H. R. 2488—72 
‘‘(1) IN GENERAL.—The term ‘qualified renewal property’ 
means any property to which section 168 applies (or would 
apply but for section 179) if— 
‘‘(A) such property was acquired by the taxpayer by 
purchase (as defined in section 179(d)(2)) after December 
31, 2000, and before January 1, 2008; and 
‘‘(B) such property would be qualified zone property 
(as defined in section 1397C) if references to renewal 
communities were substituted for references to empower-
ment zones in section 1397C. 
‘‘(2) CERTAIN RULES TO APPLY.—The rules of subsections 
(a)(2) and (b) of section 1397C shall apply for purposes of 
this section.’’. 
SEC. 703. EXTENSION OF EXPENSING OF ENVIRONMENTAL REMEDI-
ATION COSTS TO RENEWAL COMMUNITIES. 
(a) EXTENSION.—Paragraph (2) of section 198(c) (defining tar-
geted area) is amended by redesignating subparagraph (C) as 
subparagraph (D) and by inserting after subparagraph (B) the 
following new subparagraph: 
‘‘(C) RENEWAL COMMUNITIES INCLUDED.—Except as pro-
vided in subparagraph (B), such term shall include a 
renewal community (as defined in section 1400E) with 
respect to expenditures paid or incurred after December 
31, 2000.’’. 
(b) EXTENSION OF TERMINATION DATE FOR RENEWAL COMMU-
NITIES.—Subsection (h) of section 198 is amended by inserting before 
the period ‘‘(December 31, 2007, in the case of a renewal community, 
as defined in section 1400E).’’. 
SEC. 704. EXTENSION OF WORK OPPORTUNITY TAX CREDIT FOR 
RENEWAL COMMUNITIES. 
(a) EXTENSION.—Subsection (c) of section 51 (relating to termi-
nation) is amended by adding at the end the following new para-
graph: 
‘‘(5) EXTENSION OF CREDIT FOR RENEWAL COMMUNITIES.— 
‘‘(A) IN GENERAL.—In the case of an individual who 
begins work for the employer after the date contained 
in paragraph (4)(B), for purposes of section 38— 
‘‘(i) in lieu of applying subsection (a), the amount 
of the work opportunity credit determined under this 
section for the taxable year shall be equal to— 
‘‘(I) 15 percent of the qualified first-year wages 
for such year; and 
‘‘(II) 30 percent of the qualified second-year 
wages for such year; 
‘‘(ii) subsection (b)(3) shall be applied by sub-
stituting ‘$10,000’ for ‘$6,000’; 
‘‘(iii) paragraph (4)(B) shall be applied by sub-
stituting for the date contained therein the last day 
for which the designation under section 1400E of the 
renewal community referred to in subparagraph (B)(i) 
is in effect; and 
‘‘(iv) rules similar to the rules of section 
51A(b)(5)(C) shall apply. 
‘‘(B) QUALIFIED FIRST- AND SECOND-YEAR WAGES.—For 
purposes of subparagraph (A)— 
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H. R. 2488—73 
‘‘(i) IN
GENERAL.—The term ‘qualified wages’ 
means, with respect to each 1-year period referred 
to in clause (ii) or (iii), as the case may be, the wages 
paid or incurred by the employer during the taxable 
year to any individual but only if— 
‘‘(I) the employer is engaged in a trade or 
business in a renewal community throughout such 
1-year period; 
‘‘(II) the principal place of abode of such indi-
vidual is in such renewal community throughout 
such 1-year period; and 
‘‘(III) substantially all of the services which 
such individual performs for the employer during 
such 1-year period are performed in such renewal 
community. 
‘‘(ii) QUALIFIED
FIRST-YEAR
WAGES.—The term 
‘qualified first-year wages’ means, with respect to any 
individual, qualified wages attributable to service ren-
dered during the 1-year period beginning with the 
day the individual begins work for the employer. 
‘‘(iii) QUALIFIED SECOND-YEAR WAGES.—The term 
‘qualified second-year wages’ means, with respect to 
any individual, qualified wages attributable to service 
rendered during the 1-year period beginning on the 
day after the last day of the 1-year period with respect 
to such individual determined under clause (ii).’’. 
