I 
111TH CONGRESS 
2D SESSION 
H. R. 5478 
To amend the Internal Revenue Code of 1986 to provide an incentive to 
encourage the replacement of inefficient, outdated freight railcars with 
greener, more fuel efficient vehicles. 
IN THE HOUSE OF REPRESENTATIVES 
JUNE 8, 2010 
Mr. BLUMENAUER (for himself, Mr. BRADY of Texas, Mr. TANNER, Mr. SHU-
STER, Mr. DEFAZIO, Mr. MCMAHON, Mr. WU, Mrs. DAHLKEMPER, Mr. 
PETRI, Mr. CARNEY, Mr. SCHRADER, Mr. THOMPSON of Pennsylvania, 
Mr. FILNER, Mr. SMITH of Texas, Mr. PAUL, Mr. MANZULLO, Mr. 
COSTELLO, Mr. GERLACH, Mr. GRIJALVA, Ms. GRANGER, Mr. TIM MUR-
PHY of Pennsylvania, Mr. MORAN of Kansas, Mr. LATHAM, Mr. BERRY, 
Mr. WESTMORELAND, Mr. MCDERMOTT, Mr. LIPINSKI, Mr. RODRIGUEZ, 
Ms. JENKINS, Mr. BOSWELL, Mr. LOEBSACK, Mr. HOLDEN, Mr. BACH-
US, Mr. INGLIS, Mr. ROSS, Mr. MICA, Mr. CARTER, Mr. SPRATT, Ms. 
CORRINE BROWN of Florida, Mr. GRAVES, Mr. BRADY of Pennsylvania, 
Mr. WILSON of South Carolina, Mr. OLSON, Mr. CARNAHAN, Mr. 
QUIGLEY, Mr. MCGOVERN, Mrs. BLACKBURN, Mr. DICKS, Mr. SNYDER, 
and Mr. RAHALL) 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 
an incentive to encourage the replacement of inefficient, 
outdated freight railcars with greener, more fuel efficient 
vehicles. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
VerDate Mar 15 2010 
00:57 Jun 09, 2010
Jkt 089200
PO 00000
Frm 00001
Fmt 6652
Sfmt 6201
E:\BILLS\H5478.IH
H5478
smartinez on DSKB9S0YB1PROD with BILLS
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Green Railcar En-
hancement Act of 2010’’. 
SEC. 2. CREDIT FOR FREIGHT RAILCAR REPLACEMENT OR 
MODERNIZATION. 
(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 adding at the end the following new 
section: 
‘‘SEC. 45R. FREIGHT RAILCAR REPLACEMENT OR MOD-
ERNIZATION CREDIT. 
‘‘(a) GENERAL RULE.—For purposes of section 38, 
the freight railcar replacement or modernization credit de-
termined under this section for the taxable year is an 
amount equal to 25 percent of the sum of— 
‘‘(1) the basis of any qualified freight railcar 
placed in service by the taxpayer during the taxable 
year, plus 
‘‘(2) the qualified freight railcar rebuild expend-
itures of the taxpayer for the taxable year. 
‘‘(b) QUALIFIED FREIGHT RAILCAR.— 
‘‘(1) IN GENERAL.—For purposes of this sec-
tion, the term ‘qualified freight railcar’ means a 
freight railcar which— 
‘‘(A) is acquired or rebuilt by the taxpayer 
pursuant to a binding agreement entered into 
VerDate Mar 15 2010 
00:57 Jun 09, 2010
Jkt 089200
PO 00000
Frm 00002
Fmt 6652
Sfmt 6201
E:\BILLS\H5478.IH
H5478
smartinez on DSKB9S0YB1PROD with BILLS
after the date of the enactment of this section, 
and 
‘‘(B) meets the capacity or fuel efficiency 
improvement requirements of paragraph (2). 
‘‘(2) CAPACITY OR FUEL EFFICIENCY REQUIRE-
MENTS.— 
‘‘(A) IN GENERAL.—A freight railcar shall 
be treated as meeting the capacity or fuel effi-
ciency requirements of this paragraph if— 
‘‘(i) in the case of a freight railcar 
which is acquired by the taxpayer during 
the taxable year (‘replacement railcar’), the 
taxpayer identifies another railcar (al-
though not necessarily one being used for 
an identical purpose) which the taxpayer 
certifies— 
‘‘(I) was removed permanently 
from service as a freight railcar dur-
ing the taxable year, or 
‘‘(II) is being rebuilt in such a 
manner as to achieve a significant im-
provement in capacity or fuel effi-
ciency, or 
‘‘(ii) in the case of a freight railcar re-
built by the taxpayer, such rebuilding re-
VerDate Mar 15 2010 
00:57 Jun 09, 2010
Jkt 089200
PO 00000
Frm 00003
Fmt 6652
Sfmt 6201
E:\BILLS\H5478.IH
H5478
smartinez on DSKB9S0YB1PROD with BILLS
sults in a significant improvement in ca-
pacity or fuel efficiency. 
