I 
113TH CONGRESS 
1ST SESSION H. R. 2137 
To amend the Internal Revenue Code of 1986 to provide tax relief for 
damages relating to Hurricane Sandy, and for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
MAY 23, 2013 
Mr. PASCRELL (for himself, Mr. RUNYAN, Mr. GRIMM, Mr. LANCE, Mr. KING 
of New York, Mr. REED, Mr. FRELINGHUYSEN, Mr. LOBIONDO, Mr. 
SMITH of New Jersey, Mr. RANGEL, Mr. CROWLEY, Mr. LARSON of Con-
necticut, Mr. MEEKS, Mr. COURTNEY, Ms. DELAURO, Mr. BISHOP of 
New York, Mrs. MCCARTHY of New York, Mr. LANGEVIN, Mr. PAYNE, 
Mr. SERRANO, Mr. PALLONE, Mr. NADLER, Mr. SIRES, Mr. ANDREWS, 
Mr. ENGEL, Mr. CICILLINE, Mr. ISRAEL, Ms. MENG, and Mr. HOLT) in-
troduced 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 
tax relief for damages relating to Hurricane Sandy, and 
for other purposes. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE, ETC. 
(a) SHORT TITLE.—This Act may be cited as the 
‘‘Hurricane Sandy Tax Relief Act of 2013’’. 
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(b) AMENDMENT OF 1986 CODE.—Except as other-
wise expressly provided, whenever in this Act an amend-
ment or repeal is expressed in terms of an amendment 
to, or repeal of, a section or other provision, the reference 
shall be considered to be made to a section or other provi-
sion of the Internal Revenue Code of 1986. 
(c) TABLE OF CONTENTS.—The table of contents for 
this Act is as follows: 
Sec. 1. Short title, etc. 
Sec. 2. Waiver of adjusted gross income limitation for losses and increase in 
standard deduction by disaster casualty losses attributable to 
Hurricane Sandy. 
Sec. 3. Expensing of qualified disaster expenses. 
Sec. 4. Net operating losses attributable to federally declared disasters. 
Sec. 5. Waiver of certain mortgage revenue bond requirements following feder-
ally declared disasters. 
Sec. 6. Increased expensing for Hurricane Sandy qualified disaster assistance 
property. 
Sec. 7. Increased limitation on charitable contributions for disaster relief. 
Sec. 8. Increase in new markets tax credit for investments in community devel-
opment entities serving Hurricane Sandy disaster areas. 
Sec. 9. Extension of expensing for environmental remediation costs. 
Sec. 10. Special rule for public utility casualty losses. 
Sec. 11. Determination of earned income for purposes of earned income credit 
and child tax credit. 
Sec. 12. Work Opportunity Credit. 
Sec. 13. Hurricane Sandy Bonds. 
Sec. 14. Additional low-income housing credit may be allocated in States dam-
aged by Hurricane Sandy. 
Sec. 15. Special rules for use of retirement funds. 
SEC. 2. WAIVER OF ADJUSTED GROSS INCOME LIMITATION 
FOR LOSSES AND INCREASE IN STANDARD 
DEDUCTION BY DISASTER CASUALTY LOSSES 
ATTRIBUTABLE TO HURRICANE SANDY. 
(a) 
IN
GENERAL.—Subclause 
(I) 
of 
section 
165(h)(3)(B)(i) is amended by striking ‘‘January 1, 
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2010’’ and inserting ‘‘January 1, 2010, or the Hurricane 
Sandy federally declared disaster’’. 
(b) HURRICANE SANDY FEDERALLY DECLARED DIS-
ASTER.—Paragraph (3) of section 165(h) is amended by 
adding at the end the following new subparagraph: 
‘‘(D) 
APPLICATION
TO
HURRICANE 
SANDY.— 
‘‘(i) IN GENERAL.—Personal casualty 
losses shall be treated as described in sub-
paragraph (B)(i) if such losses— 
‘‘(I) are attributable to the Hur-
ricane Sandy federally declared dis-
aster, and 
‘‘(II) occur in the Hurricane 
Sandy disaster area. 
‘‘(ii) HURRICANE SANDY FEDERALLY 
DECLARED
DISASTER.—For purposes of 
clause (i), the term ‘Hurricane Sandy fed-
erally declared disaster’ means the disaster 
occurring by reason of Hurricane Sandy 
and determined by the President before 
November 4, 2012, to warrant individual 
or individual and public assistance from 
the Federal Government under the Robert 
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T. Stafford Disaster Relief and Emergency 
Assistance Act. 
‘‘(iii) HURRICANE
SANDY
DISASTER 
AREA.—The term ‘Hurricane Sandy dis-
aster area’ means the area so determined 
to warrant such assistance.’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this subsection shall apply to taxable years ending after 
October 28, 2012. 
SEC. 3. EXPENSING OF QUALIFIED DISASTER EXPENSES. 
(a) IN GENERAL.—Paragraph (2) of 198A(b) is 
amended— 
(1) in subparagraph (A) by striking ‘‘January 
1, 2010’’ and inserting ‘‘January 1, 2010, or re-
leased in the Hurricane Sandy disaster area on ac-
count of the Hurricane Sandy federally declared dis-
aster, as defined by section 165(h)(3)(D)’’, 
(2) in subparagraph (B) by striking ‘‘such 
date’’ and inserting ‘‘such date or which is business- 
related property in the Hurricane Sandy disaster 
area that is damaged or destroyed as a result of the 
Hurricane Sandy federally declared disaster (as so 
defined)’’, and 
(3) in subparagraph (C) by striking ‘‘such 
date’’ and inserting ‘‘such date or which is business- 
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related property in the Hurricane Sandy disaster 
area that is damaged as a result of the Hurricane 
Sandy federally declared disaster (as so defined)’’. 
