I 
108TH CONGRESS 
2D SESSION 
H. R. 5146 
To amend the Internal Revenue Code of 1986 to provide incentives for 
alternative fuels and alternative fuel vehicles. 
IN THE HOUSE OF REPRESENTATIVES 
SEPTEMBER 23, 2004 
Mr. RUPPERSBERGER (for himself and Mr. GILCHREST) introduced the 
following bill; which was referred to the Committee on Ways and Means 
A BILL 
To amend the Internal Revenue Code of 1986 to provide 
incentives for alternative fuels and alternative fuel vehicles. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
(a) SHORT TITLE.—This Act may be cited as the 
‘‘Common Sense Automobile Efficiency Act of 2004’’. 
(b) AMENDMENT OF 1986 CODE.—Except as other-
wise expressly provided, whenever in this Act an amend-
ment or repeal is expressed in terms of an amendment 
to, or repeal of, a section or other provision, the reference
shall be considered to be made to a section or other provi-
sion of the Internal Revenue Code of 1986. 
SEC. 2. REPEAL OF PHASEOUTS FOR QUALIFIED ELECTRIC 
VEHICLE 
CREDIT 
AND 
DEDUCTION 
FOR 
CLEAN-FUEL VEHICLES. 
(a) CREDIT FOR QUALIFIED ELECTRIC VEHICLES.— 
Subsection (b) of section 30 (relating to limitations) is 
amended by striking paragraph (2) and redesignating 
paragraph (3) as paragraph (2). 
(b) DEDUCTION FOR CLEAN-FUEL VEHICLES AND 
CERTAIN REFUELING PROPERTY.—Paragraph (1) of sec-
tion 179A(b) (relating to qualified clean-fuel vehicle prop-
erty) is amended to read as follows: 
‘‘(1) QUALIFIED CLEAN-FUEL VEHICLE PROP-
ERTY.—The cost which may be taken into account 
under subsection (a)(1)(A) with respect to any 
motor vehicle shall not exceed— 
‘‘(A) in the case of a motor vehicle not de-
scribed in subparagraph (B) or (C), $2,000, 
‘‘(B) in the case of any truck or van with 
a gross vehicle weight rating greater than 
10,000 pounds but not greater than 26,000 
pounds, $5,000, or 
‘‘(C) $50,000 in the case of—
‘‘(i) a truck or van with a gross vehi-
cle weight rating greater than 26,000 
pounds, or 
‘‘(ii) any bus which has a seating ca-
pacity of at least 20 adults (not including 
the driver).’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to property placed in service after 
the date of the enactment of this Act. 
SEC. 3. ALTERNATIVE MOTOR VEHICLE CREDIT. 
(a) IN GENERAL.—Subpart B of part IV of sub-
chapter A of chapter 1 (relating to foreign tax credit, etc.) 
is amended by adding at the end the following: 
‘‘SEC. 30B. ALTERNATIVE MOTOR VEHICLE CREDIT. 
‘‘(a) ALLOWANCE OF CREDIT.—There shall be al-
lowed as a credit against the tax imposed by this chapter 
for the taxable year an amount equal to the sum of— 
‘‘(1) the new qualified fuel cell motor vehicle 
credit determined under subsection (b), 
‘‘(2) the new advanced lean burn technology 
motor vehicle credit determined under subsection (c), 
‘‘(3) the new qualified hybrid motor vehicle 
credit determined under subsection (d), and 
‘‘(4) the new qualified alternative fuel motor ve-
hicle credit determined under subsection (e).
‘‘(b) NEW QUALIFIED FUEL CELL MOTOR VEHICLE 
CREDIT.— 
‘‘(1) IN GENERAL.—For purposes of subsection 
(a), the new qualified fuel cell motor vehicle credit 
determined under this subsection with respect to a 
new qualified fuel cell motor vehicle placed in service 
by the taxpayer during the taxable year shall be de-
termined in accordance with the following table: 
‘‘In the case of a vehicle which 
has a gross vehicle weight rat-
ing of— 
The new qualified 
fuel cell motor 
vehicle credit is— 
Not more than 8,500 lbs .........................................................
$4,000
More than 8,500 lbs but not more than 14,000 lbs ................
$10,000
More than 14,000 lbs but not more than 26,000 lbs ..............
$20,000
More than 26,000 lbs ...............................................................