(b) CONGRUENT TREATMENT OF RENEWAL COMMUNITIES AND 
ENTERPRISE ZONES FOR PURPOSES OF YOUTH RESIDENCE REQUIRE-
MENTS.— 
(1) HIGH-RISK YOUTH.—Subparagraphs (A)(ii) and (B) of 
section 51(d)(5) are each amended by striking ‘‘empowerment 
zone or enterprise community’’ and inserting ‘‘empowerment 
zone, enterprise community, or renewal community’’. 
(2) QUALIFIED SUMMER YOUTH EMPLOYEE.—Clause (iv) of 
section 51(d)(7)(A) is amended by striking ‘‘empowerment zone 
or enterprise community’’ and inserting ‘‘empowerment zone, 
enterprise community, or renewal community’’. 
(3) HEADINGS.—Paragraphs (5)(B) and (7)(C) of section 
51(d) are each amended by inserting ‘‘OR COMMUNITY’’ in the 
heading after ‘‘ZONE’’. 
(4) EFFECTIVE DATE.—The amendments made by this sub-
section shall apply to individuals who begin work for the 
employer after December 31, 2000. 
SEC. 705. CONFORMING AND CLERICAL AMENDMENTS. 
(a) DEDUCTION FOR CONTRIBUTIONS TO FAMILY DEVELOPMENT 
ACCOUNTS ALLOWABLE WHETHER OR NOT TAXPAYER ITEMIZES.— 
Subsection (a) of section 62 (relating to adjusted gross income 
defined) is amended by inserting after paragraph (19) the following 
new paragraph: 
‘‘(20) FAMILY
DEVELOPMENT
ACCOUNTS.—The deduction 
allowed by section 1400H(a)(1).’’. 
(b) TAX ON EXCESS CONTRIBUTIONS.— 
(1) TAX
IMPOSED.—Subsection (a) of section 4973 is 
amended by striking ‘‘or’’ at the end of paragraph (3), adding 
‘‘or’’ at the end of paragraph (4), and inserting after paragraph 
(4) the following new paragraph: 
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H. R. 2488—74 
‘‘(5) a family development account (within the meaning 
of section 1400H(e)),’’. 
(2) EXCESS CONTRIBUTIONS.—Section 4973 is amended by 
adding at the end the following new subsection: 
‘‘(g) FAMILY DEVELOPMENT ACCOUNTS.—For purposes of this 
section, in the case of family development accounts, the term ‘excess 
contributions’ means the sum of— 
‘‘(1) the excess (if any) of— 
‘‘(A) the amount contributed for the taxable year to 
the accounts (other than a qualified rollover, as defined 
in section 1400H(c)(7)), over 
‘‘(B) the amount allowable as a deduction under section 
1400H for such contributions; and 
‘‘(2) the amount determined under this subsection for the 
preceding taxable year reduced by the sum of— 
‘‘(A) the distributions out of the accounts for the taxable 
year which were included in the gross income of the payee 
under section 1400H(b)(1); 
‘‘(B) the distributions out of the accounts for the taxable 
year to which rules similar to the rules of section 408(d)(5) 
apply by reason of section 1400H(d)(3); and 
‘‘(C) the excess (if any) of the maximum amount allow-
able as a deduction under section 1400H for the taxable 
year over the amount contributed to the account for the 
taxable year. 
For purposes of this subsection, any contribution which is distrib-
uted from the family development account in a distribution to 
which rules similar to the rules of section 408(d)(4) apply by reason 
of section 1400H(d)(3) shall be treated as an amount not contrib-
uted.’’. 
(c) TAX
ON
PROHIBITED
TRANSACTIONS.—Section 4975 is 
amended— 
(1) by adding at the end of subsection (c) the following 
new paragraph: 
‘‘(6) SPECIAL RULE FOR FAMILY DEVELOPMENT ACCOUNTS.— 
An individual for whose benefit a family development account 
is established and any contributor to such account shall be 
exempt from the tax imposed by this section with respect to 
any transaction concerning such account (which would other-
wise be taxable under this section) if, with respect to such 
transaction, the account ceases to be a family development 
account by reason of the application of section 1400H(d)(2) 
to such account.’’; and 
(2) in subsection (e)(1), by striking ‘‘or’’ at the end of 
subparagraph (E), by redesignating subparagraph (F) as 
subparagraph (G), and by inserting after subparagraph (E) 
the following new subparagraph: 
‘‘(F) a family development account described in section 
1400H(e), or’’. 
