I 
112TH CONGRESS 
2D SESSION 
H. R. 4231 
To amend the Internal Revenue Code of 1986 to repeal certain tax breaks 
for gas and oil companies and to refund the revenue savings to registered 
vehicle owners. 
IN THE HOUSE OF REPRESENTATIVES 
MARCH 21, 2012 
Mr. YARMUTH (for himself, Mr. CONNOLLY of Virginia, Mr. CONYERS, Mr. 
STARK, Mr. JACKSON of Illinois, Mr. RANGEL, Ms. HAHN, Mr. RYAN of 
Ohio, Mr. SCHIFF, Mr. FILNER, Mr. VAN HOLLEN, Mr. CARSON of Indi-
ana, Mr. MCNERNEY, and Ms. CHU) 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 repeal 
certain tax breaks for gas and oil companies and to 
refund the revenue savings to registered vehicle owners. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Gas Rebate Act of 
2012’’. 
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TITLE I—DENIAL OF CERTAIN 
TAX BENEFITS TO OIL AND 
GAS COMPANIES 
SEC. 101. REPEAL OF ENHANCED OIL RECOVERY CREDIT. 
(a) IN GENERAL.—Subpart D of part IV of sub-
chapter A of chapter 1 of the Internal Revenue Code of 
1986 is amended by striking section 43 (and the table of 
sections of such subpart is amended by striking the item 
relating to such section). 
(b) CONFORMING AMENDMENTS.— 
(1) Subsection (b) of section 38 of such Code 
is amended by striking paragraph (6) and redesig-
nating paragraphs (7) through (36) as paragraphs 
(6) through (35), respectively. 
(2) Paragraph (7) of section 45Q(d) of such 
Code is amended to read as follows: 
‘‘(7) INFLATION ADJUSTMENT.— 
‘‘(A) IN
GENERAL.—In the case of any 
taxable year beginning in a calendar year after 
2009, there shall be substituted for each dollar 
amount contained in subsection (a) an amount 
equal to the product of— 
‘‘(i) such dollar amount, multiplied by 
‘‘(ii) the inflation adjustment factor 
for such calendar year. 
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‘‘(B) INFLATION ADJUSTMENT FACTOR.— 
The term ‘inflation adjustment factor’ means, 
with respect to any calendar year, a fraction the 
numerator of which is the GNP implicit price 
deflator for the preceding calendar year and the 
denominator of which is the GNP implicit price 
deflator for 2008. For purposes of the pre-
ceding sentence, the term ‘GNP implicit price 
deflator’ means the first revision of the implicit 
price deflator for the gross national product as 
computed and published by the Secretary of 
Commerce. Not later than April 1 of any cal-
endar year, the Secretary shall publish the in-
flation adjustment factor for the preceding cal-
endar year.’’. 
(3) Subsection (c) of section 196 of such Code 
is amended by striking paragraph (5) and redesig-
nating paragraphs (6) through (14) as paragraphs 
(5) through (13), respectively. 
(c) EFFECTIVE DATE.— 
(1) IN
GENERAL.—Except as otherwise pro-
vided in this subsection, the amendments made by 
this section shall apply to taxable years beginning 
after December 31, 2012. 
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(2) CONTINUATION OF BASIS REDUCTIONS.— 
Paragraph (2) of section 43(d) of the Internal Rev-
enue Code of 1986 (as in effect before its repeal by 
this section) shall continue to apply with respect to 
credits determined for taxable years beginning on or 
before December 31, 2012. 
SEC. 102. REPEAL OF CREDIT FOR PRODUCING OIL AND 
GAS FROM MARGINAL WELLS. 
(a) IN GENERAL.—Subpart D of part IV of sub-
chapter A of chapter 1 of the Internal Revenue Code of 
1986 is amended by striking section 45I (and the table 
of sections of such subpart is amended by striking the item 
relating to such section). 
(b) CONFORMING AMENDMENT.—Subsection (b) of 
section 38 of such Code, as amended by section 101, is 
amended by striking paragraph (18) and redesignating 
paragraphs (19) through (35) as paragraphs (18) through 
(34), respectively. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years beginning after 
December 31, 2012. 
SEC. 103. REPEAL OF EXPENSING OF INTANGIBLE DRILL-
ING AND DEVELOPMENT COSTS. 
(a) IN GENERAL.—Section 263 of the Internal Rev-
enue Code of 1986 is amended by striking subsection (c). 
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(b) EFFECTIVE DATE.—The amendment made by 
this section shall apply to taxable years beginning after 
December 31, 2012. 
SEC. 
104. 
REPEAL 
OF 
DEDUCTION 
FOR 
TERTIARY 
INJECTANTS. 
(a) IN GENERAL.—Part VI of subchapter B of chap-
ter 1 of the Internal Revenue Code of 1986 is amended 
by striking section 193 (and the table of sections of such 
subpart is amended by striking the item relating to such 
section). 