$40,000. 
‘‘(2) INCREASE FOR FUEL EFFICIENCY.— 
‘‘(A) IN
GENERAL.—The amount deter-
mined under paragraph (1) with respect to a 
new qualified fuel cell motor vehicle which is a 
passenger automobile or light truck shall be in-
creased by the additional credit amount. 
‘‘(B) ADDITIONAL CREDIT AMOUNT.—For 
purposes of subparagraph (A), the additional 
credit amount shall be determined in accord-
ance with the following table: 
‘‘In the case of a vehicle which 
achieves a fuel economy (ex-
pressed as a percentage of the 
2002 model year city fuel econ-
omy) of— 
The additional 
credit amount 
is— 
At least 150 percent but less than 175 percent ......................
$1,000
At least 175 percent but less than 200 percent ......................
$1,500
At least 200 percent but less than 225 percent ......................
$2,000
‘‘In the case of a vehicle which 
achieves a fuel economy (ex-
pressed as a percentage of the 
2002 model year city fuel econ-
omy) of— 
The additional 
credit amount 
is— 
At least 225 percent but less than 250 percent ......................
$2,500
At least 250 percent but less than 275 percent ......................
$3,000
At least 275 percent but less than 300 percent ......................
$3,500
At least 300 percent ................................................................
$4,000. 
‘‘(3) NEW QUALIFIED FUEL CELL MOTOR VEHI-
CLE.—For purposes of this subsection, the term 
‘new qualified fuel cell motor vehicle’ means a motor 
vehicle— 
‘‘(A) which is propelled by power derived 
from one or more cells which convert chemical 
energy directly into electricity by combining ox-
ygen with hydrogen fuel which is stored on 
board the vehicle in any form and may or may 
not require reformation prior to use, 
‘‘(B) which, in the case of a passenger 
automobile or light truck, has received— 
‘‘(i) a certificate of conformity under 
the Clean Air Act and meets or exceeds the 
equivalent qualifying California low emis-
sion 
vehicle 
standard 
under 
section 
243(e)(2) of the Clean Air Act for that 
make and model year, and 
‘‘(ii) a certificate that such vehicle 
meets or exceeds the Bin 5 Tier II emis-
sion standard established in regulations
prescribed by the Administrator of the En-
vironmental Protection Agency under sec-
tion 202(i) of the Clean Air Act for that 
make and model year vehicle, 
‘‘(C) the original use of which commences 
with the taxpayer, 
‘‘(D) which is acquired for use or lease by 
the taxpayer and not for resale, and 
‘‘(E) which is made by a manufacturer. 
‘‘(c) NEW ADVANCED LEAN BURN TECHNOLOGY 
MOTOR VEHICLE CREDIT.— 
‘‘(1) IN GENERAL.—For purposes of subsection 
(a), the new advanced lean burn technology motor 
vehicle credit determined under this subsection with 
respect to a new advanced lean burn technology 
motor vehicle placed in service by the taxpayer dur-
ing the taxable year is the credit amount determined 
under paragraph (2). 
‘‘(2) CREDIT AMOUNT.— 
‘‘(A) FUEL ECONOMY.—The credit amount 
determined under this paragraph shall be deter-
mined in accordance with the following table: 
‘‘In the case of a vehicle which 
achieves a fuel economy (ex-
pressed as a percentage of the 
2002 model year city fuel econ-
omy) of— 
The credit 
amount is— 
At least 125 percent but less than 150 percent ......................
$400
At least 150 percent but less than 175 percent ......................
$800
‘‘In the case of a vehicle which 
achieves a fuel economy (ex-
pressed as a percentage of the 
2002 model year city fuel econ-
omy) of— 
The credit 
amount is— 
At least 175 percent but less than 200 percent ......................
$1,200
At least 200 percent but less than 225 percent ......................
$1,600
At least 225 percent but less than 250 percent ......................
$2,000
At least 250 percent ................................................................
$2,400. 
‘‘(B) 
CONSERVATION
CREDIT.—The 
amount determined under subparagraph (A) 
with respect to a new advanced lean burn tech-
nology motor vehicle shall be increased by the 
conservation credit amount determined in ac-
cordance with the following table: 
‘‘In the case of a vehicle which 
achieves a lifetime fuel savings 
(expressed in gallons of gaso-
line) of— 
The conservation 
credit amount 
is— 
At least 1,200 but less than 1,800 ..........................................
