IMPACT Act of 2014

To amend the Internal Revenue Code of 1986 to provide incentives for clean energy and to repeal fossil fuel subsidies for big oil companies. 1. Short title; table of contents (a) Short title This Act may be cited as the Investing to Modernize the Production of American Clean Energy and Technology Act of 2014 IMPACT Act of 2014 (b) Table of contents The table of contents of this Act is as follows: Sec. 1. Short title; table of contents. Title I—Clean energy incentives Subtitle A—Renewable energy Sec. 101. Extension of renewable energy credits. Sec. 102. Extension of election of investment tax credit in lieu of production credit. Sec. 103. Extension of qualifying advanced energy project credit. Sec. 104. Extension of credit for energy-efficient new homes. Sec. 105. Extension of credit for energy-efficient appliances. Subtitle B—Electric, natural gas, and hydrogen vehicles Sec. 111. Increase and expansion of credit for qualified plug-in electric drive motor vehicles. Sec. 112. Extension of new qualified alternative fuel motor vehicle credit for heavy natural gas vehicles. Sec. 113. Modification of credit for alternative fuel vehicle refueling property for vehicles powered by electricity, natural gas, or hydrogen. Sec. 114. Electric, natural gas, and hydrogen vehicle refueling property tax credit bonds. Title II—Repeal of fossil fuel subsidies for big oil companies Sec. 201. Prohibition on using last-in, first-out accounting for major integrated oil companies. Sec. 202. Modifications of foreign tax credit rules applicable to major integrated oil companies which are dual capacity taxpayers. Sec. 203. Limitation on section 199 deduction attributable to oil, natural gas, or primary products thereof. Sec. 204. Limitation on deduction for intangible drilling and development costs. Sec. 205. Limitation on percentage depletion allowance for oil and gas wells. Sec. 206. Limitation on deduction for tertiary injectants. I Clean energy incentives A Renewable energy 101. Extension of renewable energy credits (a) Wind, biomass, geothermal, small irrigation, landfill gas, hydropower, marine, and hydrokinetic Each of the following provisions of section 45(d) of such Code is amended by striking January 1, 2014 January 1, 2024 (1) Paragraph (1). (2) Clauses (i) and (ii) of paragraph (2)(A). (3) Clauses (i)(I) and (ii) of paragraph (3)(A). (4) Paragraph (4). (5) Paragraph (6). (6) Subparagraphs (A) and (C) of paragraph (9). (7) Subparagraph (B) of paragraph (11). (b) Early termination in event of Federal renewable electricity requirement Subsection (d) of section 45 (12) Termination in event of Federal renewable electricity requirement Notwithstanding any other provision of this section, the term qualified facility . 102. Extension of election of investment tax credit in lieu of production credit (a) In general Clause (ii) of section 48(a)(5)(C) January 1, 2014 January 1, 2024 (b) Limitation Paragraph (5) of section 48(a) of such Code is amended by adding at the end the following new subparagraphs: (E) Limitation In the case of a qualifying offshore wind facility to which this paragraph applies and the total megawatt nameplate capacity of which exceeds 3,000 megawatts, the basis which would (but for this subparagraph) be taken into account under subsection (a) with respect to such facility shall not exceed the amount which bears the same ratio to such basis as— (i) 3000 megawatts, bears to (ii) the total megawatt nameplate capacity of such facility. (F) Qualifying offshore wind facility For purposes of this paragraph— (i) In general The term qualifying offshore wind facility (ii) Offshore facility The term offshore facility United States . (c) Effective date The amendments made by this section shall apply to facilities placed in service after December 31, 2013. 103. Extension of qualifying advanced energy project credit Paragraph (1) of section 48C(d) (C) Additional limitation amount (i) In general The total amount of credits that may be allocated under the program shall be increased by $5,000,000,000. (ii) Applications Notwithstanding the deadline for submitting applications specified in paragraph (2)(A), an applicant for certification with respect to credits allocated pursuant to clause (i) may submit an application to the Secretary at such time and in such manner as the Secretary may provide. (iii) Review, redistribution, and reallocation Notwithstanding the deadline for review specified in paragraph (4)(A), the Secretary shall review the credits allocated pursuant to clause (i) at such time as the Secretary determines appropriate. . 104. Extension of credit for energy-efficient new homes (a) In general Subsection (g) of section 45L December 31, 2013 December 31, 2016 (b) Effective date The amendment made by this section shall apply to homes acquired after December 31, 2013. 105. Extension of credit for energy-efficient appliances (a) In general Section 45M(b) or 2013 2013, 2014, 2015, or 2016 (b) Effective date The amendments made by this section shall apply to appliances produced after December 31, 2013. B Electric, natural gas, and hydrogen vehicles 111. Increase and expansion of credit for qualified plug-in electric drive motor vehicles (a) Increase in dollar limitation Paragraph (2) of section 30D(b) $2,500 $5,000 (b) Increase in limitation on number of vehicles eligible for credit Paragraph (2) of section 30D(e) of such Code is amended by striking 200,000 400,000 (c) Effective date The amendment made by this section shall apply to vehicles acquired after the date of the enactment of this Act. 112. Extension of new qualified alternative fuel motor vehicle credit for heavy natural gas vehicles (a) In general Paragraph (4) of section 30B(k) (December 31, 2018, in the case of a vehicle powered by compressed or liquefied natural gas and weighing more than 8,500 pounds) (b) Effective