then the Secretary shall pay to such exporter an 
amount equal to $0.825 per ton of such coal ex-
ported by the exporter or caused to be exported or 
shipped, or caused to be exported or shipped, by the 
exporter. 
(b) LIMITATIONS.—Subsection (a) shall not apply 
with respect to exported coal if a settlement with the Fed-
eral Government has been made with and accepted by, the 
coal producer, a party related to such coal producer, or 
the exporter, of such coal, as of the date that the claim 
is filed under this section with respect to such exported 
coal. For purposes of this subsection, the term ‘‘settlement 
with the Federal Government’’ shall not include any settle-
ment or stipulation entered into as of the date of the en-
actment of this Act, the terms of which contemplate a 
judgment concerning which any party has reserved the 
right to file an appeal, or has filed an appeal. 
(c) SUBSEQUENT REFUND PROHIBITED.—No refund 
shall be made under this section to the extent that a credit 
or refund of such tax on such exported or shipped coal 
has been paid to any person. 
(d) DEFINITIONS.—For purposes of this section— 
(1) COAL
PRODUCER.—The term ‘‘coal pro-
ducer’’ means the person in whom is vested owner-
ship of the coal immediately after the coal is severed 
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from the ground, without regard to the existence of 
any contractual arrangement for the sale or other 
disposition of the coal or the payment of any royal-
ties between the producer and third parties. The 
term includes any person who extracts coal from 
coal waste refuse piles or from the silt waste product 
which results from the wet washing (or similar proc-
essing) of coal. 
(2) EXPORTER.—The term ‘‘exporter’’ means a 
person, other than a coal producer, who does not 
have a contract, fee arrangement, or any other 
agreement with a producer or seller of such coal to 
export or ship such coal to a third party on behalf 
of the producer or seller of such coal and— 
(A) is indicated in the shipper’s export 
declaration or other documentation as the ex-
porter of record, or 
(B) actually exported such coal to a for-
eign country or shipped such coal to a posses-
sion of the United States, or caused such coal 
to be so exported or shipped. 
(3) RELATED PARTY.—The term ‘‘a party re-
lated to such coal producer’’ means a person who— 
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(A) is related to such coal producer 
through any degree of common management, 
stock ownership, or voting control, 
(B) is related (within the meaning of sec-
tion 144(a)(3) of the Internal Revenue Code of 
1986) to such coal producer, or 
(C) has a contract, fee arrangement, or 
any other agreement with such coal producer to 
sell such coal to a third party on behalf of such 
coal producer. 
(4) SECRETARY.—The term ‘‘Secretary’’ means 
the Secretary of Treasury or the Secretary’s des-
ignee. 
(e) TIMING OF REFUND.—With respect to any claim 
for refund filed pursuant to this section, the Secretary 
shall determine whether the requirements of this section 
are met not later than 180 days after such claim is filed. 
If the Secretary determines that the requirements of this 
section are met, the claim for refund shall be paid not 
later than 180 days after the Secretary makes such deter-
mination. 
(f) INTEREST.—Any refund paid pursuant to this 
section shall be paid by the Secretary with interest from 
the date of overpayment determined by using the overpay-
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ment rate and method under section 6621 of the Internal 
Revenue Code of 1986. 
(g) DENIAL OF DOUBLE BENEFIT.—The payment 
under subsection (a) with respect to any coal shall not ex-
ceed— 
(1) in the case of a payment to a coal producer, 
the amount of tax paid under section 4121 of the 
Internal Revenue Code of 1986 with respect to such 
coal by such coal producer or a party related to such 
coal producer, and 
(2) in the case of a payment to an exporter, an 
amount equal to $0.825 per ton with respect to such 
coal exported by the exporter or caused to be ex-
ported by the exporter. 
(h) APPLICATION OF SECTION.—This section applies 
only to claims on coal exported or shipped on or after Oc-
tober 1, 1990, through the date of the enactment of this 
Act. 
SEC. 115. CARBON AUDIT OF THE TAX CODE. 
(a) STUDY.—The Secretary of the Treasury shall 
enter into an agreement with the National Academy of 
Sciences to undertake a comprehensive review of the Inter-
nal Revenue Code of 1986 to identify the types of and 
specific tax provisions that have the largest effects on car-
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bon and other greenhouse gas emissions and to estimate 
the magnitude of those effects. 
(b) REPORT.—Not later than 2 years after the date 
of enactment of this Act, the National Academy of 
Sciences shall submit to Congress a report containing the 
results of study authorized under this section. 
(c) AUTHORIZATION OF APPROPRIATIONS.—There is 
authorized to be appropriated to carry out this section 
$1,500,000 for the period of fiscal years 2009 and 2010. 
Subtitle B—Transportation and 
Domestic Fuel Security Provisions 
SEC. 121. INCLUSION OF CELLULOSIC BIOFUEL IN BONUS 
DEPRECIATION 
FOR 
BIOMASS 
ETHANOL 
PLANT PROPERTY. 
(a) IN GENERAL.—Paragraph (3) of section 168(l) 
is amended to read as follows: 
‘‘(3) CELLULOSIC
BIOFUEL.—The term ‘cel-
lulosic biofuel’ means any liquid fuel which is pro-
duced from any lignocellulosic or hemicellulosic mat-
ter that is available on a renewable or recurring 
basis.’’. 
(b) CONFORMING AMENDMENTS.—Subsection (l) of 
section 168 is amended— 
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(1) by striking ‘‘cellulosic biomass ethanol’’ 
each place it appears and inserting ‘‘cellulosic 
biofuel’’, 
(2) by striking ‘‘CELLULOSIC BIOMASS ETH-
ANOL’’ in the heading of such subsection and insert-
ing ‘‘CELLULOSIC BIOFUEL’’, and 
(3) by striking ‘‘CELLULOSIC
BIOMASS
ETH-
ANOL’’ in the heading of paragraph (2) thereof and 
inserting ‘‘CELLULOSIC BIOFUEL’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to property placed in service after 
the date of the enactment of this Act, in taxable years 
ending after such date. 
SEC. 122. CREDITS FOR BIODIESEL AND RENEWABLE DIE-
SEL. 
(a) IN GENERAL.—Sections 40A(g), 6426(c)(6), and 
6427(e)(5)(B) are each amended by striking ‘‘December 
31, 2008’’ and inserting ‘‘December 31, 2009’’. 
(b) INCREASE IN RATE OF CREDIT.— 
(1) INCOME TAX CREDIT.—Paragraphs (1)(A) 
and (2)(A) of section 40A(b) are each amended by 
striking ‘‘50 cents’’ and inserting ‘‘$1.00’’. 
(2) EXCISE
TAX
CREDIT.—Paragraph (2) of 
section 6426(c) is amended to read as follows: 
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‘‘(2) APPLICABLE AMOUNT.—For purposes of 
this subsection, the applicable amount is $1.00.’’. 
(3) CONFORMING AMENDMENTS.— 
(A) Subsection (b) of section 40A is 
amended by striking paragraph (3) and by re-
designating paragraphs (4) and (5) as para-
graphs (3) and (4), respectively. 
(B) Paragraph (2) of section 40A(f) is 
amended to read as follows: 
‘‘(2) EXCEPTION.—Subsection (b)(4) shall not 
apply with respect to renewable diesel.’’. 
(C) Paragraphs (2) and (3) of section 
40A(e) are each amended by striking ‘‘sub-
section (b)(5)(C)’’ and inserting ‘‘subsection 
(b)(4)(C)’’. 
(D) Clause (ii) of section 40A(d)(3)(C) is 
amended by striking ‘‘subsection (b)(5)(B)’’ 
and inserting ‘‘subsection (b)(4)(B)’’. 
