(b) CREDIT TREATED AS PART OF GENERAL BUSI-
NESS CREDIT.—Section 38(b) (relating to current year 
business credit) is amended by striking ‘‘plus’’ at the end 
of paragraph (16), by striking the period at the end of 
paragraph (17) and inserting ‘‘, plus’’, and by adding at 
the end the following new paragraph: 
‘‘(18) the biodiesel fuels credit determined 
under section 40A(a).’’. 
(c) CONFORMING AMENDMENTS.— 
(1)(A) Section 87 is amended to read as fol-
lows: 
‘‘SEC. 87. ALCOHOL AND BIODIESEL FUELS CREDITS. 
‘‘Gross income includes— 
‘‘(1) the amount of the alcohol fuels credit de-
termined with respect to the taxpayer for the taxable 
year under section 40(a), and 
‘‘(2) the biodiesel fuels credit determined with 
respect to the taxpayer for the taxable year under 
section 40A(a).’’. 
(B) The item relating to section 87 in the 
table of sections for part II of subchapter B of 
chapter 1 is amended by striking ‘‘fuel credit’’ 
and inserting ‘‘and biodiesel fuels credits’’. 
(2) Section 196(c) is amended by striking 
‘‘and’’ at the end of paragraph (9), by striking the
period at the end of paragraph (10) and inserting ‘‘, 
and’’, and by adding at the end the following new 
paragraph: 
‘‘(11) the biodiesel fuels credit determined 
under section 40A(a).’’. 
(3) The table of sections for subpart D of part 
IV of subchapter A of chapter 1 is amended by add-
ing after the item relating to section 40 the fol-
lowing new item: 
‘‘Sec. 40A. Biodiesel used as fuel.’’. 
(d) EFFECTIVE DATE.—The amendments made by 
this section shall apply to fuel produced, and sold or used, 
after December 31, 2003, in taxable years ending after 
such date. 
SEC. 6. ALCOHOL FUEL AND BIODIESEL MIXTURES EXCISE 
TAX CREDIT. 
(a) IN GENERAL.—Subchapter B of chapter 65 (re-
lating to rules of special application) is amended by insert-
ing after section 6425 the following new section: 
‘‘SEC. 6426. CREDIT FOR ALCOHOL FUEL AND BIODIESEL 
MIXTURES. 
‘‘(a) ALLOWANCE OF CREDITS.—There shall be al-
lowed as a credit against the tax imposed by section 4081 
an amount equal to the sum of— 
‘‘(1) the alcohol fuel mixture credit, plus 
‘‘(2) the biodiesel mixture credit.
‘‘(b) ALCOHOL FUEL MIXTURE CREDIT.— 
‘‘(1) IN GENERAL.—For purposes of this sec-
tion, the alcohol fuel mixture credit is the product 
of the applicable amount and the number of gallons 
of alcohol used by the taxpayer in producing any al-
cohol fuel mixture for sale or use in a trade or busi-
ness of the taxpayer. 
‘‘(2) APPLICABLE AMOUNT.—For purposes of 
this subsection— 
‘‘(A) IN GENERAL.—Except as provided in 
subparagraph (B), the applicable amount is 52 
cents (51 cents in the case of any sale or use 
after 2004). 
‘‘(B) MIXTURES
NOT
CONTAINING
ETH-
ANOL.—In the case of an alcohol fuel mixture 
in which none of the alcohol consists of ethanol, 
the applicable amount is 60 cents. 
‘‘(3) ALCOHOL FUEL MIXTURE.—For purposes 
of this subsection, the term ‘alcohol fuel mixture’ 
means a mixture of alcohol and a taxable fuel 
which— 
‘‘(A) is sold by the taxpayer producing 
such mixture to any person for use as a fuel, 
‘‘(B) is used as a fuel by the taxpayer pro-
ducing such mixture, or
‘‘(C) is removed from the refinery by a 
person producing such mixture. 
‘‘(4) OTHER
DEFINITIONS.—For purposes of 
this subsection— 
‘‘(A) ALCOHOL.—The term ‘alcohol’ in-
cludes methanol and ethanol but does not in-
clude— 
‘‘(i) alcohol produced from petroleum, 
natural gas, or coal (including peat), or 
‘‘(ii) alcohol with a proof of less than 
190 (determined without regard to any 
added denaturants). 
