I 

111TH CONGRESS 

1ST SESSION H. R. 2543 

To amend the Internal Revenue Code of 1986 to make permanent the reduction in the rate of tax on qualified timber gain of corporations, and 

for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

MAY 21, 2009 

Mr. MCDERMOTT (for himself, Mr. BRADY of Texas, Mr. BLUMENAUER, Mr. 

REICHERT, Mr. DICKS, Mr. JONES, Mr. WU, Mr. HERGER, and Mr. 

SMITH of Washington) 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 make 

permanent the reduction in the rate of tax on qualified 

timber gain of corporations, and for other purposes. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Timber Revitalization 

5 and Economic Enhancement Act of 2009’’. 


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1 SEC. 2. PERMANENT REDUCTION IN RATE OF TAX ON 

2 QUALIFIED TIMBER GAIN OF CORPORATIONS. 

3 (a) IN GENERAL.—Paragraph (1) of section 1201(b) 

4 of the Internal Revenue Code of 1986 is amended by strik5 ing ‘‘and beginning on or before the date which is 1 year 

6 after such date’’. 

7 (b) CONFORMING AMENDMENT.—Paragraph (3) of 

8 section 1201(b) of such Code is amended to read as fol9 lows: 

10 ‘‘(3) COMPUTATION FOR TAXABLE YEARS IN

11 WHICH RATE FIRST APPLIES.—In the case of any 

12 taxable year which includes the date set forth in 

13 paragraph (1), the qualified timber gain for such 

14 year shall not exceed the qualified timber gain prop15 erly taken into account for the portion of the year 

16 after such date.’’. 

17 (c) EFFECTIVE DATE.—The amendments made by 

18 this section shall take effect as if included in the amend19 ment made by section 15311(a) of the Food, Conservation, 

20 and Energy Act of 2008. 

21 SEC. 3. PERMANENT TIMBER REIT MODERNIZATION. 

22 (a) IN GENERAL.—Subparagraph (H) of section 

23 856(c)(5) of the Internal Revenue Code of 1986 is amend24 ed by striking clause (iii). 


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1 (b) CONFORMING AMENDMENT.—Subsection (c) of 

2 section 856 of such Code is amended by striking para3 graph (8). 

4 (c) EFFECTIVE DATE.—The amendments made by 

5 this section shall take effect as if included in the amend6 ment made by section 15312 of the Food, Conservation, 

7 and Energy Act of 2008. 

8 SEC. 4. PERMANENT QUALIFICATION OF MINERAL ROY9 ALTY INCOME FOR TIMBER REITS. 

10 (a) IN GENERAL.—Subparagraph (I) of section 

11 856(c)(2) of the Internal Revenue Code of 1986 is amend12 ed by striking ‘‘the first taxable year beginning after the 

13 date of the enactment of this subparagraph’’ and inserting 

14 ‘‘any taxable year’’. 

15 (b) EFFECTIVE DATE.—The amendment made by 

16 this section shall take effect as if included in the amend17 ment made by section 15313(a) of the Food, Conservation, 

18 and Energy Act of 2008. 

19 SEC. 5. PERMANENT MODIFCATION OF PROHIBITED 

20 TRANSACTION RULES FOR TIMBER PROP21 ERTY. 

22 (a) IN GENERAL.—(1) Clause (v) of section 

23 857(b)(6)(D) of the Internal Revenue Code of 1986 is 

24 amended by striking ‘‘, in the case of a sale on or before 

25 the termination date,’’. 


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1 (2) Subparagraph (H) of section 857(b)(6) of such 

2 Code is amended by striking ‘‘In the case of a sale on 

3 or before the termination date, the sale’’ and inserting 

4 ‘‘The sale’’. 

5 (3) Paragraph (6) of section 857(b) of such Code is 

6 amended by striking subparagraph (H). 

7 (b) EFFECTIVE DATE.—The amendments made by 

8 this section shall take effect as if included in the amend9 ments made by section 15315 of the Food, Conservation, 

10 and Energy Act of 2008. 

Æ 


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