$250
At least 1,800 but less than 2,400 ..........................................
$500
At least 2,400 but less than 3,000 ..........................................
$750
At least 3,000 ..........................................................................
$1,000. 
‘‘(3) NEW ADVANCED LEAN BURN TECHNOLOGY 
MOTOR VEHICLE.—For purposes of this subsection, 
the term ‘new advanced lean burn technology motor 
vehicle’ means a passenger automobile or a light 
truck— 
‘‘(A) with an internal combustion engine 
which— 
‘‘(i) is designed to operate primarily 
using more air than is necessary for com-
plete combustion of the fuel, 
‘‘(ii) incorporates direct injection,
‘‘(D) which is made by a manufacturer. 
‘‘(4) LIFETIME FUEL SAVINGS.—For purposes 
of this subsection, the term ‘lifetime fuel savings’ 
means, in the case of any new advanced lean burn 
technology motor vehicle, an amount equal to the ex-
cess (if any) of— 
‘‘(A) 120,000 divided by the 2002 model 
year city fuel economy for the vehicle inertia 
weight class, over 
‘‘(B) 120,000 divided by the city fuel econ-
omy for such vehicle. 
‘‘(d) NEW QUALIFIED HYBRID MOTOR VEHICLE 
CREDIT.— 
‘‘(1) IN GENERAL.—For purposes of subsection 
(a), the new qualified hybrid motor vehicle credit de-
termined under this subsection with respect to a new 
qualified hybrid motor vehicle placed in service by 
the taxpayer during the taxable year is the credit 
amount determined under paragraph (2). 
‘‘(2) CREDIT AMOUNT.— 
‘‘(A) CREDIT
AMOUNT
FOR
PASSENGER 
AUTOMOBILES
AND
LIGHT
TRUCKS.—In the 
case of a new qualified hybrid motor vehicle 
which is a passenger automobile or light truck 
and which has a gross vehicle weight rating of
not more than 8,500 pounds, the amount deter-
mined under this paragraph is the sum of the 
amounts determined under clauses (i) and (ii). 
‘‘(i) FUEL
ECONOMY.—The amount 
determined under this clause is the amount 
which would be determined under sub-
section (c)(2)(A) if such vehicle were a ve-
hicle referred to in such subsection. 
‘‘(ii) CONSERVATION
CREDIT.—The 
amount determined under this clause is the 
amount which would be determined under 
subsection (c)(2)(B) if such vehicle were a 
vehicle referred to in such subsection. 
‘‘(B) CREDIT AMOUNT FOR OTHER MOTOR 
VEHICLES.— 
‘‘(i) IN GENERAL.—In the case of any 
new qualified hybrid motor vehicle to which 
subparagraph (A) does not apply, the 
amount determined under this paragraph 
is the amount equal to the applicable per-
centage of the qualified incremental hybrid 
cost of the vehicle as certified under clause 
(v).
‘‘(ii) APPLICABLE PERCENTAGE.—For 
purposes of clause (i), the applicable per-
centage is— 
‘‘(I) 20 percent if the vehicle 
achieves an increase in city fuel econ-
omy relative to a comparable vehicle 
of at least 30 percent but less than 40 
percent, 
‘‘(II) 30 percent if the vehicle 
achieves such an increase of at least 
40 percent but less than 50 percent, 
and 
‘‘(III) 40 percent if the vehicle 
achieves such an increase of at least 
50 percent. 
‘‘(iii) QUALIFIED
INCREMENTAL
HY-
BRID COST.—For purposes of this subpara-
graph, the qualified incremental hybrid 
cost of any vehicle is equal to the amount 
of the excess of the manufacturer’s sug-
gested retail price for such vehicle over 
such price for a comparable vehicle, to the 
extent such amount does not exceed—
‘‘(I) $7,500, if such vehicle has a 
gross vehicle weight rating of not 
more than 14,000 pounds, 
‘‘(II) $15,000, if such vehicle has 
a gross vehicle weight rating of more 
than 14,000 pounds but not more 
than 26,000 pounds, and 
‘‘(III) $30,000, if such vehicle 
has a gross vehicle weight rating of 
more than 26,000 pounds. 
