II 

110TH CONGRESS 

2D SESSION S. 3336 

To amend the Internal Revenue Code of 1986 to reduce our dependence 

on foreign oil by investing in clean, renewable, and alternative energy. 

IN THE SENATE OF THE UNITED STATES 

JULY 25, 2008 

Mrs. DOLE introduced the following bill; which was read twice and referred 

to the Committee on Finance 

A BILL 

To amend the Internal Revenue Code of 1986 to reduce 

our dependence on foreign oil by investing in clean, renewable, and alternative energy. 

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; ETC. 

4 (a) SHORT TITLE.—This Act may be cited as the 

5 ‘‘New Clean Energy Tax Extenders Act’’. 

6 (b) REFERENCE.—Except as otherwise expressly pro7 vided, whenever in this Act an amendment or repeal is 

8 expressed in terms of an amendment to, or repeal of, a 

9 section or other provision, the reference shall be considVerDate Aug 31 2005 01:45 Jul 27, 2008 Jkt 069200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\S3336.IS S3336

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1 ered to be made to a section or other provision of the In2 ternal Revenue Code of 1986. 

3 (c) TABLE OF CONTENTS.—The table of contents for 

4 this Act is as follows: 

Sec. 1. Short title; etc. 

TITLE I—EXTENSION OF CLEAN ENERGY PRODUCTION 

INCENTIVES 

Sec. 101. Extension and modification of renewable energy production tax credit. 

Sec. 102. Extension and modification of solar energy and fuel cell investment 

tax credit. 

Sec. 103. Extension and modification of residential energy efficient property 

credit. 

Sec. 104. Extension and modification of credit for clean renewable energy 

bonds. 

Sec. 105. Extension of special rule to implement FERC restructuring policy. 

TITLE II—EXTENSION OF INCENTIVES TO IMPROVE ENERGY 

EFFICIENCY 

Sec. 201. Extension and modification of credit for energy efficiency improvements to existing homes. 

Sec. 202. Extension and modification of tax credit for energy efficient new 

homes. 

Sec. 203. Extension and modification of energy efficient commercial buildings 

deduction. 

Sec. 204. Modification and extension of energy efficient appliance credit for appliances produced after 2007. 

TITLE III—REVENUE PROVISIONS 

Sec. 301. Denial of deduction for major integrated oil companies for income attributable to domestic production of oil, gas, or primary products thereof. 

Sec. 302. Elimination of the different treatment of foreign oil and gas extraction income and foreign oil related income for purposes of the 

foreign tax credit. 


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1 TITLE I—EXTENSION OF CLEAN 

2 ENERGY PRODUCTION INCEN3 TIVES 

4 SEC. 101. EXTENSION AND MODIFICATION OF RENEWABLE 

5 ENERGY PRODUCTION TAX CREDIT. 

6 (a) EXTENSION OF CREDIT.—Each of the following 

7 provisions of section 45(d) (relating to qualified facilities) 

8 is amended by striking ‘‘January 1, 2009’’ and inserting 

9 ‘‘January 1, 2013’’: 

10 (1) Paragraph (1). 

11 (2) Clauses (i) and (ii) of paragraph (2)(A). 

12 (3) Clauses (i)(I) and (ii) of paragraph (3)(A). 

13 (4) Paragraph (4). 

14 (5) Paragraph (5). 

15 (6) Paragraph (6). 

16 (7) Paragraph (7). 

17 (8) Paragraph (8). 

18 (9) Subparagraphs (A) and (B) of paragraph 

19 (9). 

20 (b) PRODUCTION CREDIT FOR ELECTRICITY PRO21 DUCED FROM MARINE RENEWABLES.— 

22 (1) IN GENERAL.—Paragraph (1) of section 

23 45(c) (relating to resources) is amended by striking 

24 ‘‘and’’ at the end of subparagraph (G), by striking 

25 the period at the end of subparagraph (H) and inVerDate Aug 31 2005 01:45 Jul 27, 2008 Jkt 069200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\S3336.IS S3336

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1 serting ‘‘, and’’, and by adding at the end the fol2 lowing new subparagraph: 

3 ‘‘(I) marine and hydrokinetic renewable en4 ergy.’’. 

5 (2) MARINE RENEWABLES.—Subsection (c) of 

6 section 45 is amended by adding at the end the fol7 lowing new paragraph: 

8 ‘‘(10) MARINE AND HYDROKINETIC RENEW9 ABLE ENERGY.— 

10 ‘‘(A) IN GENERAL.—The term ‘marine and 

11 hydrokinetic renewable energy’ means energy 

12 derived from— 

13 ‘‘(i) waves, tides, and currents in 

14 oceans, estuaries, and tidal areas, 

15 ‘‘(ii) free flowing water in rivers, 

16 lakes, and streams, 

17 ‘‘(iii) free flowing water in an irriga18 tion system, canal, or other man-made 

19 channel, including projects that utilize non20 mechanical structures to accelerate the 

21 flow of water for electric power production 

22 purposes, or 

23 ‘‘(iv) differentials in ocean tempera24 ture (ocean thermal energy conversion). 


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1 ‘‘(B) EXCEPTIONS.—Such term shall not 

2 include any energy which is derived from any 

3 source which utilizes a dam, diversionary struc4 ture (except as provided in subparagraph 

5 (A)(iii)), or impoundment for electric power 

6 production purposes.’’. 

7 (3) DEFINITION OF FACILITY.—Subsection (d) 

8 of section 45 is amended by adding at the end the 

9 following new paragraph: 

10 ‘‘(11) MARINE AND HYDROKINETIC RENEW11 ABLE ENERGY FACILITIES.—In the case of a facility 

12 producing electricity from marine and hydrokinetic 

13 renewable energy, the term ‘qualified facility’ means 

14 any facility owned by the taxpayer— 

15 ‘‘(A) which has a nameplate capacity rat16 ing of at least 150 kilowatts, and 

17 ‘‘(B) which is originally placed in service 

18 on or after the date of the enactment of this 

19 paragraph and before January 1, 2013.’’. 