(c) UNIFORM TREATMENT OF DIESEL PRODUCED 
FROM BIOMASS.—Paragraph (3) of section 40A(f) is 
amended— 
(1) by striking ‘‘diesel fuel’’ and inserting ‘‘liq-
uid fuel’’, 
(2) 
by 
striking 
‘‘using 
a 
thermal 
depolymerization process’’, and 
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(3) by striking ‘‘or D396’’ in subparagraph (B) 
and inserting ‘‘, D396, or other equivalent standard 
approved by the Secretary’’. 
(d) COPRODUCTION OF RENEWABLE DIESEL WITH 
PETROLEUM FEEDSTOCK.— 
(1) IN
GENERAL.—Paragraph (3) of section 
40A(f) (defining renewable diesel) is amended by 
adding at the end the following flush sentence: 
‘‘Such term does not include any fuel derived from 
coprocessing biomass with a feedstock which is not 
biomass. For purposes of this paragraph, the term 
‘biomass’ has the meaning given such term by sec-
tion 45K(c)(3).’’. 
(2) CONFORMING AMENDMENT.—Paragraph (3) 
of section 40A(f) is amended by striking ‘‘(as de-
fined in section 45K(c)(3))’’. 
(e) ELIGIBILITY OF CERTAIN AVIATION FUEL.—Sub-
section (f) of section 40A (relating to renewable diesel) 
is amended by adding at the end the following new para-
graph: 
‘‘(4) CERTAIN AVIATION FUEL.— 
‘‘(A) IN GENERAL.—Except as provided in 
the last three sentences of paragraph (3), the 
term ‘renewable diesel’ shall include fuel derived 
from biomass which meets the requirements of 
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a Department of Defense specification for mili-
tary jet fuel or an American Society of Testing 
and Materials specification for aviation turbine 
fuel. 
‘‘(B) APPLICATION
OF
MIXTURE
CRED-
ITS.—In the case of fuel which is treated as re-
newable diesel solely by reason of subparagraph 
(A), subsection (b)(1) and section 6426(c) shall 
be applied with respect to such fuel by treating 
kerosene as though it were diesel fuel.’’. 
(f) EFFECTIVE DATE.— 
(1) IN
GENERAL.—Except as otherwise pro-
vided in this subsection, the amendments made by 
this section shall apply to fuel produced, and sold or 
used, after December 31, 2008. 
(2) COPRODUCTION
OF
RENEWABLE
DIESEL 
WITH PETROLEUM FEEDSTOCK.—The amendments 
made by subsection (c) shall apply to fuel produced, 
and sold or used, after February 13, 2008. 
SEC. 123. CLARIFICATION THAT CREDITS FOR FUEL ARE 
DESIGNED TO PROVIDE AN INCENTIVE FOR 
UNITED STATES PRODUCTION. 
(a) ALCOHOL FUELS CREDIT.—Subsection (d) of 
section 40 is amended by adding at the end the following 
new paragraph: 
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‘‘(7) LIMITATION TO ALCOHOL WITH CONNEC-
TION TO THE UNITED STATES.—No credit shall be 
determined under this section with respect to any al-
cohol which is produced outside the United States 
for use as a fuel outside the United States. For pur-
poses of this paragraph, the term ‘United States’ in-
cludes any possession of the United States.’’. 
(b) BIODIESEL FUELS CREDIT.—Subsection (d) of 
section 40A is amended by adding at the end the following 
new paragraph: 
‘‘(5) LIMITATION TO BIODIESEL WITH CONNEC-
TION TO THE UNITED STATES.—No credit shall be 
determined under this section with respect to any 
biodiesel which is produced outside the United 
States for use as a fuel outside the United States. 
For purposes of this paragraph, the term ‘United 
States’ includes any possession of the United 
States.’’. 
(c) EXCISE TAX CREDIT.— 
(1) IN GENERAL.—Section 6426 is amended by 
adding at the end the following new subsection: 
‘‘(i) LIMITATION TO FUELS WITH CONNECTION TO 
THE UNITED STATES.— 
‘‘(1) ALCOHOL.—No credit shall be determined 
under this section with respect to any alcohol which 
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is produced outside the United States for use as a 
fuel outside the United States. 
‘‘(2) BIODIESEL AND ALTERNATIVE FUELS.— 
No credit shall be determined under this section 
with respect to any biodiesel or alternative fuel 
which is produced outside the United States for use 
as a fuel outside the United States. 
For purposes of this subsection, the term ‘United States’ 
includes any possession of the United States.’’. 
(2) CONFORMING AMENDMENT.—Subsection (e) 
of section 6427 is amended by redesignating para-
graph (5) as paragraph (6) and by inserting after 
paragraph (4) the following new paragraph: 
‘‘(5) LIMITATION TO FUELS WITH CONNECTION 
TO THE UNITED STATES.—No amount shall be pay-
able under paragraph (1) or (2) with respect to any 
mixture or alternative fuel if credit is not allowed 
with respect to such mixture or alternative fuel by 
reason of section 6426(i).’’. 
(d) EFFECTIVE DATE.—The amendments made by 
this section shall apply to claims for credit or payment 
made on or after May 15, 2008. 
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SEC. 124. CREDIT FOR NEW QUALIFIED PLUG-IN ELECTRIC 
DRIVE MOTOR VEHICLES. 
(a) IN GENERAL.—Section 30 is amended to read as 
follows: 
‘‘SEC. 30. NEW QUALIFIED PLUG-IN ELECTRIC DRIVE 
MOTOR VEHICLES. 
‘‘(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 the sum of the 
credit amounts determined under subsection (b) with re-
spect to each new qualified plug-in electric drive motor ve-
hicle placed in service by the taxpayer during the taxable 
year. 
‘‘(b) PER VEHICLE DOLLAR LIMITATION.— 
‘‘(1) IN
GENERAL.—The amount determined 
under this subsection with respect to any new quali-
fied plug-in electric drive motor vehicle is the sum 
of the amounts determined under paragraphs (2) 
and (3) with respect to such vehicle. 
‘‘(2) BASE AMOUNT.—The amount determined 
under this paragraph is $3,000. 
‘‘(3) BATTERY CAPACITY.—In the case of a ve-
hicle which draws propulsion energy from a battery 
with not less than 5 kilowatt hours of capacity, the 
amount determined under this paragraph is $200, 
plus $200 for each kilowatt hour of capacity in ex-
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cess of 5 kilowatt hours. The amount determined 
under this paragraph shall not exceed $2,000. 
‘‘(c) APPLICATION WITH OTHER CREDITS.— 
‘‘(1) BUSINESS CREDIT TREATED AS PART OF 
GENERAL BUSINESS CREDIT.—So much of the credit 
which would be allowed under subsection (a) for any 
taxable year (determined without regard to this sub-
section) that is attributable to property of a char-
acter subject to an allowance for depreciation shall 
be treated as a credit listed in section 38(b) for such 
taxable year (and not allowed under subsection (a)). 
‘‘(2) PERSONAL CREDIT.— 
‘‘(A) IN GENERAL.—For purposes of this 
title, the credit allowed under subsection (a) for 
any taxable year (determined after application 
of paragraph (1)) shall be treated as a credit 
allowable under subpart A for such taxable 
year. 
‘‘(B) LIMITATION BASED ON AMOUNT OF 
TAX.—In the case of a taxable year to which 
section 26(a)(2) does not apply, the credit al-
lowed under subsection (a) for any taxable year 
(determined after application of paragraph (1)) 
shall not exceed the excess of— 
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‘‘(i) the sum of the regular tax liabil-
ity (as defined in section 26(b)) plus the 
tax imposed by section 55, over 
‘‘(ii) the sum of the credits allowable 
under subpart A (other than this section 
and sections 23 and 25D) and section 27 
for the taxable year. 
