I 

110TH CONGRESS 

2D SESSION H. R. 5746 

To amend the Internal Revenue Code of 1986 to establish the infrastructure 

foundation for the hydrogen economy, and for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

APRIL 9, 2008 

Mr. LARSON of Connecticut (for himself, Mr. DENT, Mr. WYNN, Mr. INGLIS

of South Carolina, Ms. DELAURO, Mr. DOYLE, Mr. HOLDEN, Mr. WAMP, 

Mr. TERRY, Mr. MCNULTY, and Mr. BUTTERFIELD) 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 establish 

the infrastructure foundation for the hydrogen economy, 

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 ‘‘Hydrogen Tax Incen5 tives Act of 2008’’. 

6 SEC. 2. HYDROGEN INFRASTRUCTURE AND FUEL COSTS. 

7 (a) IN GENERAL.—Subpart B of part IV of sub8 chapter A of chapter 1 of the Internal Revenue Code of 


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1 1986 (relating to foreign tax credit, etc.) is amended by 

2 adding at the end the following new section: 

3 ‘‘SEC. 30D. HYDROGEN INFRASTRUCTURE AND FUEL 

4 COSTS. 

5 ‘‘(a) ALLOWANCE OF CREDIT.—There shall be al6 lowed as a credit against the tax imposed by this chapter 

7 for the taxable year an amount equal to the sum of— 

8 ‘‘(1) the hydrogen infrastructure costs credit 

9 determined under subsection (b), and 

10 ‘‘(2) the hydrogen fuel costs credit determined 

11 under subsection (c). 

12 ‘‘(b) HYDROGEN INFRASTRUCTURE COSTS CRED13 IT.— 

14 ‘‘(1) IN GENERAL.—For purposes of subsection 

15 (a), the hydrogen infrastructure costs credit deter16 mined under this subsection with respect to each eli17 gible hydrogen production and distribution facility of 

18 the taxpayer is an amount equal to 30 percent of so 

19 much of the infrastructure costs for the taxable year 

20 as does not exceed $200,000 with respect to such fa21 cility. 

22 ‘‘(2) ELIGIBLE HYDROGEN PRODUCTION AND

23 DISTRIBUTION FACILITY.—For purposes of this sub24 section, the term ‘eligible hydrogen production and 

25 distribution facility’ means a hydrogen production 


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1 and distribution facility which is placed in service 

2 after December 31, 2007. 

3 ‘‘(c) HYDROGEN FUEL COSTS CREDIT.— 

4 ‘‘(1) IN GENERAL.—For purposes of subsection 

5 (a), the hydrogen fuel costs credit determined under 

6 this subsection with respect to each eligible hydrogen 

7 device of the taxpayer is an amount equal to the 

8 qualified hydrogen expenditure amounts with respect 

9 to such device. 

10 ‘‘(2) QUALIFIED HYDROGEN EXPENDITURE

11 AMOUNT.—For purposes of this subsection— 

12 ‘‘(A) IN GENERAL.—The term ‘qualified 

13 hydrogen expenditure amount’ means, with re14 spect to each eligible hydrogen energy conver15 sion device of the taxpayer with a production 

16 capacity of not more than 25 kilowatts of elec17 tricity, the lesser of— 

18 ‘‘(i) 30 percent of the amount paid or 

19 incurred by the taxpayer during the tax20 able year for hydrogen which is consumed 

21 by such device, and 

22 ‘‘(ii) $2,000. 

23 In the case of any device which is not owned by 

24 the taxpayer at all times during the taxable 

25 year, the $2,000 amount in clause (ii) shall be 


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1 reduced by an amount which bears the same 

2 ratio to $2,000 as the portion of the year which 

3 such device is not owned by the taxpayer bears 

4 to the entire year. 

5 ‘‘(B) HIGHER LIMITATION FOR DEVICES

6 WITH MORE PRODUCTION CAPACITY.—In the 

7 case of any eligible hydrogen energy conversion 

8 device with a production capacity of— 

9 ‘‘(i) more than 25 but less than 100 

10 kilowatts of electricity, subparagraph (A) 

11 shall be applied by substituting ‘$4,000’ 

12 for ‘$2,000’ each place it appears, and 

13 ‘‘(ii) not less than 100 kilowatts of 

14 electricity, subparagraph (A) shall be ap15 plied by substituting ‘$6,000’ for ‘$2,000’ 

16 each place it appears. 

17 ‘‘(3) ELIGIBLE HYDROGEN ENERGY CONVER18 SION DEVICES.—For purposes of this subsection— 

19 ‘‘(A) IN GENERAL.—The term ‘eligible hy20 drogen energy conversion device’ means, with 

21 respect to any taxpayer, any hydrogen energy 

22 conversion device which— 

23 ‘‘(i) is placed in service after Decem24 ber 31, 2004, and 


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1 ‘‘(ii) is wholly owned by the taxpayer 

2 during the taxable year. 

