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103D CONGRESS

1ST SESSION H. R. 2024

To clarify the tax treatment of intermodal containers.

IN THE HOUSE OF REPRESENTATIVES

MAY 6, 1993

Mr. MATSUI (for himself and Mr. THOMAS of California) introduced the

following bill; which was referred to the Committee on Ways and Means

A BILL

To clarify the tax treatment of intermodal containers.

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

3 SECTION 1. TREATMENT OF CERTAIN CARGO CONTAINERS.

4 (a) GENERAL RULE.—A qualified intermodal cargo

5 container shall be treated as property described in section

6 48(a)(2)(B)(v) of the Internal Revenue Code of 1986 (as

7 in effect on the day before the date of enactment of the

8 Revenue Reconciliation Act of 1990).

9 (b) QUALIFIED INTERMODAL CARGO CONTAINER.—

10 (1) GENERAL RULE.—For purposes of this sec11 tion, the term ‘‘qualified intermodal cargo con12 tainer’’ means any intermodal cargo container of a
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1 United States person which, after being placed in

2 service, at all times during the taxable year either—

3 (A) is subject to a qualifying lease, or

4 (B) is being—

5 (i) held for lease,

6 (ii) moved for purposes of leasing or

7 being available for lease, or

8 (iii) maintained or repaired for subse9 quent lease,

10 by the taxpayer, a lessee or agent of the tax11 payer or any other person.

12 (2) DEFINITIONS.—For purposes of this sub13 section—

14 (A) QUALIFYING LEASE.—The term

15 ‘‘qualifying lease’’ means—

16 (i) any lease to a container user that

17 has one or more trade routes that contact

18 the United States, or

19 (ii) any short-term lease to a con20 tainer user.

21 (B) CONTAINER USER.—The term ‘‘con22 tainer user’’ means—

23 (i) a person that is in the business of

24 using intermodal cargo containers to ship

25 or transport cargo for other persons, or
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1 (ii) with respect to an intermodal

2 cargo container, a person that uses the

3 container to ship or transport its own

4 cargo.

5 (C) U.S. TRADE ROUTES.—A container

6 user shall be deemed to have one or more trade

7 routes that contact the United States if at any

8 time during the taxable year such person—

9 (i) owns, operates, or charters any

10 vessel that receives or delivers any inter11 modal cargo container in the United

12 States, or

13 (ii) uses any intermodal cargo con14 tainer to ship cargo to or from the United

15 States.

16 (D) SHORT-TERM LEASE.—The term

17 ‘‘short-term lease’’ means—

18 (i) any lease the stated term of which

19 is not more than 50 percent of the class

20 life (within the meaning of section

21 168(i)(1) of the Internal Revenue Code of

22 1986) of the container, and

23 (ii) any lease under a lease agreement

24 under which the lessee is not required to
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1 use or hold the container for a specified

2 term.

3 (E) LEASE.—The term ‘‘lease’’ means

4 lease or sublease.

5 SEC. 2. NO INFERENCE.

6 No inference shall be drawn from this Act as to the

7 application of section 48(a)(2)(B)(v) of the Internal Reve8 nue Code of 1986 (as in effect on the day before the date

9 of enactment of the Revenue Reconciliation Act of 1990)

10 or section 168(g)(4)(E) of the Internal Revenue Code of

11 1986 to containers that are not qualified intermodal cargo

12 containers or to containers placed in service after Decem13 ber 31, 1989.

14 SEC. 3. REVOCATION OF PRIOR ELECTION.

15 (a) GENERAL RULE.—Any election made under In16 ternal Revenue Service Revenue Procedure 90–10 prior to

17 the date of enactment of this Act may be revoked without

18 the consent of the Secretary of the Treasury or his dele19 gate. An election revoked under this section shall be treat20 ed as never having been made.

21 (b) TIME AND MANNER OF REVOCATION.—Any rev22 ocation under subsection (a) shall be made within 180

23 days after the date of enactment of this Act by filing with

24 the Secretary of the Treasury or his delegate—
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1 (1) a statement describing the election being re2 voked and indicating that the election is revoked,

3 and

4 (2) an amended return consistent with such

5 revocation.

6 SEC. 4. EFFECTIVE DATE.

7 (a) GENERAL RULE.—Section 1 shall apply to all

8 intermodal cargo containers placed in service before Janu9 ary 1, 1990.

10 (b) REVOCATION OF ELECTION.—Section 3 shall

11 take effect on the date of the enactment of this Act.

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