Such term also includes an alcohol gallon equiv-
alent of ethyl tertiary butyl ether or other 
ethers produced from such alcohol. 
‘‘(B) TAXABLE FUEL.—The term ‘taxable 
fuel’ has the meaning given such term by sec-
tion 4083(a)(1). 
‘‘(5) TERMINATION.—This subsection shall not 
apply to any sale, use, or removal for any period 
after December 31, 2010. 
‘‘(c) BIODIESEL MIXTURE CREDIT.— 
‘‘(1) IN GENERAL.—For purposes of this sec-
tion, the biodiesel mixture credit is the product of 
the applicable amount and the number of gallons of
biodiesel used by the taxpayer in producing any bio-
diesel mixture for sale or use in a trade or business 
of the taxpayer. 
‘‘(2) APPLICABLE AMOUNT.—For purposes of 
this subsection— 
‘‘(A) IN GENERAL.—Except as provided in 
subparagraph (B), the applicable amount is 50 
cents. 
‘‘(B) AMOUNT
FOR
AGRI-BIODIESEL.—In 
the case of any biodiesel which is agri-biodiesel, 
the applicable amount is $1.00. 
‘‘(3) BIODIESEL
MIXTURE.—For purposes of 
this section, the term ‘biodiesel mixture’ means a 
mixture of biodiesel and a taxable fuel which— 
‘‘(A) is sold by the taxpayer producing 
such mixture to any person for use as a fuel, 
‘‘(B) is used as a fuel by the taxpayer pro-
ducing such mixture, or 
‘‘(C) is removed from the refinery by a 
person producing such mixture. 
‘‘(4) 
CERTIFICATION
FOR
BIODIESEL.—No 
credit shall be allowed under this section unless the 
taxpayer obtains a certification (in such form and 
manner as prescribed by the Secretary) from the 
producer of the biodiesel which identifies the product
produced and the percentage of biodiesel and agri- 
biodiesel in the product. 
‘‘(5) OTHER DEFINITIONS.—Any term used in 
this subsection which is also used in section 40A 
shall have the meaning given such term by section 
40A. 
‘‘(6) TERMINATION.—This subsection shall not 
apply to any sale, use, or removal for any period 
after December 31, 2005. 
‘‘(d) MIXTURE NOT USED AS A FUEL, ETC.— 
‘‘(1) IMPOSITION OF TAX.—If— 
‘‘(A) any credit was determined under this 
section with respect to alcohol or biodiesel used 
in the production of any alcohol fuel mixture or 
biodiesel mixture, respectively, and 
‘‘(B) any person— 
‘‘(i) separates the alcohol or biodiesel 
from the mixture, or 
‘‘(ii) without separation, uses the mix-
ture other than as a fuel, 
then there is hereby imposed on such person a 
tax equal to the product of the applicable 
amount and the number of gallons of such alco-
hol or biodiesel.
‘‘(2) APPLICABLE LAWS.—All provisions of law, 
including penalties, shall, insofar as applicable and 
not inconsistent with this section, apply in respect of 
any tax imposed under paragraph (1) as if such tax 
were imposed by section 4081 and not by this sec-
tion. 
‘‘(e) COORDINATION WITH EXEMPTION FROM EX-
CISE TAX.—Rules similar to the rules under section 40(c) 
shall apply for purposes of this section.’’. 
(b) REGISTRATION REQUIREMENT.—Section 4101(a) 
(relating to registration) is amended by inserting ‘‘and 
every person producing biodiesel (as defined in section 
40A(d)(1)) 
or 
alcohol 
(as 
defined 
in 
section 
6426(b)(4)(A))’’ after ‘‘4091’’. 
(c) ADDITIONAL AMENDMENTS.— 
(1) Section 40(c) is amended by striking ‘‘or 
section 4091(c)’’ and inserting ‘‘section 4091(c), or 
section 6426’’. 
(2) Section 40(e)(1) is amended— 
(A) by striking ‘‘2007’’ in subparagraph 
(A) and inserting ‘‘2010’’, and 
(B) by striking ‘‘2008’’ in subparagraph 
(B) and inserting ‘‘2011’’. 
