapter A of chapter 61 is amended by
inserting after the item relating to section 6045 the following
new item:
``Sec. 6045A. Information required in connection with transfers of
covered securities to brokers.''.
(d) Additional Issuer Information To Aid Brokers.--
(1) In general.--Subpart B of part III of subchapter A of
chapter 61, as amended by subsection (b), is amended by
inserting after section 6045A the following new section:
``SEC. 6045B. RETURNS RELATING TO ACTIONS AFFECTING BASIS OF SPECIFIED
SECURITIES.
``(a) In General.--According to the forms or regulations prescribed
by the Secretary, any issuer of a specified security shall make a
return setting forth--
``(1) a description of any organizational action which
affects the basis of such specified security of such issuer,
``(2) the quantitative effect on the basis of such
specified security resulting from such action, and
``(3) such other information as the Secretary may
prescribe.
``(b) Time for Filing Return.--Any return required by subsection
(a) shall be filed not later than the earlier of--
``(1) 45 days after the date of the action described in
subsection (a), or
``(2) January 15 of the year following the calendar year
during which such action occurred.
``(c) Statements To Be Furnished to Holders of Specified Securities
or Their Nominees.--According to the forms or regulations prescribed by
the Secretary, every person required to make a return under subsection
(a) with respect to a specified security shall furnish to the nominee
with respect to the specified security (or certificate holder if there
is no nominee) a written statement showing--
``(1) the name, address, and phone number of the
information contact of the person required to make such return,
``(2) the information required to be shown on such return
with respect to such security, and
``(3) such other information as the Secretary may
prescribe.
The written statement required under the preceding sentence shall be
furnished to the holder on or before January 15 of the year following
the calendar year during which the action described in subsection (a)
occurred.
``(d) Specified Security.--For purposes of this section, the term
`specified security' has the meaning given such term by section
6045(g)(3)(B). No return shall be required under this section with
respect to actions described in subsection (a) with respect to a
specified security which occur before the applicable date (as defined
in section 6045(g)(3)(C)) with respect to such security.
``(e) Public Reporting in Lieu of Return.--The Secretary may waive
the requirements under subsections (a) and (c) with respect to a
specified security, if the person required to make the return under
subsection (a) makes publicly available, in such form and manner as the
Secretary determines necessary to carry out the purposes of this
section--
``(1) the name, address, phone number, and email address of
the information contact of such person, and
``(2) the information described in paragraphs (1), (2), and
(3) of subsection (a).''.
(2) Assessable penalties.--
(A) Subparagraph (B) of section 6724(d)(1) is
amended by redesignating clause (iv) and each of the
clauses which follow as clauses (v) through (xxiii),
respectively, and by inserting after clause (iii) the
following new clause:
``(iv) section 6045B(a) (relating to
returns relating to actions affecting basis of
specified securities),''.
(B) Paragraph (2) of section 6724(d), as amended by
subsection (c)(2), is amended by redesignating
subparagraphs (J) through (EE) as subparagraphs (K)
through (FF), respectively, and by inserting after
subparagraph (I) the following new subparagraph:
``(J) subsections (c) and (e) of section 6045B
(relating to returns relating to actions affecting
basis of specified securities),''.
(3) Clerical amendment.--The table of sections for subpart
B of part III of subchapter A of chapter 61, as amended by
subsection (b)(3), is amended by inserting after the item
relating to section 6045A the following new item:
``Sec. 6045B. Returns relating to actions affecting basis of specified
securities.''.
(e) Effective Date.--
(1) In general.--Except as otherwise provided in this
subsection, the amendments made by this section shall take
effect on January 1, 2011.
(2) Extension of period for statements sent to customers.--
The amendments made by subsection (a)(3) shall apply to
statements required to be furnished after December 31, 2008.
SEC. 204. INCREASE AND EXTENSION OF OIL SPILL LIABILITY TRUST FUND TAX.
(a) Increase in Rate.--
(1) Increase in rate.--Section 4611(c) is amended by adding
at the end the following new paragraph:
``(3) Increase in oil spill liability trust fund financing
rate.--For purposes of this subsection, the Oil Spill Liability
Trust Fund financing rate is increased (in addition to any
other increase under this subsection) by--
``(A) in the case of crude oil received or
petroleum products entered before January 1, 2011, 0.5
cent a barrel, and
``(B) in the case of crude oil received or
petroleum products entered after December 31, 2010, 1
cent a barrel.''.
(2) Effective date.--The amendment made by this subsection
shall apply on and after the first day of the first calendar
quarter beginning more than 60 days after the date of the
enactment of this Act.
(b) Extension.--
(1) In general.--Section 4611(f) (relating to application
of Oil Spill Liability Trust Fund financing rate) is amended by
striking paragraphs (2) and (3) and inserting the following new
paragraph:
``(2) Termination.--The Oil Spill Liability Trust Fund
financing rate shall not apply after December 31, 2017.''.
(2) Conforming amendment.--Section 4611(f)(1) is amended by
striking ``paragraphs (2) and (3)'' and inserting ``paragraph
(2)''.
(3) Effective date.--The amendments made by this subsection
shall take effect on the date of the enactment of this Act.
SEC. 205. TIME FOR PAYMENT OF CORPORATE ESTIMATED TAXES.
The percentage under subparagraph (C) of section 401(1) of the Tax
Increase Prevention and Reconciliation Act of 2005 in effect on the
date of the enactment of this Act is increased by 10.5 percentage
points.
<all>