‘‘(B) OWNERSHIP
NOT
REQUIRED.—For 
purposes of subparagraph (A)(i), such other 
railcar may be one owned by the taxpayer or 
one owned by another taxpayer, so long as 
there exists a binding agreement to so remove 
or rebuild the railcar. 
‘‘(C) SIGNIFICANT
IMPROVEMENT.—For 
purposes of subparagraph (A), an improvement 
in capacity or fuel efficiency with respect to a 
freight railcar shall be treated as significant if 
such capacity or fuel efficiency, as the case may 
be, is increased by at least 8 percent. 
‘‘(c) QUALIFIED FREIGHT RAILCAR REBUILD EX-
PENDITURE.—For purposes of this section, the term 
‘qualified freight railcar rebuild expenditure’ means any 
amount paid or incurred— 
‘‘(1) in connection with the modification of a 
freight railcar resulting in such railcar being a quali-
fied freight railcar, and 
‘‘(2) which is properly chargeable to a capital 
account with respect to such freight railcar. 
‘‘(d) OTHER SPECIAL RULES.— 
VerDate Mar 15 2010 
00:57 Jun 09, 2010
Jkt 089200
PO 00000
Frm 00004
Fmt 6652
Sfmt 6201
E:\BILLS\H5478.IH
H5478
smartinez on DSKB9S0YB1PROD with BILLS
‘‘(1) COORDINATION WITH OTHER CREDITS.— 
Any amount taken into account in determining the 
credit under this section may not be taken into ac-
count in determining a credit under any other provi-
sion of this title. 
‘‘(2) BASIS
ADJUSTMENT.—For purposes of 
this subtitle, if a credit is allowed under subsection 
(a) with respect to any qualified freight railcar, the 
basis of such railcar shall be reduced by the amount 
of the credit so allowed. 
‘‘(3) SALE-LEASEBACK.—For purposes of sub-
section (a)(1), if any qualified freight railcar is— 
‘‘(A) originally placed in service by a per-
son after øthe date of the enactment of this 
section¿, and 
‘‘(B) sold and leased back by such person 
within 3 months after the railcars are originally 
placed in service (or, in the case of more than 
1 railcar subject to the same lease, within 3 
months after the date the final railcar is placed 
in service, so long as the period between the 
time the first railcar is placed in service and the 
time the last railcar is placed in service does 
not exceed 12 months), 
VerDate Mar 15 2010 
00:57 Jun 09, 2010
Jkt 089200
PO 00000
Frm 00005
Fmt 6652
Sfmt 6201
E:\BILLS\H5478.IH
H5478
smartinez on DSKB9S0YB1PROD with BILLS
such railcars shall be treated as originally placed in 
service not earlier than the date on which such rail-
cars are used under the leaseback referred to in sub-
paragraph (B). 
‘‘(4) SYNDICATION.—For purposes of sub-
section (a)(1), if— 
‘‘(A) any qualified freight railcar is origi-
nally placed in service after the date of enact-
ment of this section by the lessor of such rail-
car, 
‘‘(B) such railcar is sold by such lessor or 
any subsequent purchaser within 3 months 
after the date such railcar was originally placed 
in service (or, in the case of more than 1 railcar 
subject to the same lease, within 3 months after 
the date the final railcar is placed in service 
and the time the last railcar is placed in service 
does not exceed 12 months), and 
‘‘(C) the user of such railcar after the last 
sale during such 3-month period remains the 
same as when such railcar was originally placed 
in service, 
such railcars shall be treated as originally placed in 
service not earlier than the date of such last sale. 
VerDate Mar 15 2010 
00:57 Jun 09, 2010
Jkt 089200
PO 00000
Frm 00006
Fmt 6652
Sfmt 6201
E:\BILLS\H5478.IH
H5478
smartinez on DSKB9S0YB1PROD with BILLS