(b) EFFECTIVE DATE.—The amendments made by 
this section shall apply to amounts paid or incurred after 
October 28, 2012. 
SEC. 4. NET OPERATING LOSSES ATTRIBUTABLE TO FED-
ERALLY DECLARED DISASTERS. 
(a) IN GENERAL.—Subsection (j) of section 172 is 
amended by adding at the end the following new para-
graph: 
‘‘(5) APPLICATION TO HURRICANE SANDY.— 
‘‘(A) IN GENERAL.—Losses shall be treat-
ed as described in paragraph (1)(A)(i) if such 
losses are attributable to the Hurricane Sandy 
federally declared disaster (as defined in section 
165(h)(3)(D)) and occur in the Hurricane 
Sandy disaster area (as so defined). 
‘‘(B) SPECIAL
RULE.—For purposes of 
subparagraph (A), paragraph (4) shall not 
apply.’’. 
(b) EFFECTIVE DATE.—The amendment made by 
this section shall apply to taxable years ending after Octo-
ber 28, 2012. 
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SEC. 5. WAIVER OF CERTAIN MORTGAGE REVENUE BOND 
REQUIREMENTS FOLLOWING FEDERALLY DE-
CLARED DISASTERS. 
(a) IN GENERAL.—Subparagraphs (A)(i) and (B)(i) 
of section 143(k)(12), as added by the Tax Extenders and 
Alternative Minimum Tax Relief Act of 2008, are each 
amended by striking ‘‘January 1, 2010’’ and inserting 
‘‘January 1, 2010, or in the case of a residence located 
in the Hurricane Sandy disaster area on October 29, 
2012, by reason of the Hurricane Sandy federally declared 
disaster, as defined by section 165(h)(3)(D)’’. 
(b) 
CONFORMING
AMENDMENTS.—Subparagraph 
(A)(ii) of such section is amended by striking ‘‘such date’’ 
and inserting ‘‘such date or by reason of the Hurricane 
Sandy federally declared disaster (as so defined)’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to disasters occurring after Octo-
ber 28, 2012. 
SEC. 6. INCREASED EXPENSING FOR HURRICANE SANDY 
QUALIFIED 
DISASTER 
ASSISTANCE 
PROP-
ERTY. 
(a) IN GENERAL.—Subsection (e) of section 179 is 
amended to read as follows: 
‘‘(e) SPECIAL RULES FOR HURRICANE SANDY.— 
‘‘(1) IN GENERAL.—If a taxpayer elects the ap-
plication of this subsection for a taxable year and 
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places in service during the taxable year any Hurri-
cane Sandy qualified disaster assistance property— 
‘‘(A) the dollar amount in effect under 
subsection (b)(1) for the taxable year shall be 
increased by the qualified disaster limitation 
amount, and 
‘‘(B) the dollar amount in effect under 
subsection (b)(2) for the taxable year shall be 
increased by the qualified disaster limitation re-
duction amount. 
‘‘(2) 
QUALIFIED
DISASTER
LIMITATION 
AMOUNT.—For purposes of paragraph (1), the term 
‘qualified disaster limitation amount’ means the less-
er of— 
‘‘(A) $500,000, or 
‘‘(B) the cost of Hurricane Sandy qualified 
disaster assistance property placed in service 
during the taxable year. 
‘‘(3) QUALIFIED DISASTER LIMITATION REDUC-
TION AMOUNT.—For purposes of paragraph (1), the 
term ‘qualified disaster limitation amount’ means 
the lesser of— 
‘‘(A) $2,000,000, or 
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‘‘(B) the cost of Hurricane Sandy qualified 
disaster assistance property placed in service 
during the taxable year. 
‘‘(4) HURRICANE SANDY QUALIFIED DISASTER 
ASSISTANCE PROPERTY.—For purposes of this sub-
section— 
‘‘(A) IN GENERAL.—The term ‘Hurricane 
Sandy qualified disaster assistance property’ 
means section 179 property (as defined in sub-
section (d)) and qualified property— 
‘‘(i) the original use of which in the 
Hurricane Sandy disaster area commences 
with the taxpayer on or after October 29, 
2012, 
‘‘(ii) substantially all of the use of 
which is in the Hurricane Sandy disaster 
area, and 
‘‘(iii) which— 
‘‘(I) rehabilitates property dam-
aged, or replaces property destroyed 
or condemned, as a result of the Hur-
ricane Sandy federally declared dis-
aster, except that, for purposes of this 
clause, property shall be treated as re-
placing property destroyed or con-
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demned if, as part of an integrated 
plan, such property replaces property 
which is included in a continuous area 
which includes real property destroyed 
or condemned, and 
‘‘(II) is located in the same coun-
ty as the property being rehabilitated 
or replaced, 
‘‘(iv) which is placed in service or ac-
quired by the taxpayer by purchase (as de-
fined in subsection (d)) on or after October 
29, 2012, but only if no written binding 
contract for the acquisition was in effect 
before such date, and 
‘‘(v) which is placed in service by the 
taxpayer on or after October 29, 2012, and 
before December 31, 2015 (December 31, 
2016, in the case of nonresidential real 
property and residential rental property). 