‘‘(iv) COMPARABLE
VEHICLE.—For 
purposes of this subparagraph, the term 
‘comparable vehicle’ means, with respect to 
any new qualified hybrid motor vehicle, 
any vehicle which is powered solely by a 
gasoline or diesel internal combustion en-
gine and which is comparable in weight, 
size, and use to such vehicle. 
‘‘(v) CERTIFICATION.—A certification 
described in clause (i) shall be made by the 
manufacturer and shall be determined in 
accordance with guidance prescribed by the 
Secretary. Such guidance shall specify pro-
cedures and methods for calculating fuel
economy savings and incremental hybrid 
costs. 
‘‘(3) NEW
QUALIFIED
HYBRID
MOTOR
VEHI-
CLE.—For purposes of this subsection— 
‘‘(A) IN GENERAL.—The term ‘new quali-
fied hybrid motor vehicle’ means a motor vehi-
cle— 
‘‘(i) which draws propulsion energy 
from onboard sources of stored energy 
which are both— 
‘‘(I) an internal combustion or 
heat engine using consumable fuel, 
and 
‘‘(II) a rechargeable energy stor-
age system, 
‘‘(ii) which, in the case of a vehicle to 
which paragraph (2)(A) applies, has re-
ceived a certificate of conformity under the 
Clean Air Act and meets or exceeds the 
equivalent qualifying California low emis-
sion 
vehicle 
standard 
under 
section 
243(e)(2) of the Clean Air Act for that 
make and model year, and 
‘‘(I) in the case of a vehicle hav-
ing a gross vehicle weight rating of
6,000 pounds or less, the Bin 5 Tier 
II emission standard established in 
regulations prescribed by the Adminis-
trator of the Environmental Protec-
tion Agency under section 202(i) of 
the Clean Air Act for that make and 
model year vehicle, and 
‘‘(II) in the case of a vehicle hav-
ing a gross vehicle weight rating of 
more than 6,000 pounds but not more 
than 8,500 pounds, the Bin 8 Tier II 
emission standard which is so estab-
lished, 
‘‘(iii) which has a maximum available 
power of at least— 
‘‘(I) 4 percent in the case of a ve-
hicle to which paragraph (2)(A) ap-
plies, 
‘‘(II) 10 percent in the case of a 
vehicle which has a gross vehicle 
weight rating or more than 8,500 
pounds and not than 14,000 pounds, 
and 
‘‘(III) 15 percent in the case of a 
vehicle in excess of 14,000 pounds,
‘‘(iv) which, in the case of a vehicle to 
which paragraph (2)(B) applies, has an in-
ternal combustion or heat engine which 
has received a certificate of conformity 
under the Clean Air Act as meeting the 
emission standards set in the regulations 
prescribed by the Administrator of the En-
vironmental Protection Agency for 2004 
through 2007 model year diesel heavy duty 
engines or ottocycle heavy duty engines, as 
applicable, 
‘‘(v) the original use of which com-
mences with the taxpayer, 
‘‘(vi) which is acquired for use or 
lease by the taxpayer and not for resale, 
and 
‘‘(vii) which is made by a manufac-
turer. 
Such term shall not include any vehicle which 
is not a passenger automobile or light truck if 
such vehicle has a gross vehicle weight rating of 
less than 8,500 pounds. 
‘‘(B) CONSUMABLE FUEL.—For purposes 
of subparagraph (A)(i)(I), the term ‘consumable 
fuel’ means any solid, liquid, or gaseous matter
which releases energy when consumed by an 
auxiliary power unit. 
‘‘(C) MAXIMUM AVAILABLE POWER.— 
‘‘(i) 
CERTAIN
PASSENGER
AUTO-
MOBILES AND LIGHT TRUCKS.—In the case 
of a vehicle to which paragraph (2)(A) ap-
plies, the term ‘maximum available power’ 
means the maximum power available from 
the rechargeable energy storage system, 
during a standard 10 second pulse power 
or equivalent test, divided by such max-
imum power and the SAE net power of the 
heat engine. 
