105 
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SEC. 237. BASIS ADJUSTMENT TO STOCK OF S CORPORA-
TIONS 
MAKING 
CHARITABLE 
CONTRIBU-
TIONS OF PROPERTY. 
(a) IN GENERAL.—The last sentence of section 
1367(a)(2) is amended by striking ‘‘December 31, 2007’’ 
and inserting ‘‘December 31, 2009’’. 
(b) EFFECTIVE DATE.—The amendment made by 
this section shall apply to contributions made in taxable 
years beginning after December 31, 2007. 
SEC. 238. WORK OPPORTUNITY TAX CREDIT FOR HURRI-
CANE KATRINA EMPLOYEES. 
(a) IN GENERAL.—Paragraph (1) of section 201(b) 
of the Katrina Emergency Tax Relief Act of 2005 is 
amended by striking ‘‘2-year’’ and inserting ‘‘4-year’’. 
(b) EFFECTIVE DATE.—The amendment made by 
subsection (a) shall apply to individuals hired after August 
27, 2007. 
SEC. 239. SUBPART F EXCEPTION FOR ACTIVE FINANCING 
INCOME. 
(a) EXEMPT INSURANCE INCOME.—Paragraph (10) 
of section 953(e) (relating to application) is amended— 
(1) by striking ‘‘January 1, 2009’’ and insert-
ing ‘‘January 1, 2010’’, and 
(2) by striking ‘‘December 31, 2008’’ and in-
serting ‘‘December 31, 2009’’. 
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(b) EXCEPTION TO TREATMENT AS FOREIGN PER-
SONAL HOLDING COMPANY INCOME.—Paragraph (9) of 
section 954(h) (relating to application) is amended by 
striking ‘‘January 1, 2009’’ and inserting ‘‘January 1, 
2010’’. 
SEC. 240. LOOK-THRU RULE FOR RELATED CONTROLLED 
FOREIGN CORPORATIONS. 
(a) IN GENERAL.—Subparagraph (C) of section 
954(c)(6) (relating to application) is amended by striking 
‘‘January 1, 2009’’ and inserting ‘‘January 1, 2010’’. 
(b) EFFECTIVE DATE.—The amendment made by 
this section shall apply to taxable years of foreign corpora-
tions beginning after December 31, 2008, and to taxable 
years of United States shareholders with or within which 
such taxable years of foreign corporations end. 
SEC. 241. EXPENSING FOR CERTAIN QUALIFIED FILM AND 
TELEVISION PRODUCTIONS. 
(a) IN GENERAL.—Subsection (f) of section 181 is 
amended by striking ‘‘December 31, 2008’’ and inserting 
‘‘December 31, 2009’’. 
(b) EFFECTIVE DATE.—The amendment made by 
this section shall apply to productions commencing after 
December 31, 2008. 
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HR 7060 PCS
Subtitle C—Other Extensions 
SEC. 251. AUTHORITY TO DISCLOSE INFORMATION RE-
LATED TO TERRORIST ACTIVITIES MADE 
PERMANENT. 
(a) IN GENERAL.—Subparagraph (C) of section 
6103(i)(3) is amended by striking clause (iv). 
(b) DISCLOSURE ON REQUEST.—Paragraph (7) of 
section 6103(i) is amended by striking subparagraph (E). 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to disclosures after the date of the 
enactment of this Act. 
SEC. 252. AUTHORITY FOR UNDERCOVER OPERATIONS 
MADE PERMANENT. 
(a) IN GENERAL.—Subsection (c) of section 7608 is 
amended by striking paragraph (6). 
(b) EFFECTIVE DATE.—The amendment made by 
this section shall take effect on January 1, 2008. 
SEC. 253. INCREASE IN LIMIT ON COVER OVER OF RUM EX-
CISE TAX TO PUERTO RICO AND THE VIRGIN 
ISLANDS. 
(a) IN GENERAL.—Paragraph (1) of section 7652(f) 
is amended by striking ‘‘January 1, 2008’’ and inserting 
‘‘January 1, 2010’’. 
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(b) EFFECTIVE DATE.—The amendment made by 
this section shall apply to distilled spirits brought into the 
United States after December 31, 2007. 
TITLE III—ADDITIONAL TAX RE-
LIEF 
AND 
OTHER 
PROVI-
SIONS 
SEC. 301. REFUNDABLE CHILD CREDIT. 
(a) MODIFICATION
OF
THRESHOLD
AMOUNT.— 
Clause (i) of section 24(d)(1)(B) is amended by inserting 
‘‘($8,500 in the case of taxable years beginning in 2009)’’ 
after ‘‘$10,000’’. 
(b) EFFECTIVE DATE.—The amendment made by 
subsection (a) shall apply to taxable years beginning after 
December 31, 2008. 
SEC. 302. PROVISIONS RELATED TO FILM AND TELEVISION 
PRODUCTIONS. 
(a) MODIFICATION
OF LIMITATION
ON EXPENS-
ING.—Subparagraph (A) of section 181(a)(2) is amended 
to read as follows: 
‘‘(A) IN
GENERAL.—Paragraph (1) shall 
not apply to so much of the aggregate cost of 
any qualified film or television production as ex-
ceeds $15,000,000.’’. 
(b) MODIFICATIONS TO DEDUCTION FOR DOMESTIC 
ACTIVITIES.— 
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HR 7060 PCS
(1) DETERMINATION
OF
W-2
WAGES.—Para-
graph (2) of section 199(b) is amended by adding at 
the end the following new subparagraph: 
‘‘(D) SPECIAL
RULE
FOR
QUALIFIED 
FILM.—In the case of a qualified film, such 
term shall include compensation for services 
performed in the United States by actors, pro-
duction personnel, directors, and producers.’’. 
(2) DEFINITION
OF
QUALIFIED
FILM.—Para-
graph (6) of section 199(c) is amended by adding at 
the end the following: ‘‘A qualified film shall include 
any copyrights, trademarks, or other intangibles 
with respect to such film. The methods and means 
of distributing a qualified film shall not affect the 
availability of the deduction under this section.’’. 
(3) PARTNERSHIPS.—Subparagraph (A) of sec-
tion 199(d)(1) is amended by striking ‘‘and’’ at the 
end of clause (ii), by striking the period at the end 
of clause (iii) and inserting ‘‘, and’’, and by adding 
at the end the following new clause: 
‘‘(iv) in the case of each partner of a 
partnership, or shareholder of an S cor-
poration, who owns (directly or indirectly) 
at least 20 percent of the capital interests 
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in such partnership or of the stock of such 
S corporation— 
‘‘(I) such partner or shareholder 
shall be treated as having engaged di-
rectly in any film produced by such 
partnership or S corporation, and 
‘‘(II) such partnership or S cor-
poration shall be treated as having en-
gaged directly in any film produced by 
such partner or shareholder.’’. 