‘‘(B) QUALIFIED
PROPERTY.—The term 
‘qualified property’ means property which is— 
‘‘(i) tangible property to which section 
168 applies and which has a recovery pe-
riod of 39 years or less, or 
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‘‘(ii) computer software (as defined in 
section 167(f)(1)(B)) for which a deduc-
tion is allowable under section 167(a). 
‘‘(C) EXCEPTIONS.— 
‘‘(i) 
ALTERNATIVE
DEPRECIATION 
PROPERTY.—Such term shall not include 
any property to which the alternative de-
preciation system under section 168(g) ap-
plies, determined without regard to para-
graph (7) thereof (relating to election to 
have system apply). 
‘‘(ii) TAX-EXEMPT
BOND
FINANCED 
PROPERTY.—Such term shall not include 
any property any portion of which is fi-
nanced with the proceeds of any obligation 
the interest on which is exempt from tax 
under section 103. 
‘‘(D) ELECTION.—An election under this 
subsection for any taxable year shall— 
‘‘(i) specify the items of Hurricane 
Sandy qualified disaster assistance prop-
erty to which the election applies and the 
portion of the cost of each of such items 
which is to be taken into account under 
paragraph (1), and 
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‘‘(ii) be made on the taxpayer’s return 
of the tax imposed by this chapter for the 
taxable year. 
‘‘(E) SPECIAL
RULES.—For purposes of 
this subsection, rules similar to the rules of 
subparagraph (E) of section 168(k)(2) shall 
apply, except that such subparagraph shall be 
applied— 
‘‘(i) by substituting ‘the date of the 
Hurricane Sandy federally declared dis-
aster’ for ‘December 31, 2007’ each place 
it appears therein, 
‘‘(ii) by substituting ‘January 1, 
2016’ for ‘January 1, 2014’ in clause (i) 
thereof, and 
‘‘(iii) 
by 
substituting 
‘Hurricane 
Sandy qualified section 179 disaster assist-
ance property’ for ‘qualified property’ in 
clause (iv) thereof. 
‘‘(5) 
TERMS
RELATING
TO
HURRICANE 
SANDY.—For purposes of this subsection, the terms 
‘Hurricane Sandy federally declared disaster’ and 
‘Hurricane Sandy disaster area’ have the meanings 
given such terms by section 165(h)(3)(D). 
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‘‘(6) RECAPTURE.—For purposes of this sub-
section, rules similar to the rules under subsection 
(d)(10) shall apply with respect to any qualified sec-
tion 179 disaster assistance property which ceases to 
be qualified section 179 disaster assistance prop-
erty.’’. 
(b) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years ending after Octo-
ber 28, 2012. 
SEC. 7. INCREASED LIMITATION ON CHARITABLE CON-
TRIBUTIONS FOR DISASTER RELIEF. 
(a) INDIVIDUALS.—Paragraph (1) of section 170(b) 
is amended by redesignating subparagraphs (F) and (G) 
as subparagraphs (G) and (H), respectively, and by insert-
ing after subparagraph (E) the following new subpara-
graph: 
‘‘(F) QUALIFIED HURRICANE SANDY DIS-
ASTER CONTRIBUTIONS.— 
‘‘(i) 
IN
GENERAL.—Any 
qualified 
Hurricane Sandy disaster contribution 
shall be allowed to the extent that the ag-
gregate of such contributions does not ex-
ceed the excess of 80 percent of the tax-
payer’s contribution base over the amount 
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of all other charitable contributions allow-
able under this paragraph. 
‘‘(ii) QUALIFIED
HURRICANE
SANDY 
DISASTER
CONTRIBUTION.—For purposes 
of this subparagraph, the term ‘qualified 
Hurricane Sandy disaster contribution’ 
means any charitable contribution if— 
‘‘(I) such contribution— 
‘‘(aa) is paid during the pe-
riod beginning on October 29, 
2012, and ending on December 
31, 2013, in cash to an organiza-
tion described in subparagraph 
(A), and 
‘‘(bb) is made for relief ef-
forts in the Hurricane Sandy dis-
aster area related to the Hurri-
cane Sandy federally declared 
disaster, 
‘‘(II) the taxpayer obtains from 
such organization contemporaneous 
written acknowledgment (within the 
meaning of subsection (f)(8)) that 
such contribution was used (or is to 
be used) for relief efforts in the Hur-
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ricane Sandy disaster area related to 
the Hurricane Sandy federally de-
clared disaster, and 
‘‘(III) the taxpayer has elected 
the application of this subparagraph 
with respect to such contribution. 
‘‘(iii) EXCEPTION.—A qualified Hurri-
cane Sandy disaster contribution shall not 
include a contribution by a donor if the 
contribution is— 
‘‘(I) to an organization described 
in section 509(a)(3), or 
‘‘(II) for establishment of a new, 
or maintenance of an existing, donor 
advised fund (as defined in section 
4966(d)(2)). 
‘‘(iv) CARRYOVER.— 
‘‘(I) IN GENERAL.—If the aggre-
gate amount of contributions de-
scribed in clause (i) exceeds the limi-
tation under clause (i), such excess 
shall be treated (in a manner con-
sistent with the rules of subsection 
(d)(1)) as a charitable contribution to 
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which clause (i) applies in each of the 
5 succeeding years in order of time. 
‘‘(II) 
COORDINATION
WITH 
OTHER
SUBPARAGRAPHS.—For pur-
poses of applying this subparagraph 
and subsection (d)(1), contributions 
described in clause (i) shall not be 
treated as described in subparagraph 
(A) and such subparagraph shall be 
applied without regard to such con-
tributions. 
