I 
110TH CONGRESS 
2D SESSION 
H. R. 5858 
To amend the Internal Revenue Code of 1986 to provide incentives for 
carbon sequestration. 
IN THE HOUSE OF REPRESENTATIVES 
APRIL 22, 2008 
Mr. BOSWELL 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 carbon sequestration. 
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 ‘‘Combating Climate 
Change Through Individual Action Act of 2008’’. 
SEC. 2. FINDINGS. 
Congress finds the following: 
(1) Agricultural, grassland, and forestry prac-
tices play an essential role in capturing atmospheric 
carbon and sequestering it as soil organic matter. 
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(2) Released carbon can be captured through 
improved grassland management, tree planting, for-
est preservation, and enhanced agronomic and irri-
gation practices. 
(3) Promoting increased natural carbon sinks 
could have a significant impact on the world’s pro-
jected carbon emissions from the burning of fossil 
fuels. 
(4) Certain agricultural and forestry practices 
can reduce greenhouse gases: (A) avoiding emissions 
by maintaining existing carbon storage in trees and 
soils; (B) increasing carbon storage by, e.g., tree 
planting, conversion from conventional to conserva-
tion tillage practices on agricultural lands; 
(5) The large potentials exist through known 
cropping and land management practices such as 
adoption of no-till, reduced fallow and use of cover 
crops, and conservation set-asides with perennial 
grasses and trees. 
SEC. 3. CARBON SEQUESTRATION AND SOIL CONSERVA-
TION CREDIT. 
(a) IN GENERAL.—Subpart D of part IV of sub-
chapter A of chapter 1 of the Internal Revenue Code of 
1986 (relating to business related credits) is amended by 
adding at the end the following new section: 
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‘‘SEC. 45O. CARBON SEQUESTRATION AND SOIL CONSERVA-
TION. 
‘‘(a) IN GENERAL.—For purposes of section 38, in 
the case of a taxpayer engaged in the business of farming, 
the credit determined under this section for the taxable 
year is an amount equal to 30 percent of the qualified 
carbon sequestration and soil conservation expenditures 
for the taxable year which are paid or incurred with re-
spect to the land used in such farming. 
‘‘(b) LIMITATION.—The credit allowed with respect 
to a taxpayer under this section for a taxable year shall 
not exceed an amount equal to $10,000, reduced by the 
sum of the credits allowed with respect to the taxpayer 
under subsection (a) for all preceding taxable years. 
‘‘(c) QUALIFIED CARBON SEQUESTRATION AND SOIL 
CONSERVATION EXPENSES.—For purposes of this sec-
tion— 
‘‘(1) IN GENERAL.—The term ‘qualified carbon 
sequestration and soil conservation expenditures’ 
means amounts paid or incurred to sequester carbon 
and conserve soil, including— 
‘‘(A) expenditures described in section 
175(c), 
‘‘(B) conservation tillage expenditures, 
‘‘(C) cover cropping expenditures, 
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‘‘(D) amounts paid or incurred to increase 
the nitrogen use efficiency (other than use of 
nitrogen fertilizers) of land used in farming, 
and 
‘‘(E) amounts paid or incurred for multiple 
year rotations, including introduction of a pe-
rennial that reduces carbon loss and tillage, 
builds soil tilth, and increases carbon capture 
capacity. 
‘‘(2) 
CONSERVATION
TILLAGE
EXPENDI-
TURES.—The term ‘conservation tillage expendi-
tures’ means any expenditures paid or incurred for 
a tilling and planting method in which at least 30 
percent of the previous crop residue remains on the 
soil after planting the current crop. Such term in-
cludes the following tilling practices: no till, ridge 
till, minimum till, and mulch till. 
‘‘(3) COVER
CROPPING
EXPENDITURES.—The 
term ‘cover cropping expenditures’ means expendi-
tures paid or incurred for the preparation and seed-
ing of land for any grass, legume, or small grain— 
‘‘(A) which is not the primary crop of the 
taxpayer, 
‘‘(B) the primary purpose of which is to 
achieve one or more of the following: reduction 
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in erosion; maintenance or improvement in soil 
fertility, tilth, and structure, 
‘‘(C) a purpose of which may be interrup-
tion of pest cycles or conservation of water. 
