I 

112TH CONGRESS 

1ST SESSION H. R. 1813 

To amend the Internal Revenue Code of 1986 to deny tax benefits to large 

oil companies and distribute the amounts raised to licensed drivers in 

order to provide relief from high gas prices. 

IN THE HOUSE OF REPRESENTATIVES 

MAY 10, 2011 

Mr. CONNOLLY of Virginia 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 deny tax 

benefits to large oil companies and distribute the 

amounts raised to licensed drivers in order to provide 

relief from high gas prices. 

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 ‘‘Gas Price Relief Act 

5 of 2011’’. 


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1 SEC. 2. DISTRIBUTION OF RESULTING REVENUES TO LI2 CENSED DRIVERS. 

3 The Secretary of the Treasury shall distribute all of 

4 the revenues received by the United States each fiscal year 

5 as a result of the enactment of this Act, by payment in 

6 equal amount, to each holder of a valid driver’s license 

7 (as that term is defined in section 159 of title 23, United 

8 States Code). 

9 SEC. 3. AMORTIZATION OF GEOLOGICAL AND GEO10 PHYSICAL EXPENDITURES. 

11 (a) IN GENERAL.—Subparagraph (A) of section 

12 167(h)(5) of the Internal Revenue Code of 1986 is amend13 ed by striking ‘‘major integrated oil company’’ and insert14 ing ‘‘covered large oil company’’. 

15 (b) COVERED LARGE OIL COMPANY.—Paragraph (5) 

16 of section 167(h) of such Code is amended by redesig17 nating subparagraph (B) as subparagraph (C) and by in18 serting after subparagraph (A) the following new subpara19 graph: 

20 ‘‘(B) COVERED LARGE OIL COMPANY.— 

21 For purposes of this paragraph, the term ‘cov22 ered large oil company’ means a taxpayer 

23 which— 

24 ‘‘(i) is a major integrated oil com25 pany, or 


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1 ‘‘(ii) has gross receipts in excess of 

2 $50,000,000 for the taxable year. 

3 For purposes of clause (ii), all persons treated 

4 as a single employer under subsections (a) and 

5 (b) of section 52 shall be treated as 1 person.’’. 

6 (c) CONFORMING AMENDMENT.—The heading for 

7 paragraph (5) of section 167(h) of such Code is amended 

8 by inserting ‘‘AND OTHER LARGE TAXPAYERS’’. 

9 (d) EFFECTIVE DATE.—The amendments made by 

10 this section shall apply to amounts paid or incurred in tax11 able years beginning after December 31, 2011. 

12 SEC. 4. PRODUCING OIL AND GAS FROM MARGINAL WELLS. 

13 (a) IN GENERAL.—Section 45I of the Internal Rev14 enue Code of 1986 is amended by adding at the end the 

15 following new subsection: 

16 ‘‘(e) EXCEPTION FOR TAXPAYER WHO IS NOT

17 SMALL, INDEPENDENT OIL AND GAS COMPANY.— 

18 ‘‘(1) IN GENERAL.—Subsection (a) shall not 

19 apply to any taxpayer which is not a small, inde20 pendent oil and gas company for the taxable year. 

21 ‘‘(2) AGGREGATION RULE.—For purposes of 

22 paragraph (1), all persons treated as a single em23 ployer under subsections (a) and (b) of section 52 

24 shall be treated as 1 person.’’. 


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

2 subsection (a) shall apply to credits determined for taxable 

3 years beginning after December 31, 2011. 

4 SEC. 5. ENHANCED OIL RECOVERY CREDIT. 

5 (a) IN GENERAL.—Section 43 of the Internal Rev6 enue Code of 1986 is amended by adding at the end the 

7 following new subsection: 

8 ‘‘(f) EXCEPTION FOR TAXPAYER WHO IS NOT

9 SMALL, INDEPENDENT OIL AND GAS COMPANY.— 

10 ‘‘(1) IN GENERAL.—Subsection (a) shall not 

11 apply to any taxpayer which is not a small, inde12 pendent oil and gas company for the taxable year. 

13 ‘‘(2) AGGREGATION RULE.—For purposes of 

14 paragraph (1), all persons treated as a single em15 ployer under subsections (a) and (b) of section 52 

16 shall be treated as 1 person.’’. 