date The amendment made by this section shall apply to vehicles purchased after the date of the enactment of this Act. 113. Modification of credit for alternative fuel vehicle refueling property for vehicles powered by electricity, natural gas, or hydrogen (a) Special Rules for Property Placed in Service Before January 1, 2021 Subsection (e) of section 30C (7) Property for recharging vehicles powered by electricity, natural gas, or hydrogen In the case of property placed in service after December 31, 2013, and before January 1, 2021, which relates to electricity, natural gas, or hydrogen— (A) subsection (a) shall be applied by substituting 50 percent 30 percent (B) subsection (b)(1) shall be applied by substituting $50,000 $30,000 (C) subsection (b)(2) shall be applied by substituting $2,000 $1,000 . (b) Installation Costs Subsection (e) of section 30C of such Code, as amended by subsection (a), is amended by adding at the end the following: (8) Installation costs The cost of any qualified alternative fuel vehicle refueling property which relates to electricity, natural gas, or hydrogen shall include the cost of the original installation of such property. . (c) Termination of Credit Paragraph (1) of section 30C(g) of such Code is amended to read as follows: (1) in the case of property relating to electricity, natural gas, or hydrogen, after December 31, 2020, and . (d) Effective Date The amendments made by this section shall apply to property placed in service after December 31, 2013. 114. Electric, natural gas, and hydrogen vehicle refueling property tax credit bonds (a) In General Paragraph (1) of section 54A(d) or or (F) a qualified electric, natural gas, and hydrogen vehicle refueling property bond, . (b) Qualified Purpose Subparagraph (C) of section 54A(d)(2) of such Code is amended by striking and , and (vi) in the case of a qualified electric, natural gas, and hydrogen vehicle refueling property bond, a purpose specified in section 54G(a)(1). . (c) Bonds Allowed Subpart I of part IV of subchapter A of chapter 1 of such Code is amended by adding at the end the following new section: 54G. Qualified electric, natural gas, and hydrogen vehicle refueling property bonds (a) Qualified Electric, Natural Gas, and Hydrogen Vehicle Refueling Property Bond For purposes of this subpart, the term qualified electric, natural gas, and hydrogen vehicle refueling property bond (1) 100 percent of the available project proceeds of such issue are to be used for capital expenditures incurred by a qualified issuer for 1 or more qualified electric, natural gas, and hydrogen vehicle refueling properties, (2) the bond is issued by a qualified issuer, and (3) the issuer designates such bond for purposes of this section. (b) Reduced Credit Amount Notwithstanding paragraph (2) of section 54A(b), the annual credit determined with respect to any qualified electric, natural gas, and hydrogen vehicle refueling property bond is 70 percent of the amount which would (but for this subsection) otherwise be determined under such paragraph with respect to such bond. (c) Limitation on Amount of Bonds Designated The maximum aggregate face amount of bonds which may be designated under subsection (a) by any issuer shall not exceed the limitation amount allocated to such issuer under subsection (e). (d) National Limitation on Amount of Bonds Designated There is a national qualified electric, natural gas, and hydrogen vehicle refueling property bond limitation of $750,000,000. (e) Allocations The Secretary shall make allocations of the amount of the national qualified electric, natural gas, and hydrogen vehicle refueling property bond limitation described in subsection (d) among purposes described in subsection (a)(1) in such manner as the Secretary determines appropriate. (f) Definitions For purposes of this section— (1) Qualified electric, natural gas, and hydrogen vehicle refueling property The term qualified electric, natural gas, and hydrogen vehicle refueling property (2) Qualified issuer (A) In general The term qualified issuer (B) Governmental body The term governmental body (C) Public power provider The term public power provider (D) Cooperative electric company The term cooperative electric company . (d) Clerical Amendment The table of sections for subpart I of part IV of subchapter A of chapter 1 of the Internal Revenue Code of 1986 is amended by adding at the end the following new item: Sec. 54G. Qualified electric, natural gas, and hydrogen vehicle refueling property bonds. . (e) Effective Date The amendments made by this section shall apply to obligations issued after the date of the enactment of this Act. II Repeal of fossil fuel subsidies for big oil companies 201. Prohibition on using last-in, first-out accounting for major integrated oil companies (a) In general Section 472 (h) Major integrated oil companies Notwithstanding any other provision of this section, a major integrated oil company (as defined in section 167(h)(5)(B)) may not use the method provided in subsection (b) in inventorying of any goods. . (b) Effective date and special rule (1) In general The amendment made by subsection (a) shall apply to taxable years beginning after the date of the enactment of this Act. (2) Change in method of accounting In the case of any taxpayer required by the amendment made by this section to change its method of accounting for its first taxable year beginning after the date of the enactment of this Act— (A) such change shall be treated as initiated by the taxpayer, (B) such change shall be treated as made with the consent of the Secretary of the Treasury, and (C) the net amount of the adjustments required to be taken into account by the taxpayer under section 481 of the Internal Revenue Code of 1986 shall be taken into account ratably over a period (not greater than 8 taxable years) beginning with