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‘‘(B) $10,000, if such vehicle has a gross ve-
hicle weight rating of more than 8,500 pounds 
but not more than 14,000 pounds, 
‘‘(C) $25,000, if such vehicle has a gross ve-
hicle 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 ve-
hicle weight rating of more than 26,000 pounds. 
‘‘(4) NEW QUALIFIED ALTERNATIVE FUEL MOTOR 
VEHICLE.—For purposes of this subsection— 
‘‘(A) IN GENERAL.—The term ‘new qualified 
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 ‘alter-
native fuel’ means compressed natural gas, lique-
fied natural gas, liquefied petroleum gas, hydro-
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gen, 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 taxpayer 
during the taxable year, the credit determined 
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 subsection if 
such vehicle was a qualified alternative 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 subsection if 
such vehicle was a qualified alternative fuel 
motor vehicle. 
‘‘(B) MIXED-FUEL VEHICLE.—For purposes 
of this subsection, the term ‘mixed-fuel vehicle’ 
means any motor vehicle described in subpara-
graph (C) or (D) of paragraph (3), which— 
‘‘(i) is certified by the manufacturer as 
being able to perform efficiently in normal 
operation on a combination of an alter-
native fuel and a petroleum-based fuel,
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‘‘(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 manufacturer. 
‘‘(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
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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. 
‘‘(e) APPLICATION WITH OTHER CREDITS.—The credit 
allowed under subsection (a) for any taxable year shall not 
exceed the excess (if any) of— 
‘‘(1) the regular tax for the taxable year reduced 
by the sum of the credits allowable under subpart A 
and sections 27, 29, and 30, over 
‘‘(2) the tentative minimum tax for the taxable 
year. 
‘‘(f) OTHER DEFINITIONS AND SPECIAL RULES.—For 
purposes of this section— 
‘‘(1) MOTOR VEHICLE.—The term ‘motor vehicle’ 
has the meaning given such term by section 30(c)(2). 
‘‘(2) CITY FUEL ECONOMY.—The city fuel econ-
omy with respect to any vehicle shall be measured in 
a manner which is substantially similar to the man-
ner city fuel economy is measured in accordance with 
procedures under part 600 of subchapter Q of chapter 
I of title 40, Code of Federal Regulations, as in effect 
on the date of the enactment of this section. 
‘‘(3) OTHER
TERMS.—The terms ‘automobile’, 
‘passenger automobile’, ‘medium duty passenger vehi-
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cle’, ‘light truck’, and ‘manufacturer’ have the mean-
ings given such terms in regulations prescribed by the 
Administrator of the Environmental Protection Agen-
cy for purposes of the administration of title II of the 
Clean Air Act (42 U.S.C. 7521 et seq.). 
‘‘(4) REDUCTION IN BASIS.—For purposes of this 
subtitle, the basis of any property for which a credit 
is allowable under subsection (a) shall be reduced by 
the amount of such credit so allowed (determined 
without regard to subsection (e)). 
‘‘(5) NO DOUBLE BENEFIT.—The amount of any 
deduction or other credit allowable under this chap-
ter— 
‘‘(A) for any incremental cost taken into ac-
count in computing the amount of the credit de-
termined under subsection (d) shall be reduced 
by the amount of such credit attributable to such 
cost, and 
‘‘(B) with respect to a vehicle described 
under subsection (b) or (c), shall be reduced by 
the amount of credit allowed under subsection 
(a) for such vehicle for the taxable year. 
‘‘(6) PROPERTY USED BY TAX-EXEMPT ENTITY.— 
In the case of a vehicle whose use is described in 
paragraph (3) or (4) of section 50(b) and which is
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not subject to a lease, the person who sold such vehicle 
to the person or entity using such vehicle shall be 
treated as the taxpayer that placed such vehicle in 
service, but only if such person clearly discloses to 
such person or entity in a document the amount of 
any credit allowable under subsection (a) with respect 
to such vehicle (determined without regard to sub-
section (e)). 
‘‘(7) PROPERTY USED OUTSIDE UNITED STATES, 
ETC., NOT QUALIFIED.—No credit shall be allowable 
under subsection (a) with respect to any property re-
ferred to in section 50(b)(1) or with respect to the 
portion of the cost of any property taken into account 
under section 179. 
‘‘(8) RECAPTURE.—The Secretary shall, by regu-
lations, 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 vehicle). 
‘‘(9) ELECTION TO NOT 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.