‘‘(v) APPLICATION OF ELECTION TO 
PARTNERSHIPS AND S CORPORATIONS.—In 
the case of a partnership or S corporation, 
the 
election 
under 
subparagraph 
(F)(ii)(III) shall be made separately by 
each partner or shareholder. 
‘‘(vi) HURRICANE SANDY FEDERALLY 
DECLARED
DISASTER
AND
DISASTER 
AREA.—For purposes of this subpara-
graph, the terms ‘Hurricane Sandy feder-
ally declared disaster’ and ‘Hurricane 
Sandy disaster area’ have the meanings 
given 
such 
terms 
by 
section 
165(h)(3)(D).’’. 
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(b) CORPORATIONS.— 
(1) IN
GENERAL.—Paragraph (2) of section 
170(b) is amended by redesignating subparagraph 
(C) as subparagraph (D) and by inserting after sub-
paragraph (B) the following new subparagraph: 
‘‘(C) QUALIFIED
DISASTER
CONTRIBU-
TIONS.— 
‘‘(i) 
IN
GENERAL.—Any 
qualified 
Hurricane Sandy disaster contribution 
shall be allowed to the extent that the ag-
gregate of such contributions does not ex-
ceed the excess of 20 percent of the tax-
payer’s taxable income over the amount of 
charitable contributions allowed under sub-
paragraph (A). 
‘‘(ii) CARRYOVER.—If the aggregate 
amount of contributions described in clause 
(i) exceeds the limitation under clause (i), 
such excess shall be treated (in a manner 
consistent with the rules of subsection 
(d)(1)) as a charitable contribution to 
which clause (i) applies in each of the 5 
succeeding years in order of time. 
‘‘(iii) 
QUALIFIED
DISASTER
CON-
TRIBUTION.—The term ‘qualified Hurri-
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cane Sandy disaster contribution’ has the 
meaning given such term under paragraph 
(1)(F).’’. 
(2) CONFORMING AMENDMENTS.— 
(A) Subparagraph (A) of section 170(b)(2) 
is amended by striking ‘‘subparagraph (B) ap-
plies’’ and inserting ‘‘subparagraphs (B) and 
(C) apply’’. 
(B) Subparagraph (B) of section 170(b)(2) 
is amended by striking ‘‘subparagraph (A)’’ and 
inserting ‘‘subparagraphs (A) and (C)’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years ending after the 
date of the enactment of this Act. 
SEC. 8. INCREASE IN NEW MARKETS TAX CREDIT FOR IN-
VESTMENTS IN COMMUNITY DEVELOPMENT 
ENTITIES SERVING HURRICANE SANDY DIS-
ASTER AREAS. 
(a) IN GENERAL.—Paragraph (1) of section 45D(f) 
is amended by striking the period at the end of subpara-
graph (G) and inserting ‘‘, and’’ and by adding at the end 
the following: 
‘‘(H) in the case of the Hurricane Sandy 
Federal disaster area, $250,000,000.’’. 
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(b) RULES RELATING TO HURRICANE SANDY.—Sub-
section (f) of section 45D is amended by adding at the 
end the following new paragraph: 
‘‘(4) INCREASED
SPECIAL
ALLOCATION
FOR 
COMMUNITY DEVELOPMENT ENTITIES SERVING HUR-
RICANE SANDY FEDERAL DISASTER AREAS.— 
‘‘(A) IN GENERAL.—The limitation under 
paragraph (1)(H) shall be allocated among 
qualified community development entities to 
make qualified low-income community invest-
ments within the Hurricane Sandy disaster area 
(as defined in section 165(h)(3)(D)). 
‘‘(B) ALLOCATION
OF
INCREASE.—The 
limitation under subparagraph (A) shall be allo-
cated by the Secretary under paragraph (2) to 
qualified community development entities and 
shall give priority to such entities with a record 
of having successfully provided capital or tech-
nical assistance to businesses or communities 
within the Hurricane Sandy disaster area. 
‘‘(C) SEPARATE CARRYOVER OF UNUSED 
LIMITATION.—Paragraph (3) shall be applied 
separately with respect to the limitation under 
paragraph (1)(H).’’. 
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(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to calendar years beginning after 
2011. 
SEC. 9. EXTENSION OF EXPENSING FOR ENVIRONMENTAL 
REMEDIATION COSTS. 
(a) IN GENERAL.—Section 198 is amended by adding 
at the end the following: 
‘‘(i) 
EXTENSION
RELATING
TO
HURRICANE 
SANDY.—Subsection (h) shall not apply in the case of any 
qualified environmental remediation expenditure paid or 
incurred after the date of the Hurricane Sandy federally 
declared disaster (as defined in section 165(h)(3)(D)) and 
before January 1, 2015, by reason of such disaster at a 
qualified contaminated site located in the Hurricane 
Sandy disaster area (as so defined).’’. 
(b) EFFECTIVE DATE.—The amendment made by 
subsection (a) shall apply to expenditures paid or incurred 
after October 28, 2012. 
SEC. 10. SPECIAL RULE FOR PUBLIC UTILITY CASUALTY 
LOSSES. 
(a) IN GENERAL.—Subsection (f) of section 172 is 
amended by adding at the end the following: 
‘‘(7) HURRICANE SANDY PUBLIC UTILITY CAS-
UALTY LOSSES.— 
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‘‘(A) IN GENERAL.—The amount described 
in paragraph (1)(A) for any taxable year shall 
be increased by the Hurricane Sandy public 
utility casualty loss for such taxable year. 