‘‘(d) PER ACRE CREDIT ALTERNATIVE.— 
‘‘(1) IN GENERAL.—Not later than 180 days 
after the date of the enactment of this section, the 
Secretary shall, in consultation with the Secretary of 
Agriculture, establish an alternative procedure for 
determining the credit under subsection (a), which, 
at the election of the taxpayer, shall be treated as 
the amount determined under subsection (a). 
‘‘(2) PROCEDURE DESCRIBED.—(A) The Sec-
retary shall establish credit amounts to apply to land 
used in farming on a per acre basis with respect to 
each method of carbon sequestration and soil con-
servation described in subsection (c)(1). 
‘‘(B) Such credit amounts shall be based on the 
efficacy of the method in sequestering carbon and 
preventing soil erosion. 
‘‘(C) No such credit amount may exceed $15 
per acre. 
‘‘(D) The Secretary shall prescribe rules similar 
to the rules of paragraphs (1) through (4) of sub-
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section (e) to apply for purposes of the procedure es-
tablished under this subsection. 
‘‘(3) ELECTION.—An election to use such alter-
native method shall be made in such form and man-
ner as the Secretary may prescribe, and shall apply 
to the taxable year for which made and for all subse-
quent taxable years. 
‘‘(e) DEFINITION AND SPECIAL RULES.— 
‘‘(1) LAND USED IN FARMING.—For purposes 
of this section, land shall be treated as used in farm-
ing only if such land is used (before or simulta-
neously with the expenditures described in sub-
section (c)(1)) by the taxpayer or his tenant for the 
production of crops, fruits, or other agricultural 
products or for the sustenance of livestock. 
‘‘(2) EXPENDITURES
MUST
BE
CONSISTENT 
WITH SOIL CONSERVATION PLAN.—Notwithstanding 
any other provision of this section, subsection (a) 
shall not apply to any expenditures unless such ex-
penditures are consistent with— 
‘‘(A) the plan (if any) approved by the Soil 
Conservation Service of the Department of Ag-
riculture for the area in which the land is lo-
cated, or 
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‘‘(B) if there is no plan described in clause 
(i), any soil conservation plan of a comparable 
State agency. 
‘‘(3) BASIS
ADJUSTMENT.—For purposes of 
this subtitle, if a credit is determined under this sec-
tion for any expenditure with respect to any prop-
erty, the increase in the basis of such property which 
would (but for this paragraph) result from such ex-
penditure shall be reduced by the amount of the 
credit so determined. 
‘‘(4) DENIAL OF DOUBLE BENEFIT.—No deduc-
tion or other credit shall be allowed under this chap-
ter for any amount taken into account in deter-
mining the credit under this section. 
‘‘(f) TERMINATION.—This section shall not apply to 
taxable years beginning after December 31, 2013.’’. 
(b) CREDIT MADE PART OF GENERAL BUSINESS 
CREDIT.—Subsection (b) of section 38 of such Code (re-
lating to current year business credit) is amended by strik-
ing ‘‘plus’’ at the end of paragraph (30), by striking the 
period at the end of paragraph (31) and inserting ‘‘plus’’, 
and by adding at the end the following new paragraph: 
‘‘(32) the carbon sequestration and soil con-
servation credit determined under section 45O(a).’’. 
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(c) CONFORMING AMENDMENTS.—Subsection (a) of 
section 1016 of such Code (relating to adjustments to 
basis) is amended by striking ‘‘and’’ at the end of para-
graph (35), by striking the period at the end of paragraph 
(36) and inserting ‘‘and’’, and by adding at the end the 
following new paragraph: 
‘‘(37) to the extent provided in section 
45O(e).’’. 
