I 

108TH CONGRESS 

1ST SESSION H. R. 870

To amend the Internal Revenue Code of 1986 to provide for the treatment 

of certain motor vehicle dealer transitional assistance. 

IN THE HOUSE OF REPRESENTATIVES 

FEBRUARY 25, 2003

Mr. CAMP (for himself, Mr. LEVIN, Mr. MCCRERY, Mr. NEAL of Massachusetts, Mr. ROGERS of Michigan, Mr. BECERRA, Mr. ENGLISH, Mr. 

DOGGETT, Mr. LEWIS of Kentucky, Mr. PALLONE, and Mr. HAYWORTH) 

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 provide 

for the treatment of certain motor vehicle dealer transitional assistance.

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

3 SECTION 1. MOTOR VEHICLE DEALER TRANSITIONAL AS4 SISTANCE. 

5 (a) IN GENERAL.—For purposes of subtitle A of the 

6 Internal Revenue Code of 1986, in the case of a taxpayer 

7 who elects the application of this section and who was a 

8 party to a motor vehicle sales and service agreement with 
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1 a motor vehicle manufacturer who announced in December 

2 2000 that it would phase-out the motor vehicle brand to 

3 which such agreement relates—

4 (1) amounts received by such taxpayer from 

5 such manufacturer on account of the termination of 

6 such agreement (hereafter in this section referred to 

7 as ‘‘termination payment’’) are considered to be re8 ceived for property used in the trade or business of 

9 a motor vehicle retail sales and service dealership, 

10 and 

11 (2) to the extent such termination payment is 

12 reinvested in property used in a motor vehicle retail 

13 sales and service dealership located within the 

14 United States, such property shall qualify as like15 kind replacement property to which section 1031 of 

16 the Internal Revenue Code of 1986 shall apply with 

17 the following modifications: 

18 (A) Such section shall be applied without 

19 regard to subparagraphs (A) and (B)(ii) of sub20 section (a)(3). 

21 (B) The period described in section 

22 1031(a)(3)(B) of such Code shall be applied by 

23 substituting ‘‘2 years’’ for ‘‘180 days’’. 

24 (b) RULES FOR ELECTION.—
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1 (1) FORM OF ELECTION.—The taxpayer shall 

2 make an election under this section in such form 

3 and manner as the Secretary of the Treasury may 

4 prescribe and shall include in such election the 

5 amount of the termination payment received, the 

6 identification of the replacement property purchased, 

7 and such other information as the Secretary may 

8 prescribe. 

9 (2) ELECTION ON AMENDED RETURN.—The 

10 Secretary of the Treasury shall permit an election 

11 under this section on an amended tax return for tax12 able years beginning before the date of the enact13 ment of this Act. 

14 (c) STATUTE OF LIMITATIONS.—Notwithstanding the 

15 provisions of any other law or rule of law, the statutory 

16 period for the assessment for any deficiency attributable 

17 to any termination payment gain shall be extended until 

18 3 years after the date the Secretary of the Treasury is 

19 notified by the taxpayer of the like-kind replacement prop20 erty or an intention not to replace. 

21 (d) EFFECTIVE DATE.—This section shall apply to 

22 amounts received after December 12, 2000, in taxable 

23 years ending after such date.

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