‘‘(ii) OTHER
MOTOR
VEHICLES.—In 
the case of a vehicle to which paragraph 
(2)(B) applies, the term ‘maximum avail-
able power’ means the maximum power 
available from the rechargeable energy 
storage system, during a standard 10 sec-
ond pulse power or equivalent test, divided 
by the vehicle’s total traction power. For 
purposes of the preceding sentence, the 
term ‘total traction power’ means the sum 
of the peak power from the rechargeable 
energy storage system and the heat engine
peak power of the vehicle, except that if 
such storage system is the sole means by 
which the vehicle can be driven, the total 
traction power is the peak power of such 
storage system. 
‘‘(e) NEW QUALIFIED ALTERNATIVE FUEL MOTOR 
VEHICLE CREDIT.— 
‘‘(1) ALLOWANCE OF CREDIT.—Except as pro-
vided in paragraph (5), the new qualified alternative 
fuel motor vehicle credit determined under this sub-
section is an amount equal to the applicable percent-
age of the incremental cost of any new qualified al-
ternative fuel motor vehicle placed in service by the 
taxpayer during the taxable year. 
‘‘(2) APPLICABLE PERCENTAGE.—For purposes 
of paragraph (1), the applicable percentage with re-
spect to any new qualified alternative fuel motor ve-
hicle is— 
‘‘(A) 40 percent, plus 
‘‘(B) 30 percent, if such vehicle— 
‘‘(i) has received a certificate of con-
formity under the Clean Air Act and meets 
or exceeds the most stringent standard 
available for certification under the Clean 
Air Act for that make and model year vehi-
cle (other than a zero emission standard), 
or 
‘‘(ii) has received an order certifying 
the vehicle as meeting the same require-
ments as vehicles which may be sold or 
leased in California and meets or exceeds 
the most stringent standard available for 
certification under the State laws of Cali-
fornia (enacted in accordance with a waiv-
er granted under section 209(b) of the 
Clean Air Act) for that make and model 
year vehicle (other than a zero emission 
standard). 
For purposes of the preceding sentence, in the case 
of any new qualified alternative fuel motor vehicle 
which has a gross vehicle weight rating of more than 
14,000 pounds, the most stringent standard avail-
able shall be such standard available for certification 
on the date of the enactment of the Energy Tax Pol-
icy Act of 2003. 
‘‘(3) INCREMENTAL
COST.—For purposes of 
this subsection, the incremental cost of any new 
qualified alternative fuel motor vehicle is equal to 
the amount of the excess of the manufacturer’s sug-
gested retail price for such vehicle over such price
for a gasoline or diesel fuel motor vehicle of the 
same model, to the extent such amount does not ex-
ceed— 
‘‘(A) $5,000, if such vehicle has a gross ve-
hicle weight rating of not more than 8,500 
pounds, 
‘‘(B) $10,000, if such vehicle has a gross 
vehicle weight rating of more than 8,500 
pounds but not more than 14,000 pounds, 
‘‘(C) $25,000, if such vehicle has a gross 
vehicle weight rating of more than 14,000 
pounds but not more than 26,000 pounds, and 
‘‘(D) $40,000, if such vehicle has a gross 
vehicle weight rating of more than 26,000 
pounds. 
‘‘(4) NEW
QUALIFIED
ALTERNATIVE
FUEL 
MOTOR
VEHICLE.—For purposes of this sub-
section— 
‘‘(A) IN GENERAL.—The term ‘new quali-
fied alternative fuel motor vehicle’ means any 
motor vehicle— 
‘‘(i) which is only capable of operating 
on an alternative fuel, 
‘‘(ii) the original use of which com-
mences with the taxpayer,
‘‘(iii) which is acquired by the tax-
payer for use or lease, but not for resale, 
and 
‘‘(iv) which is made by a manufac-
turer. 
‘‘(B) ALTERNATIVE FUEL.—The term ‘al-
ternative fuel’ means compressed natural gas, 
liquefied natural gas, liquefied petroleum gas, 
hydrogen, and any liquid at least 85 percent of 
the volume of which consists of methanol. 
‘‘(5) CREDIT FOR MIXED-FUEL VEHICLES.— 
‘‘(A) IN
GENERAL.—In the case of a 
mixed-fuel vehicle placed in service by the tax-
payer during the taxable year, the credit deter-
mined under this subsection is an amount equal 
to— 
‘‘(i) in the case of a 75/25 mixed-fuel 
vehicle, 70 percent of the credit which 
would have been allowed under this sub-
section if such vehicle was a qualified alter-
native fuel motor vehicle, and 
‘‘(ii) in the case of a 90/10 mixed-fuel 
vehicle, 90 percent of the credit which 
would have been allowed under this sub-
section if such vehicle was a qualified alter-
native fuel motor vehicle. 
