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[Congressional Bills 103th Congress]
[From the U.S. Government Publishing Office]
[H.R. 4144 Introduced in House (IH)]

103d CONGRESS
  2d Session
                                H. R. 4144

    To amend the Internal Revenue Code of 1986 with respect to the 
               treatment of crops destroyed by casualty.

_______________________________________________________________________

                    IN THE HOUSE OF REPRESENTATIVES

                             March 24, 1994

  Mr. Matsui introduced the following bill; which was referred to the 
                      Committee on Ways and Means

_______________________________________________________________________

                                 A BILL

 
    To amend the Internal Revenue Code of 1986 with respect to the 
               treatment of crops destroyed by casualty.

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

SECTION 1. TREATMENT OF CROPS DESTROYED BY CASUALTY.

    (a) General Rule.--Paragraph (2) of section 263A(d) of the Internal 
Revenue Code of 1986 is amended by redesignating subparagraph (B) as 
subparagraph (F) and by striking subparagraph (A) and inserting the 
following new subparagraphs:
                    ``(A) In general.--If plants bearing an edible crop 
                for human consumption were lost or damaged (while in 
                the hands of the taxpayer) by reason of freezing 
                temperatures, disease, drought, pests, or casualty, 
                this section and section 263 shall not apply to--
                            ``(i) preproductive or removal costs, and
                            ``(ii) 80 percent of a taxpayer's special 
                        replanting costs,
                which are incurred for replanting plants bearing the 
                same type of crop (whether on the same parcel of land 
                on which such lost or damaged plants were located or 
                any other parcel of land of the same acreage in the 
                United States).
                    ``(B) Treatment of special replanting costs.--
                Subsection (a) of this section and section 263 shall 
                apply to the remaining 20 percent of a taxpayer's 
                special replanting costs.
                    ``(C) Preproductive costs.--For purposes of this 
                subsection, the term `preproductive costs' means costs 
                which are--
                            ``(i) incurred during the preproductive 
                        period, and
                            ``(ii) not treated as special replanting 
                        costs as defined in subparagraph (D).
                Such costs shall include cultivation, maintenance, and 
                development costs as well as administrative costs and 
                interest; but shall not include any costs related to 
                assets which are dissimilar to those used on the 
                original acreage prior to the casualty.
                    ``(D) Special replanting costs.--For purposes of 
                this subsection, the term `special replanting costs' 
                includes direct costs incurred for--
                            ``(i) plants and supporting structures,
                            ``(ii) irrigation and drainage systems 
                        destroyed during removal of the lost or damaged 
                        plants, and
                            ``(iii) land preparation and fumigation 
                        costs,
                but shall not include any assets which are dissimilar 
                to those used on the original acreage prior to the 
                casualty.
                    ``(E) Special rule for certain plantings.--
                Subparagraph (A) shall apply to that portion of the 
                costs (including the plants and associated costs) 
                attributable to replanting additional plants on 
                acreage, only if such planted acreage is the same size 
                or smaller as that on which the lost or destroyed 
                plants were located. For purposes of this rule, the 
                term `additional plant' includes any plant which does 
                not replace a plant qualified under subparagraph (A).
                    ``(F) Loss limitation rule.--Any costs otherwise 
                eligible under subparagraph (A) shall be reduced by any 
                amounts deducted under section 165 which relate to lost 
                or damaged plants and associated assets. The reduction 
                for deductions previously taken under section 165 is 
                limited to the most recent original planting of the 
                lost or damaged planted acreage before the current 
                casualty.''
    (b) Conforming Amendment.--Section 165 of such Code is amended by 
redesignating subsection (m) as subsection (n) and by inserting after 
subsection (l) the following new subsection:
    ``(m) Losses to Which Section 263A(d)(2) Deductions Are Taken.--No 
deduction shall be allowed under this section with respect to any loss 
for which the costs of replanting are deducted under section 
263A(d)(2)(A).''
    (c) Effective Date.--The amendments in this section shall take 
effect as if included in the amendments made by section 803 of the Tax 
Reform Act of 1986.

                                 <all>
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