20 (4) CREDIT RATE.—Subparagraph (A) of sec21 tion 45(b)(4) is amended by striking ‘‘or (9)’’ and 

22 inserting ‘‘(9), or (11)’’. 

23 (5) COORDINATION WITH SMALL IRRIGATION

24 POWER.—Paragraph (5) of section 45(d), as amend25 ed by subsection (a), is amended by striking ‘‘JanuVerDate Aug 31 2005 01:45 Jul 27, 2008 Jkt 069200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\S3336.IS S3336

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1 ary 1, 2010’’ and inserting ‘‘the date of the enact2 ment of paragraph (11)’’. 

3 (c) SALES OF ELECTRICITY TO REGULATED PUBLIC

4 UTILITIES TREATED AS SALES TO UNRELATED PER5 SONS.—Section 45(e)(4) (relating to related persons) is 

6 amended by adding at the end the following new sentence: 

7 ‘‘A taxpayer shall be treated as selling electricity to an 

8 unrelated person if such electricity is sold to a regulated 

9 public utility (as defined in section 7701(a)(33).’’. 

10 (d) TRASH FACILITY CLARIFICATION.—Paragraph 

11 (7) of section 45(d) is amended— 

12 (1) by striking ‘‘facility which burns’’ and in13 serting ‘‘facility (other than a facility described in 

14 paragraph (6)) which uses’’, and 

15 (2) by striking ‘‘COMBUSTION’’. 

16 (e) EFFECTIVE DATES.— 

17 (1) EXTENSION.—The amendments made by 

18 subsection (a) shall apply to property originally 

19 placed in service after December 31, 2008. 

20 (2) MODIFICATIONS.—The amendments made 

21 by subsections (b) and (c) shall apply to electricity 

22 produced and sold after the date of the enactment 

23 of this Act, in taxable years ending after such date. 

24 (3) TRASH FACILITY CLARIFICATION.—The 

25 amendments made by subsection (d) shall apply to 


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1 electricity produced and sold before, on, or after De2 cember 31, 2007. 

3 SEC. 102. EXTENSION AND MODIFICATION OF SOLAR EN4 ERGY AND FUEL CELL INVESTMENT TAX 

5 CREDIT. 

6 (a) EXTENSION OF CREDIT.— 

7 (1) SOLAR ENERGY PROPERTY.—Paragraphs 

8 (2)(A)(i)(II) and (3)(A)(ii) of section 48(a) (relating 

9 to energy credit) are each amended by striking 

10 ‘‘January 1, 2009’’ and inserting ‘‘January 1, 

11 2017’’. 

12 (2) FUEL CELL PROPERTY.—Subparagraph (E) 

13 of section 48(c)(1) (relating to qualified fuel cell 

14 property) is amended by striking ‘‘December 31, 

15 2008’’ and inserting ‘‘January 1, 2017’’. 

16 (3) QUALIFIED MICROTURBINE PROPERTY.— 

17 Subparagraph (E) of section 48(c)(2) (relating to 

18 qualified microturbine property) is amended by 

19 striking ‘‘December 31, 2008’’ and inserting ‘‘Janu20 ary 1, 2017’’. 

21 (b) ALLOWANCE OF ENERGY CREDIT AGAINST AL22 TERNATIVE MINIMUM TAX.—Subparagraph (B) of section 

23 38(c)(4) (relating to specified credits) is amended by strik24 ing ‘‘and’’ at the end of clause (iii), by striking the period 


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1 at the end of clause (iv) and inserting ‘‘, and’’, and by 

2 adding at the end the following new clause: 

3 ‘‘(v) the credit determined under sec4 tion 46 to the extent that such credit is at5 tributable to the energy credit determined 

6 under section 48.’’. 

7 (c) REPEAL OF DOLLAR PER KILOWATT LIMITATION

8 FOR FUEL CELL PROPERTY.— 

9 (1) IN GENERAL.—Section 48(c)(1) (relating to 

10 qualified fuel cell), as amended by subsection (a)(2), 

11 is amended by striking subparagraph (B) and by re12 designating subparagraphs (C), (D), and (E) as sub13 paragraphs (B), (C), and (D), respectively. 

14 (2) CONFORMING AMENDMENT.—Section 

15 48(a)(1) is amended by striking ‘‘paragraphs (1)(B) 

16 and (2)(B) of subsection (c)’’ and inserting ‘‘sub17 section (c)(2)(B)’’. 

18 (d) PUBLIC ELECTRIC UTILITY PROPERTY TAKEN

19 INTO ACCOUNT.— 

20 (1) IN GENERAL.—Paragraph (3) of section 

21 48(a) is amended by striking the second sentence 

22 thereof. 

23 (2) CONFORMING AMENDMENTS.— 

24 (A) Paragraph (1) of section 48(c), as 

25 amended by this section, is amended by striking 


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1 subparagraph (C) and redesignating subpara2 graph (D) as subparagraph (C). 

3 (B) Paragraph (2) of section 48(c), as 

4 amended by subsection (a)(3), is amended by 

5 striking subparagraph (D) and redesignating 

6 subparagraph (E) as subparagraph (D). 

7 (e) EFFECTIVE DATES.— 

8 (1) EXTENSION.—The amendments made by 

9 subsection (a) shall take effect on the date of the en10 actment of this Act. 

11 (2) ALLOWANCE AGAINST ALTERNATIVE MIN12 IMUM TAX.—The amendments made by subsection 

13 (b) shall apply to credits determined under section 

14 46 of the Internal Revenue Code of 1986 in taxable 

15 years beginning after the date of the enactment of 

16 this Act and to carrybacks of such credits. 