3 If an owner of a device (determined without re4 gard to this subparagraph) provides to the pri5 mary user of such device a written statement 

6 that such user shall be treated as the owner of 

7 such device for purposes of this section, then 

8 such user (and not such owner) shall be so 

9 treated. 

10 ‘‘(B) HYDROGEN ENERGY CONVERSION

11 DEVICE.—The term ‘hydrogen energy conver12 sion device’ means— 

13 ‘‘(i) any electrochemical device which 

14 converts hydrogen into electricity, and 

15 ‘‘(ii) any combustion engine which 

16 burns hydrogen as a fuel. 

17 ‘‘(d) REDUCTION IN BASIS.—For purposes of this 

18 subtitle, if a credit is allowed under this section for any 

19 expenditure with respect to any property, the increase in 

20 the basis of such property which would (but for this para21 graph) result from such expenditure shall be reduced by 

22 the amount of the credit so allowed. 

23 ‘‘(e) APPLICATION WITH OTHER CREDITS.— 

24 ‘‘(1) BUSINESS CREDIT TREATED AS PART OF

25 GENERAL BUSINESS CREDIT.—So much of the credit 


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1 which would be allowed under subsection (a) for any 

2 taxable year (determined without regard to this sub3 section) that is attributable to amounts which (but 

4 for subsection (g) would be allowed as a deduction 

5 under section 162 shall be treated as a credit listed 

6 in section 38(b) for such taxable year (and not al7 lowed under subsection (a)). 

8 ‘‘(2) PERSONAL CREDIT.—The credit allowed 

9 under subsection (a) (after the application of para10 graph (1)) for any taxable year shall not exceed the 

11 excess (if any) of— 

12 ‘‘(A) the regular tax liability (as defined in 

13 section 26(b)) reduced by the sum of the credits 

14 allowable under subpart A and sections 27, 30, 

15 30B, and 30C, over 

16 ‘‘(B) the tentative minimum tax for the 

17 taxable year. 

18 ‘‘(f) DENIAL OF DOUBLE BENEFIT.—The amount of 

19 any deduction or other credit allowable under this chapter 

20 for any cost taken into account in determining the amount 

21 of the credit under subsection (a) shall be reduced by the 

22 amount of such credit attributable to such cost. 

23 ‘‘(g) RECAPTURE.—The Secretary shall, by regula24 tions, provided for recapturing the benefit of any credit 


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1 allowable under subsection (a) with respect to any prop2 erty which ceases to be property eligible for such credit. 

3 ‘‘(h) ELECTION NOT TO TAKE CREDIT.—No credit 

4 shall be allowed under subsection (a) for any property if 

5 the taxpayer elects not to have this section apply to such 

6 property. 

7 ‘‘(i) REGULATIONS.—The Secretary shall prescribe 

8 such regulations as necessary to carry out the provisions 

9 of this section. 

10 ‘‘(j) TERMINATION.—This section shall not apply to 

11 any costs paid or incurred after the end of the 3-year pe12 riod beginning on the date of the enactment of this sec13 tion.’’. 

14 (b) CONFORMING AMENDMENTS.— 

15 (1) Section 38(b) of the Internal Revenue Code 

16 of 1986 is amended by striking ‘‘plus’’ at the end of 

17 paragraph (30), by striking the period at the end of 

18 paragraph (31) and inserting ‘‘plus’’, and by adding 

19 at the end the following new paragraph: 

20 ‘‘(32) the portion of the hydrogen infrastruc21 ture and fuel credit to which section 30D(e)(1) ap22 plies.’’. 

23 (2) Section 55(c)(3) of such Code is amended 

24 by inserting ‘‘30D(e)(2),’’ after ‘‘30C(d)(2),’’. 


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1 (3) Section 1016(a) of such Code is amended 

2 by striking ‘‘and’’ at the end of paragraph (36), by 

3 striking the period at the end of paragraph (37) and 

4 inserting ‘‘, and’’, and by adding at the end the fol5 lowing new paragraph: 

6 ‘‘(38) to the extent provided in section 

7 30D(d).’’. 

8 (4) Section 6501(m) of such Code is amended 

9 by inserting ‘‘30D(h),’’ after ‘‘30C(e)(5),’’. 

10 (5) The table of sections for subpart B of part 

11 IV of subchapter A of chapter 1 of such Code is 

12 amended by inserting after the item relating to sec13 tion 30C the following new item: 

‘‘Sec. 30D. Hydrogen infrastructure and fuel costs.’’. 

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

15 this section shall apply to amounts paid or incurred after 

16 December 31, 2007, in taxable years ending after such 

17 date. 

Æ 


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