(b) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years beginning after 
December 31, 2012. 
SEC. 105. REPEAL OF EXCEPTION TO PASSIVE LOSS LIMITA-
TIONS FOR WORKING INTERESTS IN OIL AND 
GAS PROPERTIES. 
(a) IN GENERAL.—Paragraph (3) of section 469(c) 
of the Internal Revenue Code of 1986 is amended by add-
ing at the end the following new subparagraph: 
‘‘(C) TERMINATION.—Subparagraph (A) 
shall not apply with respect to any taxable year 
beginning after the date of the enactment of 
this Act.’’. 
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(b) EFFECTIVE DATE.—The amendment made by 
this section shall apply to taxable years beginning after 
December 31, 2012. 
SEC. 106. REPEAL OF PERCENTAGE DEPLETION FOR OIL 
AND GAS WELLS. 
(a) IN GENERAL.—Part I of subchapter I of chapter 
1 of the Internal Revenue Code of 1986 is amended by 
striking section 613A (and the table of sections of such 
part is amended by striking the item relating to such sec-
tion). 
(b) CONFORMING AMENDMENTS.— 
(1) Subsection (d) of section 45H of such Code 
is amended— 
(A) by striking ‘‘For purposes this section’’ 
and inserting the following: 
‘‘(1) IN GENERAL.—For purposes of this sec-
tion’’, 
(B) by striking ‘‘(within the meaning of 
section 613A(d)(3))’’, and 
(C) by adding at the end the following new 
paragraph: 
‘‘(2) RELATED PERSON.—For purposes of this 
subsection, a person is a related person with respect 
to the taxpayer if a significant ownership interest in 
either the taxpayer or such person is held by the 
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other, or if a third person has a significant owner-
ship interest in both the taxpayer and such person. 
For purposes of the preceding sentence, the term 
‘significant ownership interest’ means— 
‘‘(A) with respect to any corporation, 5 
percent or more in value of the outstanding 
stock of such corporation, 
‘‘(B) with respect to a partnership, 5 per-
cent or more interest in the profits or capital of 
such partnership, and 
‘‘(C) with respect to an estate or trust, 5 
percent or more of the beneficial interests in 
such estate or trust. 
For purposes of determining a significant ownership 
interest, an interest owned by or for a corporation, 
partnership, trust, or estate shall be considered as 
owned directly both by itself and proportionately by 
its shareholders, partners, or beneficiaries, as the 
case may be.’’. 
(2) Subparagraph (F) of section 56(g)(4) of 
such Code is amended to read as follows: 
‘‘(F) DEPLETION.—The allowance for de-
pletion with respect to any property placed in 
service in a taxable year beginning after De-
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cember 31, 1989, shall be cost depletion deter-
mined under section 611.’’. 
(3) Paragraph (1) of section 57(a) of such Code 
is amended by striking the last sentence. 
(4) Paragraph (4) of section 291(b) of such 
Code is amended by adding at the end the following: 
‘‘Any reference in the preceding sentence to section 
613A shall be treated as a reference to such section 
as in effect prior to the date of the enactment of the 
Gas Rebate Act of 2012.’’. 
(5) Subsection (d) of section 613 of such Code 
is amended by striking ‘‘Except as provided in sec-
tion 613A, in the case of’’ and inserting ‘‘In the case 
of’’. 
(6) Subsection (e) of section 613 of such Code 
is amended— 
(A) by striking ‘‘or section 613A’’ in para-
graph (2), and 
(B) by striking ‘‘any amount described in 
section 613A(d)(5)’’ in paragraph (3) and in-
serting ‘‘any lease bonus, advance royalty, or 
other amount payable without regard to produc-
tion from property’’. 
(7) Subsection (a) of section 705 of such Code 
is amended— 
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(A) by inserting ‘‘and’’ at the end of para-
graph (1)(C), 
(B) by striking ‘‘; and’’ at the end of para-
graph (2)(B) and inserting a period, and 
(C) by striking paragraph (3). 
(8) Section 776 of such Code is amended by 
striking subsection (a) and by redesignating sub-
section (b) as subsection (a). 
(9) Subparagraph (D) of section 954(g)(2) of 
such Code is amended by inserting ‘‘(as in effect be-
fore the date of the enactment of the Gas Rebate 
Act of 2012)’’ after ‘‘section 613A’’. 
(10) Subparagraph (C) of section 993(c)(2) of 
such Code is amended by striking ‘‘section 613 or 
613A’’ and inserting ‘‘section 613 (determined with-
out regard to subsection (d) thereof)’’. 
(11) Subparagraph (D) of section 1202(e)(3) of 
such Code is amended by striking ‘‘section 613 or 
613A’’ and inserting ‘‘section 613 (determined with-
out regard to subsection (d) thereof)’’. 