(d) INFORMATION RELATING TO CERTAIN TRUSTS AND ANNUITY 
PLANS.—Subsection (c) of section 6047 is amended— 
(1) by inserting ‘‘or section 1400H’’ after ‘‘section 219’’; 
and 
(2) by inserting ‘‘, of any family development account 
described in section 1400H(e),’’, after ‘‘section 408(a)’’. 
(e) INSPECTION OF APPLICATIONS FOR TAX EXEMPTION.—Clause 
(i) of section 6104(a)(1)(B) is amended by inserting ‘‘a family 
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H. R. 2488—75 
development account described in section 1400H(e),’’ after ‘‘section 
408(a),’’. 
(f ) FAILURE TO PROVIDE REPORTS ON FAMILY DEVELOPMENT 
ACCOUNTS.—Paragraph (2) of section 6693(a) is amended by striking 
‘‘and’’ at the end of subparagraph (C), by striking the period and 
inserting ‘‘, and’’ at the end of subparagraph (D), and by adding 
at the end the following new subparagraph: 
‘‘(E) section 1400H(g)(6) (relating to family develop-
ment accounts).’’. 
(g) 
CONFORMING
AMENDMENTS
REGARDING
COMMERCIAL 
REVITALIZATION DEDUCTION.— 
(1) Section 172 is amended by redesignating subsection 
( j) as subsection (k) and by inserting after subsection (i) the 
following new subsection: 
‘‘( j) NO CARRYBACK OF SECTION 1400K DEDUCTION BEFORE DATE 
OF THE ENACTMENT.—No portion of the net operating loss for any 
taxable year which is attributable to any commercial revitalization 
deduction determined under section 1400K may be carried back 
to a taxable year ending before the date of the enactment of section 
1400K.’’. 
(2) Subparagraph (B) of section 48(a)(2) is amended by 
inserting ‘‘or commercial revitalization’’ after ‘‘rehabilitation’’ 
each place it appears in the text and heading. 
(3) Subparagraph (C) of section 469(i)(3) is amended— 
(A) by inserting ‘‘or section 1400K’’ after ‘‘section 42’’; 
and 
(B) by inserting ‘‘AND
COMMERCIAL
REVITALIZATION 
DEDUCTION’’ after ‘‘CREDIT’’ in the heading. 
(h) CLERICAL AMENDMENTS.—The table of subchapters for 
chapter 1 is amended by adding at the end the following new 
item: 
‘‘Subchapter X. Renewal Communities.’’. 
Subtitle B—Farming Incentive 
SEC. 711. PRODUCTION FLEXIBILITY CONTRACT PAYMENTS. 
Any option to accelerate the receipt of any payment under 
a production flexibility contract which is payable under the Federal 
Agriculture Improvement and Reform Act of 1996 (7 U.S.C. 7200 
et seq.), as in effect on the date of the enactment of this Act, 
shall be disregarded in determining the taxable year for which 
such payment is properly includible in gross income for purposes 
of the Internal Revenue Code of 1986. 
Subtitle C—Oil and Gas Incentives 
SEC. 721. 5-YEAR NET OPERATING LOSS CARRYBACK FOR LOSSES 
ATTRIBUTABLE TO OPERATING MINERAL INTERESTS OF 
INDEPENDENT OIL AND GAS PRODUCERS. 
(a) IN GENERAL.—Paragraph (1) of section 172(b) (relating to 
years to which loss may be carried) is amended by adding at 
the end the following new subparagraph: 
‘‘(H) LOSSES
ON
OPERATING
MINERAL
INTERESTS
OF 
INDEPENDENT
OIL
AND
GAS
PRODUCERS.—In the case of 
a taxpayer— 
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