issues. This decision shall be final, binding, and con-
clusive upon the parties. 
‘‘(i) ISSUANCE OF REGULATIONS.—Not later than 6 
months after the date of the enactment of this section, 
the Secretary shall issue regulations for carrying out this 
section. 
‘‘(j) DEFINITIONS.—For purposes of this section—
‘‘(1) SUBSECTION (f) BOND.—The term ‘sub-
section (f) bond’ means a bond designated by the 
Secretary under subsection (a) for purposes of sub-
section (f). 
‘‘(2) SECTION 54 BOND.—The term ‘section 54 
bond’ means a bond designated by the Secretary 
under subsection (a) for purposes of section 54 of 
the Internal Revenue Code of 1986 (relating to cred-
it to holders of qualified high-speed rail infrastruc-
ture bonds).’’. 
(b) TABLE OF SECTIONS AMENDMENT.—The table of 
sections of chapter 261 of title 49, United States Code, 
is amended by adding after the item relating to section 
26105 the following new item:
‘‘26106. High-speed rail infrastructure bonds.’’.
SEC. 3. TAX CREDIT TO HOLDERS OF QUALIFIED HIGH-
SPEED RAIL INFRASTRUCTURE BONDS. 
(a) IN GENERAL.—Part IV of subchapter A of chap-
ter 1 of the Internal Revenue Code of 1986 (relating to
credits against tax) is amended by adding at the end the 
following new subpart: 
‘‘Subpart H—Nonrefundable Credit for Holders of 
Qualified High-Speed Rail Infrastructure Bonds
‘‘Sec. 54. Credit to holders of qualified high-speed rail infrastructure bonds.
‘‘SEC. 54. CREDIT TO HOLDERS OF QUALIFIED HIGH-SPEED 
RAIL INFRASTRUCTURE BONDS. 
‘‘(a) ALLOWANCE OF CREDIT.—In the case of a tax-
payer who holds a qualified high-speed rail infrastructure 
bond on a credit allowance date of such bond which occurs 
during the taxable year, there shall be allowed as a credit 
against the tax imposed by this chapter for such taxable 
year an amount equal to the sum of the credits determined 
under subsection (b) with respect to credit allowance dates 
during such year on which the taxpayer holds such bond. 
‘‘(b) AMOUNT OF CREDIT.—
‘‘(1) IN GENERAL.—The amount of the credit 
determined under this subsection with respect to any 
credit allowance date for a qualified high-speed rail 
infrastructure bond is 25 percent of the annual cred-
it determined with respect to such bond. 
‘‘(2) ANNUAL CREDIT.—The annual credit de-
termined with respect to any qualified high-speed 
rail infrastructure bond is the product of—
‘‘(A) the applicable credit rate, multiplied 
by 
‘‘(B) the outstanding face amount of the 
bond. 
‘‘(3) APPLICABLE CREDIT RATE.—For purposes 
of paragraph (2), the applicable credit rate with re-
spect to an issue is the rate equal to an average 
market yield (as of the day before the date of sale 
of the issue) on outstanding long-term corporate 
debt obligations (determined under regulations pre-
scribed by the Secretary). 
‘‘(4) CREDIT ALLOWANCE DATE.—For purposes 
of this section, the term ‘credit allowance date’ 
means—
‘‘(A) March 15, 
‘‘(B) June 15, 
‘‘(C) September 15, and 
‘‘(D) December 15. 
Such term includes the last day on which the bond 
is outstanding. 
‘‘(5) SPECIAL RULE FOR ISSUANCE AND RE-
DEMPTION.—In the case of a bond which is issued 
during the 3-month period ending on a credit allow-
ance date, the amount of the credit determined 
under this subsection with respect to such credit al-
lowance date shall be a ratable portion of the credit 
otherwise determined based on the portion of the 3-
month period during which the bond is outstanding. 
A similar rule shall apply when the bond is re-
deemed. 
‘‘(c) LIMITATION BASED ON AMOUNT OF TAX.—
‘‘(1) IN GENERAL.—The credit allowed under 
subsection (a) for any taxable year shall not exceed 
the excess of—
‘‘(A) the sum of the regular tax liability 
(as defined in section 26(b)) plus the tax im-
posed by section 55, over 
‘‘(B) the sum of the credits allowable 
under this part (other than this subpart and 
subpart C). 
‘‘(2) CARRYOVER OF UNUSED CREDIT.—If the 
credit allowable under subsection (a) exceeds the 
limitation imposed by paragraph (1) for such taxable 
year, such excess shall be carried to the succeeding 
taxable year and added to the credit allowable under 
subsection (a) for such taxable year. 
‘‘(d) CREDIT INCLUDED IN GROSS INCOME.—Gross 
income includes the amount of the credit allowed to the 
taxpayer under this section (determined without regard to
subsection (c)) and the amount so included shall be treat-
ed as interest income. 
‘‘(e) QUALIFIED HIGH-SPEED RAIL INFRASTRUC-
TURE BOND.—For purposes of this part, the term ‘quali-
fied high-speed rail infrastructure bond’ means any bond 
issued as part of an issue if—
‘‘(1) the issuer certifies that the Secretary of 
Transportation has designated the bond for purposes 
of this section under section 26106(a) of title 49, 
United States Code, as in effect on the date of the 
enactment of this section, 
‘‘(2) 95 percent or more of the proceeds from 
the sale of such issue are to be used for expenditures 
incurred after the date of the enactment of this sec-
tion for any project described in section 26106(a)(2) 
of title 49, United States Code, 
‘‘(3) the term of each bond which is part of 
such issue does not exceed 20 years, 
‘‘(4) the payment of principal with respect to 
such bond is the obligation solely of the issuer, and 
‘‘(5) the issue meets the requirements of sub-
section (f) (relating to arbitrage). 
‘‘(f) SPECIAL RULES RELATING TO ARBITRAGE.—
‘‘(1) IN GENERAL.—Subject to paragraph (2), 
an issue shall be treated as meeting the require-