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

18 this section shall apply to amounts paid or incurred in tax19 able years beginning after December 31, 2011. 

20 SEC. 6. INTANGIBLE DRILLING AND DEVELOPMENT COSTS 

21 IN THE CASE OF OIL AND GAS WELLS. 

22 (a) IN GENERAL.—Subsection (c) of section 263 of 

23 the Internal Revenue Code of 1986 is amended by adding 

24 at the end the following new sentence: ‘‘This subsection 

25 shall not apply to amounts paid or incurred by a taxpayer 


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1 in any taxable year in which such taxpayer is not a small, 

2 independent oil and gas company, determined by deeming 

3 all persons treated as a single employer under subsections 

4 (a) and (b) of section 52 as 1 person.’’. 

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

6 this section shall apply to amounts paid or incurred in tax7 able years beginning after December 31, 2011. 

8 SEC. 7. PERCENTAGE DEPLETION. 

9 (a) IN GENERAL.—Section 613A of the Internal Rev10 enue Code of 1986 is amended by adding at the end the 

11 following new subsection: 

12 ‘‘(f) EXCEPTION FOR TAXPAYER WHO IS NOT

13 SMALL, INDEPENDENT OIL AND GAS COMPANY.— 

14 ‘‘(1) IN GENERAL.—This section and section 

15 611 shall not apply to any taxpayer which is not a 

16 small, independent oil and gas company for the tax17 able year. 

18 ‘‘(2) AGGREGATION RULE.—For purposes of 

19 paragraph (1), all persons treated as a single em20 ployer under subsections (a) and (b) of section 52 

21 shall be treated as 1 person.’’. 

22 (b) CONFORMING AMENDMENT.—Section 613A(c)(1) 

23 of such Code is amended by striking ‘‘subsection (d)’’ and 

24 inserting ‘‘subsections (d) and (f)’’. 


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1 (c) EFFECTIVE DATE.—The amendment made by 

2 this section shall apply to taxable years beginning after 

3 December 31, 2011. 

4 SEC. 8. TERTIARY INJECTANTS. 

5 (a) IN GENERAL.—Section 193 of the Internal Rev6 enue Code of 1986 is amended by adding at the end the 

7 following new subsection: 

8 ‘‘(d) EXCEPTION FOR TAXPAYER WHO IS NOT

9 SMALL, INDEPENDENT OIL AND GAS COMPANY.— 

10 ‘‘(1) IN GENERAL.—Subsection (a) shall not 

11 apply to any taxpayer which is not a small, inde12 pendent oil and gas company for the taxable year. 

13 ‘‘(2) EXCEPTION FOR QUALIFIED CARBON DI14 OXIDE DISPOSED IN SECURE GEOLOGICAL STOR15 AGE.—Paragraph (1) shall not apply in the case of 

16 any qualified tertiary injectant expense paid or in17 curred for any tertiary injectant is qualified carbon 

18 dioxide (as defined in section 45Q(b)) which is dis19 posed of by the taxpayer in secure geological storage 

20 (as defined by section 45Q(d)). 

21 ‘‘(3) AGGREGATION RULE.—For purposes of 

22 paragraph (1), all persons treated as a single em23 ployer under subsections (a) and (b) of section 52 

24 shall be treated as 1 person.’’. 


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

2 this section shall apply to expenses incurred after Decem3 ber 31, 2011. 

4 SEC. 9. PASSIVE ACTIVITY LOSSES AND CREDITS LIMITED. 

5 (a) IN GENERAL.—Paragraph (3) of section 469(c) 

6 of the Internal Revenue Code of 1986 is amended by add7 ing at the end the following: 

8 ‘‘(C) EXCEPTION FOR TAXPAYER WHO IS

9 NOT SMALL, INDEPENDENT OIL AND GAS COM10 PANY.— 

11 ‘‘(i) IN GENERAL.—Subparagraph (A) 

12 shall not apply to any taxpayer which is 

13 not a small, independent oil and gas com14 pany for the taxable year. 

15 ‘‘(ii) AGGREGATION RULE.—For pur16 poses of clause (i), all persons treated as 

17 a single employer under subsections (a) 

18 and (b) of section 52 shall be treated as 1 

19 person.’’. 