17 (3) FUEL CELL PROPERTY AND PUBLIC ELEC18 TRIC UTILITY PROPERTY.—The amendments made 

19 by subsections (c) and (d) shall apply to periods 

20 after the date of the enactment of this Act, in tax21 able years ending after such date, under rules simi22 lar to the rules of section 48(m) of the Internal Rev23 enue Code of 1986 (as in effect on the day before 

24 the date of the enactment of the Revenue Reconcili25 ation Act of 1990). 


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1 SEC. 103. EXTENSION AND MODIFICATION OF RESIDENTIAL 

2 ENERGY EFFICIENT PROPERTY CREDIT. 

3 (a) EXTENSION.—Section 25D(g) (relating to termi4 nation) is amended by striking ‘‘December 31, 2008’’ and 

5 inserting ‘‘December 31, 2012’’. 

6 (b) NO DOLLAR LIMITATION FOR CREDIT FOR

7 SOLAR ELECTRIC PROPERTY.— 

8 (1) IN GENERAL.—Section 25D(b)(1) (relating 

9 to maximum credit) is amended by striking subpara10 graph (A) and by redesignating subparagraphs (B) 

11 and (C) as subparagraphs (A) and (B), respectively. 

12 (2) CONFORMING AMENDMENTS.—Section 

13 25D(e)(4) is amended— 

14 (A) by striking clause (i) in subparagraph 

15 (A), 

16 (B) by redesignating clauses (ii) and (iii) 

17 in subparagraph (A) as clauses (i) and (ii), re18 spectively, and 

19 (C) by striking ‘‘, (2),’’ in subparagraph 

20 (C). 

21 (c) CREDIT ALLOWED AGAINST ALTERNATIVE MIN22 IMUM TAX.— 

23 (1) IN GENERAL.—Subsection (c) of section 

24 25D is amended to read as follows: 

25 ‘‘(c) LIMITATION BASED ON AMOUNT OF TAX; 

26 CARRYFORWARD OF UNUSED CREDIT.— 


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1 ‘‘(1) LIMITATION BASED ON AMOUNT OF

2 TAX.—In the case of a taxable year to which section 

3 26(a)(2) does not apply, the credit allowed under 

4 subsection (a) for the taxable year shall not exceed 

5 the excess of— 

6 ‘‘(A) the sum of the regular tax liability 

7 (as defined in section 26(b)) plus the tax im8 posed by section 55, over 

9 ‘‘(B) the sum of the credits allowable 

10 under this subpart (other than this section) and 

11 section 27 for the taxable year. 

12 ‘‘(2) CARRYFORWARD OF UNUSED CREDIT.— 

13 ‘‘(A) RULE FOR YEARS IN WHICH ALL

14 PERSONAL CREDITS ALLOWED AGAINST REG15 ULAR AND ALTERNATIVE MINIMUM TAX.—In 

16 the case of a taxable year to which section 

17 26(a)(2) applies, if the credit allowable under 

18 subsection (a) exceeds the limitation imposed by 

19 section 26(a)(2) for such taxable year reduced 

20 by the sum of the credits allowable under this 

21 subpart (other than this section), such excess 

22 shall be carried to the succeeding taxable year 

23 and added to the credit allowable under sub24 section (a) for such succeeding taxable year. 


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1 ‘‘(B) RULE FOR OTHER YEARS.—In the 

2 case of a taxable year to which section 26(a)(2) 

3 does not apply, if the credit allowable under 

4 subsection (a) exceeds the limitation imposed by 

5 paragraph (1) for such taxable year, such ex6 cess shall be carried to the succeeding taxable 

7 year and added to the credit allowable under 

8 subsection (a) for such succeeding taxable 

9 year.’’. 

10 (2) CONFORMING AMENDMENTS.— 

11 (A) Section 23(b)(4)(B) is amended by in12 serting ‘‘and section 25D’’ after ‘‘this section’’. 

13 (B) Section 24(b)(3)(B) is amended by 

14 striking ‘‘and 25B’’ and inserting ‘‘, 25B, and 

15 25D’’. 

16 (C) Section 25B(g)(2) is amended by strik17 ing ‘‘section 23’’ and inserting ‘‘sections 23 and 

18 25D’’. 

19 (D) Section 26(a)(1) is amended by strik20 ing ‘‘and 25B’’ and inserting ‘‘25B, and 25D’’. 

21 (d) EFFECTIVE DATE.— 

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

23 this section shall apply to taxable years beginning 

24 after December 31, 2007. 


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1 (2) APPLICATION OF EGTRRA SUNSET.—The 

2 amendments made by subparagraphs (A) and (B) of 

3 subsection (c)(2) shall be subject to title IX of the 

4 Economic Growth and Tax Relief Reconciliation Act 

5 of 2001 in the same manner as the provisions of 

6 such Act to which such amendments relate. 

7 SEC. 104. EXTENSION AND MODIFICATION OF CREDIT FOR 

8 CLEAN RENEWABLE ENERGY BONDS. 

9 (a) EXTENSION.—Section 54(m) (relating to termi10 nation) is amended by striking ‘‘December 31, 2008’’ and 

11 inserting ‘‘December 31, 2012’’. 

12 (b) INCREASE IN NATIONAL LIMITATION.—Section 

13 54(f) (relating to limitation on amount of bonds des14 ignated) is amended— 

15 (1) by inserting ‘‘, and for the period beginning 

16 after the date of the enactment of the New Clean 

17 Energy Tax Extenders Act and ending before Janu18 ary 1, 2013, $400,000,000’’ after ‘‘$1,200,000,000’’ 

19 in paragraph (1), 

20 (2) by striking ‘‘$750,000,000 of the’’ in para21 graph (2) and inserting ‘‘$750,000,000 of the 

22 $1,200,000,000’’, and 

23 (3) by striking ‘‘bodies’’ in paragraph (2) and 

24 inserting ‘‘bodies, and except that the Secretary may 

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1 tional clean renewable energy bond limitation to fi2 nance qualified projects of qualified borrowers which 

are public power providers nor more than 1 3 ⁄3 of such 

4 limitation to finance qualified projects of qualified 

5 borrowers which are mutual or cooperative electric 

6 companies described in section 501(c)(12) or section 

7 1381(a)(2)(C)’’. 

