(1) IN GENERAL.—Section 1201 of the Internal 
Revenue Code of 1986 is amended by redesignating 
subsection (b) as subsection (c), and by striking sub-
section (a) and inserting the following new sub-
sections: 
‘‘(a) GENERAL RULE.—If for any taxable year a cor-
poration has a net capital gain, then, in lieu of the tax 
imposed by sections 11, 511, 821(a) or (c), and 831(a), 
there is hereby imposed a tax (if such tax is less than 
the tax imposed by such sections) which shall consist of 
the sum of— 
‘‘(1) a tax computed on the taxable income re-
duced by the amount of the net capital gain, at the 
rates and in the manner as if this subsection had 
not been enacted, 
‘‘(2) 0 percent of the adjusted net capital gain 
(or, if less, taxable income), 
‘‘(3) 25 percent of taxable income in excess of 
the sum of the amounts on which tax is determined 
under the preceding paragraphs of this subsection. 
‘‘(b) DEFINITIONS AND SPECIAL RULES.—For pur-
poses of this section— 
‘‘(1) IN
GENERAL.—The term ‘adjusted net 
capital gain’ shall have the meaning given such term 
in section 1(h). 
VerDate Aug 31 2005 
22:06 Oct 07, 2008
Jkt 079200
PO 00000
Frm 00003
Fmt 6652
Sfmt 6201
E:\BILLS\H7253.IH
H7253
PWALKER on PROD1PC71 with BILLS
‘‘(2) DIVIDENDS
TAXED
AT
NET
CAPITAL 
GAIN.—Except as otherwise provided in this section, 
the term ‘net capital gain’ has the meaning given 
such term in section 1(h)(11).’’. 
(2) 
ALTERNATIVE
MINIMUM
TAX.—Section 
55(b) of such Code is amended by adding at the end 
the following new paragraph: 
‘‘(4) MAXIMUM RATE OF TAX ON NET CAPITAL 
GAIN OF CORPORATIONS.—The amount determined 
under paragraph (1)(B)(i) shall not exceed the sum 
of— 
‘‘(A) the amount determined under such 
paragraph computed at the rates and in the 
same manner as if this paragraph had not been 
enacted on the taxable excess reduced by the 
net capital gain, plus 
‘‘(B) the amount determined under section 
1201.’’. 
(3) TECHNICAL AMENDMENTS.— 
(A) Section 1445(e)(1) of such Code is 
amended by striking ‘‘35 percent (or, to the ex-
tent provided in regulations, 15 percent)’’ and 
inserting ‘‘0 percent’’. 
VerDate Aug 31 2005 
22:06 Oct 07, 2008
Jkt 079200
PO 00000
Frm 00004
Fmt 6652
Sfmt 6201
E:\BILLS\H7253.IH
H7253
PWALKER on PROD1PC71 with BILLS
(B) Section 1445(e)(2) of such Code is 
amended by striking ‘‘35 percent’’ and inserting 
‘‘0 percent’’. 
(C) Section 7518(g)(6)(A) of such Code is 
amended by striking ‘‘15 percent (34 percent in 
the case of a corporation)’’ and inserting ‘‘0 
percent’’. 
(D) Section 607(h)(6)(A) of the Merchant 
Marine Act, 1936 is amended by striking ‘‘15 
percent (34 percent in the case of a corpora-
tion)’’ and inserting ‘‘0 percent’’. 
(c) EFFECTIVE DATE.— 
(1) IN GENERAL.—Except as provided in para-
graph (2), the amendments made by this section 
shall apply to taxable years beginning after the date 
of the enactment of this Act. 
(2) WITHHOLDING.—The amendments made by 
subparagraphs (A) and (B) of subsection (b)(3) 
shall take apply to dispositions and distributions 
after the date of the enactment of this Act. 
SEC. 3. REDUCTION IN TOP CORPORATE MARGINAL RATE. 
(a) IN GENERAL.—Paragraph (1) of section 11(b) of 
the Internal Revenue Code of 1986 is amended— 
(1) by adding ‘‘and’’ at the end of subpara-
graph (A), 
VerDate Aug 31 2005 
22:06 Oct 07, 2008
Jkt 079200
PO 00000
Frm 00005
Fmt 6652
Sfmt 6201
E:\BILLS\H7253.IH
H7253
PWALKER on PROD1PC71 with BILLS
(2) by striking ‘‘ but does not exceed $75,000,’’ 
in subparagraph (B) and inserting a period, 
(3) by striking subparagraphs (C) and (D), and 
(4) by striking ‘‘$11,750’’ and all that follows 
and inserting ‘‘$5,000.’’. 
(b) CONFORMING AMENDMENTS.— 
(1) Section 11(b)(2) of such Code is amended 
by striking ‘‘35 percent’’ and inserting ‘‘28 per-
cent’’. 
(2) Section 833(b)(1)(A) of such Code is 
amended by striking ‘‘25 percent’’ and inserting ‘‘20 
percent’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years beginning after 
the date of the enactment of this Act. 