‘‘(d) NEW QUALIFIED PLUG-IN ELECTRIC DRIVE 
MOTOR VEHICLE.—For purposes of this section— 
‘‘(1) IN
GENERAL.—The term ‘new qualified 
plug-in electric drive motor vehicle’ means a motor 
vehicle— 
‘‘(A) the original use of which commences 
with the taxpayer, 
‘‘(B) which is acquired for use or lease by 
the taxpayer and not for resale, 
‘‘(C) which is made by a manufacturer, 
‘‘(D) which has a gross vehicle weight rat-
ing of less than 14,000 pounds, 
‘‘(E) which has received a certificate of 
conformity under the Clean Air Act and meets 
or exceeds the Bin 5 Tier II emission standard 
established in regulations prescribed by the Ad-
ministrator of the Environmental Protection 
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Agency under section 202(i) of the Clean Air 
Act for that make and model year vehicle, and 
‘‘(F) which is propelled to a significant ex-
tent by an electric motor which draws electricity 
from a battery which— 
‘‘(i) has a capacity of not less than 4 
kilowatt hours, and 
‘‘(ii) is capable of being recharged 
from an external source of electricity. 
‘‘(2) EXCEPTION.—The term ‘new qualified 
plug-in electric drive motor vehicle’ shall not include 
any vehicle which is not a passenger automobile or 
light truck if such vehicle has a gross vehicle weight 
rating of less than 8,500 pounds. 
‘‘(3) MOTOR VEHICLE.—The term ‘motor vehi-
cle’ means any vehicle which is manufactured pri-
marily for use on public streets, roads, and highways 
(not including a vehicle operated exclusively on a rail 
or rails) and which has at least 4 wheels. 
‘‘(4) OTHER
TERMS.—The terms ‘passenger 
automobile’, ‘light truck’, and ‘manufacturer’ have 
the meanings given such terms in regulations pre-
scribed by the Administrator of the Environmental 
Protection Agency for purposes of the administra-
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tion of title II of the Clean Air Act (42 U.S.C. 7521 
et seq.). 
‘‘(5) BATTERY CAPACITY.—The term ‘capacity’ 
means, with respect to any battery, the quantity of 
electricity which the battery is capable of storing, ex-
pressed in kilowatt hours, as measured from a 100 
percent state of charge to a 0 percent state of 
charge. 
‘‘(e) LIMITATION ON NUMBER OF NEW QUALIFIED 
PLUG-IN ELECTRIC DRIVE MOTOR VEHICLES ELIGIBLE 
FOR CREDIT.— 
‘‘(1) IN GENERAL.—In the case of a new quali-
fied plug-in electric drive motor vehicle sold during 
the phaseout period, only the applicable percentage 
of the credit otherwise allowable under subsection 
(a) shall be allowed. 
‘‘(2) PHASEOUT PERIOD.—For purposes of this 
subsection, the phaseout period is the period begin-
ning with the second calendar quarter following the 
calendar quarter which includes the first date on 
which the number of new qualified plug-in electric 
drive motor vehicles manufactured by the manufac-
turer of the vehicle referred to in paragraph (1) sold 
for use in the United States after the date of the en-
actment of this section, is at least 60,000. 
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‘‘(3) APPLICABLE PERCENTAGE.—For purposes 
of paragraph (1), the applicable percentage is— 
‘‘(A) 50 percent for the first 2 calendar 
quarters of the phaseout period, 
‘‘(B) 25 percent for the 3d and 4th cal-
endar quarters of the phaseout period, and 
‘‘(C) 0 percent for each calendar quarter 
thereafter. 
‘‘(4) CONTROLLED GROUPS.—Rules similar to 
the rules of section 30B(f)(4) shall apply for pur-
poses of this subsection. 
‘‘(f) SPECIAL RULES.— 
‘‘(1) BASIS
REDUCTION.—The basis of any 
property for which a credit is allowable under sub-
section (a) shall be reduced by the amount of such 
credit (determined without regard to subsection (c)). 
‘‘(2) RECAPTURE.—The Secretary shall, by reg-
ulations, 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. 
‘‘(3) 
PROPERTY
USED
OUTSIDE
UNITED 
STATES, ETC., NOT QUALIFIED.—No credit shall be 
allowed under subsection (a) with respect to any 
property referred to in section 50(b)(1) or with re-
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spect to the portion of the cost of any property 
taken into account under section 179. 
‘‘(4) ELECTION
NOT
TO
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. 
‘‘(5) PROPERTY USED BY TAX-EXEMPT ENTITY; 
INTERACTION WITH AIR QUALITY AND MOTOR VEHI-
CLE SAFETY STANDARDS.—Rules similar to the rules 
of paragraphs (6) and (10) of section 30B(h) shall 
apply for purposes of this section.’’. 
(b) COORDINATION WITH ALTERNATIVE MOTOR VE-
HICLE CREDIT.—Section 30B(d)(3) is amended by adding 
at the end the following new subparagraph: 
‘‘(D) EXCLUSION OF PLUG-IN VEHICLES.— 
Any vehicle with respect to which a credit is al-
lowable under section 30 (determined without 
regard to subsection (c) thereof) shall not be 
taken into account under this section.’’. 
(c) CREDIT MADE PART OF GENERAL BUSINESS 
CREDIT.—Section 38(b) is amended by striking ‘‘plus’’ at 
the end of paragraph (32), by striking the period at the 
end of paragraph (33) and inserting ‘‘, plus’’, and by add-
ing at the end the following new paragraph: 
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‘‘(34) the portion of the new qualified plug-in 
electric drive motor vehicle credit to which section 
30(c)(1) applies.’’. 
(d) CONFORMING AMENDMENTS.— 
(1)(A) Section 24(b)(3)(B), as amended by sec-
tion 104, is amended by striking ‘‘and 25D’’ and in-
serting ‘‘25D, and 30’’. 
(B) Section 25(e)(1)(C)(ii) is amended by in-
serting ‘‘30,’’ after ‘‘25D,’’. 
(C) Section 25B(g)(2), as amended by section 
104, is amended by striking ‘‘and 25D’’ and insert-
ing ‘‘, 25D, and 30’’. 
(D) Section 26(a)(1), as amended by section 
104, is amended by striking ‘‘and 25D’’ and insert-
ing ‘‘25D, and 30’’. 
(E) Section 1400C(d)(2) is amended by striking 
‘‘and 25D’’ and inserting ‘‘25D, and 30’’. 
(2) Section 30B(h)(1) is amended by striking 
‘‘section 30(c)(2)’’ and inserting ‘‘section 30(d)(3)’’. 
(3)(A) Section 53(d)(1)(B) is amended by strik-
ing clause (iii) and redesignating clause (iv) as 
clause (iii). 
(B) Subclause (II) of section 53(d)(1)(B)(iii), 
as so redesignated, is amended by striking ‘‘in-
creased in the manner provided in clause (iii)’’. 
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(4) Section 55(c)(3) is amended by striking 
‘‘30(b)(3),’’. 
(5) Section 1016(a)(25) is amended by striking 
‘‘section 30(d)(1)’’ and inserting ‘‘section 30(f)(1)’’. 
(6) Section 6501(m) is amended by striking 
‘‘section 30(d)(4)’’ and inserting ‘‘section 30(f)(4)’’. 
(7) The item in the table of sections for subpart 
B of part IV of subchapter A of chapter 1 is amend-
ed to read as follows: 
‘‘Sec. 30. New qualified plug-in electric drive motor vehicles.’’. 