such first taxable year. 202. Modifications of foreign tax credit rules applicable to major integrated oil companies which are dual capacity taxpayers (a) In general Section 901 (n) Special rules relating to major integrated oil companies which are dual capacity taxpayers (1) General rule Notwithstanding any other provision of this chapter, any amount paid or accrued by a dual capacity taxpayer which is a major integrated oil company (as defined in section 167(h)(5)(B)) to a foreign country or possession of the United States for any period shall not be considered a tax— (A) if, for such period, the foreign country or possession does not impose a generally applicable income tax, or (B) to the extent such amount exceeds the amount (determined in accordance with regulations) which— (i) is paid by such dual capacity taxpayer pursuant to the generally applicable income tax imposed by the country or possession, or (ii) would be paid if the generally applicable income tax imposed by the country or possession were applicable to such dual capacity taxpayer. Nothing in this paragraph shall be construed to imply the proper treatment of any such amount not in excess of the amount determined under subparagraph (B). (2) Dual capacity taxpayer For purposes of this subsection, the term dual capacity taxpayer (A) is subject to a levy of such country or possession, and (B) receives (or will receive) directly or indirectly a specific economic benefit (as determined in accordance with regulations) from such country or possession. (3) Generally applicable income tax For purposes of this subsection— (A) In general The term generally applicable income tax (B) Exceptions Such term shall not include a tax unless it has substantial application, by its terms and in practice, to— (i) persons who are not dual capacity taxpayers, and (ii) persons who are citizens or residents of the foreign country or possession. . (b) Effective Date (1) In general The amendments made by this section shall apply to taxes paid or accrued in taxable years beginning after the date of the enactment of this Act. (2) Contrary treaty obligations upheld The amendments made by this section shall not apply to the extent contrary to any treaty obligation of the United States. 203. Limitation on section 199 deduction attributable to oil, natural gas, or primary products thereof (a) Denial of deduction Paragraph (4) of section 199(c) (E) Special rule for certain oil and gas income In the case of any taxpayer who is a major integrated oil company (as defined in section 167(h)(5)(B)) for the taxable year, the term domestic production gross receipts . (b) Effective date The amendment made by this section shall apply to taxable years beginning after December 31, 2013. 204. Limitation on deduction for intangible drilling and development costs (a) In general Section 263(c) This subsection shall not apply to amounts paid or incurred by a taxpayer in any taxable year in which such taxpayer is a major integrated oil company (as defined in section 167(h)(5)(B)). (b) Effective date The amendment made by this section shall apply to amounts paid or incurred in taxable years beginning after December 31, 2013. 205. Limitation on percentage depletion allowance for oil and gas wells (a) In general Section 613A (f) Application with respect to major integrated oil companies In the case of any taxable year in which the taxpayer is a major integrated oil company (as defined in section 167(h)(5)(B)), the allowance for percentage depletion shall be zero. . (b) Effective date The amendment made by this section shall apply to taxable years beginning after December 31, 2013. 206. Limitation on deduction for tertiary injectants (a) In general Section 193 (d) Application with respect to major integrated oil companies This section shall not apply to amounts paid or incurred by a taxpayer in any taxable year in which such taxpayer is a major integrated oil company (as defined in section 167(h)(5)(B)). . (b) Effective date The amendment made by this section shall apply to amounts paid or incurred in taxable years beginning after December 31, 2013.

Summary: Investing to Modernize the Production of American Clean Energy and Technology Act of 2014 or the IMPACT Act of 2014 - Amends the Internal Revenue Code, with respect to alternative and renewable energy tax provisions, to: (1) extend through 2023 the placed-in-service dates for the tax credit for producing electricity from wind, biomass, geothermal or solar energy, landfill gas, hydropower, and marine and hydrokinetic renewable energy facilities; (2) extend through 2023 the election of the tax credit for investment in energy property in lieu of the tax credit for producing electricity from renewable resources; (3) authorize an additional allocation of credits under the qualifying advanced energy program; and (4) extend through 2016 the tax credits for energy-efficient new home expenditures and for energy-efficient appliances. Increases or extends tax credits for qualified plug-in electric drive motor vehicles, heavy natural gas vehicles, and alternative fuel vehicle refueling property. Provides for tax-exempt financing of electric, natural gas, and hydrogen vehicle refueling property. Repeals or imposes limits on tax preferences for major integrated oil companies (i.e., companies that have an average daily worldwide production of at least 500,000 barrels and annual gross income over $1 billion), including the tax deduction for income attributable to oil, natural gas, or primary products thereof, the tax deduction for intangible drilling and development costs, the percentage depletion allowance for oil and gas wells, the tax deduction for tertiary injectants, and the foreign tax credit for dual capacity taxpayers. Prohibits the use of the last-in, first-out (LIFO) accounting method by major integrated oil companies.