‘‘(C) the requirements of section 148 are 
met with respect to all bonds issued under this 
subsection. 
‘‘(c) LOW-INCOME HOUSING CREDIT.— 
‘‘(1) ADDITIONAL
HOUSING
CREDIT
DOLLAR 
AMOUNT.— 
‘‘(A) IN GENERAL.—For purposes of sec-
tion 42, in the case of calendar years 2006, 
2007, and 2008, the State housing credit ceil-
ing of each State, any portion of which is lo-
cated in the Gulf Opportunity Zone, shall be in-
creased by the lesser of— 
‘‘(i) the aggregate housing credit dol-
lar amount allocated by the State housing 
credit agency of such State to buildings lo-
cated in the Gulf Opportunity Zone for 
such calendar year, or 
‘‘(ii) the Gulf Opportunity housing 
amount for such State for such calendar 
year. 
‘‘(B) 
GULF
OPPORTUNITY
HOUSING 
AMOUNT.—For purposes of subparagraph (A), 
the term ‘Gulf Opportunity housing amount’ 
means, for any calendar year, the amount equal 
to the product of $18.00 multiplied by the por-
tion of the State population which is in the Gulf 
Opportunity Zone (as determined on the basis 
of the most recent census estimate of resident 
population released by the Bureau of Census 
before August 28, 2005). 
‘‘(C) ALLOCATIONS
TREATED
AS
MADE 
FIRST FROM ADDITIONAL ALLOCATION AMOUNT 
FOR
PURPOSES
OF
DETERMINING
CARRY-
OVER.—For purposes of determining the un-
used State housing credit ceiling under section 
42(h)(3)(C) for any calendar year, any increase 
in the State housing credit ceiling under sub-
paragraph (A) shall be treated as an amount 
described in clause (ii) of such section. 
‘‘(2) DIFFICULT DEVELOPMENT AREA.— 
‘‘(A) IN GENERAL.—For purposes of sec-
tion 42, in the case of property placed in service 
during 2006, 2007, or 2008, the Gulf Oppor-
tunity Zone— 
‘‘(i) shall be treated as a difficult de-
velopment area designated under subclause 
(I) of section 42(d)(5)(C)(iii), and 
‘‘(ii) shall not be taken into account 
for purposes of applying the limitation 
under subclause (II) of such section.
‘‘(B) APPLICATION.—Subparagraph (A) 
shall apply only to— 
‘‘(i) housing credit dollar amounts al-
located during the period beginning on 
January 1, 2006, and ending on December 
31, 2008, and 
‘‘(ii) buildings placed in service during 
such period to the extent that paragraph 
(1) of section 42(h) does not apply to any 
building by reason of paragraph (4) there-
of, but only with respect to bonds issued 
after December 31, 2005. 
‘‘(3) SPECIAL
RULE
FOR
APPLYING
INCOME 
TESTS.—In the case of property placed in service— 
‘‘(A) during 2006, 2007, or 2008, 
‘‘(B) in the Gulf Opportunity Zone, and 
‘‘(C) in a nonmetropolitan area (as defined 
in section 42(d)(5)(C)(iv)(IV)), 
section 42 shall be applied by substituting ‘national 
nonmetropolitan median gross income (determined 
under rules similar to the rules of section 
142(d)(2)(B))’ for ‘area median gross income’ in 
subparagraphs (A) and (B) of section 42(g)(1).
‘‘(4) DEFINITIONS.—Any term used in this sub-
section which is also used in section 42 shall have 
the same meaning as when used in such section. 
‘‘(d) SPECIAL ALLOWANCE FOR CERTAIN PROPERTY 
ACQUIRED ON OR AFTER AUGUST 28, 2005.— 
‘‘(1) ADDITIONAL ALLOWANCE.—In the case of 
any qualified Gulf Opportunity Zone property— 
‘‘(A) the depreciation deduction provided 
by section 167(a) for the taxable year in which 
such property is placed in service shall include 
an allowance equal to 50 percent of the ad-
justed basis of such property, and 
‘‘(B) the adjusted basis of the qualified 
Gulf Opportunity Zone property shall be re-
duced by the amount of such deduction before 
computing the amount otherwise allowable as a 
depreciation deduction under this chapter for 
such taxable year and any subsequent taxable 
year. 
‘‘(2) QUALIFIED
GULF
OPPORTUNITY
ZONE 
PROPERTY.— For purposes of this subsection— 
‘‘(A) IN
GENERAL.—The term ‘qualified 
Gulf Opportunity Zone property’ means prop-
erty—