(e) TREATMENT OF ALTERNATIVE MOTOR VEHICLE 
CREDIT AS A PERSONAL CREDIT.— 
(1) IN
GENERAL.—Paragraph (2) of section 
30B(g) is amended to read as follows: 
‘‘(2) PERSONAL
CREDIT.—The credit allowed 
under subsection (a) for any taxable year (after ap-
plication of paragraph (1)) shall be treated as a 
credit allowable under subpart A for such taxable 
year.’’. 
(2) CONFORMING AMENDMENTS.— 
(A) Subparagraph (A) of section 30C(d)(2) 
is amended by striking ‘‘sections 27, 30, and 
30B’’ and inserting ‘‘section 27’’. 
(B) Paragraph (3) of section 55(c) is 
amended by striking ‘‘30B(g)(2),’’. 
(f) EFFECTIVE DATE.— 
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(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, 2008. 
(2) TREATMENT OF ALTERNATIVE MOTOR VE-
HICLE CREDIT AS PERSONAL CREDIT.—The amend-
ments made by subsection (e) shall apply to taxable 
years beginning after December 31, 2007. 
(g) APPLICATION
OF
EGTRRA SUNSET.—The 
amendment made by subsection (d)(1)(A) shall be subject 
to title IX of the Economic Growth and Tax Relief Rec-
onciliation Act of 2001 in the same manner as the provi-
sion of such Act to which such amendment relates. 
SEC. 125. EXCLUSION FROM HEAVY TRUCK TAX FOR IDLING 
REDUCTION UNITS AND ADVANCED INSULA-
TION. 
(a) IN GENERAL.—Section 4053 is amended by add-
ing at the end the following new paragraphs: 
‘‘(9) IDLING REDUCTION DEVICE.—Any device 
or system of devices which— 
‘‘(A) is designed to provide to a vehicle 
those services (such as heat, air conditioning, or 
electricity) that would otherwise require the op-
eration of the main drive engine while the vehi-
cle is temporarily parked or remains stationary 
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using one or more devices affixed to a tractor 
or truck, and 
‘‘(B) is determined by the Administrator of 
the Environmental Protection Agency, in con-
sultation with the Secretary of Energy and the 
Secretary of Transportation, to reduce idling of 
such vehicle at a motor vehicle rest stop or 
other location where such vehicles are tempo-
rarily parked or remain stationary. 
‘‘(10) ADVANCED INSULATION.—Any insulation 
that has an R value of not less than R35 per inch.’’. 
(b) EFFECTIVE DATE.—The amendment made by 
this section shall apply to sales or installations after the 
date of the enactment of this Act. 
SEC. 126. TRANSPORTATION FRINGE BENEFIT TO BICYCLE 
COMMUTERS. 
(a) IN GENERAL.—Paragraph (1) of section 132(f) 
is amended by adding at the end the following: 
‘‘(D) Any qualified bicycle commuting re-
imbursement.’’. 
(b) LIMITATION ON EXCLUSION.—Paragraph (2) of 
section 132(f) is amended by striking ‘‘and’’ at the end 
of subparagraph (A), by striking the period at the end 
of subparagraph (B) and inserting ‘‘, and’’, and by adding 
at the end the following new subparagraph: 
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‘‘(C) the applicable annual limitation in 
the case of any qualified bicycle commuting re-
imbursement.’’. 
(c) DEFINITIONS.—Paragraph (5) of section 132(f) 
is amended by adding at the end the following: 
‘‘(F) DEFINITIONS RELATED TO BICYCLE 
COMMUTING REIMBURSEMENT.— 
‘‘(i) QUALIFIED BICYCLE COMMUTING 
REIMBURSEMENT.—The term ‘qualified bi-
cycle commuting reimbursement’ means, 
with respect to any calendar year, any em-
ployer reimbursement during the 15-month 
period beginning with the first day of such 
calendar year for reasonable expenses in-
curred by the employee during such cal-
endar year for the purchase of a bicycle 
and bicycle improvements, repair, and stor-
age, if such bicycle is regularly used for 
travel between the employee’s residence 
and place of employment. 
‘‘(ii) APPLICABLE
ANNUAL
LIMITA-
TION.—The term ‘applicable annual limita-
tion’ means, with respect to any employee 
for any calendar year, the product of $20 
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multiplied by the number of qualified bicy-
cle commuting months during such year. 
‘‘(iii) 
QUALIFIED
BICYCLE
COM-
MUTING MONTH.—The term ‘qualified bi-
cycle commuting month’ means, with re-
spect to any employee, any month during 
which such employee— 
‘‘(I) regularly uses the bicycle for 
a substantial portion of the travel be-
tween the employee’s residence and 
place of employment, and 
‘‘(II) does not receive any benefit 
described in subparagraph (A), (B), 
or (C) of paragraph (1).’’. 
(d) CONSTRUCTIVE RECEIPT OF BENEFIT.—Para-
graph (4) of section 132(f) is amended by inserting 
‘‘(other than a qualified bicycle commuting reimburse-
ment)’’ after ‘‘qualified transportation fringe’’. 
(e) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years beginning after 
December 31, 2008. 
SEC. 127. ALTERNATIVE FUEL VEHICLE REFUELING PROP-
ERTY CREDIT. 
(a) INCREASE IN CREDIT AMOUNT.—Section 30C is 
amended— 
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(1) by striking ‘‘30 percent’’ in subsection (a) 
and inserting ‘‘50 percent’’, 
(2) by striking ‘‘$30,000’’ in subsection (b)(1) 
and inserting ‘‘$50,000’’, and 
(3) by striking ‘‘$1,000’’ in subsection (b)(2) 
and inserting ‘‘$2,000’’. 
(b) EXTENSION OF CREDIT.—Subsection (g) of sec-
tion 30C is amended to read as follows: 
‘‘(g) TERMINATION.—This section shall not apply to 
any property placed in service after— 
‘‘(1) December 31 2017, in the case of property 
relating to natural gas, compressed natural gas, or 
liquified natural gas, and which is not of a character 
subject to an allowance for depreciation, 
‘‘(2) December 31, 2014, in the case of— 
‘‘(A) property relating to hydrogen, and 
‘‘(B) property relating to natural gas, com-
pressed natural gas, or liquified natural gas, 
and which is of a character subject to an allow-
ance for depreciation, and 
‘‘(3) December 31, 2010, in any other case.’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to property placed in service after 
the date of the enactment of this Act, in taxable years 
ending after such date. 
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SEC. 128. CERTAIN INCOME AND GAINS RELATING TO AL-
COHOL FUELS AND MIXTURES, BIODIESEL 
FUELS AND MIXTURES, AND ALTERNATIVE 
FUELS AND MIXTURES TREATED AS QUALI-
FYING 
INCOME 
FOR 
PUBLICLY 
TRADED 
PARTNERSHIPS. 
(a) IN GENERAL.—Subparagraph (E) of section 
7704(d)(1) is amended by inserting ‘‘, or the transpor-
tation or storage of any fuel described in subsection (b), 
(c), (d), or (e) of section 6426, or any alcohol fuel defined 
in section 6426(b)(4)(A) or any biodiesel fuel as defined 
in section 40A(d)(1)’’ after ‘‘timber)’’. 
(b) EFFECTIVE DATE.—The amendment made by 
this section shall apply to taxable years beginning after 
the date of the enactment of this Act. 
Subtitle C—Energy Conservation 
and Efficiency Provisions 
SEC. 131. CREDIT FOR NONBUSINESS ENERGY PROPERTY. 