8 (c) PUBLIC POWER PROVIDERS DEFINED.—Section 

9 54(j) is amended— 

10 (1) by adding at the end the following new 

11 paragraph: 

12 ‘‘(6) PUBLIC POWER PROVIDER.—The term 

13 ‘public power provider’ means a State utility with a 

14 service obligation, as such terms are defined in sec15 tion 217 of the Federal Power Act (as in effect on 

16 the date of the enactment of this paragraph).’’, and 

17 (2) by inserting ‘‘; PUBLIC POWER PROVIDER’’ 

18 before the period at the end of the heading. 

19 (d) TECHNICAL AMENDMENT.—The third sentence of 

20 section 54(e)(2) is amended by striking ‘‘subsection 

21 (l)(6)’’ and inserting ‘‘subsection (l)(5)’’. 

22 (e) EFFECTIVE DATE.—The amendments made by 

23 this section shall apply to bonds issued after the date of 

24 the enactment of this Act. 


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1 SEC. 105. EXTENSION OF SPECIAL RULE TO IMPLEMENT 

2 FERC RESTRUCTURING POLICY. 

3 (a) QUALIFYING ELECTRIC TRANSMISSION TRANS4 ACTION.— 

5 (1) IN GENERAL.—Section 451(i)(3) (defining 

6 qualifying electric transmission transaction) is 

7 amended by striking ‘‘January 1, 2008’’ and insert8 ing ‘‘January 1, 2012’’. 

9 (2) EFFECTIVE DATE.—The amendment made 

10 by this subsection shall apply to transactions after 

11 December 31, 2007. 

12 (b) INDEPENDENT TRANSMISSION COMPANY.— 

13 (1) IN GENERAL.—Section 451(i)(4)(B)(ii) (de14 fining independent transmission company) is amend15 ed by striking ‘‘December 31, 2007’’ and inserting 

16 ‘‘the date which is 5 years after the date of such 

17 transaction’’. 

18 (2) EFFECTIVE DATE.—The amendment made 

19 by this subsection shall take effect as if included in 

20 the amendments made by section 909 of the Amer21 ican Jobs Creation Act of 2004. 


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1 TITLE II—EXTENSION OF INCEN2 TIVES TO IMPROVE ENERGY 

3 EFFICIENCY 

4 SEC. 201. EXTENSION AND MODIFICATION OF CREDIT FOR 

5 ENERGY EFFICIENCY IMPROVEMENTS TO EX6 ISTING HOMES. 

7 (a) EXTENSION OF CREDIT.—Section 25C(g) (relat8 ing to termination) is amended by striking ‘‘December 31, 

9 2007’’ and inserting ‘‘December 31, 2011’’. 

10 (b) QUALIFIED BIOMASS FUEL PROPERTY.— 

11 (1) IN GENERAL.—Section 25C(d)(3) is amend12 ed— 

13 (A) by striking ‘‘and’’ at the end of sub14 paragraph (D), 

15 (B) by striking the period at the end of 

16 subparagraph (E) and inserting ‘‘, and’’, and 

17 (C) by adding at the end the following new 

18 subparagraph: 

19 ‘‘(F) a stove which uses the burning of bio20 mass fuel to heat a dwelling unit located in the 

21 United States and used as a residence by the 

22 taxpayer, or to heat water for use in such a 

23 dwelling unit, and which has a thermal effi24 ciency rating of at least 75 percent.’’. 


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1 (2) BIOMASS FUEL.—Section 25C(d) (relating 

2 to residential energy property expenditures) is 

3 amended by adding at the end the following new 

4 paragraph: 

5 ‘‘(6) BIOMASS FUEL.—The term ‘biomass fuel’ 

6 means any plant-derived fuel available on a renew7 able or recurring basis, including agricultural crops 

8 and trees, wood and wood waste and residues (in9 cluding wood pellets), plants (including aquatic 

10 plants), grasses, residues, and fibers.’’. 

11 (c) MODIFICATIONS OF STANDARDS FOR ENERGY12 EFFICIENT BUILDING PROPERTY.— 

13 (1) ELECTRIC HEAT PUMPS.—Subparagraph 

14 (B) of section 25C(d)(3) is amended to read as fol15 lows: 

16 ‘‘(A) an electric heat pump which achieves 

17 the highest efficiency tier established by the 

18 Consortium for Energy Efficiency, as in effect 

19 on January 1, 2008.’’. 

20 (2) CENTRAL AIR CONDITIONERS.—Section 

21 25C(d)(3)(D) is amended by striking ‘‘2006’’ and 

22 inserting ‘‘2008’’. 

23 (3) WATER HEATERS.—Subparagraph (E) of 

24 section 25C(d) is amended to read as follows: 


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1 ‘‘(E) a natural gas, propane, or oil water 

2 heater which has either an energy factor of at 

3 least 0.80 or a thermal efficiency of at least 90 

4 percent.’’. 

5 (4) OIL FURNACES AND HOT WATER BOIL6 ERS.—Paragraph (4) of section 25C(d) is amended 

7 to read as follows: 

8 ‘‘(4) QUALIFIED NATURAL GAS, PROPANE, AND

9 OIL FURNACES AND HOT WATER BOILERS.— 

10 ‘‘(A) QUALIFIED NATURAL GAS FUR11 NACE.—The term ‘qualified natural gas fur12 nace’ means any natural gas furnace which 

13 achieves an annual fuel utilization efficiency 

14 rate of not less than 95. 

