To amend the Internal Revenue Code of 1986 to encourage and accelerate the nationwide production, retail sale, and consumer use of new commercial and consumer motor vehicles with intelligent vehicle technology systems.

Summary: Intelligent Vehicle Highway Safety Act of 2004 - Amends the Internal Revenue Code to allow a deduction from gross income for the cost, up to $1,000, of qualified intelligent vehicle systems property. Defines "qualified intelligent systems property" as any device installed by a motor vehicle manufacturer to enhance the safety or security of a driver, passenger, or load by, among other things, warning or informing a driver of dangerous driving conditions or by actively monitoring and adjusting driver workload. Terminates the deduction after 2010.

Exempts intelligent vehicle systems properties from the first $5,000 of the excise tax on heavy trucks and trailers sold at retail.

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Intelligent Vehicle Highway Safety 
Act of 2004''.

SEC. 2. DEDUCTION FOR INTELLIGENT VEHICLE TECHNOLOGY SYSTEMS.

    (a) In General.--Part VI of subchapter B of chapter 1 of the 
Internal Revenue Code of 1986 (relating to itemized deductions for 
individuals and corporations) is amended by adding at the end the 
following new section:

``SEC. 199. INTELLIGENT VEHICLE SYSTEMS PROPERTY.

    ``(a) Deduction Allowed.--There shall be allowed as a deduction for 
the taxable year an amount equal to the amount paid or incurred by the 
taxpayer for qualified intelligent vehicle systems property. The 
deduction under the preceding sentence with respect to any property 
shall be allowed for the taxable year in which such property is placed 
in service.
    ``(b) Limitation.--
            ``(1) In general.--The amount allowed as a deduction under 
        subsection (a) with respect to any motor vehicle shall not 
        exceed $1,000.
            ``(2) Phaseout.--In the case of any qualified intelligent 
        vehicle systems property placed in service after December 31, 
        2007, the limit otherwise applicable under paragraph (1) shall 
        be reduced by--
                    ``(A) 25 percent in the case of property placed in 
                service in calendar year 2008,
                    ``(B) 50 percent in the case of property placed in 
                service in calendar year 2009, and
                    ``(C) 75 percent in the case of property placed in 
                service in calendar year 2010.
    ``(c) Qualified Intelligent Vehicle Systems Property.--For purposes 
of this section--
            ``(1) In general.--The term `qualified intelligent vehicle 
        systems property' means any device described in paragraph (2) 
        if such device--
                    ``(A) is an integrated, in-vehicle electronic 
                device installed in a motor vehicle at the point of 
                manufacture by the original equipment manufacturer, or 
                as an aftermarket installation, and
                    ``(B) enhances the safety or security of the 
                driver, passenger, or load.
            ``(2) Devices described.--A device described in this 
        paragraph is a device which--
                    ``(A) is a device that warns or informs a driver of 
                driving conditions or location, such as collision 
                warning systems, automated collision notification 
                systems, vehicle rollover warning systems, lane 
                departure warning systems, and fatigue management 
                systems,
                    ``(B) is a positional communications and tracking 
                device,
                    ``(C) assists in verification of driver identity, 
                such as biometric identifiers and electronic ignition 
                locks,
                    ``(D) is an electronic seal,
                    ``(E) is a roll stability control system, or
                    ``(F) actively monitors and adjusts driver 
                workload.
            ``(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.
    ``(d) Special Rules.--
            ``(1) Property used outside united states, etc., not 
        qualified.--No deduction shall be allowed under subsection (a) 
        with respect to any property referred to in section 50(b) or 
        with respect to the portion of the cost of any property taken 
        into account under section 179.
            ``(2) Basis reduction.--
                    ``(A) In general.--For purposes of this title, the 
                basis of any property shall be reduced by the portion 
                of the cost of such property taken into account under 
                subsection (a).
                    ``(B) Ordinary income recapture.--For purposes of 
                section 1245, the amount of the deduction allowable 
                under subsection (a) with respect to any property which 
                is of a character subject to the allowance for 
                depreciation shall be treated as a deduction allowed 
                for depreciation under section 167.
    ``(e) Supporting Documentation.--No deduction shall be allowed 
under subsection (a) unless the taxpayer receives, at the time of 
purchase of the qualified intelligent vehicle systems property, such 
documentation as the Secretary may require. Such documentation shall 
identify the type of each intelligent vehicle systems property 
installed on the motor vehicle, retail cost of each such system, the 
purchase date of the motor vehicle containing such systems (or the 
installation date of such systems in the case of installation after the 
date of the first retail sale (as defined in section 4052(a)).
    ``(f) Termination.--This section shall not apply to any property 
placed in service after December 31, 2010.''.
    (b) Deduction Allowed Whether or not Individual Itemizes Other 
Deductions.--Subsection (a) of section 62 of such Code is amended by 
inserting after paragraph (19) the following new paragraph:
            ``(20) Intelligent vehicle systems property.--The deduction 
        allowed by section 199.''.
    (c) Conforming Amendments.--
            (1) Subsection (a) of section 1016 of such Code is amended 
        by striking ``and'' at the end of paragraph (27), by striking 
        the period at the end of paragraph (28) and inserting ``; 
        and'', and by adding at the end the following new paragraph:
            ``(29) to the extent provided in section 199(d)(2).''.
            (2) Subparagraph (C) of section 1245(a)(2) of such Code is 
        amended by striking ``or 193'' and inserting ``193, or 199''.
    (d) Clerical Amendment.--The table of sections for part VI of 
subchapter B of chapter 1 of such Code is amended by adding at the end 
the following new item:

``Sec. 199. Intelligent vehicle systems property.''.
    (e) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after December 31, 2004.

SEC. 3. INTELLIGENT VEHICLE SYSTEMS PROPERTY EXCEPTION TO TAX ON HEAVY 
              TRUCKS AND TRAILERS SOLD AT RETAIL.

    (a) In General.--Section 4051 of the Internal Revenue Code of 1986 
(relating to imposition of tax on heavy trucks and trailers sold at 
retail) is amended by redesignating subsection (c) as subsection (d) 
and by inserting after subsection (b) the following new subsection:
    ``(c) Exclusion for Intelligent Vehicle Systems Property.--
            ``(1) In general.--The tax imposed by subsections (a) and 
        (b) shall not apply to any article which is qualified 
        intelligent vehicle systems property.
            ``(2) Limitation.--The amount excluded by paragraph (1) 
        shall not exceed $5,000 with respect to any article which is a 
        chassis, body, trailer, or tractor described in a subparagraph 
        of paragraph (1).
            ``(3) Qualified intelligent vehicle systems property.--The 
        term `qualified intelligent vehicle system property' shall have 
        the meaning given such term by section 199(c).''.
    (b) Effective Date.--The amendments made by this section shall 
apply to articles sold after December 31, 2004.