(a) EXTENSION
OF CREDIT.—Section 25C(g) is 
amended by striking ‘‘placed in service after December 31, 
2007’’ and inserting ‘‘placed in service— 
‘‘(1) after December 31, 2007, and before Jan-
uary 1, 2009, or 
‘‘(2) after December 31, 2009.’’. 
(b) QUALIFIED BIOMASS FUEL PROPERTY.— 
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(1) IN GENERAL.—Section 25C(d)(3) is amend-
ed— 
(A) by striking ‘‘and’’ at the end of sub-
paragraph (D), 
(B) by striking the period at the end of 
subparagraph (E) and inserting ‘‘, and’’, and 
(C) by adding at the end the following new 
subparagraph: 
‘‘(F) a stove which uses the burning of bio-
mass fuel to heat a dwelling unit located in the 
United States and used as a residence by the 
taxpayer, or to heat water for use in such a 
dwelling unit, and which has a thermal effi-
ciency rating of at least 75 percent.’’. 
(2) BIOMASS FUEL.—Section 25C(d) is amend-
ed by adding at the end the following new para-
graph: 
‘‘(6) BIOMASS FUEL.—The term ‘biomass fuel’ 
means any plant-derived fuel available on a renew-
able or recurring basis, including agricultural crops 
and trees, wood and wood waste and residues (in-
cluding wood pellets), plants (including aquatic 
plants), grasses, residues, and fibers.’’. 
(c) COORDINATION WITH CREDIT FOR QUALIFIED 
GEOTHERMAL HEAT PUMP PROPERTY EXPENDITURES.— 
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(1) IN
GENERAL.—Paragraph (3) of section 
25C(d), as amended by subsection (b), is amended 
by striking subparagraph (C) and by redesignating 
subparagraphs (D), (E), and (F) as subparagraphs 
(C), (D), and (E), respectively. 
(2) CONFORMING AMENDMENT.—Subparagraph 
(C) of section 25C(d)(2) is amended to read as fol-
lows: 
‘‘(C) REQUIREMENTS
AND
STANDARDS 
FOR AIR CONDITIONERS AND HEAT PUMPS.— 
The standards and requirements prescribed by 
the Secretary under subparagraph (B) with re-
spect to the energy efficiency ratio (EER) for 
central air conditioners and electric heat 
pumps— 
‘‘(i) shall require measurements to be 
based on published data which is tested by 
manufacturers at 95 degrees Fahrenheit, 
and 
‘‘(ii) may be based on the certified 
data of the Air Conditioning and Refrig-
eration Institute that are prepared in part-
nership with the Consortium for Energy 
Efficiency.’’. 
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(d) EFFECTIVE DATE.—The amendments made by 
this section shall apply to expenditures made after Decem-
ber 31, 2008. 
SEC. 132. ENERGY EFFICIENT COMMERCIAL BUILDINGS DE-
DUCTION. 
Subsection (h) of section 179D is amended by strik-
ing ‘‘December 31, 2008’’ and inserting ‘‘December 31, 
2013’’. 
SEC. 133. MODIFICATIONS OF ENERGY EFFICIENT APPLI-
ANCE CREDIT FOR APPLIANCES PRODUCED 
AFTER 2007. 
(a) IN GENERAL.—Subsection (b) of section 45M is 
amended to read as follows: 
‘‘(b) APPLICABLE AMOUNT.—For purposes of sub-
section (a)— 
‘‘(1) DISHWASHERS.—The applicable amount 
is— 
‘‘(A) $45 in the case of a dishwasher which 
is manufactured in calendar year 2008 or 2009 
and which uses no more than 324 kilowatt 
hours per year and 5.8 gallons per cycle, and 
‘‘(B) $75 in the case of a dishwasher 
which is manufactured in calendar year 2008, 
2009, or 2010 and which uses no more than 
307 kilowatt hours per year and 5.0 gallons per 
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cycle (5.5 gallons per cycle for dishwashers de-
signed for greater than 12 place settings). 
‘‘(2) 
CLOTHES
WASHERS.—The 
applicable 
amount is— 
‘‘(A) $75 in the case of a residential top- 
loading clothes washer manufactured in cal-
endar year 2008 which meets or exceeds a 1.72 
modified energy factor and does not exceed a 
8.0 water consumption factor, 
‘‘(B) $125 in the case of a residential top- 
loading clothes washer manufactured in cal-
endar year 2008 or 2009 which meets or ex-
ceeds a 1.8 modified energy factor and does not 
exceed a 7.5 water consumption factor, 
‘‘(C) $150 in the case of a residential or 
commercial clothes washer manufactured in cal-
endar year 2008, 2009, or 2010 which meets or 
exceeds 2.0 modified energy factor and does not 
exceed a 6.0 water consumption factor, and 
‘‘(D) $250 in the case of a residential or 
commercial clothes washer manufactured in cal-
endar year 2008, 2009, or 2010 which meets or 
exceeds 2.2 modified energy factor and does not 
exceed a 4.5 water consumption factor. 
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‘‘(3) REFRIGERATORS.—The applicable amount 
is— 
‘‘(A) $50 in the case of a refrigerator 
which is manufactured in calendar year 2008, 
and consumes at least 20 percent but not more 
than 22.9 percent less kilowatt hours per year 
than the 2001 energy conservation standards, 
‘‘(B) $75 in the case of a refrigerator 
which is manufactured in calendar year 2008 or 
2009, and consumes at least 23 percent but no 
more than 24.9 percent less kilowatt hours per 
year than the 2001 energy conservation stand-
ards, 
‘‘(C) $100 in the case of a refrigerator 
which is manufactured in calendar year 2008, 
2009, or 2010, and consumes at least 25 per-
cent but not more than 29.9 percent less kilo-
watt hours per year than the 2001 energy con-
servation standards, and 
‘‘(D) $200 in the case of a refrigerator 
manufactured in calendar year 2008, 2009, or 
2010 and which consumes at least 30 percent 
less energy than the 2001 energy conservation 
standards.’’. 
(b) ELIGIBLE PRODUCTION.— 
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(1) SIMILAR
TREATMENT
FOR
ALL
APPLI-
ANCES.—Subsection (c) of section 45M is amend-
ed— 
(A) by striking paragraph (2), 
(B) by striking ‘‘(1) IN GENERAL’’ and all 
that follows through ‘‘the eligible’’ and inserting 
‘‘The eligible’’, 
(C) by moving the text of such subsection 
in line with the subsection heading, and 
(D) by redesignating subparagraphs (A) 
and (B) as paragraphs (1) and (2), respectively, 
and by moving such paragraphs 2 ems to the 
left. 
(2) MODIFICATION
OF
BASE
PERIOD.—Para-
graph (2) of section 45M(c), as amended by para-
graph (1), is amended by striking ‘‘3-calendar year’’ 
and inserting ‘‘2-calendar year’’. 
(c) TYPES OF ENERGY EFFICIENT APPLIANCES.— 
Subsection (d) of section 45M (defining types of energy 
efficient appliances) is amended to read as follows: 
‘‘(d) TYPES OF ENERGY EFFICIENT APPLIANCE.— 
For purposes of this section, the types of energy efficient 
appliances are— 
‘‘(1) dishwashers described in subsection (b)(1), 
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‘‘(2) clothes washers described in subsection 
(b)(2), and 
‘‘(3) 
refrigerators 
described 
in 
subsection 
(b)(3).’’. 
(d) AGGREGATE CREDIT AMOUNT ALLOWED.— 
(1) INCREASE IN LIMIT.—Paragraph (1) of sec-
tion 45M(e) is amended to read as follows: 
‘‘(1) AGGREGATE CREDIT AMOUNT ALLOWED.— 
The aggregate amount of credit allowed under sub-
section (a) with respect to a taxpayer for any tax-
able year shall not exceed $75,000,000 reduced by 
the amount of the credit allowed under subsection 
(a) to the taxpayer (or any predecessor) for all prior 
taxable years beginning after December 31, 2007.’’. 