20 SEC. 10. INCOME ATTRIBUTABLE TO DOMESTIC PRODUC21 TION ACTIVITIES. 

22 (a) IN GENERAL.—Section 199 of the Internal Rev23 enue Code of 1986 is amended by adding at the end the 

24 following new subsection: 


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1 ‘‘(e) EXCEPTION FOR TAXPAYER WHO IS NOT

2 SMALL, INDEPENDENT OIL AND GAS COMPANY.—Sub3 section (a) shall not apply to the income derived from the 

4 production, transportation, or distribution of oil, natural 

5 gas, or any primary product (within the meaning of sub6 section (d)(9)) thereof by any taxpayer which for the tax7 able year is an oil and gas company which is not a small, 

8 independent oil and gas company.’’. 

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

10 this section shall apply to taxable years beginning after 

11 December 31, 2011. 

12 SEC. 11. PROHIBITION ON USING LAST-IN, FIRST-OUT AC13 COUNTING FOR MAJOR INTEGRATED OIL 

14 COMPANIES. 

15 (a) IN GENERAL.—Section 472 of the Internal Rev16 enue Code of 1986 is amended by adding at the end the 

17 following new subsection: 

18 ‘‘(h) MAJOR INTEGRATED OIL COMPANIES.—Not19 withstanding any other provision of this section, a major 

20 integrated oil company (as defined in section 167(h)) may 

21 not use the method provided in subsection (b) in 

22 inventorying of any goods.’’. 

23 (b) EFFECTIVE DATE AND SPECIAL RULE.— 


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1 (1) IN GENERAL.—The amendment made by 

2 subsection (a) shall apply to taxable years beginning 

3 after December 31, 2011. 

4 (2) CHANGE IN METHOD OF ACCOUNTING.—In 

5 the case of any taxpayer required by the amendment 

6 made by this section to change its method of ac7 counting for its first taxable year beginning after the 

8 date of the enactment of this Act— 

9 (A) such change shall be treated as initi10 ated by the taxpayer, 

11 (B) such change shall be treated as made 

12 with the consent of the Secretary of the Treas13 ury, and 

14 (C) the net amount of the adjustments re15 quired to be taken into account by the taxpayer 

16 under section 481 of the Internal Revenue Code 

17 of 1986 shall be taken into account ratably over 

18 a period (not greater than 8 taxable years) be19 ginning with such first taxable year. 

20 SEC. 12. MODIFICATIONS OF FOREIGN TAX CREDIT RULES 

21 APPLICABLE TO DUAL CAPACITY TAXPAYERS. 

22 (a) IN GENERAL.—Section 901 of the Internal Rev23 enue Code of 1986 is amended by redesignating subsection 

24 (n) as subsection (o) and by inserting after subsection (m) 

25 the following new subsection: 


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1 ‘‘(n) SPECIAL RULES RELATING TO DUAL CAPACITY

2 TAXPAYERS.— 

3 ‘‘(1) GENERAL RULE.—Notwithstanding any 

4 other provision of this chapter, any amount paid or 

5 accrued by a dual capacity taxpayer to a foreign 

6 country or possession of the United States for any 

7 period with respect to combined foreign oil and gas 

8 income (as defined in section 907(b)(1)) shall not be 

9 considered a tax to the extent such amount exceeds 

10 the amount (determined in accordance with regula11 tions) which would have been required to be paid if 

12 the taxpayer were not a dual capacity taxpayer. 

13 ‘‘(2) DUAL CAPACITY TAXPAYER.—For pur14 poses of this subsection, the term ‘dual capacity tax15 payer’ means, with respect to any foreign country or 

16 possession of the United States, a person who— 

17 ‘‘(A) is subject to a levy of such country or 

18 possession, and 

19 ‘‘(B) receives (or will receive) directly or 

20 indirectly a specific economic benefit (as deter21 mined in accordance with regulations) from 

22 such country or possession.’’. 

23 (b) EFFECTIVE DATE.— 


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1 (1) IN GENERAL.—The amendments made by 

2 this section shall apply to taxes paid or accrued in 

3 taxable years beginning after December 31, 2011. 

4 (2) CONTRARY TREATY OBLIGATIONS

5 UPHELD.—The amendments made by this section 

6 shall not apply to the extent contrary to any treaty 

7 obligation of the United States. 

Æ 


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