(d) CLERICAL AMENDMENT.—The table of sections 
for subpart D of part IV of subchapter A of chapter 1 
of such Code is amended by adding at the end the fol-
lowing new item: 
‘‘Sec. 45O. Carbon sequestration and soil conservation.’’. 
(e) EFFECTIVE DATE.—The amendments made by 
this section shall apply to expenditures paid or incurred 
after December 31, 2008. 
SEC. 4. QUALIFYING PLANTING EXPENDITURE CREDIT. 
(a) IN GENERAL.—Subpart B of part IV of sub-
chapter A of chapter 1 of the Internal Revenue Code of 
1986 (relating to other credits) is amended by adding at 
the end the following new section: 
‘‘SEC. 30D. QUALIFIED PLANTING EXPENDITURE 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 10 percent of the 
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qualified planting expenditures of the taxpayer for the tax-
able year. 
‘‘(b) LIMITATIONS.—The amount taken into account 
under subsection (a) for any taxable year shall not ex-
ceed— 
‘‘(1) in the case of expenditures paid or in-
curred by the taxpayer with respect to an area which 
is included under section 121 as part of the tax-
payer’s principal residence, $5,000, 
‘‘(2) in the case of expenditures paid or in-
curred by the taxpayer in the course of, or with re-
spect to, a trade or business carried on by the tax-
payer, $50,000, and 
‘‘(3) in any other case, zero. 
‘‘(c) QUALIFIED PLANTING EXPENDITURES.—For 
purposes of this section— 
‘‘(1) IN GENERAL.—The term ‘qualifying plant-
ing expenditures’ means expenditures paid or in-
curred— 
‘‘(A) for the purchase and planting of any 
tree, plant, shrub, or bush which meets the re-
quirements of paragraph (2), and 
‘‘(B) for the purchase and installation of a 
vegetated roof system. 
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Such term shall not include expenditures relating to 
any property which is held by the taxpayer for use 
in a trade or business or for the production of in-
come, or which is property described in section 
1221(a)(1) in the hands of the taxpayer. 
‘‘(2) TREES, PLANTS, SHRUBS, OR BUSHES.—A 
tree, plant, shrub, or bush satisfies the requirements 
of the paragraph if such tree, plant, shrub, or bush 
is certified, in accordance with guidance prescribed 
by the Secretary (after consultation with the Admin-
istrator of the Environmental Protection Agency and 
the Secretary of Agriculture), to be quick-growing, 
appropriate for the region in which it is planted, and 
effective in capturing carbon. 
‘‘(3) VEGETATED
ROOF
SYSTEM.—The term 
‘vegetated roof system’ means a system by which 
vegetation growing in a substrate is integrated with 
the roof (or portion thereof) of a building owned by 
the taxpayer. 
‘‘(d) 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 liability (as defined in sec-
tion 26(b)) reduced by the sum of the credits allow-
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able under subpart A and sections 27, 30, 30B, and 
30C, over 
‘‘(2) the tentative minimum tax for the taxable 
year. 
‘‘(e) DEFINITION AND SPECIAL RULES.—For pur-
poses of this section— 
‘‘(1) PRINCIPAL RESIDENCE.—The term ‘prin-
cipal residence’ has the same meaning as when used 
in section 121, except that no ownership require-
ment shall be imposed. 
‘‘(2) JOINT OCCUPANCY, COOPERATIVE HOUS-
ING
CORPORATIONS, AND
CONDOMINIUM
MANAGE-
MENT ASSOCIATIONS.—Rules similar to the rules of 
paragraphs (4), (5), and (6) of section 25D(e) shall 
apply. 
‘‘(3) 
EXPENDITURES
OUTSIDE
UNITED 
STATES.—The credit under this section shall not be 
allowed with respect to expenditures paid or incurred 
for areas located outside the United States. 
‘‘(4) BASIS
ADJUSTMENT.—For purposes of 
this subtitle, if a credit is allowed under this section 
for an expenditure, the increase in basis which would 
result (but for this subsection) from such expendi-
ture shall be reduced by the amount of credit al-
lowed under this section. 