‘‘(B) MIXED-FUEL
VEHICLE.—For pur-
poses of this subsection, the term ‘mixed-fuel 
vehicle’ means any motor vehicle described in 
subparagraph (C) or (D) of paragraph (3), 
which— 
‘‘(i) is certified by the manufacturer 
as being able to perform efficiently in nor-
mal operation on a combination of an al-
ternative fuel and a petroleum-based fuel, 
‘‘(ii) either— 
‘‘(I) has received a certificate of 
conformity under the Clean Air Act, 
or 
‘‘(II) has received an order certi-
fying the vehicle as meeting the same 
requirements as vehicles which may be 
sold or leased in California and meets 
or exceeds the low emission vehicle 
standard under section 88.105–94 of 
title 40, Code of Federal Regulations, 
for that make and model year vehicle, 
‘‘(iii) the original use of which com-
mences with the taxpayer,
‘‘(iv) which is acquired by the tax-
payer for use or lease, but not for resale, 
and 
‘‘(v) which is made by a manufac-
turer. 
‘‘(C) 75/25 MIXED-FUEL
VEHICLE.—For 
purposes of this subsection, the term ‘75/25 
mixed-fuel vehicle’ means a mixed-fuel vehicle 
which operates using at least 75 percent alter-
native fuel and not more than 25 percent petro-
leum-based fuel. 
‘‘(D) 90/10 MIXED-FUEL
VEHICLE.—For 
purposes of this subsection, the term ‘90/10 
mixed-fuel vehicle’ means a mixed-fuel vehicle 
which operates using at least 90 percent alter-
native fuel and not more than 10 percent petro-
leum-based fuel. 
‘‘(f) LIMITATION ON NUMBER OF NEW QUALIFIED 
HYBRID AND ADVANCED LEAN-BURN TECHNOLOGY VE-
HICLES ELIGIBLE FOR CREDIT.— 
‘‘(1) IN GENERAL.—In the case of a qualified 
vehicle sold during the phaseout period, only the ap-
plicable percentage of the credit otherwise allowable 
under subsection (c) or (d) shall be allowed.
‘‘(2) PHASEOUT PERIOD.—For purposes of this 
subsection, the phaseout period is the period begin-
ning with the second calendar quarter following the 
calendar quarter which includes the first date on 
which the number of qualified vehicles manufactured 
by the manufacturer of the vehicle referred to in 
paragraph (1) sold for use in the United States after 
the date of the enactment of this section is at least 
80,000. 
‘‘(3) APPLICABLE PERCENTAGE.—For purposes 
of paragraph (1), the applicable percentage is— 
‘‘(A) 50 percent for the first 2 calendar 
quarters of the phaseout period, 
‘‘(B) 25 percent for the 3d and 4th cal-
endar quarters of the phaseout period, and 
‘‘(C) 0 percent for each calendar quarter 
thereafter. 
‘‘(4) CONTROLLED GROUPS.— 
‘‘(A) IN GENERAL.—For purposes of this 
subsection, all persons treated as a single em-
ployer under subsection (a) or (b) of section 52 
or subsection (m) or (o) of section 414 shall be 
treated as a single manufacturer. 
‘‘(B) INCLUSION
OF
FOREIGN
CORPORA-
TIONS.—For purposes of subparagraph (A), in
applying subsections (a) and (b) of section 52 
to this section, section 1563 shall be applied 
without regard to subsection (b)(2)(C) thereof. 
‘‘(5) QUALIFIED
VEHICLE.—For purposes of 
this subsection, the term ‘qualified vehicle’ means 
any new qualified hybrid motor vehicle and any new 
advanced lean burn technology motor vehicle. 
‘‘(g) LIMITATION BASED ON AMOUNT OF TAX.—The 
credit allowed under subsection (a) for the taxable year 
shall not exceed the excess of— 
‘‘(1) the sum of the regular tax liability (as de-
fined in section 26(b)) plus the tax imposed by sec-
tion 55, over 
‘‘(2) the sum of the credits allowable under sub-
part A and sections 27 and 30 for the taxable year. 