15 ‘‘(B) QUALIFIED NATURAL GAS HOT

16 WATER BOILER.—The term ‘qualified natural 

17 gas hot water boiler’ means any natural gas hot 

18 water boiler which achieves an annual fuel utili19 zation efficiency rate of not less than 90. 

20 ‘‘(C) QUALIFIED PROPANE FURNACE.— 

21 The term ‘qualified propane furnace’ means any 

22 propane furnace which achieves an annual fuel 

23 utilization efficiency rate of not less than 95. 

24 ‘‘(D) QUALIFIED PROPANE HOT WATER

25 BOILER.—The term ‘qualified propane hot 


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1 water boiler’ means any propane hot water boil2 er which achieves an annual fuel utilization effi3 ciency rate of not less than 90. 

4 ‘‘(E) QUALIFIED OIL FURNACES.—The 

5 term ‘qualified oil furnace’ means any oil fur6 nace which achieves an annual fuel utilization 

7 efficiency rate of not less than 90. 

8 ‘‘(F) QUALIFIED OIL HOT WATER BOIL9 ER.—The term ‘qualified oil hot water boiler’ 

10 means any oil hot water boiler which achieves 

11 an annual fuel utilization efficiency rate of not 

12 less than 90.’’. 

13 (d) EFFECTIVE DATE.—The amendments made this 

14 section shall apply to expenditures made after December 

15 31, 2007. 

16 SEC. 202. EXTENSION AND MODIFICATION OF TAX CREDIT 

17 FOR ENERGY EFFICIENT NEW HOMES. 

18 (a) EXTENSION OF CREDIT.—Subsection (g) of sec19 tion 45L (relating to termination) is amended by striking 

20 ‘‘December 31, 2008’’ and inserting ‘‘December 31, 

21 2012’’. 

22 (b) ALLOWANCE FOR CONTRACTOR’S PERSONAL

23 RESIDENCE.—Subparagraph (B) of section 45L(a)(1) is 

24 amended to read as follows: 


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1 ‘‘(B)(i) acquired by a person from such eli2 gible contractor and used by any person as a 

3 residence during the taxable year, or 

4 ‘‘(ii) used by such eligible contractor as a 

5 residence during the taxable year.’’. 

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

7 this section shall apply to homes acquired after December 

8 31, 2008. 

9 SEC. 203. EXTENSION AND MODIFICATION OF ENERGY EF10 FICIENT COMMERCIAL BUILDINGS DEDUC11 TION. 

12 (a) EXTENSION.—Section 179D(h) (relating to ter13 mination) is amended by striking ‘‘December 31, 2008’’ 

14 and inserting ‘‘December 31, 2012’’. 

15 (b) ADJUSTMENT OF MAXIMUM DEDUCTION

16 AMOUNT.— 

17 (1) IN GENERAL.—Subparagraph (A) of section 

18 179D(b)(1) (relating to maximum amount of deduc19 tion) is amended by striking ‘‘$1.80’’ and inserting 

20 ‘‘$2.25’’. 

21 (2) PARTIAL ALLOWANCE.—Paragraph (1) of 

22 section 179D(d) is amended— 

23 (A) by striking ‘‘$.60’’ and inserting 

24 ‘‘$0.75’’, and 


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1 (B) by striking ‘‘$1.80’’ and inserting 

2 ‘‘$2.25’’. 

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

4 this section shall apply to property placed in service after 

5 the date of the enactment of this Act. 

6 SEC. 204. MODIFICATION AND EXTENSION OF ENERGY EF7 FICIENT APPLIANCE CREDIT FOR APPLI8 ANCES PRODUCED AFTER 2007. 

9 (a) IN GENERAL.—Subsection (b) of section 45M (re10 lating to applicable amount) is amended to read as follows: 

11 ‘‘(b) APPLICABLE AMOUNT.—For purposes of sub12 section (a)— 

13 ‘‘(1) DISHWASHERS.—The applicable amount 

14 is— 

15 ‘‘(A) $45 in the case of a dishwasher which 

16 is manufactured in calendar year 2008 or 2009 

17 and which uses no more than 324 kilowatt 

18 hours per year and 5.8 gallons per cycle, and 

19 ‘‘(B) $75 in the case of a dishwasher 

20 which is manufactured in calendar year 2008, 

21 2009, or 2010 and which uses no more than 

22 307 kilowatt hours per year and 5.0 gallons per 

23 cycle (5.5 gallons per cycle for dishwashers de24 signed for greater than 12 place settings). 


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1 ‘‘(2) CLOTHES WASHERS.—The applicable 

2 amount is— 

3 ‘‘(A) $75 in the case of a residential top4 loading clothes washer manufactured in cal5 endar year 2008 which meets or exceeds a 1.72 

6 modified energy factor and does not exceed a 

7 8.0 water consumption factor, 

8 ‘‘(B) $125 in the case of a residential top9 loading clothes washer manufactured in cal10 endar year 2008 or 2009 which meets or ex11 ceeds a 1.8 modified energy factor and does not 

12 exceed a 7.5 water consumption factor, 

13 ‘‘(C) $150 in the case of a residential or 

14 commercial clothes washer manufactured in cal15 endar year 2008, 2009, or 2010 which meets or 

16 exceeds 2.0 modified energy factor and does not 

17 exceed a 6.0 water consumption factor, and 

18 ‘‘(D) $250 in the case of a residential or 

19 commercial clothes washer manufactured in cal20 endar year 2008, 2009, or 2010 which meets or 

21 exceeds 2.2 modified energy factor and does not 

22 exceed a 4.5 water consumption factor. 