(12) Paragraph (2) of section 1367(a) of such 
Code is amended by inserting ‘‘and’’ at the end of 
subparagraph (C), by striking ‘‘, and’’ at the end of 
subparagraph (D) and inserting a period, and by 
striking subparagraph (E). 
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(13) Subsection (c) of section 1446 of such 
Code is amended by striking paragraph (2) and by 
redesignating paragraph (3) as paragraph (2). 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to property placed in service after 
December 31, 2012. 
SEC. 107. DEDUCTION FOR INCOME ATTRIBUTABLE TO DO-
MESTIC PRODUCTION ACTIVITIES NOT AL-
LOWED WITH RESPECT TO OIL AND GAS AC-
TIVITIES. 
(a) IN GENERAL.—Subparagraph (B) of section 
199(c)(4) of the Internal Revenue Code of 1986 is amend-
ed by striking ‘‘and’’ at the end of clause (ii), by striking 
the period at the end of clause (iii) and inserting ‘‘, and’’, 
and by inserting after clause (iii) the following new clause: 
‘‘(iv) the production, refining, proc-
essing, transportation, or distribution of 
oil, gas, or any primary product thereof.’’. 
(b) CONFORMING AMENDMENT.—Subsection (d) of 
section 199 of such Code is amended by striking para-
graph (9) and by redesignating paragraph (10) as para-
graph (9). 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years beginning after 
December 31, 2012. 
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SEC. 108. 7-YEAR AMORTIZATION FOR GEOLOGICAL AND 
GEOPHYSICAL EXPENDITURES. 
(a) IN GENERAL.—Subsection (h) of section 167 of 
the Internal Revenue Code of 1986 is amended— 
(1) by striking ‘‘24-month’’ in paragraphs (1) 
and (4) and inserting ‘‘7-year’’, and 
(2) by striking paragraph (5). 
(b) EFFECTIVE DATE.—The amendments made by 
this section shall apply to expenses paid or incurred after 
December 31, 2012. 
TITLE II—REGISTERED VEHICLE 
OWNER REBATE 
SEC. 201. REGISTERED VEHICLE OWNER REBATE. 
(a) IN GENERAL.—Each person who is a registered 
motor vehicle owner as of the date of the enactment of 
this Act, shall be treated as having made a payment 
against the tax imposed by chapter 1 of the Internal Rev-
enue Code of 1986 for the taxable year during which such 
date occurs in an amount equal to the motor vehicle owner 
rebate amount with respect to such person. 
(b) MOTOR VEHICLE OWNER REBATE AMOUNT.— 
For purposes of this section, the motor vehicle owner re-
bate amount with respect to any person is an amount 
equal to— 
(1) the number of motor vehicles registered by 
such person in the United States, multiplied by 
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(2) an amount equal to— 
(A) the amount of revenue that the Sec-
retary of the Treasury estimates will be received 
in the Treasury after December 31, 2012, and 
before December 31, 2022, which is attrib-
utable to title I of the Gas Rebate Act of 2012 
and the amendments made thereby, divided by 
(B) the number of motor vehicles reg-
istered by all persons in the United States. 
(c) ADVANCE PAYMENT.— 
(1) IN GENERAL.—The Secretary of the Treas-
ury shall, subject to provisions of the Internal Rev-
enue Code of 1986, refund or credit any overpay-
ment attributable to this section as rapidly as pos-
sible. 
(2) NO INTEREST.—No interest shall be allowed 
on any overpayment attributable to this section. 
(d) DEFINITION
AND SPECIAL RULES.—For pur-
poses of this section— 
(1) MOTOR VEHICLE.—The term ‘‘motor vehi-
cle’’ means any vehicle which is manufactured pri-
marily for use on public streets, roads, and highways 
(not including a vehicle operated exclusively on rail 
or rails) and which has at least 4 wheels. 
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(2) REGISTRATION.—A motor vehicle shall not 
be treated as registered in the United States unless 
such vehicle is situated within the United States and 
registered under the laws of one of the several 
States. 
(3) LONG-TERM LEASE AGREEMENTS.—In the 
case of a person who leases a vehicle under a lease 
agreement with an uninterrupted lease term of 1 
year or more, such person (and not the lessor of the 
vehicle) shall be treated as the registered vehicle 
owner. 
(4) NO
PAYMENTS
TO
GOVERNMENT
ENTI-
TIES.—Motor vehicles owned by any Federal, State, 
local, or foreign government (or any political subdivi-
sion, agency, or instrumentality thereof) shall not be 
taken into account. 
(e) COORDINATION WITH STATE AUTHORITIES.— 
For purposes of this section, the Secretary of the Treasury 
shall prescribe such rules, and consult with such State au-
thorities, as may be necessary or appropriate to determine 
the registered motor vehicle owners to whom this section 
applies and to prevent erroneous rebates and double- 
counting of motor vehicles. 
Æ 
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