‘‘(h) OTHER DEFINITIONS AND SPECIAL RULES.— 
For purposes of this section— 
‘‘(1) MOTOR VEHICLE.—The term ‘motor vehi-
cle’ has the meaning given such term by section 
30(c)(2). 
‘‘(2) OTHER TERMS.—The terms ‘automobile’, 
‘passenger automobile’, ‘light truck’, and ‘manufac-
turer’ have the meanings given such terms in regula-
tions prescribed by the Administrator of the Envi-
ronmental Protection Agency for purposes of the ad-
ministration of title II of the Clean Air Act (42 
U.S.C. 7521 et seq.). 
‘‘(3) 2002 MODEL
YEAR
CITY
FUEL
ECON-
OMY.— 
‘‘(A) IN GENERAL.—The 2002 model year 
city fuel economy with respect to a vehicle shall 
be determined in accordance with the following 
tables: 
‘‘(i) In the case of a passenger auto-
mobile: 
The 2002 model year city 
‘‘If vehicle inertia weight class is: 
fuel economy is: 
1,500 or 1,750 lbs ....................................................................
45.2 mpg
2,000 lbs ..................................................................................
39.6 mpg
2,250 lbs ..................................................................................
35.2 mpg
2,500 lbs ..................................................................................
31.7 mpg
2,750 lbs ..................................................................................
28.8 mpg
3,000 lbs ..................................................................................
26.4 mpg
3,500 lbs ..................................................................................
22.6 mpg
4,000 lbs ..................................................................................
19.8 mpg
4,500 lbs ..................................................................................
17.6 mpg
5,000 lbs ..................................................................................
15.9 mpg
5,500 lbs ..................................................................................
14.4 mpg
6,000 lbs ..................................................................................
13.2 mpg
6,500 lbs ..................................................................................
12.2 mpg
7,000 to 8,500 lbs ....................................................................
11.3 mpg. 
‘‘(ii) In the case of a light truck: 
The 2002 model year city 
‘‘If vehicle inertia weight class is: 
fuel economy is: 
1,500 or 1,750 lbs ....................................................................
39.4 mpg
2,000 lbs ..................................................................................
35.2 mpg
2,250 lbs ..................................................................................
31.8 mpg
2,500 lbs ..................................................................................
29.0 mpg
2,750 lbs ..................................................................................
26.8 mpg
3,000 lbs ..................................................................................
24.9 mpg
3,500 lbs ..................................................................................
21.8 mpg
4,000 lbs ..................................................................................
19.4 mpg
4,500 lbs ..................................................................................
17.6 mpg
5,000 lbs ..................................................................................
16.1 mpg
5,500 lbs ..................................................................................
14.8 mpg
6,000 lbs ..................................................................................
13.7 mpg
The 2002 model year city 
‘‘If vehicle inertia weight class is: 
fuel economy is: 
6,500 lbs ..................................................................................
12.8 mpg
7,000 to 8,500 lbs ....................................................................
12.1 mpg. 
‘‘(B) VEHICLE INERTIA WEIGHT CLASS.— 
For purposes of subparagraph (A), the term 
‘vehicle inertia weight class’ has the same 
meaning as when defined in regulations pre-
scribed by the Administrator of the Environ-
mental Protection Agency for purposes of the 
administration of title II of the Clean Air Act 
(42 U.S.C. 7521 et seq.). 
‘‘(4) FUEL ECONOMY.—Fuel economy with re-
spect to any vehicle shall be measured under rules 
similar to the rules under section 4064(c). 
‘‘(5) REDUCTION IN BASIS.—For purposes of 
this subtitle, if a credit is allowed under this section 
for any expenditure with respect to any property, the 
increase in the basis of such property which would 
(but for this paragraph) result from such expendi-
ture shall be reduced by the amount of the credit so 
allowed. 
‘‘(6) NO
DOUBLE
BENEFIT.—The amount of 
any deduction or credit allowable under this chapter 
(other than the credits allowable under this section 
and section 30) shall be reduced by the amount of
credit allowed under subsection (a) for such vehicle 
for the taxable year. 
‘‘(7) RECAPTURE.—The Secretary shall, by reg-
ulations, provide for recapturing the benefit of any 
credit allowable under subsection (a) with respect to 
any property which ceases to be property eligible for 
such credit (including recapture in the case of a 
lease period of less than the economic life of a vehi-
cle). 