23 ‘‘(3) REFRIGERATORS.—The applicable amount 

24 is— 


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1 ‘‘(A) $50 in the case of a refrigerator 

2 which is manufactured in calendar year 2008, 

3 and consumes at least 20 percent but not more 

4 than 22.9 percent less kilowatt hours per year 

5 than the 2001 energy conservation standards, 

6 ‘‘(B) $75 in the case of a refrigerator 

7 which is manufactured in calendar year 2008 or 

8 2009, and consumes at least 23 percent but no 

9 more than 24.9 percent less kilowatt hours per 

10 year than the 2001 energy conservation stand11 ards, 

12 ‘‘(C) $100 in the case of a refrigerator 

13 which is manufactured in calendar year 2008, 

14 2009, or 2010, and consumes at least 25 per15 cent but not more than 29.9 percent less kilo16 watt hours per year than the 2001 energy con17 servation standards, and 

18 ‘‘(D) $200 in the case of a refrigerator 

19 manufactured in calendar year 2008, 2009, or 

20 2010 and which consumes at least 30 percent 

21 less energy than the 2001 energy conservation 

22 standards.’’. 

23 (b) ELIGIBLE PRODUCTION.— 


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1 (1) SIMILAR TREATMENT FOR ALL APPLI2 ANCES.—Subsection (c) of section 45M (relating to 

3 eligible production) is amended— 

4 (A) by striking paragraph (2), 

5 (B) by striking ‘‘(1) IN GENERAL’’ and all 

6 that follows through ‘‘the eligible’’ and inserting 

7 ‘‘The eligible’’, and 

8 (C) by moving the text of such subsection 

9 in line with the subsection heading and redesig10 nating subparagraphs (A) and (B) as para11 graphs (1) and (2), respectively. 

12 (2) MODIFICATION OF BASE PERIOD.—Para13 graph (2) of section 45M(c), as amended by para14 graph (1) of this section, is amended by striking ‘‘3- 

15 calendar year’’ and inserting ‘‘2-calendar year’’. 

16 (c) TYPES OF ENERGY EFFICIENT APPLIANCES.— 

17 Subsection (d) of section 45M (defining types of energy 

18 efficient appliances) is amended to read as follows: 

19 ‘‘(d) TYPES OF ENERGY EFFICIENT APPLIANCE.— 

20 For purposes of this section, the types of energy efficient 

21 appliances are— 

22 ‘‘(1) dishwashers described in subsection (b)(1), 

23 ‘‘(2) clothes washers described in subsection 

24 (b)(2), and 


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1 ‘‘(3) refrigerators described in subsection 

2 (b)(3).’’. 

3 (d) AGGREGATE CREDIT AMOUNT ALLOWED.— 

4 (1) INCREASE IN LIMIT.—Paragraph (1) of sec5 tion 45M(e) (relating to aggregate credit amount al6 lowed) is amended to read as follows: 

7 ‘‘(1) AGGREGATE CREDIT AMOUNT ALLOWED.— 

8 The aggregate amount of credit allowed under sub9 section (a) with respect to a taxpayer for any tax10 able year shall not exceed $75,000,000 reduced by 

11 the amount of the credit allowed under subsection 

12 (a) to the taxpayer (or any predecessor) for all prior 

13 taxable years beginning after December 31, 2007.’’. 

14 (2) EXCEPTION FOR CERTAIN REFRIGERATOR

15 AND CLOTHES WASHERS.—Paragraph (2) of section 

16 45M(e) is amended to read as follows: 

17 ‘‘(2) AMOUNT ALLOWED FOR CERTAIN REFRIG18 ERATORS AND CLOTHES WASHERS.—Refrigerators 

19 described in subsection (b)(3)(D) and clothes wash20 ers described in subsection (b)(2)(D) shall not be 

21 taken into account under paragraph (1).’’. 

22 (e) QUALIFIED ENERGY EFFICIENT APPLIANCES.— 

23 (1) IN GENERAL.—Paragraph (1) of section 

24 45M(f) (defining qualified energy efficient appliance) 

25 is amended to read as follows: 


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1 ‘‘(1) QUALIFIED ENERGY EFFICIENT APPLI2 ANCE.—The term ‘qualified energy efficient appli3 ance’ means— 

4 ‘‘(A) any dishwasher described in sub5 section (b)(1), 

6 ‘‘(B) any clothes washer described in sub7 section (b)(2), and 

8 ‘‘(C) any refrigerator described in sub9 section (b)(3).’’. 

10 (2) CLOTHES WASHER.—Section 45M(f)(3) (de11 fining clothes washer) is amended by inserting 

12 ‘‘commercial’’ before ‘‘residential’’ the second place 

13 it appears. 

14 (3) TOP-LOADING CLOTHES WASHER.—Sub15 section (f) of section 45M (relating to definitions) is 

16 amended by redesignating paragraphs (4), (5), (6), 

17 and (7) as paragraphs (5), (6), (7), and (8), respec18 tively, and by inserting after paragraph (3) the fol19 lowing new paragraph: 

20 ‘‘(4) TOP-LOADING CLOTHES WASHER.—The 

21 term ‘top-loading clothes washer’ means a clothes 

22 washer which has the clothes container compartment 

23 access located on the top of the machine and which 

24 operates on a vertical axis.’’. 


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1 (4) REPLACEMENT OF ENERGY FACTOR.—Sec2 tion 45M(f)(6), as redesignated by paragraph (3), is 

3 amended to read as follows: 

4 ‘‘(6) MODIFIED ENERGY FACTOR.—The term 

5 ‘modified energy factor’ means the modified energy 

6 factor established by the Department of Energy for 

7 compliance with the Federal energy conservation 

8 standard.’’. 

9 (5) GALLONS PER CYCLE; WATER CONSUMP10 TION FACTOR.—Section 45M(f) (relating to defini11 tions), as amended by paragraph (3), is amended by 

12 adding at the end the following: 

13 ‘‘(9) GALLONS PER CYCLE.—The term ‘gallons 

14 per cycle’ means, with respect to a dishwasher, the 

15 amount of water, expressed in gallons, required to 

16 complete a normal cycle of a dishwasher. 

17 ‘‘(10) WATER CONSUMPTION FACTOR.—The 

18 term ‘water consumption factor’ means, with respect 

19 to a clothes washer, the quotient of the total weight20 ed per-cycle water consumption divided by the cubic 

21 foot (or liter) capacity of the clothes washer.’’. 

22 (f) EFFECTIVE DATE.—The amendments made by 

23 this section shall apply to appliances produced after De24 cember 31, 2007. 


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1 TITLE III—REVENUE 

2 PROVISIONS 

3 SEC. 301. DENIAL OF DEDUCTION FOR MAJOR INTEGRATED 

4 OIL COMPANIES FOR INCOME ATTRIBUTABLE 

5 TO DOMESTIC PRODUCTION OF OIL, GAS, OR 

6 PRIMARY PRODUCTS THEREOF. 

7 (a) IN GENERAL.—Subparagraph (B) of section 

8 199(c)(4) of the Internal Revenue Code of 1986 (relating 

9 to exceptions) is amended by striking ‘‘or’’ at the end of 

10 clause (ii), by striking the period at the end of clause (iii) 

11 and inserting ‘‘, or’’, and by inserting after clause (iii) the 

12 following new clause: 

13 ‘‘(iv) in the case of any major inte14 grated oil company (as defined in section 

15 167(h)(5)(B)), the production, refining, 

16 processing, transportation, or distribution 

17 of oil, gas, or any primary product thereof 

18 during any taxable year described in sec19 tion 167(h)(5)(B).’’. 

20 (b) PRIMARY PRODUCT.—Section 199(c)(4)(B) of 

21 such Code is amended by adding at the end the following 

22 flush sentence: 

23 ‘‘For purposes of clause (iv), the term ‘primary 

24 product’ has the same meaning as when used in 


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1 section 927(a)(2)(C), as in effect before its re2 peal.’’. 

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

4 this section shall apply to taxable years beginning after 

5 December 31, 2007. 

6 SEC. 302. ELIMINATION OF THE DIFFERENT TREATMENT 

7 OF FOREIGN OIL AND GAS EXTRACTION IN8 COME AND FOREIGN OIL RELATED INCOME 

9 FOR PURPOSES OF THE FOREIGN TAX CRED10 IT. 

11 (a) IN GENERAL.—Subsections (a) and (b) of section 

12 907 (relating to special rules in case of foreign oil and 

13 gas income) are amended to read as follows: 

14 ‘‘(a) REDUCTION IN AMOUNT ALLOWED AS FOREIGN

15 TAX UNDER SECTION 901.—In applying section 901, the 

16 amount of any foreign oil and gas taxes paid or accrued 

17 (or deemed to have been paid) during the taxable year 

18 which would (but for this subsection) be taken into ac19 count for purposes of section 901 shall be reduced by the 

20 amount (if any) by which the amount of such taxes ex21 ceeds the product of— 

22 ‘‘(1) the amount of the combined foreign oil 

23 and gas income for the taxable year, 

24 ‘‘(2) multiplied by— 


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1 ‘‘(A) in the case of a corporation, the per2 centage which is equal to the highest rate of tax 

3 specified under section 11(b), or 

4 ‘‘(B) in the case of an individual, a frac5 tion the numerator of which is the tax against 

6 which the credit under section 901(a) is taken 

7 and the denominator of which is the taxpayer’s 

8 entire taxable income. 

9 ‘‘(b) COMBINED FOREIGN OIL AND GAS INCOME; 

10 FOREIGN OIL AND GAS TAXES.—For purposes of this sec11 tion— 

12 ‘‘(1) COMBINED FOREIGN OIL AND GAS IN13 COME.—The term ‘combined foreign oil and gas in14 come’ means, with respect to any taxable year, the 

15 sum of— 

16 ‘‘(A) foreign oil and gas extraction income, 

17 and 

18 ‘‘(B) foreign oil related income. 

19 ‘‘(2) FOREIGN OIL AND GAS TAXES.—The term 

20 ‘foreign oil and gas taxes’ means, with respect to 

21 any taxable year, the sum of— 

22 ‘‘(A) oil and gas extraction taxes, and 

23 ‘‘(B) any income, war profits, and excess 

24 profits taxes paid or accrued (or deemed to 

25 have been paid or accrued under section 902 or 


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1 960) during the taxable year with respect to 

2 foreign oil related income (determined without 

3 regard to subsection (c)(4)) or loss which would 

4 be taken into account for purposes of section 

5 901 without regard to this section.’’. 

6 (b) RECAPTURE OF FOREIGN OIL AND GAS

7 LOSSES.—Paragraph (4) of section 907(c) (relating to re8 capture of foreign oil and gas extraction losses by re9 characterizing later extraction income) is amended to read 

10 as follows: 

11 ‘‘(4) RECAPTURE OF FOREIGN OIL AND GAS

12 LOSSES BY RECHARACTERIZING LATER COMBINED

13 FOREIGN OIL AND GAS INCOME.— 

14 ‘‘(A) IN GENERAL.—The combined foreign 

15 oil and gas income of a taxpayer for a taxable 

16 year (determined without regard to this para17 graph) shall be reduced— 

18 ‘‘(i) first by the amount determined 

19 under subparagraph (B), and 

20 ‘‘(ii) then by the amount determined 

21 under subparagraph (C). 

22 The aggregate amount of such reductions shall 

23 be treated as income (from sources without the 

24 United States) which is not combined foreign 

25 oil and gas income. 


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1 ‘‘(B) REDUCTION FOR PRE-2008FOREIGN

2 OIL EXTRACTION LOSSES.—The reduction 

3 under this paragraph shall be equal to the less4 er of— 

5 ‘‘(i) the foreign oil and gas extraction 

6 income of the taxpayer for the taxable year 

7 (determined without regard to this para8 graph), or 

9 ‘‘(ii) the excess of— 

10 ‘‘(I) the aggregate amount of for11 eign oil extraction losses for preceding 

12 taxable years beginning after Decem13 ber 31, 1982, and before January 1, 

14 2008, over 

15 ‘‘(II) so much of such aggregate 

16 amount as was recharacterized under 

17 this paragraph (as in effect before 

18 and after the date of the enactment of 

19 the Energy Advancement and Invest20 ment Act of 2007) for preceding tax21 able years beginning after December 

22 31, 1982. 

23 ‘‘(C) REDUCTION FOR POST-2008FOREIGN

24 OIL AND GAS LOSSES.—The reduction under 

25 this paragraph shall be equal to the lesser of— 


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1 ‘‘(i) the combined foreign oil and gas 

2 income of the taxpayer for the taxable year 

3 (determined without regard to this para4 graph), reduced by an amount equal to the 

5 reduction under subparagraph (A) for the 

6 taxable year, or 

7 ‘‘(ii) the excess of— 

8 ‘‘(I) the aggregate amount of for9 eign oil and gas losses for preceding 

10 taxable years beginning after Decem11 ber 31, 2007, over 

12 ‘‘(II) so much of such aggregate 

13 amount as was recharacterized under 

14 this paragraph for preceding taxable 

15 years beginning after December 31, 

16 2007. 

17 ‘‘(D) FOREIGN OIL AND GAS LOSS DE18 FINED.— 

19 ‘‘(i) IN GENERAL.—For purposes of 

20 this paragraph, the term ‘foreign oil and 

21 gas loss’ means the amount by which— 

22 ‘‘(I) the gross income for the tax23 able year from sources without the 

24 United States and its possessions 

25 (whether or not the taxpayer chooses 


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•S 3336 IS

1 the benefits of this subpart for such 

2 taxable year) taken into account in 

3 determining the combined foreign oil 

4 and gas income for such year, is ex5 ceeded by 

6 ‘‘(II) the sum of the deductions 

7 properly apportioned or allocated 

8 thereto. 

9 ‘‘(ii) NET OPERATING LOSS DEDUC10 TION NOT TAKEN INTO ACCOUNT.—For 

11 purposes of clause (i), the net operating 

12 loss deduction allowable for the taxable 

13 year under section 172(a) shall not be 

14 taken into account. 

15 ‘‘(iii) EXPROPRIATION AND CASUALTY

16 LOSSES NOT TAKEN INTO ACCOUNT.—For 

17 purposes of clause (i), there shall not be 

18 taken into account— 

19 ‘‘(I) any foreign expropriation 

20 loss (as defined in section 172(h) (as 

21 in effect on the day before the date of 

22 the enactment of the Revenue Rec23 onciliation Act of 1990)) for the tax24 able year, or 


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1 ‘‘(II) any loss for the taxable 

2 year which arises from fire, storm, 

3 shipwreck, or other casualty, or from 

4 theft, 

5 to the extent such loss is not compensated 

6 for by insurance or otherwise. 

7 ‘‘(iv) FOREIGN OIL EXTRACTION

8 LOSS.—For purposes of subparagraph 

9 (B)(ii)(I), foreign oil extraction losses shall 

10 be determined under this paragraph as in 

11 effect on the day before the date of the en12 actment of the Energy Advancement and 

13 Investment Act of 2007.’’. 

14 (c) CARRYBACK AND CARRYOVER OF DISALLOWED

15 CREDITS.—Section 907(f) (relating to carryback and car16 ryover of disallowed credits) is amended— 

17 (1) by striking ‘‘oil and gas extraction taxes’’ 

18 each place it appears and inserting ‘‘foreign oil and 

19 gas taxes’’, and 

20 (2) by adding at the end the following new 

21 paragraph: 

22 ‘‘(4) TRANSITION RULES FOR PRE-2008AND

23 2008DISALLOWED CREDITS.— 

24 ‘‘(A) PRE-2008CREDITS.—In the case of 

25 any unused credit year beginning before JanuVerDate Aug 31 2005 01:45 Jul 27, 2008 Jkt 069200 PO 00000 Frm 00035 Fmt 6652 Sfmt 6201 E:\BILLS\S3336.IS S3336

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1 ary 1, 2008, this subsection shall be applied to 

2 any unused oil and gas extraction taxes carried 

3 from such unused credit year to a year begin4 ning after December 31, 2007, by substituting 

5 ‘oil and gas extraction taxes’ for ‘foreign oil and 

6 gas taxes’ each place it appears in paragraphs 

7 (1), (2), and (3), and by substituting ‘foreign 

8 oil and gas extraction income’ for ‘foreign oil 

9 and gas income’ in applying subsection (a) for 

10 each relevant year. 

11 ‘‘(B) 2008 CREDITS.—In the case of any 

12 unused credit year beginning in 2008, the 

13 amendments made to this subsection by the En14 ergy Advancement and Investment Act of 2007 

15 shall be treated as being in effect for any pre16 ceding year beginning before January 1, 2008, 

17 solely for purposes of determining how much of 

18 the unused foreign oil and gas taxes for such 

19 unused credit year may be deemed paid or ac20 crued in such preceding year.’’. 

21 (d) CONFORMING AMENDMENT.—Section 6501(i) is 

22 amended by striking ‘‘oil and gas extraction taxes’’ and 

23 inserting ‘‘foreign oil and gas taxes’’. 


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1 (e) EFFECTIVE DATE.—The amendments made by 

2 this section shall apply to taxable years beginning after 

3 December 31, 2007. 

Æ 


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