(c) 
CONFORMING
AMENDMENT.—Section 
181(d)(3)(A) is amended by striking ‘‘actors’’ and all that 
follows and inserting ‘‘actors, production personnel, direc-
tors, and producers.’’. 
(d) 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, 2007. 
(2) EXPENSING.—The amendments made by 
subsection (a) shall apply to qualified film and tele-
vision productions commencing after December 31, 
2007. 
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SEC. 303. EXEMPTION FROM EXCISE TAX FOR CERTAIN AR-
ROWS DESIGNED FOR USE BY CHILDREN. 
(a) IN GENERAL.—Paragraph (2) of section 4161(b) 
(relating to arrows) is amended by redesignating subpara-
graph (B) as subparagraph (C) and by inserting after sub-
paragraph (A) the following new subparagraph: 
‘‘(B) EXEMPTION
FOR
CERTAIN
ARROW 
SHAFTS.—Subparagraph (A) shall not apply to 
any shaft measuring 5/16 of an inch or less in 
diameter and consisting of either— 
‘‘(i) all fiberglass and hollow, or 
‘‘(ii) all natural wood, 
with no laminations or artificial means of en-
hancing the spine of such shaft (whether sold 
separately or incorporated as part of a finished 
or unfinished product) of a type used in the 
manufacture of any arrow which after its as-
sembly is not suitable for use with a bow de-
scribed in paragraph (1)(A).’’. 
(b) EFFECTIVE DATE.—The amendments made by 
this section shall apply to shafts first sold after the date 
of enactment of this Act. 
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SEC. 304. MODIFICATION OF PENALTY ON UNDERSTATE-
MENT OF TAXPAYER’S LIABILITY BY TAX RE-
TURN PREPARER. 
(a) IN GENERAL.—Subsection (a) of section 6694 
(relating to understatement due to unreasonable positions) 
is amended to read as follows: 
‘‘(a) UNDERSTATEMENT DUE
TO UNREASONABLE 
POSITIONS.— 
‘‘(1) IN GENERAL.—If a tax return preparer— 
‘‘(A) prepares any return or claim of re-
fund with respect to which any part of an un-
derstatement of liability is due to a position de-
scribed in paragraph (2), and 
‘‘(B) knew (or reasonably should have 
known) of the position, 
such tax return preparer shall pay a penalty with re-
spect to each such return or claim in an amount 
equal to the greater of $1,000 or 50 percent of the 
income derived (or to be derived) by the tax return 
preparer with respect to the return or claim. 
‘‘(2) UNREASONABLE POSITION.— 
‘‘(A) IN GENERAL.—Except as otherwise 
provided in this paragraph, a position is de-
scribed in this paragraph unless there is or was 
substantial authority for the position. 
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‘‘(B) DISCLOSED POSITIONS.—If the posi-
tion was disclosed as provided in section 
6662(d)(2)(B)(ii)(I) and is not a position to 
which subparagraph (C) applies, the position is 
described in this paragraph unless there is a 
reasonable basis for the position. 
‘‘(C) REPORTABLE TRANSACTIONS.—If the 
position is with respect to a reportable trans-
action to which section 6662A applies, the posi-
tion is described in this paragraph unless it is 
reasonable to believe that the position would 
more likely than not be sustained on its merits. 
‘‘(3) REASONABLE
CAUSE
EXCEPTION.—No 
penalty shall be imposed under this subsection if it 
is shown that there is reasonable cause for the un-
derstatement and the tax return preparer acted in 
good faith.’’. 
(b) EFFECTIVE DATE.—The amendment made by 
this section shall apply— 
(1) in the case of a position other than a posi-
tion described in subparagraph (C) of section 
6694(a)(2) of the Internal Revenue Code of 1986 
(as amended by this section), to returns prepared 
after May 25, 2007, and 
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HR 7060 PCS
(2) in the case of a position described in such 
subparagraph (C), to returns prepared for taxable 
years beginning after the date of the enactment of 
this Act. 
TITLE IV—REVENUE 
PROVISIONS 
SEC. 401. LIMITATION OF DEDUCTION FOR INCOME AT-
TRIBUTABLE TO DOMESTIC PRODUCTION OF 
OIL, GAS, OR PRIMARY PRODUCTS THEREOF. 
(a) IN GENERAL.—Section 199(d) is amended by re-
designating paragraph (9) as paragraph (10) and by in-
serting after paragraph (8) the following new paragraph: 
‘‘(9) SPECIAL RULE FOR TAXPAYERS WITH OIL 
RELATED
QUALIFIED
PRODUCTION
ACTIVITIES
IN-
COME.— 
‘‘(A) IN GENERAL.—If a taxpayer has oil 
related qualified production activities income for 
any taxable year beginning after 2009, the 
amount otherwise allowable as a deduction 
under subsection (a) shall be reduced by 3 per-
cent of the least of— 
‘‘(i) the oil related qualified produc-
tion activities income of the taxpayer for 
the taxable year, 
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‘‘(ii) the qualified production activities 
income of the taxpayer for the taxable 
year, or 
‘‘(iii) 
taxable 
income 
(determined 
without regard to this section). 
‘‘(B) OIL
RELATED
QUALIFIED
PRODUC-
TION
ACTIVITIES
INCOME.—For purposes of 
this paragraph, the term ‘oil related qualified 
production activities income’ means for any tax-
able year the qualified production activities in-
come which is attributable to the production, 
refining, processing, transportation, or distribu-
tion of oil, gas, or any primary product thereof 
during such taxable year. 
‘‘(C) PRIMARY PRODUCT.—For purposes of 
this paragraph, the term ‘primary product’ has 
the same meaning as when used in section 
927(a)(2)(C), as in effect before its repeal.’’. 
(b) CONFORMING AMENDMENT.—Section 199(d)(2) 
(relating to application to individuals) is amended by 
striking ‘‘subsection (a)(1)(B)’’ and inserting ‘‘subsections 
(a)(1)(B) and (d)(9)(A)(iii)’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years beginning after 
December 31, 2008. 
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HR 7060 PCS
SEC. 402. ELIMINATION OF THE DIFFERENT TREATMENT 
OF FOREIGN OIL AND GAS EXTRACTION IN-
COME AND FOREIGN OIL RELATED INCOME 
FOR PURPOSES OF THE FOREIGN TAX CRED-
IT. 
(a) IN GENERAL.—Subsections (a) and (b) of section 
907 (relating to special rules in case of foreign oil and 
gas income) are amended to read as follows: 
‘‘(a) REDUCTION IN AMOUNT ALLOWED AS FOREIGN 
TAX UNDER SECTION 901.—In applying section 901, the 
amount of any foreign oil and gas taxes paid or accrued 
(or deemed to have been paid) during the taxable year 
which would (but for this subsection) be taken into ac-
count for purposes of section 901 shall be reduced by the 
amount (if any) by which the amount of such taxes ex-
ceeds the product of— 
‘‘(1) the amount of the combined foreign oil 
and gas income for the taxable year, 
‘‘(2) multiplied by— 
‘‘(A) in the case of a corporation, the per-
centage which is equal to the highest rate of tax 
specified under section 11(b), or 
‘‘(B) in the case of an individual, a frac-
tion the numerator of which is the tax against 
which the credit under section 901(a) is taken 
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and the denominator of which is the taxpayer’s 
entire taxable income. 
‘‘(b) COMBINED FOREIGN OIL AND GAS INCOME; 
FOREIGN OIL AND GAS TAXES.—For purposes of this sec-
tion— 
‘‘(1) COMBINED
FOREIGN
OIL
AND
GAS
IN-
COME.—The term ‘combined foreign oil and gas in-
come’ means, with respect to any taxable year, the 
sum of— 
‘‘(A) foreign oil and gas extraction income, 
and 
‘‘(B) foreign oil related income. 
‘‘(2) FOREIGN OIL AND GAS TAXES.—The term 
‘foreign oil and gas taxes’ means, with respect to 
any taxable year, the sum of— 
‘‘(A) oil and gas extraction taxes, and 
‘‘(B) any income, war profits, and excess 
profits taxes paid or accrued (or deemed to 
have been paid or accrued under section 902 or 
960) during the taxable year with respect to 
foreign oil related income (determined without 
regard to subsection (c)(4)) or loss which would 
be taken into account for purposes of section 
901 without regard to this section.’’. 
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HR 7060 PCS
(b) RECAPTURE
OF
FOREIGN
OIL
AND
GAS 
LOSSES.—Paragraph (4) of section 907(c) (relating to re-
capture of foreign oil and gas extraction losses by re-
characterizing later extraction income) is amended to read 
as follows: 
‘‘(4) RECAPTURE
OF
FOREIGN
OIL
AND
GAS 
LOSSES
BY
RECHARACTERIZING
LATER
COMBINED 
FOREIGN OIL AND GAS INCOME.— 
‘‘(A) IN GENERAL.—The combined foreign 
oil and gas income of a taxpayer for a taxable 
year (determined without regard to this para-
graph) shall be reduced— 
‘‘(i) first by the amount determined 
under subparagraph (B), and 
‘‘(ii) then by the amount determined 
under subparagraph (C). 
The aggregate amount of such reductions shall 
be treated as income (from sources without the 
United States) which is not combined foreign 
oil and gas income. 
‘‘(B) REDUCTION FOR PRE-2009 FOREIGN 
OIL
EXTRACTION
LOSSES.—The 
reduction 
under this paragraph shall be equal to the less-
er of— 
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‘‘(i) the foreign oil and gas extraction 
income of the taxpayer for the taxable year 
(determined without regard to this para-
graph), or 
‘‘(ii) the excess of— 
‘‘(I) the aggregate amount of for-
eign oil extraction losses for preceding 
taxable years beginning after Decem-
ber 31, 1982, and before January 1, 
2009, over 
‘‘(II) so much of such aggregate 
amount as was recharacterized under 
this paragraph (as in effect before 
and after the date of the enactment of 
the Renewable Energy and Job Cre-
ation Tax Act of 2008) for preceding 
taxable years beginning after Decem-
ber 31, 1982. 
‘‘(C) REDUCTION FOR POST-2008 FOREIGN 
OIL
AND
GAS
LOSSES.—The reduction under 
this paragraph shall be equal to the lesser of— 
‘‘(i) the combined foreign oil and gas 
income of the taxpayer for the taxable year 
(determined without regard to this para-
graph), reduced by an amount equal to the 
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reduction under subparagraph (A) for the 
taxable year, or 
‘‘(ii) the excess of— 
‘‘(I) the aggregate amount of for-
eign oil and gas losses for preceding 
taxable years beginning after Decem-
ber 31, 2008, over 
‘‘(II) so much of such aggregate 
amount as was recharacterized under 
this paragraph for preceding taxable 
years beginning after December 31, 
2008. 
‘‘(D) FOREIGN
OIL
AND
GAS
LOSS
DE-
FINED.— 
‘‘(i) IN
GENERAL.—For purposes of 
this paragraph, the term ‘foreign oil and 
gas loss’ means the amount by which— 
‘‘(I) the gross income for the tax-
able year from sources without the 
United States and its possessions 
(whether or not the taxpayer chooses 
the benefits of this subpart for such 
taxable year) taken into account in 
determining the combined foreign oil 
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and gas income for such year, is ex-
ceeded by 
‘‘(II) the sum of the deductions 
properly 
apportioned 
or 
allocated 
thereto. 
‘‘(ii) NET
OPERATING
LOSS
DEDUC-
TION
NOT
TAKEN
INTO
ACCOUNT.—For 
purposes of clause (i), the net operating 
loss deduction allowable for the taxable 
year under section 172(a) shall not be 
taken into account. 
‘‘(iii) EXPROPRIATION AND CASUALTY 
LOSSES NOT TAKEN INTO ACCOUNT.—For 
purposes of clause (i), there shall not be 
taken into account— 
‘‘(I) any foreign expropriation 
loss (as defined in section 172(h) (as 
in effect on the day before the date of 
the enactment of the Revenue Rec-
onciliation Act of 1990)) for the tax-
able year, or 
‘‘(II) any loss for the taxable 
year which arises from fire, storm, 
shipwreck, or other casualty, or from 
theft, 
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to the extent such loss is not compensated 
for by insurance or otherwise. 
‘‘(iv) 
FOREIGN
OIL
EXTRACTION 
LOSS.—For 
purposes 
of 
subparagraph 
(B)(ii)(I), foreign oil extraction losses shall 
be determined under this paragraph as in 
effect on the day before the date of the en-
actment of the Renewable Energy and Job 
Creation Tax Act of 2008.’’. 
(c) CARRYBACK AND CARRYOVER OF DISALLOWED 
CREDITS.—Section 907(f) (relating to carryback and car-
ryover of disallowed credits) is amended— 
(1) by striking ‘‘oil and gas extraction taxes’’ 
each place it appears and inserting ‘‘foreign oil and 
gas taxes’’, and 
(2) by adding at the end the following new 
paragraph: 
‘‘(4) TRANSITION
RULES
FOR
PRE-2009
AND 
2009 DISALLOWED CREDITS.— 
‘‘(A) PRE-2009 CREDITS.—In the case of 
any unused credit year beginning before Janu-
ary 1, 2009, this subsection shall be applied to 
any unused oil and gas extraction taxes carried 
from such unused credit year to a year begin-
ning after December 31, 2008— 
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‘‘(i) by substituting ‘oil and gas ex-
traction taxes’ for ‘foreign oil and gas 
taxes’ each place it appears in paragraphs 
(1), (2), and (3), and 
‘‘(ii) by computing, for purposes of 
paragraph (2)(A), the limitation under 
subparagraph (A) for the year to which 
such taxes are carried by substituting ‘for-
eign oil and gas extraction income’ for ‘for-
eign oil and gas income’ in subsection (a). 
‘‘(B) 2009 CREDITS.—In the case of any 
unused credit year beginning in 2009, the 
amendments made to this subsection by the Re-
newable Energy and Job Creation Tax Act of 
2008 shall be treated as being in effect for any 
preceding year beginning before January 1, 
2009, solely for purposes of determining how 
much of the unused foreign oil and gas taxes 
for such unused credit year may be deemed 
paid or accrued in such preceding year.’’. 
(d) CONFORMING AMENDMENT.—Section 6501(i) is 
amended by striking ‘‘oil and gas extraction taxes’’ and 
inserting ‘‘foreign oil and gas taxes’’. 
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(e) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years beginning after 
December 31, 2008. 
SEC. 403. BROKER REPORTING OF CUSTOMER’S BASIS IN 
SECURITIES TRANSACTIONS. 
(a) IN GENERAL.— 
(1) BROKER
REPORTING
FOR
SECURITIES 
TRANSACTIONS.—Section 6045 is amended by add-
ing at the end the following new subsection: 
‘‘(g) ADDITIONAL INFORMATION REQUIRED IN THE 
CASE OF SECURITIES TRANSACTIONS, ETC.— 
‘‘(1) IN GENERAL.—If a broker is otherwise re-
quired to make a return under subsection (a) with 
respect to the gross proceeds of the sale of a covered 
security, the broker shall include in such return the 
information described in paragraph (2). 
‘‘(2) ADDITIONAL INFORMATION REQUIRED.— 
‘‘(A) IN GENERAL.—The information re-
quired under paragraph (1) to be shown on a 
return with respect to a covered security of a 
customer shall include the customer’s adjusted 
basis in such security and whether any gain or 
loss with respect to such security is long-term 
or short-term (within the meaning of section 
1222). 
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‘‘(B) 
DETERMINATION
OF
ADJUSTED 
BASIS.—For purposes of subparagraph (A)— 
‘‘(i) IN
GENERAL.—The customer’s 
adjusted basis shall be determined— 
‘‘(I) in the case of any security 
(other than any stock for which an av-
erage basis method is permissible 
under section 1012), in accordance 
with the first-in first-out method un-
less the customer notifies the broker 
by means of making an adequate 
identification of the stock sold or 
transferred, and 
‘‘(II) in the case of any stock for 
which an average basis method is per-
missible under section 1012, in ac-
cordance with the broker’s default 
method unless the customer notifies 
the broker that he elects another ac-
ceptable method under section 1012 
with respect to the account in which 
such stock is held. 
‘‘(ii) EXCEPTION FOR WASH SALES.— 
Except as otherwise provided by the Sec-
retary, the customer’s adjusted basis shall 
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be determined without regard to section 
1091 (relating to loss from wash sales of 
stock or securities) unless the transactions 
occur in the same account with respect to 
identical securities. 
‘‘(3) COVERED
SECURITY.—For purposes of 
this subsection— 
‘‘(A) IN GENERAL.—The term ‘covered se-
curity’ means any specified security acquired on 
or after the applicable date if such security— 
‘‘(i) was acquired through a trans-
action in the account in which such secu-
rity is held, or 
‘‘(ii) was transferred to such account 
from an account in which such security 
was a covered security, but only if the 
broker received a statement under section 
6045A with respect to the transfer. 
‘‘(B) SPECIFIED
SECURITY.—The term 
‘specified security’ means— 
‘‘(i) any share of stock in a corpora-
tion, 
‘‘(ii) any note, bond, debenture, or 
other evidence of indebtedness, 
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‘‘(iii) any commodity, or contract or 
derivative with respect to such commodity, 
if the Secretary determines that adjusted 
basis reporting is appropriate for purposes 
of this subsection, and 
‘‘(iv) any other financial instrument 
with respect to which the Secretary deter-
mines that adjusted basis reporting is ap-
propriate for purposes of this subsection. 
‘‘(C) APPLICABLE DATE.—The term ‘appli-
cable date’ means— 
‘‘(i) January 1, 2011, in the case of 
any specified security which is stock in a 
corporation (other than any stock de-
scribed in clause (ii)), 
‘‘(ii) January 1, 2012, in the case of 
any stock for which an average basis meth-
od is permissible under section 1012, and 
‘‘(iii) January 1, 2013, or such later 
date determined by the Secretary in the 
case of any other specified security. 
‘‘(4) TREATMENT OF S CORPORATIONS.—In the 
case of the sale of a covered security acquired by an 
S corporation (other than a financial institution) 
after December 31, 2011, such S corporation shall 
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be treated in the same manner as a partnership for 
purposes of this section. 
‘‘(5) SPECIAL RULES FOR SHORT SALES.—In 
the case of a short sale, reporting under this section 
shall be made for the year in which such sale is 
closed.’’. 
(2) BROKER INFORMATION REQUIRED WITH RE-
SPECT TO OPTIONS.—Section 6045, as amended by 
subsection (a), is amended by adding at the end the 
following new subsection: 
‘‘(h) APPLICATION TO OPTIONS ON SECURITIES.— 
‘‘(1) EXERCISE OF OPTION.—For purposes of 
this section, if a covered security is acquired or dis-
posed of pursuant to the exercise of an option that 
was granted or acquired in the same account as the 
covered security, the amount received with respect to 
the grant or paid with respect to the acquisition of 
such option shall be treated as an adjustment to 
gross proceeds or as an adjustment to basis, as the 
case may be. 
‘‘(2) LAPSE OR CLOSING TRANSACTION.—In the 
case of the lapse (or closing transaction (as defined 
in section 1234(b)(2)(A))) of an option on a speci-
fied security or the exercise of a cash-settled option 
on a specified security, reporting under subsections 
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(a) and (g) with respect to such option shall be 
made for the calendar year which includes the date 
of such lapse, closing transaction, or exercise. 
‘‘(3) PROSPECTIVE APPLICATION.—Paragraphs 
(1) and (2) shall not apply to any option which is 
granted or acquired before January 1, 2013. 
‘‘(4) DEFINITIONS.—For purposes of this sub-
section, the terms ‘covered security’ and ‘specified 
security’ shall have the meanings given such terms 
in subsection (g)(3).’’. 
(3) EXTENSION OF PERIOD FOR STATEMENTS 
SENT TO CUSTOMERS.— 
(A) IN GENERAL.—Subsection (b) of sec-
tion 6045 is amended by striking ‘‘January 31’’ 
and inserting ‘‘February 15’’. 
(B) STATEMENTS
RELATED
TO
SUB-
STITUTE PAYMENTS.—Subsection (d) of section 
6045 is amended— 
(i) by striking ‘‘at such time and’’, 
and 
(ii) by inserting after ‘‘other item.’’ 
the following new sentence: ‘‘The written 
statement required under the preceding 
sentence shall be furnished on or before 
February 15 of the year following the cal-
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endar year in which the payment was 
made.’’. 
(C) OTHER STATEMENTS.—Subsection (b) 
of section 6045 is amended by adding at the 
end the following: ‘‘In the case of a consolidated 
reporting statement (as defined in regulations) 
with respect to any customer, any statement 
which would otherwise be required to be fur-
nished on or before January 31 of a calendar 
year with respect to any item reportable to the 
taxpayer shall instead be required to be fur-
nished on or before February 15 of such cal-
endar year if furnished with such consolidated 
reporting statement.’’. 
(b) DETERMINATION OF BASIS OF CERTAIN SECURI-
TIES
ON ACCOUNT
BY ACCOUNT
OR AVERAGE BASIS 
METHOD.—Section 1012 is amended— 
(1) by striking ‘‘The basis of property’’ and in-
serting the following: 
‘‘(a) IN GENERAL.—The basis of property’’, 
(2) by striking ‘‘The cost of real property’’ and 
inserting the following: 
‘‘(b) SPECIAL RULE FOR APPORTIONED REAL ES-
TATE TAXES.—The cost of real property’’, and 
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(3) by adding at the end the following new sub-
sections: 
‘‘(c) DETERMINATIONS BY ACCOUNT.— 
‘‘(1) IN GENERAL.—In the case of the sale, ex-
change, or other disposition of a specified security 
on or after the applicable date, the conventions pre-
scribed by regulations under this section shall be ap-
plied on an account by account basis. 
‘‘(2) APPLICATION TO CERTAIN REGULATED IN-
VESTMENT COMPANIES.— 
‘‘(A) IN GENERAL.—Except as provided in 
subparagraph (B), any stock for which an aver-
age basis method is permissible under section 
1012 which is acquired before January 1, 2012, 
shall be treated as a separate account from any 
such stock acquired on or after such date. 
‘‘(B) ELECTION FOR TREATMENT AS SIN-
GLE ACCOUNT.—If a regulated investment com-
pany elects to have this subparagraph apply 
with respect to one or more of its stock-
holders— 
‘‘(i) subparagraph (A) shall not apply 
with respect to any stock in such company 
held by such stockholders, and 
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‘‘(ii) all stock in such company which 
is held by such stockholders shall be treat-
ed as covered securities described in sec-
tion 6045(g)(3) without regard to the date 
of the acquisition of such stock. 
A rule similar to the rule of the preceding sen-
tence shall apply with respect to a broker hold-
ing such stock as a nominee. 
‘‘(3) DEFINITIONS.—For purposes of this sec-
tion, the terms ‘specified security’ and ‘applicable 
date’ shall have the meaning given such terms in 
section 6045(g). 
‘‘(d) AVERAGE BASIS FOR STOCK ACQUIRED PURSU-
ANT TO A PERIODIC STOCK INVESTMENT PLAN.— 
‘‘(1) IN GENERAL.—In the case of any stock ac-
quired after December 31, 2010, in connection with 
a periodic stock investment plan, the basis of such 
stock while held as part of such plan shall be deter-
mined using one of the methods which may be used 
for determining the basis of stock in a regulated in-
vestment company. 
‘‘(2) TREATMENT
AFTER
TRANSFER.—In the 
case of the transfer to another account of stock to 
which paragraph (1) applies, such stock shall have 
a cost basis in such other account equal to its basis 
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in the periodic stock investment plan immediately 
before such transfer (properly adjusted for any fees 
or other charges taken into account in connection 
with such transfer). 
‘‘(3) SEPARATE
ACCOUNTS; 
ELECTION
FOR 
TREATMENT AS SINGLE ACCOUNT.—Rules similar to 
the rules of subsection (c)(2) shall apply for pur-
poses of this subsection. 
‘‘(4) PERIODIC
STOCK
INVESTMENT
PLAN.— 
For purposes of this subsection— 
‘‘(A) IN
GENERAL.—The term ‘periodic 
stock investment plan’ means— 
‘‘(i) any stock purchase plan, and 
‘‘(ii) any dividend reinvestment plan. 
‘‘(B) STOCK PURCHASE PLAN.—The term 
‘stock purchase plan’ means any arrangement 
under which identical stock is periodically pur-
chased pursuant to a written plan. 
‘‘(C) DIVIDEND REINVESTMENT PLAN.— 
‘‘(i) IN
GENERAL.—The term ‘divi-
dend reinvestment plan’ means any ar-
rangement under which dividends on any 
stock are reinvested in stock identical to 
the stock with respect to which the divi-
dends are paid. 
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‘‘(ii) INITIAL
STOCK
ACQUISITION 
TREATED
AS
ACQUIRED
IN
CONNECTION 
WITH PLAN.—Stock shall be treated as ac-
quired in connection with a dividend rein-
vestment plan if such stock is acquired 
pursuant to such plan or if the dividends 
paid on such stock are subject to such 
plan.’’. 
(c) INFORMATION BY TRANSFERORS TO AID BRO-
KERS.— 
(1) IN GENERAL.—Subpart B of part III of 
subchapter A of chapter 61 is amended by inserting 
after section 6045 the following new section: 
‘‘SEC. 6045A. INFORMATION REQUIRED IN CONNECTION 
WITH TRANSFERS OF COVERED SECURITIES 
TO BROKERS. 
‘‘(a) FURNISHING OF INFORMATION.—Every applica-
ble person which transfers to a broker (as defined in sec-
tion 6045(c)(1)) a security which is a covered security (as 
defined in section 6045(g)(3)) in the hands of such appli-
cable person shall furnish to such broker a written state-
ment in such manner and setting forth such information 
as the Secretary may by regulations prescribe for purposes 
of enabling such broker to meet the requirements of sec-
tion 6045(g). 
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‘‘(b) APPLICABLE PERSON.—For purposes of sub-
section (a), the term ‘applicable person’ means— 
‘‘(1) any broker (as defined in section 
6045(c)(1)), and 
‘‘(2) any other person as provided by the Sec-
retary in regulations. 
‘‘(c) TIME FOR FURNISHING STATEMENT.—Except 
as otherwise provided by the Secretary, any statement re-
quired by subsection (a) shall be furnished not later than 
15 days after the date of the transfer described in such 
subsection.’’. 
(2) ASSESSABLE
PENALTIES.—Paragraph (2) 
of section 6724(d) is amended by redesignating sub-
paragraphs (I) through (DD) as subparagraphs (J) 
through (EE), respectively, and by inserting after 
subparagraph (H) the following new subparagraph: 
‘‘(I) section 6045A (relating to information 
required in connection with transfers of covered 
securities to brokers),’’. 
(3) CLERICAL AMENDMENT.—The table of sec-
tions for subpart B of part III of subchapter A of 
chapter 61 is amended by inserting after the item 
relating to section 6045 the following new item: 
‘‘Sec. 6045A. Information required in connection with transfers of covered se-
curities to brokers.’’. 
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(d) ADDITIONAL ISSUER INFORMATION TO AID BRO-
KERS.— 
(1) IN GENERAL.—Subpart B of part III of 
subchapter A of chapter 61, as amended by sub-
section (b), is amended by inserting after section 
6045A the following new section: 
‘‘SEC. 6045B. RETURNS RELATING TO ACTIONS AFFECTING 
BASIS OF SPECIFIED SECURITIES. 
‘‘(a) IN GENERAL.—According to the forms or regu-
lations prescribed by the Secretary, any issuer of a speci-
fied security shall make a return setting forth— 
‘‘(1) a description of any organizational action 
which affects the basis of such specified security of 
such issuer, 
‘‘(2) the quantitative effect on the basis of such 
specified security resulting from such action, and 
‘‘(3) such other information as the Secretary 
may prescribe. 
‘‘(b) TIME FOR FILING RETURN.—Any return re-
quired by subsection (a) shall be filed not later than the 
earlier of— 
‘‘(1) 45 days after the date of the action de-
scribed in subsection (a), or 
‘‘(2) January 15 of the year following the cal-
endar year during which such action occurred. 
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‘‘(c) STATEMENTS TO BE FURNISHED TO HOLDERS 
OF SPECIFIED SECURITIES OR THEIR NOMINEES.—Ac-
cording to the forms or regulations prescribed by the Sec-
retary, every person required to make a return under sub-
section (a) with respect to a specified security shall furnish 
to the nominee with respect to the specified security (or 
certificate holder if there is no nominee) a written state-
ment showing— 
‘‘(1) the name, address, and phone number of 
the information contact of the person required to 
make such return, 
‘‘(2) the information required to be shown on 
such return with respect to such security, and 
‘‘(3) such other information as the Secretary 
may prescribe. 
The written statement required under the preceding sen-
tence shall be furnished to the holder on or before January 
15 of the year following the calendar year during which 
the action described in subsection (a) occurred. 
‘‘(d) SPECIFIED SECURITY.—For purposes of this 
section, the term ‘specified security’ has the meaning given 
such term by section 6045(g)(3)(B). No return shall be 
required under this section with respect to actions de-
scribed in subsection (a) with respect to a specified secu-
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rity which occur before the applicable date (as defined in 
section 6045(g)(3)(C)) with respect to such security. 
‘‘(e) PUBLIC REPORTING IN LIEU OF RETURN.—The 
Secretary may waive the requirements under subsections 
(a) and (c) with respect to a specified security, if the per-
son required to make the return under subsection (a) 
makes publicly available, in such form and manner as the 
Secretary determines necessary to carry out the purposes 
of this section— 
‘‘(1) the name, address, phone number, and 
email address of the information contact of such 
person, and 
‘‘(2) the information described in paragraphs 
(1), (2), and (3) of subsection (a).’’. 
(2) ASSESSABLE PENALTIES.— 
(A) 
Subparagraph 
(B) 
of 
section 
6724(d)(1) is amended by redesignating clause 
(iv) and each of the clauses which follow as 
clauses (v) through (xxiii), respectively, and by 
inserting after clause (iii) the following new 
clause: 
‘‘(iv) section 6045B(a) (relating to re-
turns relating to actions affecting basis of 
specified securities),’’. 
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(B) Paragraph (2) of section 6724(d), as 
amended by subsection (c)(2), is amended by 
redesignating subparagraphs (J) through (EE) 
as subparagraphs (K) through (FF), respec-
tively, and by inserting after subparagraph (I) 
the following new subparagraph: 
‘‘(J) subsections (c) and (e) of section 
6045B (relating to returns relating to actions 
affecting basis of specified securities),’’. 
(3) CLERICAL AMENDMENT.—The table of sec-
tions for subpart B of part III of subchapter A of 
chapter 61, as amended by subsection (b)(3), is 
amended by inserting after the item relating to sec-
tion 6045A the following new item: 
‘‘Sec. 6045B. Returns relating to actions affecting basis of specified securi-
ties.’’. 
(e) EFFECTIVE DATE.— 
(1) IN
GENERAL.—Except as otherwise pro-
vided in this subsection, the amendments made by 
this section shall take effect on January 1, 2011. 
(2) EXTENSION OF PERIOD FOR STATEMENTS 
SENT TO CUSTOMERS.—The amendments made by 
subsection (a)(3) shall apply to statements required 
to be furnished after December 31, 2008. 
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SEC. 404. 0.2 PERCENT FUTA SURTAX. 
(a) IN GENERAL.—Section 3301 (relating to rate of 
tax) is amended— 
(1) by striking ‘‘through 2008’’ in paragraph 
(1) and inserting ‘‘through 2009’’, and 
(2) by striking ‘‘calendar year 2009’’ in para-
graph (2) and inserting ‘‘calendar year 2010’’. 
(b) EFFECTIVE DATE.—The amendments made by 
this section shall apply to wages paid after December 31, 
2008. 
SEC. 405. INCREASE AND EXTENSION OF OIL SPILL LIABIL-
ITY TRUST FUND TAX. 
(a) INCREASE IN RATE.— 
(1) IN GENERAL.—Section 4611(c)(2)(B) (re-
lating to rates) is amended by striking ‘‘is 5 cents 
a barrel.’’ and inserting ‘‘is— 
‘‘(i) in the case of crude oil received 
or petroleum products entered before Jan-
uary 1, 2017, 8 cents a barrel, and 
‘‘(ii) in the case of crude oil received 
or petroleum products entered after De-
cember 31, 2016, 9 cents a barrel.’’. 
(2) EFFECTIVE DATE.—The amendment made 
by this subsection shall apply on and after the first 
day of the first calendar quarter beginning more 
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than 60 days after the date of the enactment of this 
Act. 
(b) EXTENSION.— 
(1) IN GENERAL.—Section 4611(f) (relating to 
application of Oil Spill Liability Trust Fund financ-
ing rate) is amended by striking paragraphs (2) and 
(3) and inserting the following new paragraph: 
‘‘(2) TERMINATION.—The Oil Spill Liability 
Trust Fund financing rate shall not apply after De-
cember 31, 2017.’’. 
(2) 
CONFORMING
AMENDMENT.—Section 
4611(f)(1) is amended by striking ‘‘paragraphs (2) 
and (3)’’ and inserting ‘‘paragraph (2)’’. 
(3) EFFECTIVE DATE.—The amendments made 
by this subsection shall take effect on the date of the 
enactment of this Act. 
SEC. 
406. 
NONQUALIFIED 
DEFERRED 
COMPENSATION 
FROM CERTAIN TAX INDIFFERENT PARTIES. 
(a) IN GENERAL.—Subpart B of part II of sub-
chapter E of chapter 1 is amended by inserting after sec-
tion 457 the following new section: 
‘‘SEC. 457A. NONQUALIFIED DEFERRED COMPENSATION 
FROM CERTAIN TAX INDIFFERENT PARTIES. 
‘‘(a) IN GENERAL.—Any compensation of a service 
provider which is deferred under a nonqualified deferred 
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compensation plan of a nonqualified entity shall be includ-
ible in gross income when there is no substantial risk of 
forfeiture of the rights to such compensation. 
‘‘(b) NONQUALIFIED ENTITY.—For purposes of this 
section, the term ‘nonqualified entity’ means— 
‘‘(1) any foreign corporation unless substan-
tially all of its income is— 
‘‘(A) effectively connected with the conduct 
of a trade or business in the United States, or 
‘‘(B) subject to a comprehensive foreign in-
come tax, and 
‘‘(2) any partnership unless substantially all of 
its income is, directly or indirectly, allocated to— 
‘‘(A) United States persons (other than 
persons exempt from tax under this title), 
‘‘(B) foreign persons with respect to whom 
such income is subject to a comprehensive for-
eign income tax, 
‘‘(C) foreign persons with respect to 
whom— 
‘‘(i) such income is effectively con-
nected with the conduct of a trade or busi-
ness within the United States, and 
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‘‘(ii) a withholding tax is paid under 
section 1446 with respect to such income, 
or 
‘‘(D) organizations which are exempt from 
tax under this title if such income is unrelated 
business taxable income (as defined in section 
512) with respect to such organization. 
‘‘(c) DETERMINABILITY OF AMOUNTS OF COMPENSA-
TION.— 
‘‘(1) IN GENERAL.—If the amount of any com-
pensation is not determinable at the time that such 
compensation is otherwise includible in gross income 
under subsection (a)— 
‘‘(A) such amount shall be so includible in 
gross income when determinable, and 
‘‘(B) the tax imposed under this chapter 
for the taxable year in which such compensation 
is includible in gross income shall be increased 
by the sum of— 
‘‘(i) the amount of interest determined 
under paragraph (2), and 
‘‘(ii) an amount equal to 20 percent of 
the amount of such compensation. 
‘‘(2) INTEREST.—For purposes of paragraph 
(1)(B)(i), the interest determined under this para-
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graph for any taxable year is the amount of interest 
at the underpayment rate under section 6621 plus 
1 percentage point on the underpayments that would 
have occurred had the deferred compensation been 
includible in gross income for the taxable year in 
which first deferred or, if later, the first taxable year 
in which such deferred compensation is not subject 
to a substantial risk of forfeiture. 
‘‘(d) OTHER DEFINITIONS AND SPECIAL RULES.— 
For purposes of this section— 
‘‘(1) SUBSTANTIAL RISK OF FORFEITURE.— 
‘‘(A) IN GENERAL.—The rights of a person 
to compensation shall be treated as subject to 
a substantial risk of forfeiture only if such per-
son’s rights to such compensation are condi-
tioned upon the future performance of substan-
tial services by any individual. 
‘‘(B) 
EXCEPTION
FOR
COMPENSATION 
BASED ON GAIN RECOGNIZED ON AN INVEST-
MENT ASSET.— 
‘‘(i) IN GENERAL.—To the extent pro-
vided in regulations prescribed by the Sec-
retary, if compensation of a service pro-
vider is determined solely by reference to 
the amount of gain recognized on the dis-
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position of an investment asset, such com-
pensation shall be treated as subject to a 
substantial risk of forfeiture until the date 
of such disposition. 
‘‘(ii) INVESTMENT ASSET.—For pur-
poses of clause (i), the term ‘investment 
asset’ means any single asset (other than 
an investment fund or similar entity)— 
‘‘(I) acquired directly by an in-
vestment fund or similar entity, 
‘‘(II) with respect to which such 
entity does not (nor does any person 
related to such entity) participate in 
the active management of such asset 
(or if such asset is an interest in an 
entity, in the active management of 
the activities of such entity), and 
‘‘(III) substantially all of any 
gain on the disposition of which (other 
than such deferred compensation) is 
allocated to investors in such entity. 
‘‘(iii) COORDINATION
WITH
SPECIAL 
RULE.—Paragraph (3)(B) shall not apply 
to any compensation to which clause (i) 
applies. 
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‘‘(2) COMPREHENSIVE FOREIGN INCOME TAX.— 
The term ‘comprehensive foreign income tax’ means, 
with respect to any foreign person, the income tax 
of a foreign country if— 
‘‘(A) such person is eligible for the benefits 
of a comprehensive income tax treaty between 
such foreign country and the United States, or 
‘‘(B) such person demonstrates to the sat-
isfaction of the Secretary that such foreign 
country has a comprehensive income tax. 
‘‘(3) NONQUALIFIED
DEFERRED
COMPENSA-
TION PLAN.— 
‘‘(A) 
IN
GENERAL.—The 
term 
‘non-
qualified deferred compensation plan’ has the 
meaning 
given 
such 
term 
under 
section 
409A(d), except that such term shall include 
any plan that provides a right to compensation 
based on the appreciation in value of a specified 
number of equity units of the service recipient. 
‘‘(B) 
EXCEPTION.—Compensation 
shall 
not be treated as deferred for purposes of this 
section if the service provider receives payment 
of such compensation not later than 12 months 
after the end of the taxable year of the service 
recipient during which the right to the payment 
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of such compensation is no longer subject to a 
substantial risk of forfeiture. 
‘‘(4) SERVICE
PROVIDER.—The term ‘service 
provider’ has the meaning given such term in the 
regulations under section 409A, determined without 
regard to method of accounting. 
‘‘(5) EXCEPTION FOR CERTAIN COMPENSATION 
WITH
RESPECT
TO
EFFECTIVELY
CONNECTED
IN-
COME.—In the case of a foreign corporation with in-
come which is taxable under section 882, this section 
shall not apply to compensation payable by such for-
eign corporation which, had such compensation been 
paid in cash on the date that such compensation 
ceased to be subject to a substantial risk of for-
feiture, would have been deductible by such foreign 
corporation against such income. 
‘‘(6) EXCEPTION WITH RESPECT TO EMPLOY-
EES OF CERTAIN SUBSIDIARIES.—This section shall 
not apply to compensation deferred under a non-
qualified deferred compensation plan of a non-
qualified entity if— 
‘‘(A) such compensation is payable to an 
employee of a domestic subsidiary of such enti-
ty, and 
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‘‘(B) such compensation is reasonably ex-
pected to be deductible by such subsidiary 
under section 404(a)(5) when such compensa-
tion is includible in income by such employee. 
‘‘(7) APPLICATION OF RULES.—Rules similar to 
the rules of paragraphs (5) and (6) of section 
409A(d) shall apply. 
‘‘(e) REGULATIONS.—The Secretary shall prescribe 
such regulations as may be necessary or appropriate to 
carry out the purposes of this section, including regula-
tions— 
‘‘(1) disregarding a substantial risk of for-
feiture in cases where necessary to carry out the 
purposes of this section, and 
‘‘(2) providing appropriate treatment where an 
individual who was employed by an employer which 
is not a nonqualified entity is temporarily employed 
by a nonqualified entity which is related to such em-
ployer.’’. 
(b) CONFORMING AMENDMENT.—Section 26(b)(2) is 
amended by striking ‘‘and’’ at the end of subparagraph 
(V), by striking the period at the end of subparagraph 
(W) and inserting ‘‘, and’’, and by adding at the end the 
following new subparagraph: 
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‘‘(X) section 457A(c)(1)(B) (relating to de-
terminability of amounts of compensation).’’. 
(c) CLERICAL AMENDMENT.—The table of sections 
of subpart B of part II of subchapter E of chapter 1 is 
amended by inserting after the item relating to section 
457 the following new item: 
‘‘Sec. 457A. Nonqualified deferred compensation from certain tax indifferent 
parties.’’. 
(d) EFFECTIVE DATE.— 
(1) IN
GENERAL.—Except as otherwise pro-
vided in this subsection, the amendments made by 
this section shall apply to amounts deferred which 
are attributable to services performed after Decem-
ber 31, 2008. 
(2) APPLICATION TO EXISTING DEFERRALS.— 
In the case of any amount deferred to which the 
amendments made by this section do not apply solely 
by reason of the fact that the amount is attributable 
to services performed before January 1, 2009, to the 
extent such amount is not includible in gross income 
in a taxable year beginning before 2018, such 
amounts shall be includible in gross income in the 
later of— 
(A) the last taxable year beginning before 
2018, or 
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(B) the taxable year in which there is no 
substantial risk of forfeiture of the rights to 
such compensation (determined in the same 
manner as determined for purposes of section 
457A of the Internal Revenue Code of 1986, as 
added by this section). 
(3) ACCELERATED PAYMENTS.—No later than 
120 days after the date of the enactment of this Act, 
the Secretary shall issue guidance providing a lim-
ited period of time during which a nonqualified de-
ferred compensation arrangement attributable to 
services performed on or before December 31, 2008, 
may, without violating the requirements of section 
409A(a) of the Internal Revenue Code of 1986, be 
amended to conform the date of distribution to the 
date the amounts are required to be included in in-
come. 
(4) CERTAIN BACK-TO-BACK ARRANGEMENTS.— 
If the taxpayer is also a service recipient and main-
tains one or more nonqualified deferred compensa-
tion arrangements for its service providers under 
which any amount is attributable to services per-
formed on or before December 31, 2008, the guid-
ance issued under paragraph (4) shall permit such 
arrangements to be amended to conform the dates of 
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distribution under such arrangement to the date 
amounts are required to be included in the income 
of such taxpayer under this subsection. 
(5) ACCELERATED PAYMENT NOT TREATED AS 
MATERIAL
MODIFICATION.—Any amendment to a 
nonqualified deferred compensation arrangement 
made pursuant to paragraph (4) or (5) shall not be 
treated as a material modification of the arrange-
ment for purposes of section 409A of the Internal 
Revenue Code of 1986. 
(6) CERTAIN PREEXISTING ARRANGEMENTS.— 
If, pursuant to a written binding contract entered 
into on or before December 31, 2007, any portion of 
compensation payable under such contract for a pe-
riod is determined as a portion of the amount of 
gain recognized on the disposition during such pe-
riod of a specified asset, the amendments made by 
this section shall not apply to the portion of com-
pensation attributable to such disposition notwith-
standing the fact that such portion of compensation 
may be reduced by realized losses or depreciation in 
the value of other assets during such period or a 
prior period or be attributable in part to services 
performed after December 31, 2008, but only if— 
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(A) payment of such portion of compensa-
tion is received by the service provider and in-
cluded in its gross income no later than the ear-
lier of— 
(i) 12 months after the end of the 
taxable year of the service recipient during 
which the disposition of the specified asset 
occurs, or 
(ii) the last taxable year of the service 
provider beginning before January 1, 
2018; and 
(B) the specified asset is held by the serv-
ice recipient on the date of the enactment of 
this section. 
SEC. 407. DELAY IN APPLICATION OF WORLDWIDE ALLOCA-
TION OF INTEREST. 
(a) IN GENERAL.—Paragraphs (5)(D) and (6) of sec-
tion 864(f) are each amended by striking ‘‘December 31, 
2010’’ and inserting ‘‘December 31, 2016’’. 
(b) TRANSITION.—Paragraph (7) of section 864(f) is 
amended by striking ‘‘30 percent’’ and inserting ‘‘55 per-
cent’’. 
(c) COORDINATION WITH OTHER LEGISLATION.—If 
H.R. 6983 of the 110th Congress is enacted into law— 
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(1) such law shall be treated, solely for pur-
poses of carrying out the amendments made by this 
section, as having been enacted immediately before 
the enactment of this Act, and 
(2) in lieu of the amendments made by sub-
sections (a) and (b): 
(A) Paragraphs (5)(D) and (6) of section 
864(f), as amended by such law, are each 
amended by striking ‘‘December 31, 2012’’ and 
inserting ‘‘December 31, 2018’’. 
(B) Subsection (f) of section 864, as 
amended by such law, is amended by striking 
paragraph (7). 
SEC. 408. TIME FOR PAYMENT OF CORPORATE ESTIMATED 
TAXES. 
The percentage under subparagraph (C) of section 
401(1) of the Tax Increase Prevention and Reconciliation 
Act of 2005 in effect on the date of the enactment of this 
Act is increased by 58 percentage points. 
Passed the House of Representatives September 26, 
2008. 
Attest: 
LORRAINE C. MILLER, 
Clerk. 
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Calendar No. 1130 
110TH CONGRESS 
2D SESSION 
H. R. 7060 
AN ACT 
To amend the Internal Revenue Code of 1986 to 
provide incentives for energy production and con-
servation, to extend certain expiring provisions, 
to provide individual income tax relief, and for 
other purposes. 
DECEMBER 9, 2008 
Read the second time and placed on the calendar 
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