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‘‘(f) TERMINATION.—This section shall not apply to 
taxable years beginning after December 31, 2013.’’. 
(b) CONFORMING AMENDMENTS.— 
(1) Subsection (a) of section 1016, as amended 
by section 3, is amended by striking ‘‘and’’ at the 
end of paragraph (36), by striking the period at the 
end of paragraph (37) and inserting ‘‘and’’, and by 
adding at the end the following new paragraph: 
‘‘(38) to the extent provided in section 
30D(e)(4).’’. 
(2) The table of sections for subpart B of part 
IV of subchapter A of chapter 1 of such Code is 
amended by inserting after the item relating to sec-
tion 30C the following new item: 
‘‘Sec. 30D. Qualified planting expenditure credit.’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to expenditures paid or incurred 
after December 31, 2008. 
SEC. 5. GRASSLAND, RANGELAND, AND FOREST CONSERVA-
TION CREDIT. 
(a) IN GENERAL.—Not later than 180 days after the 
date of the enactment of this Act, the Secretary of the 
Treasury, in consultation with the Department of Agri-
culture, shall establish an appropriate tax credit, with re-
spect to land located in the United States, for— 
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(1) the conversion of cropland to pasture for 
grazing purposes or to grassland or rangeland, and 
(2) reforestation and afforestation of land— 
(A) which is not held by the taxpayer for 
the planting, cultivating, caring for, and cutting 
of trees for sale or use in the commercial pro-
duction of timber products, and 
(B) with trees which are not held by the 
taxpayer for use in a trade or business or for 
the production of income. 
(b) OTHER RULES RELATING TO CREDIT.— 
(1) CREDIT TO BE PER ACRE.—The Secretary 
shall establish credit amounts to apply to land on a 
per acre basis with respect to each method of con-
servation described in subsection (a). 
(2) PURSUANT
TO
APPROVED
PLAN.—Such 
methods must be pursuant to a plan submitted by 
the taxpayer and approved by the Secretaries of the 
Treasury and Agriculture. 
(3) BASIS
FOR
CREDIT
AMOUNTS.—Credit 
amount shall be based on— 
(A) the efficacy of the method in seques-
tering carbon and preventing soil erosion, 
(B) the expenditures relating to such 
method, and 
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(C) the number of years the taxpayer cer-
tifies to the Secretary or ensures (by conserva-
tion easement or otherwise) that the applicable 
land will remain subject to the approved plan. 
(4) RECAPTURE.—The Secretary shall provide 
for recapturing the benefit of any credit allowed 
under this section with respect to any property that 
ceases to be used in accordance with the approved 
plan. 
(5) DENIAL OF DOUBLE BENEFIT AND BASIS 
ADJUSTMENT.—The Secretary shall provide— 
(A) an appropriate basis adjustment for 
property with respect to which such credit is al-
lowed, and 
(B) rules disallowing such deductions and 
other credits as may be appropriate to avoid al-
lowing additional tax benefits for the same con-
servation method or expenses. 
(c) EFFECTIVE DATE.—The credit established by the 
Secretary shall apply to taxable years beginning after De-
cember 31, 2008. 
SEC. 6. CARBON SEQUESTRATION CREDIT REPORT. 
(a) IN GENERAL.—In the case of any substantial 
change in the carbon sequestration market (including the 
enactment into law of a carbon cap and trade program), 
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the Secretary of the Treasury shall, in consultation with 
any appropriate Federal officers, study such change and 
any effect of such change on the efficiency of, and need 
for, the credits allowed under section 5 of this Act and 
sections 45O and 30D of the Internal Revenue Code of 
1986. 
(b) REPORT.—As soon as practicable after sufficient 
opportunity to observe the effect of such change in the 
carbon sequestration market, the Secretary shall submit 
a report to Congress containing the results of the study 
conducted under subsection (a) and any recommendations 
of the Secretary for modifying such credits based on such 
results. 
Æ 
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