(2) EXCEPTION FOR CERTAIN REFRIGERATOR 
AND CLOTHES WASHERS.—Paragraph (2) of section 
45M(e) is amended to read as follows: 
‘‘(2) AMOUNT ALLOWED FOR CERTAIN REFRIG-
ERATORS
AND
CLOTHES
WASHERS.—Refrigerators 
described in subsection (b)(3)(D) and clothes wash-
ers described in subsection (b)(2)(D) shall not be 
taken into account under paragraph (1).’’. 
(e) QUALIFIED ENERGY EFFICIENT APPLIANCES.— 
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access located on the top of the machine and which 
operates on a vertical axis.’’. 
(4) REPLACEMENT OF ENERGY FACTOR.—Sec-
tion 45M(f)(6), as redesignated by paragraph (3), is 
amended to read as follows: 
‘‘(6) MODIFIED
ENERGY
FACTOR.—The term 
‘modified energy factor’ means the modified energy 
factor established by the Department of Energy for 
compliance with the Federal energy conservation 
standard.’’. 
(5) GALLONS
PER
CYCLE; WATER
CONSUMP-
TION
FACTOR.—Section 45M(f), as amended by 
paragraph (3), is amended by adding at the end the 
following: 
‘‘(9) GALLONS PER CYCLE.—The term ‘gallons 
per cycle’ means, with respect to a dishwasher, the 
amount of water, expressed in gallons, required to 
complete a normal cycle of a dishwasher. 
‘‘(10) WATER
CONSUMPTION
FACTOR.—The 
term ‘water consumption factor’ means, with respect 
to a clothes washer, the quotient of the total weight-
ed per-cycle water consumption divided by the cubic 
foot (or liter) capacity of the clothes washer.’’. 
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(f) EFFECTIVE DATE.—The amendments made by 
this section shall apply to appliances produced after De-
cember 31, 2007. 
SEC. 134. ACCELERATED RECOVERY PERIOD FOR DEPRE-
CIATION OF SMART METERS AND SMART 
GRID SYSTEMS. 
(a) IN GENERAL.—Section 168(e)(3)(D) is amended 
by striking ‘‘and’’ at the end of clause (i), by striking the 
period at the end of clause (ii) and inserting a comma, 
and by inserting after clause (ii) the following new clauses: 
‘‘(iii) any qualified smart electric 
meter, and 
‘‘(iv) any qualified smart electric grid 
system.’’. 
(b) DEFINITIONS.—Section 168(i) is amended by in-
serting at the end the following new paragraph: 
‘‘(18) QUALIFIED SMART ELECTRIC METERS.— 
‘‘(A) IN
GENERAL.—The term ‘qualified 
smart electric meter’ means any smart electric 
meter which is placed in service by a taxpayer 
who is a supplier of electric energy or a pro-
vider of electric energy services. 
‘‘(B) SMART ELECTRIC METER.—For pur-
poses of subparagraph (A), the term ‘smart 
electric meter’ means any time-based meter and 
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related communication equipment which is ca-
pable of being used by the taxpayer as part of 
a system that— 
‘‘(i) measures and records electricity 
usage data on a time-differentiated basis 
in at least 24 separate time segments per 
day, 
‘‘(ii) provides for the exchange of in-
formation between supplier or provider and 
the customer’s electric meter in support of 
time-based rates or other forms of demand 
response, 
‘‘(iii) provides data to such supplier or 
provider so that the supplier or provider 
can provide energy usage information to 
customers electronically, and 
‘‘(iv) provides net metering. 
‘‘(19) QUALIFIED SMART ELECTRIC GRID SYS-
TEMS.— 
‘‘(A) IN
GENERAL.—The term ‘qualified 
smart electric grid system’ means any smart 
grid property used as part of a system for elec-
tric distribution grid communications, moni-
toring, and management placed in service by a 
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taxpayer who is a supplier of electric energy or 
a provider of electric energy services. 
‘‘(B) SMART
GRID
PROPERTY.—For the 
purposes of subparagraph (A), the term ‘smart 
grid property’ means electronics and related 
equipment that is capable of— 
‘‘(i) sensing, collecting, and moni-
toring data of or from all portions of a 
utility’s electric distribution grid, 
‘‘(ii) providing real-time, two-way 
communications to monitor or manage 
such grid, and 
‘‘(iii) providing real time analysis of 
and event prediction based upon collected 
data that can be used to improve electric 
distribution system reliability, quality, and 
performance.’’. 
(c) CONTINUED APPLICATION OF 150 PERCENT DE-
CLINING BALANCE METHOD.—Paragraph (2) of section 
168(b) is amended by striking ‘‘or’’ at the end of subpara-
graph (B), by redesignating subparagraph (C) as subpara-
graph (D), and by inserting after subparagraph (B) the 
following new subparagraph: 
‘‘(C) any property (other than property de-
scribed in paragraph (3)) which is a qualified 
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smart electric meter or qualified smart electric 
grid system, or’’. 
(d) EFFECTIVE DATE.—The amendments made by 
this section shall apply to property placed in service after 
the date of the enactment of this Act. 
SEC. 135. QUALIFIED GREEN BUILDING AND SUSTAINABLE 
DESIGN PROJECTS. 
(a) IN GENERAL.—Paragraph (8) of section 142(l) 
is amended by striking ‘‘September 30, 2009’’ and insert-
ing ‘‘September 30, 2012’’. 
(b) 
TREATMENT
OF
CURRENT
REFUNDING 
BONDS.—Paragraph (9) of section 142(l) is amended by 
striking ‘‘October 1, 2009’’ and inserting ‘‘October 1, 
2012’’. 
(c) ACCOUNTABILITY.—The second sentence of sec-
tion 701(d) of the American Jobs Creation Act of 2004 
is amended by striking ‘‘issuance,’’ and inserting 
‘‘issuance of the last issue with respect to such project,’’. 
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TITLE II—EXTENSION OF 
TEMPORARY PROVISIONS 
Subtitle A—Extensions Primarily 
Affecting Individuals 
SEC. 201. DEDUCTION FOR STATE AND LOCAL SALES 
TAXES. 
(a) IN
GENERAL.—Subparagraph (I) of section 
164(b)(5) is amended by striking ‘‘January 1, 2008’’ and 
inserting ‘‘January 1, 2010’’. 
(b) EFFECTIVE DATE.—The amendment made by 
this section shall apply to taxable years beginning after 
December 31, 2007. 
SEC. 202. DEDUCTION OF QUALIFIED TUITION AND RE-
LATED EXPENSES. 
(a) IN GENERAL.—Subsection (e) of section 222 is 
amended by striking ‘‘December 31, 2007’’ and inserting 
‘‘December 31, 2009’’. 
(b) EFFECTIVE DATE.—The amendment made by 
this section shall apply to taxable years beginning after 
December 31, 2007. 
(c) TEMPORARY COORDINATION WITH HOPE AND 
LIFETIME LEARNING CREDIT.—In the case of any tax-
payer for any taxable year beginning in 2008 or 2009, 
no deduction shall be allowed under section 222 of the In-
ternal Revenue Code of 1986 if— 
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(1) the taxpayer’s net Federal income tax re-
duction which would be attributable to such deduc-
tion for such taxable year, is less than 
(2) the credit which would be allowed to the 
taxpayer for such taxable year under section 25A of 
such Code (determined without regard to sections 
25A(e) and 26 of such Code). 