‘‘(B) HURRICANE SANDY PUBLIC UTILITY 
CASUALTY LOSS.—For purposes of this para-
graph, the term ‘Hurricane Sandy public utility 
casualty loss’ means any casualty loss of public 
utility 
property 
(as 
defined 
in 
section 
168(i)(10)) located in the Hurricane Sandy dis-
aster area if— 
‘‘(i) such loss is allowed as a deduc-
tion under section 165 for the taxable 
year, 
‘‘(ii) such loss is by reason of Hurri-
cane Sandy, and 
‘‘(iii) the taxpayer elects the applica-
tion of this paragraph with respect to such 
loss. 
‘‘(C) REDUCTION FOR GAINS FROM INVOL-
UNTARY
CONVERSION.—The amount of any 
Hurricane Sandy public utility casualty loss 
which would (but for this subparagraph) be 
taken into account under subparagraph (A) for 
any taxable year shall be reduced by the 
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amount of any gain recognized by the taxpayer 
for such year from the involuntary conversion 
by reason of Hurricane Sandy of public utility 
property (as so defined) located in the Hurri-
cane Sandy disaster area. 
‘‘(D) 
HURRICANE
SANDY
DISASTER 
AREA.—For purposes of this paragraph, the 
term ‘Hurricane Sandy disaster area’ has the 
meaning 
given 
such 
term 
by 
section 
165(h)(3)(D). 
‘‘(E) COORDINATION WITH GENERAL DIS-
ASTER LOSS RULES.—Section 168(k) and sec-
tion 165(i) shall not apply to any Hurricane 
Sandy public utility casualty loss to the extent 
such loss is taken into account under subpara-
graph (A). 
‘‘(F) ELECTION.—Any election under sub-
paragraph (B)(iii) shall be made in such man-
ner as may be prescribed by the Secretary and 
shall be made by the due date (including exten-
sions of time) for filing the taxpayer’s return 
for the taxable year of the loss. Such election, 
once made for any taxable year, shall be irrev-
ocable for such taxable year.’’. 
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(b) EFFECTIVE DATE.—The amendment made by 
subsection (a) shall apply to losses arising in taxable years 
ending after October 28, 2012. 
SEC. 11. DETERMINATION OF EARNED INCOME FOR PUR-
POSES OF EARNED INCOME CREDIT AND 
CHILD TAX CREDIT. 
(a) EARNED INCOME CREDIT.—Section 32 is amend-
ed by adding at the end the following new subsection: 
‘‘(n) SPECIAL RULE RELATING
TO HURRICANE 
SANDY.—For purposes of this section and section 24(d)— 
‘‘(1) IN GENERAL.—In the case of a qualified 
individual, if the earned income of the taxpayer for 
the taxable year which includes the applicable date 
is less than the earned income of the taxpayer for 
the preceding taxable year, the credit allowed under 
subsection (a) may, at the election of the taxpayer, 
be determined by substituting— 
‘‘(A) such earned income for the preceding 
taxable year, for 
‘‘(B) such earned income for the taxable 
year which includes the applicable date. 
‘‘(2) QUALIFIED INDIVIDUAL.—For purposes of 
this subsection, the term ‘qualified individual’ means 
any individual— 
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‘‘(A) whose principal place of abode on the 
applicable date was located in the Hurricane 
Sandy disaster area and such individual was 
displaced from such principal place of abode by 
reason of the Hurricane Sandy federally de-
clared disaster, or 
‘‘(B) who performed substantially all em-
ployment services in the disaster area and was 
so employed on the applicable date. 
‘‘(3) OTHER
DEFINITIONS.—For purposes of 
this subsection— 
‘‘(A) APPLICABLE DATE.—The term ‘appli-
cable date’ means any day on or after October 
29, 2012, and on or before November 3, 2012. 
‘‘(B) HURRICANE SANDY FEDERALLY DE-
CLARED DISASTER AND DISASTER AREA.—The 
terms ‘Hurricane Sandy federally declared dis-
aster’ and ‘Hurricane Sandy disaster area’ have 
the meanings given such terms by section 
165(h)(3)(D). 
‘‘(4) SPECIAL RULES.— 
‘‘(A) APPLICATION TO JOINT RETURNS.— 
For purposes of paragraph (1), in the case of 
a joint return for a taxable year which includes 
the applicable date— 
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‘‘(i) such paragraph shall apply if ei-
ther spouse is a qualified individual, and 
‘‘(ii) the earned income of the tax-
payer for the preceding taxable year shall 
be the sum of the earned income of each 
spouse for such preceding taxable year. 
‘‘(B) UNIFORM
APPLICATION
OF
ELEC-
TION.—Any election made under paragraph (1) 
shall apply with respect to both this section and 
section 24(d). 
‘‘(C) ERRORS TREATED AS MATHEMATICAL 
ERROR.—For purposes of section 6213, an in-
correct use on a return of earned income pursu-
ant to paragraph (1) shall be treated as a 
mathematical or clerical error. 
‘‘(D) NO EFFECT ON DETERMINATION OF 
GROSS INCOME, ETC.—Except as otherwise pro-
vided in this subsection, this title shall be ap-
plied without regard to any substitution under 
paragraph (1).’’. 
(b) CHILD TAX CREDIT.—Subsection (d) of section 
24 is amended by adding at the end the following new 
paragraph: 
‘‘(5) SPECIAL RULE RELATING TO HURRICANE 
SANDY.—See section 32(n) for determination of 
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earned income with respect to the Hurricane Sandy 
federally declared disaster.’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years ending after Octo-
ber 28, 2012. 
SEC. 12. WORK OPPORTUNITY CREDIT. 