SEC. 4. DISTRESSED ASSETS LOAN FUND. 
(a) ESTABLISHMENT.—There is established in the 
Department of the Treasury a Distressed Assets Loan 
Fund (hereafter in this section referred to as the ‘‘Fund’’) 
under the control of the Secretary of the Treasury for the 
purpose of making loans available to depository institu-
tions with distressed assets at low rates of interest under 
terms prescribed by the Secretary and in a manner pro-
vided in the regulations prescribed under subsection (b). 
VerDate Aug 31 2005 
22:06 Oct 07, 2008
Jkt 079200
PO 00000
Frm 00006
Fmt 6652
Sfmt 6201
E:\BILLS\H7253.IH
H7253
PWALKER on PROD1PC71 with BILLS
(b) REGULATIONS.—The Secretary shall prescribe 
regulations to define terms used in this section and estab-
lish an administration for the Fund. 
SEC. 5. INCREASE IN MAXIMUM AMOUNT OF DEPOSIT IN-
SURANCE AND SHARE INSURANCE. 
(a) STANDARD
MAXIMUM
DEPOSIT
INSURANCE 
AMOUNT INCREASED.—Section 11(a) of the Federal De-
posit Insurance Act (12 U.S.C. 1821(a)) is amended— 
(1) 
in 
subparagraph 
(E), 
by 
striking 
‘‘$100,000’’ and all that follows through the end of 
the subparagraph and inserting ‘‘$250,000.’’; and 
(2) in subparagraph (F)(i)(I), by striking 
‘‘$100,000’’ and inserting ‘‘$250,000’’. 
(b) 
STANDARD
MAXIMUM
SHARE
INSURANCE 
AMOUNT INCREASED.—Section 207(k)(5) of the Federal 
Credit Union Act (12 U.S.C. 1787(k)(5)) is amended by 
striking ‘‘$100,000’’ and inserting ‘‘$250,000’’. 
SEC. 6. GAIN OR LOSS FROM SALE OR EXCHANGE OF CER-
TAIN PREFERRED STOCK. 
(a) IN GENERAL.—For purposes of the Internal Rev-
enue Code of 1986, gain or loss from the sale or exchange 
of any applicable preferred stock by any applicable finan-
cial institution shall be treated as ordinary income or loss. 
VerDate Aug 31 2005 
22:06 Oct 07, 2008
Jkt 079200
PO 00000
Frm 00007
Fmt 6652
Sfmt 6201
E:\BILLS\H7253.IH
H7253
PWALKER on PROD1PC71 with BILLS
(b) APPLICABLE PREFERRED STOCK.—For purposes 
of this section, the term ‘‘applicable preferred stock’’ 
means any stock— 
(1) which is preferred stock in— 
(A) the Federal National Mortgage Asso-
ciation, established pursuant to the Federal Na-
tional Mortgage Association Charter Act (12 
U.S.C. 1716 et seq.), or 
(B) the Federal Home Loan Mortgage 
Corporation, established pursuant to the Fed-
eral Home Loan Mortgage Corporation Act (12 
U.S.C. 1451 et seq.), and 
(2) which— 
(A) was held by the applicable financial in-
stitution on September 6, 2008, or 
(B) was sold or exchanged by the applica-
ble financial institution on or after January 1, 
2008, and before September 7, 2008. 
(c) APPLICABLE FINANCIAL INSTITUTION.—For pur-
poses of this section: 
(1) IN GENERAL.—Except as provided in para-
graph (2), the term ‘‘applicable financial institution’’ 
means— 
VerDate Aug 31 2005 
22:06 Oct 07, 2008
Jkt 079200
PO 00000
Frm 00008
Fmt 6652
Sfmt 6201
E:\BILLS\H7253.IH
H7253
PWALKER on PROD1PC71 with BILLS
(A) a financial institution referred to in 
section 582(c)(2) of the Internal Revenue Code 
of 1986, or 
(B) a depository institution holding com-
pany (as defined in section 3(w)(1) of the Fed-
eral 
Deposit 
Insurance 
Act 
(12 
U.S.C. 
1813(w)(1))). 
(2) SPECIAL RULES FOR CERTAIN SALES.—In 
the case of— 
(A) a sale or exchange described in sub-
section (b)(2)(B), an entity shall be treated as 
an applicable financial institution only if it was 
an entity described in subparagraph (A) or (B) 
of paragraph (1) at the time of the sale or ex-
change, and 
(B) a sale or exchange after September 6, 
2008, of preferred stock described in subsection 
(b)(2)(A), an entity shall be treated as an appli-
cable financial institution only if it was an enti-
ty described in subparagraph (A) or (B) of 
paragraph (1) at all times during the period be-
ginning on September 6, 2008, and ending on 
the date of the sale or exchange of the pre-
ferred stock. 
VerDate Aug 31 2005 
22:06 Oct 07, 2008
Jkt 079200
PO 00000
Frm 00009
Fmt 6652
Sfmt 6201
E:\BILLS\H7253.IH
H7253
PWALKER on PROD1PC71 with BILLS