(3) Section 40(h) is amended—
(A) by striking ‘‘2007’’ in paragraph (1) 
and inserting ‘‘2010’’, and 
(B) by striking ‘‘, 2006, or 2007’’ in the 
table contained in paragraph (2) and inserting 
‘‘through 2010’’. 
(4)(A) Subpart C of part III of subchapter A 
of chapter 32 is amended by adding at the end the 
following new section: 
‘‘SEC. 4104. INFORMATION REPORTING FOR PERSONS 
CLAIMING CERTAIN TAX BENEFITS. 
‘‘(a) IN GENERAL.—The Secretary shall require any 
person claiming tax benefits under the provisions of sec-
tion 34, 40, 40A, 4041(b)(2), 4041(k), 4081(c), 6426, or 
6427(f) to file a quarterly return (in such manner as the 
Secretary may prescribe) providing such information relat-
ing to such benefits and the coordination of such benefits 
as the Secretary may require to ensure the proper admin-
istration and use of such benefits. 
‘‘(b) ENFORCEMENT.—With respect to any person 
described in subsection (a) and subject to registration re-
quirements under this title, rules similar to rules of section 
4222(c) shall apply with respect to any requirement under 
this section.’’.
(B) The table of sections for subpart C of part 
III of subchapter A of chapter 32 is amended by 
adding at the end the following new item: 
‘‘Sec. 4104. Information reporting for persons claiming certain tax bene-
fits.’’. 
(5) Section 6427(i)(3) is amended— 
(A) by adding at the end of subparagraph 
(A) the following new flush sentence: 
‘‘In the case of an electronic claim, this sub-
paragraph shall be applied without regard to 
clause (i).’’, and 
(B) by striking ‘‘20 days of the date of the 
filing of such claim’’ in subparagraph (B) and 
inserting ‘‘45 days of the date of the filing of 
such claim (20 days in the case of an electronic 
claim)’’. 
(6) Section 9503(b)(1) is amended by adding at 
the end the following new flush sentence: 
‘‘For purposes of this paragraph, taxes received 
under sections 4041 and 4081 shall be determined 
without reduction for credits under section 6426.’’. 
(d) CLERICAL AMENDMENT.—The table of sections 
for subchapter B of chapter 65 is amended by inserting 
after the item relating to section 6425 the following new 
item: 
‘‘Sec. 6426. Credit for alcohol fuel and biodiesel mixtures.’’.
(e) EFFECTIVE DATES.— 
(1) IN GENERAL.—Except as provided in para-
graphs (2) and (3), the amendments made by this 
section shall apply to fuel sold, used, or removed 
after December 31, 2003. 
(2) SUBSECTION
(c)(4).—The amendments 
made by subsection (c)(4) shall take effect on Janu-
ary 1, 2004. 
(3) SUBSECTION
(c)(5).—The amendments 
made by subsection (c)(5) shall apply to claims filed 
after December 31, 2004. 
(f) FORMAT
FOR FILING.—The Secretary of the 
Treasury shall prescribe the electronic format for filing 
claims described in section 6427(i)(3)(B) of the Internal 
Revenue Code of 1986 (as amended by subsection 
(c)(5)(A)) not later than December 31, 2004. 
SEC. 7. NONAPPLICATION OF EXPORT EXEMPTION TO DE-
LIVERY OF FUEL TO MOTOR VEHICLES RE-
MOVED FROM UNITED STATES. 
(a) IN GENERAL.—Section 4221(d)(2) (defining ex-
port) is amended by adding at the end the following new 
sentence: ‘‘Such term does not include the delivery of a 
taxable fuel (as defined in section 4083(a)(1)) into a fuel 
tank of a motor vehicle which is shipped or driven out 
of the United States.’’.
(b) CONFORMING AMENDMENTS.— 
(1) Section 4041(g) (relating to other exemp-
tions) is amended by adding at the end the following 
new sentence: ‘‘Paragraph (3) shall not apply to the 
sale for delivery of a liquid into a fuel tank of a 
motor vehicle which is shipped or driven out of the 
United States.’’. 
(2) Clause (iv) of section 4081(a)(1)(A) (relat-
ing to tax on removal, entry, or sale) is amended by 
inserting ‘‘or at a duty-free sales enterprise (as de-
fined in section 555(b)(8) of the Tariff Act of 
1930)’’ after ‘‘section 4101’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to sales or deliveries made after 
the date of the enactment of this Act. 
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