(a) IN GENERAL.—Paragraph (1) of section 51(d) is 
amended by striking ‘‘or’’ at the end of subparagraph (H), 
by striking the period at the end of subparagraph (I) and 
inserting ‘‘, or’’, and by inserting after subparagraph (I) 
the following new subparagraph: 
‘‘(J) a Hurricane Sandy employee.’’. 
(b) HURRICANE SANDY EMPLOYEE.—Subsection (d) 
of section 51 is amended by adding at the end the fol-
lowing: 
‘‘(15) HURRICANE SANDY EMPLOYEE.— 
‘‘(A) IN GENERAL.—The term ‘Hurricane 
Sandy employee’ means any individual— 
‘‘(i) who, on or after October 29, 
2012, and on or before November 3, 2012, 
had a principal place of abode in the Hur-
ricane Sandy disaster area, 
‘‘(ii) who did not apply for or receive 
unemployment compensation under State 
or Federal law in 2012 before October 29, 
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2012, but first applied for or received such 
compensation after such date and before 
February 15, 2013, 
‘‘(iii) who receives such compensation 
without a break until the earlier of ex-
hausting such compensation under Federal 
or State law or the hiring date, and 
‘‘(iv) whose hiring date for a position 
the principal place of employment of which 
is located in the Hurricane Sandy disaster 
area (as defined in section 165(h)(3)(D)) 
is before January 1, 2014. 
‘‘(B) REASONABLE
IDENTIFICATION
AC-
CEPTABLE.—In lieu of the certification require-
ment under subparagraph (A) of paragraph 
(13), an individual may provide to the employer 
reasonable evidence that the individual is a 
Hurricane Sandy employee, and subparagraph 
(B) of such paragraph shall be applied as if 
such evidence were a certification described in 
such subparagraph. 
‘‘(C) SPECIAL
RULES.—For purposes of 
this paragraph— 
‘‘(i) subsection (c)(4) shall not apply, 
and 
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‘‘(ii) subsection (i)(2) shall not apply 
with respect to the first hire of such em-
ployee as a Hurricane Sandy employee, un-
less such employee was an employee of the 
employer on October 28, 2012.’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years ending after Octo-
ber 28, 2012. 
SEC. 13. HURRICANE SANDY BONDS. 
(a) IN GENERAL.—Subpart A of part IV of sub-
chapter B of chapter 1 is amended by inserting after sec-
tion 146 the following new section: 
‘‘SEC. 146A. HURRICANE SANDY BONDS. 
‘‘(a) IN GENERAL.—For purposes of this title, any 
qualified Hurricane Sandy Bond shall— 
‘‘(1) be treated as an exempt facility bond, and 
‘‘(2) not be subject to section 146. 
‘‘(b) QUALIFIED HURRICANE SANDY BOND.—For 
purposes of this section, the term ‘qualified Hurricane 
Sandy bond’ means any bond issued as part of an issue 
if— 
‘‘(1) 95 percent or more of the net proceeds of 
such issue are to be used for qualified project costs, 
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‘‘(2) such bond is issued by a State or any po-
litical subdivision thereof any part of which is in the 
Hurricane Sandy disaster area, 
‘‘(3) the Governor of the issuing State des-
ignates such bond for purposes of this section, and 
‘‘(4) such bond is issued after the date of the 
enactment of this section and before January 1, 
2016. 
‘‘(c) LIMITATION ON AMOUNT OF BONDS.— 
‘‘(1) IN
GENERAL.—The maximum aggregate 
face amount of bonds which may be designated 
under this section shall not exceed— 
‘‘(A) $3,200,000,000 in the case of Con-
necticut, 
‘‘(B) $9,200,000,000 in the case of New 
Jersey, and 
‘‘(C) $9,200,000,000 in the case of New 
York. 
‘‘(2) REDUCTION
FOR
FAILURE
TO
ISSUE 
BONDS.— 
‘‘(A) 2013.—If after the date of enactment 
of this section and before January 1, 2014, less 
than 10 percent of the face amount of the bond 
limitation for a State has been issued, the au-
thorized limitation for such State under para-
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graph (1) shall be reduced by the amount by 
which 10 percent of the face amount of the 
bond limitation for such State exceeds the face 
amount of issued bonds. 
‘‘(B) 2014.—If after the date of enactment 
of this section and before January 1, 2015, less 
than 30 percent of the face amount of the bond 
limitation for a State has been issued, the au-
thorized limitation for such State shall be re-
duced by the amount by which 10 percent of 
the face amount of the bond limitation for such 
State exceeds the face amount of issued bonds. 
‘‘(3) MOVABLE PROPERTY.—No bonds shall be 
issued which are to be used for movable fixtures and 
equipment. 
‘‘(4) TREATMENT
OF
CURRENT
REFUNDING 
BONDS.—Paragraph (1) shall not apply to any bond 
(or series of bonds) issued to refund a qualified 
Hurricane Sandy bond, if— 
‘‘(A) the average maturity date of the issue 
of which the refunding bond is a part is not 
later than the average maturity date of the 
bonds to be refunded by such issue, 
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‘‘(B) the amount of the refunding bond 
does not exceed the outstanding amount of the 
refunded bond, and 
‘‘(C) the net proceeds of the refunding 
bond are used to redeem the refunded bond not 
later than 90 days after the date of the 
issuance of the refunding bond. 
For purposes of subparagraph (A), average maturity 
shall be determined in accordance with section 
147(b)(2)(A). 
‘‘(d) QUALIFIED PROJECT COSTS.—For purposes of 
this section, the term ‘qualified project costs’ means the 
cost of acquisition, construction, reconstruction, and ren-
ovation of— 
‘‘(1) residential rental property (as defined in 
section 142(d)), 
‘‘(2) nonresidential real property (including 
fixed improvements associated with such property), 
‘‘(3) a facility described in paragraph (2) or (3) 
of section 142(a), or 
‘‘(4) public utility property (as defined in sec-
tion 168(i)(10)), 
which is located in the Hurricane Sandy Disaster area and 
was damaged or destroyed by reason of the Hurricane 
Sandy federally declared disaster. 
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‘‘(e) SPECIAL RULES.—In applying this title to any 
qualified Hurricane Sandy Bond, the following modifica-
tions shall apply: 
‘‘(1) Section 147(d) (relating to acquisition of 
existing property not permitted) shall be applied by 
substituting ‘50 percent’ for ‘15 percent’ each place 
it appears. 
‘‘(2) Section 148(f)(4)(C) (relating to exception 
from rebate for certain proceeds to be used to fi-
nance construction expenditures) shall apply to the 
available construction proceeds of bonds issued 
under this section. For purposes of the preceding 
sentence, the following spending requirements shall 
apply in lieu of the requirements in clause (ii) of 
such section: 
‘‘(A) 40 percent of such available construc-
tion proceeds are spent for the governmental 
purposes of the issue within the 2-year period 
beginning on the date the bonds are issued, 
‘‘(B) 60 percent of such proceeds are spent 
for such purposes within the 3-year period be-
ginning on such date, 
‘‘(C) 80 percent of such proceeds are spent 
for such purposes within the 4-year period be-
ginning on such date, and 
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‘‘(D) 100 percent of such proceeds are 
spent for such purposes within the 5-year pe-
riod beginning on such date. 
‘‘(3) Repayments of principal on financing pro-
vided by the issue— 
‘‘(A) may not be used to provide financing, 
and 
‘‘(B) must be used not later than the close 
of the 1st semiannual period beginning after 
the date of the repayment to redeem bonds 
which are part of such issue. 
The requirement of subparagraph (B) shall be treat-
ed as met with respect to amounts received within 
5 years after the date of issuance of the issue (or, 
in the case of a refunding bond, the date of issuance 
of the original bond) if such amounts are used by 
the close of such 5 years to redeem bonds which are 
part of such issue. 
‘‘(4) Section 57(a)(5) shall not apply. 
‘‘(f) SEPARATE ISSUE TREATMENT OF PORTIONS OF 
AN ISSUE.—This section shall not apply to the portion of 
an issue which (if issued as a separate issue) would be 
treated as a qualified bond or as a bond that is not a 
private activity bond (determined without regard to para-
graph (1)), if the issuer elects to so treat such portion. 
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‘‘(g) HURRICANE SANDY FEDERALLY DECLARED 
DISASTER AND DISASTER AREA.—The terms ‘Hurricane 
Sandy federally declared disaster’ and ‘Hurricane Sandy 
disaster area’ have the meanings given such terms by sec-
tion 165(h)(3)(D).’’. 
(b) CLERICAL AMENDMENT.—The table of sections 
for subpart A of part IV of subchapter B of chapter 1 
is amended by inserting after the item relating to section 
146 the following new item: 
‘‘Sec. 146A. Hurricane Sandy Bonds.’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to obligations issued after the date 
of the enactment of this Act. 
SEC. 14. ADDITIONAL LOW-INCOME HOUSING CREDIT MAY 
BE ALLOCATED IN STATES DAMAGED BY 
HURRICANE SANDY. 
(a) IN GENERAL.—Paragraph (3) of section 42(h) 
(relating to limitation on aggregate credit allowable with 
respect to projects located in a State) is amended by add-
ing at the end the following new subparagraph: 
‘‘(J) INCREASE IN STATE HOUSING CREDIT 
FOR
STATES
DAMAGED
BY
HURRICANE 
SANDY.— 
‘‘(i) IN GENERAL.—In the case of cal-
endar year 2013, the State housing credit 
ceiling of each State any portion of which 
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includes any portion of the Hurricane 
Sandy disaster area shall be increased by 
so much of the aggregate housing credit 
dollar amount as does not exceed the appli-
cable limitation allocated by the State 
housing credit agency of such State for 
such calendar year to buildings located in 
such disaster area. 
‘‘(ii) APPLICABLE
LIMITATION.—For 
purposes of clause (i), the applicable limi-
tation is the greater of— 
‘‘(I) $8 multiplied by the popu-
lation of the area described in clause 
(vii)(I), or 
‘‘(II) 50 percent of the State 
housing credit ceiling (determined 
without regard to this subparagraph) 
for 2013. 
‘‘(iii) APPLICABLE
PERCENTAGE.— 
For purposes of this section, the applicable 
percentage with respect to any building to 
which amounts allocated under clause (i) 
shall be determined under subsection 
(b)(2), except that subparagraph (A) 
thereof shall be applied by substituting 
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‘December 31, 2015’ for ‘December 31, 
2013’. 
‘‘(iv) 
ALLOCATIONS
TREATED
AS 
MADE FIRST FROM ADDITIONAL ALLOCA-
TION AMOUNT FOR PURPOSES OF DETER-
MINING CARRYOVER.—For purposes of de-
termining the unused State housing credit 
ceiling under subparagraph (C) for any 
calendar year, any increase in the State 
housing credit ceiling under clause (i) shall 
be treated as an amount described in 
clause (ii) of such subparagraph. 
‘‘(v) 
DIFFICULT
DEVELOPMENT 
AREA.— 
‘‘(I) IN GENERAL.—In the case 
of property placed in service during 
2013, 2014, or 2015, the Hurricane 
Sandy disaster area shall be treated 
as a difficult development area des-
ignated under subclause (I) of sub-
section (d)(5)(B)(iii), and shall not be 
taken into account for purposes of ap-
plying the limitation under subclause 
(II) of such subsection. 
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‘‘(II) 
APPLICATION
OF 
CLAUSE.—Subclause (I) shall apply 
only to— 
‘‘(aa) housing credit dollar 
amounts allocated during 2013, 
and 
‘‘(bb) to the extent that 
paragraph (1) does not apply to 
any building by reason of para-
graph (4), only with respect to 
bonds issued after December 31, 
2012. 
‘‘(vi) HURRICANE
SANDY
DISASTER 
AREA AND HURRICANE SANDY FEDERALLY 
DECLARED
DISASTER.—For purposes of 
this subparagraph— 
‘‘(I) DISASTER AREA.—The term 
‘Hurricane 
Sandy 
disaster 
area’ 
means each county included in the 
geographical area covered by the Hur-
ricane Sandy federally declared dis-
aster. 
‘‘(II) HURRICANE SANDY FEDER-
ALLY DECLARED DISASTER AND DIS-
ASTER
AREA.—The term ‘Hurricane 
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Sandy federally declared disaster’ has 
the meaning given such term by sec-
tion 165(h)(3)(D).’’. 
(b) EFFECTIVE DATE.—The amendment made by 
this section shall take effect on the date of the enactment 
of this Act. 
SEC. 15. SPECIAL RULES FOR USE OF RETIREMENT FUNDS. 
(a) EARLY
WITHDRAWAL
FROM
RETIREMENT 
PLANS.—Paragraph (2) of section 72(t) is amended by 
adding at the end the following new subparagraph: 
‘‘(H) 
HURRICANE
SANDY
DISTRIBU-
TIONS.—Distributions to an individual which 
are Hurricane Sandy distributions (as defined 
in paragraph (11)).’’. 
(b) SPECIAL RULES.—Subsection (t) of section 72 is 
amended by adding at the end the following: 
‘‘(11) SPECIAL RULES RELATING TO USE OF 
RETIREMENT
FUNDS
RELATING
TO
HURRICANE 
SANDY.— 
‘‘(A) DISTRIBUTIONS.—For purposes of 
this paragraph— 
‘‘(i) IN GENERAL.—The term ‘Hurri-
cane Sandy distribution’ means any dis-
tribution from an eligible retirement plan 
(as defined by section 402(c)(8)(B)) made 
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on or after October 29, 2012, and before 
January 1, 2014, to an individual whose 
principal place of abode on October 29, 
2012, is located in the Hurricane Sandy 
disaster area (as defined in section 
165(h)(3)(D)) and who has sustained an 
economic loss by reason of Hurricane 
Sandy. 
‘‘(ii) AGGREGATE
DOLLAR
LIMITA-
TION.— 
‘‘(I) IN GENERAL.—For purposes 
of this paragraph, the aggregate 
amount of distributions received by an 
individual which may be treated as 
Hurricane Sandy distributions for any 
taxable year shall not exceed the ex-
cess (if any) of— 
‘‘(aa) $100,000, over 
‘‘(bb) the aggregate amounts 
treated as Hurricane Sandy dis-
tributions received by such indi-
vidual for all prior taxable years. 
‘‘(II) TREATMENT OF PLAN DIS-
TRIBUTIONS.—If a distribution to an 
individual would (without regard to 
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subclause (I)) be a Hurricane Sandy 
distribution, a plan shall not be treat-
ed as violating any requirement of 
this title merely because the plan 
treats such distribution as a Hurri-
cane Sandy distribution, unless the 
aggregate amount of such distribu-
tions from all plans maintained by the 
employer (and any member of any 
controlled group which includes the 
employer) to such individual exceeds 
$100,000. 
‘‘(III) CONTROLLED
GROUP.— 
For purposes of subclause (II), the 
term ‘controlled group’ means any 
group treated as a single employer 
under subsection (b), (c), (m), or (o) 
of section 414. 
‘‘(iii) AMOUNT DISTRIBUTED MAY BE 
REPAID.— 
‘‘(I) IN
GENERAL.—Any indi-
vidual who receives a Hurricane 
Sandy distribution may, at any time 
during the 3-year period beginning on 
the day after the date on which such 
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‘‘(i) if the due date pursuant to sub-
paragraph (B) or (C) of paragraph (2) for 
any repayment with respect to such loan 
occurs during the period beginning on the 
qualified beginning date and ending on De-
cember 31, 2013, such due date shall be 
delayed for 1 year, 
‘‘(ii) any subsequent repayments with 
respect to any such loan shall be appro-
priately adjusted to reflect the delay in the 
due date under clause (i) and any interest 
accruing during such delay, and 
‘‘(iii) in determining the 5-year period 
and the term of a loan under subpara-
graph (B) or (C) of paragraph (2), the pe-
riod described in clause (i) shall be dis-
regarded. 
‘‘(C) QUALIFIED
INDIVIDUAL.—For pur-
poses of this paragraph— 
‘‘(i) IN GENERAL.—The term ‘quali-
fied individual’ means any qualified Hurri-
cane Sandy individual. 
‘‘(ii) QUALIFIED
HURRICANE
SANDY 
INDIVIDUAL.—The term ‘qualified Hurri-
cane Sandy individual’ means an individual 
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