‘‘(8) 
PROPERTY
USED
OUTSIDE
UNITED 
STATES, ETC., NOT QUALIFIED.—No credit shall be 
allowed under subsection (a) with respect to any 
property referred to in section 50(b) or with respect 
to the portion of the cost of any property taken into 
account under section 179. 
‘‘(9) ELECTION
NOT
TO
TAKE
CREDIT.—No 
credit shall be allowed under subsection (a) for any 
vehicle if the taxpayer elects to not have this section 
apply to such vehicle. 
‘‘(10) BUSINESS
CARRYOVERS
ALLOWED.—If 
the credit allowable under subsection (a) for a tax-
able year exceeds the limitation under subsection (g) 
for such taxable year, such excess (to the extent of 
the credit allowable with respect to property subject 
to the allowance for depreciation) shall be allowed as
a credit carryback and carryforward under rules 
similar to the rules of section 39. 
‘‘(11) INTERACTION
WITH
MOTOR
VEHICLE 
SAFETY STANDARDS.—Unless otherwise provided in 
this section, a motor vehicle shall not be considered 
eligible for a credit under this section unless such 
vehicle is in compliance with the motor vehicle safety 
provisions of sections 30101 through 30169 of title 
49, United States Code. 
‘‘(i) REGULATIONS.— 
‘‘(1) IN GENERAL.—The Secretary shall pro-
mulgate such regulations as necessary to carry out 
the provisions of this section. 
‘‘(2) DETERMINATION OF MOTOR VEHICLE ELI-
GIBILITY.—The Secretary, after coordination with 
the Secretary of Transportation and the Adminis-
trator of the Environmental Protection Agency, shall 
prescribe such regulations as necessary to determine 
whether a motor vehicle meets the requirements to 
be eligible for a credit under this section. 
‘‘(j) TERMINATION.—This section shall not apply to 
any property placed in service after— 
‘‘(1) in the case of a new qualified alternative 
fuel motor vehicle, December 31, 2006,
‘‘(2) in the case of a new advanced lean burn 
technology motor vehicle or a new qualified hybrid 
motor vehicle, December 31, 2008, and 
‘‘(3) in the case of a new qualified fuel cell 
motor vehicle, December 31, 2012.’’. 
(b) CONFORMING AMENDMENTS.— 
(1) Section 30(d) (relating to special rules) is 
amended by adding at the end the following new 
paragraphs: 
‘‘(5) NO DOUBLE BENEFIT.—No credit shall be 
allowed under this section for any motor vehicle for 
which a credit is also allowed under section 30B.’’. 
(2) Section 1016(a) is amended by striking 
‘‘and’’ at the end of paragraph (27), by striking the 
period at the end of paragraph (28) and inserting ‘‘, 
and’’, and by adding at the end the following: 
‘‘(29) to the extent provided in section 
30B(h)(5).’’. 
(3) Section 6501(m) is amended by inserting 
‘‘30B(h)(9),’’ after ‘‘30(d)(4),’’. 
(4) The table of sections for subpart B of part 
IV of subchapter A of chapter 1 is amended by in-
serting after the item relating to section 30A the fol-
lowing: 
‘‘Sec. 30B. Alternative motor vehicle credit.’’.
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to property placed in service after 
the date of the enactment of this Act, in taxable years 
ending after such date. 
(d) STICKER INFORMATION REQUIRED AT RETAIL 
SALE.— 
(1) IN GENERAL.—The Secretary of the Treas-
ury shall issue regulations under which each quali-
fied vehicle sold at retail shall display a notice— 
(A) that such vehicle is a qualified vehicle, 
and 
(B) that the buyer may not benefit from 
the credit allowed under section 30B of the In-
ternal Revenue Code of 1986 if such buyer has 
insufficient tax liability. 
(2) QUALIFIED
VEHICLE.—For purposes of 
paragraph (1), the term ‘‘qualified vehicle’’ means a 
vehicle with respect to which a credit is allowed 
under section 30B of the Internal Revenue Code of 
1986. 
SEC. 4. SMALL ETHANOL PRODUCER CREDIT. 
(a) ALLOCATION OF ALCOHOL FUELS CREDIT TO 
PATRONS OF A COOPERATIVE.—Section 40(g) (relating to 
definitions and special rules for eligible small ethanol pro-
(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: