I
106TH CONGRESS
1ST SESSION
H. R. 2953
To amend the Internal Revenue Code of 1986 to allow a credit against
income tax for recycling or remanufacturing equipment.
IN THE HOUSE OF REPRESENTATIVES
SEPTEMBER 27, 1999
Mr. ENGLISH (for himself, Mr. TANNER, Mrs. JOHNSON of Connecticut, Mr.
CANADY of Florida, Mr. CARDIN, Mr. MATSUI, Mr. WICKER, Mr.
MCDERMOTT, Mr. HOSTETTLER, and Mr. FOLEY) introduced the fol-
lowing bill; which was referred to the Committee on Ways and Means
A BILL
To amend the Internal Revenue Code of 1986 to allow a
credit against income tax for recycling or remanufac-
turing equipment.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. CREDIT FOR RECYCLING OR REMANUFAC-
TURING EQUIPMENT.
(a) IN GENERAL.—Section 46 of the Internal Rev-
enue Code of 1986 (relating to amount of investment cred-
it) is amended by striking ‘‘and’’ at the end of paragraph
(2), by striking the period at the end of paragraph (3)
and inserting ‘‘, and’’, and by adding at the end the fol-
lowing new paragraph:
‘‘(4) the reclamation credit.’’
(b) RECLAMATION CREDIT.—Section 48 of such Code
(relating to energy credit and reforestation credit) is
amended by adding at the end the following new sub-
section:
‘‘(c) RECLAMATION CREDIT.—
‘‘(1) IN GENERAL.—For purposes of section 46,
the reclamation credit for any taxable year is 20
percent of the basis of each qualified reclamation
property placed in service during the taxable year.
‘‘(2) QUALIFIED RECLAMATION PROPERTY.—
‘‘(A) IN GENERAL.—For purposes of this
section, the term ‘qualified reclamation prop-
erty’ means property—
‘‘(i) which is qualified recycling prop-
erty or qualified remanufacturing property,
‘‘(ii) which is tangible property (not
including a building and its structural
components),
‘‘(iii) with respect to which deprecia-
tion (or amortization in lieu of deprecia-
tion) is allowable,
‘‘(iv) which has a useful life of at least
5 years, and
‘‘(v) which is—
‘‘(I) acquired by purchase (as de-
fined in section 179(d)(2)) by the tax-
payer if the original use of such prop-
erty commences with the taxpayer, or
‘‘(II) constructed by or for the
taxpayer.
‘‘(B) DOLLAR LIMITATION.—
‘‘(i) IN GENERAL.—The basis of quali-
fied reclamation property taken into ac-
count under paragraph (1) for any taxable
year shall not exceed $10,000,000 for a
taxpayer.
‘‘(ii) TREATMENT
OF
CONTROLLED
GROUP.—For purposes of clause (i)—
‘‘(I) all component members of a
controlled group shall be treated as
one taxpayer, and
‘‘(II) the Secretary shall appor-
tion the dollar limitation in such
clause among the component members
of such controlled group in such man-
ner as he shall by regulation pre-
scribe.
‘‘(iii) TREATMENT OF PARTNERSHIPS
AND S CORPORATIONS.—In the case of a
partnership, the dollar limitation in clause
(i) shall apply with respect to the partner-
ship and with respect to each partner. A
similar rule shall apply in the case of an
S corporation and its shareholders.
‘‘(iv) 
CONTROLLED
GROUP
DE-
FINED.—For purposes of clause (ii), the
term ‘controlled group’ has the meaning
given such term by section 1563(a), except
that ‘more than 50 percent’ shall be sub-
stituted for ‘at least 80 percent’ each place
it appears in section 1563(a)(1).
‘‘(3) CERTAIN PROGRESS EXPENDITURE RULES
MADE APPLICABLE.—Rules similar to the rules of
subsections (c)(4) and (d) of section 46 (as in effect
on the day before the date of the enactment of the
Revenue Reconciliation Act of 1990) shall apply for
purposes of this subsection.
‘‘(4) DEFINITIONS.—For purposes of this
subsection—
‘‘(A) QUALIFIED RECYCLING PROPERTY.—
The term ‘qualified recycling property’ means
equipment used exclusively to collect, distribute,
or sort used ferrous or nonferrous metals. The
term does not include equipment used to collect,
distribute, or sort precious metals such as gold,
silver, or platinum unless such use is coinci-
dental to the collection, distribution, or sorting
of other used ferrous or nonferrous metals.
‘‘(B) 
QUALIFIED
REMANUFACTURING
PROPERTY.—The term ‘qualified remanufac-
turing property’ means equipment used pri-
marily by the taxpayer in the business of re-
building or remanufacturing a used product or
part, but only if—
‘‘(i) the rebuilt or remanufactured
product or part includes 50 percent or less
virgin material, and
‘‘(ii) the equipment is not used pri-
marily in a process occurring after the
product or part is rebuilt or remanufac-
tured.
‘‘(5) COORDINATION
WITH
REHABILITATION
AND
ENERGY
CREDITS.—For purposes of this
section—
‘‘(A) the basis of any qualified reclamation
property shall be reduced by that portion of the
basis of any property which is attributable to
qualified rehabilitation expenditures (as defined
in section 47(c)(2)) or to the energy percentage
of energy property (as determined under section
48(a)), and
‘‘(B) expenditures taken into account
under either section 47 or 48(a) shall not be
taken into account under this section.’’.
(c) SPECIAL BASIS ADJUSTMENT RULE.—Paragraph
(3) of section 50(c) of such Code (relating to basis adjust-
ment to investment credit property) is amended by strik-
ing ‘‘energy credit or reforestation credit’’ and inserting
‘‘energy credit, reforestation credit, or reclamation cred-
it’’.
(d) CLERICAL AMENDMENTS.—
(1) The section heading for section 48 of such
Code is amended to read as follows:
‘‘SEC. 48. ENERGY CREDIT; REFORESTATION CREDIT; REC-
LAMATION CREDIT.’’
(2) The item relating to section 48 in the table
of sections for subpart E of part IV of subchapter
A of chapter 1 of such Code is amended to read as
follows:
‘‘Sec. 48. Energy credit; reforestation credit; reclamation credit.’’
(e) EFFECTIVE DATE.—The amendments made by
this section shall apply to property placed in service on
or after January 1, 2000.
Æ