SEC. 203. TREATMENT OF CERTAIN DIVIDENDS OF REGU-
LATED INVESTMENT COMPANIES. 
(a) 
INTEREST-RELATED
DIVIDENDS.—Subpara-
graph (C) of section 871(k)(1) (defining interest-related 
dividend) is amended by striking ‘‘December 31, 2007’’ 
and inserting ‘‘December 31, 2009’’. 
(b) SHORT-TERM CAPITAL GAIN DIVIDENDS.—Sub-
paragraph (C) of section 871(k)(2) (defining short-term 
capital gain dividend) is amended by striking ‘‘December 
31, 2007’’ and inserting ‘‘December 31, 2009’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to dividends with respect to taxable 
years of regulated investment companies beginning after 
December 31, 2007. 
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SEC. 204. TAX-FREE DISTRIBUTIONS FROM INDIVIDUAL RE-
TIREMENT PLANS FOR CHARITABLE PUR-
POSES. 
(a) IN GENERAL.—Subparagraph (F) of section 
408(d)(8) is amended by striking ‘‘December 31, 2007’’ 
and inserting ‘‘December 31, 2009’’. 
(b) EFFECTIVE DATE.—The amendment made by 
this section shall apply to distributions made in taxable 
years beginning after December 31, 2007. 
SEC. 205. DEDUCTION FOR CERTAIN EXPENSES OF ELE-
MENTARY AND SECONDARY SCHOOL TEACH-
ERS. 
(a) IN GENERAL.—Subparagraph (D) of section 
62(a)(2) is amended by striking ‘‘or 2007’’ and inserting 
‘‘2007, 2008, or 2009’’. 
(b) EFFECTIVE DATE.—The amendment made by 
subsection (a) shall apply to taxable years beginning after 
December 31, 2007. 
SEC. 206. STOCK IN RIC FOR PURPOSES OF DETERMINING 
ESTATES OF NONRESIDENTS NOT CITIZENS. 
(a) IN GENERAL.—Paragraph (3) of section 2105(d) 
is amended by striking ‘‘December 31, 2007’’ and insert-
ing ‘‘December 31, 2009’’. 
(b) EFFECTIVE DATE.—The amendment made by 
this section shall apply to decedents dying after December 
31, 2007. 
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SEC. 207. QUALIFIED INVESTMENT ENTITIES. 
(a) 
IN
GENERAL.—Clause 
(ii) 
of 
section 
897(h)(4)(A) is amended by striking ‘‘December 31, 
2007’’ and inserting ‘‘December 31, 2009’’. 
(b) EFFECTIVE DATE.—The amendment made by 
subsection (a) shall take effect on January 1, 2008, except 
that such amendment shall not apply to the application 
of withholding requirements with respect to any payment 
made on or before the date of the enactment of this Act. 
SEC. 208. REAL PROPERTY TAX STANDARD DEDUCTION. 
(a) IN GENERAL.—Subparagraph (C) of section 
63(c)(1) is amended by inserting ‘‘or 2009’’ after ‘‘2008’’. 
(b) EFFECTIVE DATE.—The amendment made by 
this section shall apply to taxable years beginning after 
December 31, 2008. 
Subtitle B—Extensions Primarily 
Affecting Businesses 
SEC. 221. RESEARCH CREDIT. 
(a) IN GENERAL.—Subparagraph (B) of section 
41(h)(1) is amended by striking ‘‘December 31, 2007’’ 
and inserting ‘‘December 31, 2009’’. 
(b) COMPUTATION OF CREDIT FOR TAXABLE YEAR 
IN WHICH CREDIT TERMINATES.—Paragraph (2) of sec-
tion 41(h) is amended to read as follows: 
‘‘(2) COMPUTATION OF CREDIT FOR TAXABLE 
YEAR IN WHICH CREDIT TERMINATES.— 
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‘‘(A) IN
GENERAL.—In the case of any 
taxable year with respect to which this section 
applies to a number of days which is less than 
the total number of days in such taxable year, 
the applicable base amount with respect to such 
taxable year shall be the amount which bears 
the same ratio to such applicable amount (de-
termined without regard to this paragraph) as 
the number of days in such taxable year to 
which this section applies bears to the total 
number of days in such taxable year. 
‘‘(B) APPLICABLE
BASE
AMOUNT.—For 
purposes of subparagraph (A), the term ‘appli-
cable base amount’ means, with respect to any 
taxable year— 
‘‘(i) except as otherwise provided in 
this subparagraph, the base amount for 
the taxable year, 
‘‘(ii) in the case of a taxable year with 
respect to which an election under sub-
section (c)(4) (relating to election of alter-
native incremental credit) is in effect, the 
average described in subsection (c)(1)(B) 
for the taxable year, and 
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‘‘(iii) in the case of a taxable year 
with respect to which an election under 
subsection (c)(5) (relating to election of al-
ternative simplified credit) is in effect, the 
average qualified research expenses for the 
3 taxable years preceding the taxable 
year.’’. 
(c) CONFORMING AMENDMENT.—Subparagraph (D) 
of section 45C(b)(1) is amended by striking ‘‘December 
31, 2007’’ and inserting ‘‘December 31, 2009’’. 
(d) EFFECTIVE DATE.— 
(1) IN GENERAL.—Except as provided in para-
graph (2), the amendments made by this section 
shall apply to amounts paid or incurred after De-
cember 31, 2007. 
(2) COMPUTATION
OF
CREDIT
FOR
TAXABLE 
YEAR IN WHICH CREDIT BEGINS.—The amendment 
made by subsection (b) shall apply to taxable years 
beginning after December 31, 2007. 
SEC. 222. INDIAN EMPLOYMENT CREDIT. 
(a) IN GENERAL.—Subsection (f) of section 45A is 
amended by striking ‘‘December 31, 2007’’ and inserting 
‘‘December 31, 2009’’. 
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(b) EFFECTIVE DATE.—The amendment made by 
this section shall apply to taxable years beginning after 
December 31, 2007. 
SEC. 223. NEW MARKETS TAX CREDIT. 
Subparagraph (D) of section 45D(f)(1) is amended 
by striking ‘‘and 2008’’ and inserting ‘‘2008, and 2009’’. 
SEC. 224. RAILROAD TRACK MAINTENANCE. 
(a) IN GENERAL.—Subsection (f) of section 45G is 
amended by striking ‘‘January 1, 2008’’ and inserting 
‘‘January 1, 2010’’. 
(b) EFFECTIVE DATE.—The amendment made by 
this section shall apply to expenditures paid or incurred 
during taxable years beginning after December 31, 2007. 
SEC. 225. FIFTEEN-YEAR STRAIGHT-LINE COST RECOVERY 
FOR QUALIFIED LEASEHOLD IMPROVEMENTS 
AND QUALIFIED RESTAURANT PROPERTY. 
(a) IN GENERAL.—Clauses (iv) and (v) of section 
168(e)(3)(E) are each amended by striking ‘‘January 1, 
2008’’ and inserting ‘‘January 1, 2010’’. 
(b) EFFECTIVE DATE.—The amendments made by 
this section shall apply to property placed in service after 
December 31, 2007. 
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SEC. 226. SEVEN-YEAR COST RECOVERY PERIOD FOR MO-
TORSPORTS RACING TRACK FACILITY. 
(a) IN GENERAL.—Subparagraph (D) of section 
168(i)(15) is amended by striking ‘‘December 31, 2007’’ 
and inserting ‘‘December 31, 2009’’. 
(b) EFFECTIVE DATE.—The amendment made by 
this section shall apply to property placed in service after 
December 31, 2007. 
SEC. 227. ACCELERATED DEPRECIATION FOR BUSINESS 
PROPERTY ON INDIAN RESERVATION. 
(a) IN GENERAL.—Paragraph (8) of section 168(j) 
is amended by striking ‘‘December 31, 2007’’ and insert-
ing ‘‘December 31, 2009’’. 
(b) EFFECTIVE DATE.—The amendment made by 
this section shall apply to property placed in service after 
December 31, 2007. 
SEC. 228. EXPENSING OF ENVIRONMENTAL REMEDIATION 
COSTS. 
(a) IN GENERAL.—Subsection (h) of section 198 is 
amended by striking ‘‘December 31, 2007’’ and inserting 
‘‘December 31, 2009’’. 
(b) EFFECTIVE DATE.—The amendment made by 
this section shall apply to expenditures paid or incurred 
after December 31, 2007. 
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SEC. 229. DEDUCTION ALLOWABLE WITH RESPECT TO IN-
COME ATTRIBUTABLE TO DOMESTIC PRO-
DUCTION ACTIVITIES IN PUERTO RICO. 
(a) IN GENERAL.—Subparagraph (C) of section 
199(d)(8) is amended— 
(1) by striking ‘‘first 2 taxable years’’ and in-
serting ‘‘first 4 taxable years’’, and 
(2) by striking ‘‘January 1, 2008’’ and insert-
ing ‘‘January 1, 2010’’. 
(b) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years beginning after 
December 31, 2007. 
SEC. 230. MODIFICATION OF TAX TREATMENT OF CERTAIN 
PAYMENTS TO CONTROLLING EXEMPT ORGA-
NIZATIONS. 
(a) 
IN
GENERAL.—Clause 
(iv) 
of 
section 
512(b)(13)(E) is amended by striking ‘‘December 31, 
2007’’ and inserting ‘‘December 31, 2009’’. 
(b) EFFECTIVE DATE.—The amendment made by 
this section shall apply to payments received or accrued 
after December 31, 2007. 
SEC. 231. QUALIFIED ZONE ACADEMY BONDS. 
(a) IN GENERAL.—Subpart I of part IV of sub-
chapter A of chapter 1 is amended by adding at the end 
the following new section: 
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‘‘SEC. 54C. QUALIFIED ZONE ACADEMY BONDS. 
‘‘(a) QUALIFIED ZONE ACADEMY BONDS.—For pur-
poses of this subchapter, the term ‘qualified zone academy 
bond’ means any bond issued as part of an issue if— 
‘‘(1) 100 percent of the available project pro-
ceeds of such issue are to be used for a qualified 
purpose with respect to a qualified zone academy es-
tablished by an eligible local education agency, 
‘‘(2) the bond is issued by a State or local gov-
ernment within the jurisdiction of which such acad-
emy is located, and 
‘‘(3) the issuer— 
‘‘(A) designates such bond for purposes of 
this section, 
‘‘(B) certifies that it has written assur-
ances that the private business contribution re-
quirement of subsection (b) will be met with re-
spect to such academy, and 
‘‘(C) certifies that it has the written ap-
proval of the eligible local education agency for 
such bond issuance. 
‘‘(b) PRIVATE BUSINESS CONTRIBUTION REQUIRE-
MENT.—For purposes of subsection (a), the private busi-
ness contribution requirement of this subsection is met 
with respect to any issue if the eligible local education 
agency that established the qualified zone academy has 
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written commitments from private entities to make quali-
fied contributions having a present value (as of the date 
of issuance of the issue) of not less than 10 percent of 
the proceeds of the issue. 
‘‘(c) LIMITATION
ON AMOUNT
OF BONDS DES-
IGNATED.— 
‘‘(1) NATIONAL LIMITATION.—There is a na-
tional zone academy bond limitation for each cal-
endar year. Such limitation is $400,000,000 for 
2008 and 2009, and, except as provided in para-
graph (4), zero thereafter. 
‘‘(2) ALLOCATION
OF
LIMITATION.—The na-
tional zone academy bond limitation for a calendar 
year shall be allocated by the Secretary among the 
States on the basis of their respective populations of 
individuals below the poverty line (as defined by the 
Office of Management and Budget). The limitation 
amount allocated to a State under the preceding 
sentence shall be allocated by the State education 
agency to qualified zone academies within such 
State. 
‘‘(3) DESIGNATION
SUBJECT
TO
LIMITATION 
AMOUNT.—The maximum aggregate face amount of 
bonds issued during any calendar year which may be 
designated under subsection (a) with respect to any 
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qualified zone academy shall not exceed the limita-
tion amount allocated to such academy under para-
graph (2) for such calendar year. 
‘‘(4) CARRYOVER OF UNUSED LIMITATION.— 
‘‘(A) IN
GENERAL.—If for any calendar 
year— 
‘‘(i) the limitation amount for any 
State, exceeds 
‘‘(ii) the amount of bonds issued dur-
ing such year which are designated under 
subsection (a) with respect to qualified 
zone academies within such State, 
the limitation amount for such State for the fol-
lowing calendar year shall be increased by the 
amount of such excess. 
‘‘(B) LIMITATION
ON
CARRYOVER.—Any 
carryforward of a limitation amount may be 
carried only to the first 2 years following the 
unused limitation year. For purposes of the pre-
ceding sentence, a limitation amount shall be 
treated as used on a first-in first-out basis. 
‘‘(C) 
COORDINATION
WITH
SECTION 
1397E.—Any carryover determined under sec-
tion 1397E(e)(4) (relating to carryover of un-
used limitation) with respect to any State to 
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calendar year 2008 shall be treated for pur-
poses of this section as a carryover with respect 
to such State for such calendar year under sub-
paragraph (A), and the limitation of subpara-
graph (B) shall apply to such carryover taking 
into account the calendar years to which such 
carryover relates. 
‘‘(d) DEFINITIONS.—For purposes of this section— 
‘‘(1) QUALIFIED
ZONE
ACADEMY.—The term 
‘qualified zone academy’ means any public school (or 
academic program within a public school) which is 
established by and operated under the supervision of 
an eligible local education agency to provide edu-
cation or training below the postsecondary level if— 
‘‘(A) such public school or program (as the 
case may be) is designed in cooperation with 
business to enhance the academic curriculum, 
increase graduation and employment rates, and 
better prepare students for the rigors of college 
and the increasingly complex workforce, 
‘‘(B) students in such public school or pro-
gram (as the case may be) will be subject to the 
same academic standards and assessments as 
other students educated by the eligible local 
education agency, 
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‘‘(C) the comprehensive education plan of 
such public school or program is approved by 
the eligible local education agency, and 
‘‘(D)(i) such public school is located in an 
empowerment zone or enterprise community 
(including any such zone or community des-
ignated after the date of the enactment of this 
section), or 
‘‘(ii) there is a reasonable expectation (as 
of the date of issuance of the bonds) that at 
least 35 percent of the students attending such 
school or participating in such program (as the 
case may be) will be eligible for free or reduced- 
cost lunches under the school lunch program es-
tablished under the National School Lunch Act. 
‘‘(2) ELIGIBLE LOCAL EDUCATION AGENCY.— 
For purposes of this section, the term ‘eligible local 
education agency’ means any local educational agen-
cy as defined in section 9101 of the Elementary and 
Secondary Education Act of 1965. 
‘‘(3) QUALIFIED PURPOSE.—The term ‘quali-
fied purpose’ means, with respect to any qualified 
zone academy— 
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‘‘(A) rehabilitating or repairing the public 
school facility in which the academy is estab-
lished, 
‘‘(B) providing equipment for use at such 
academy, 
‘‘(C) developing course materials for edu-
cation to be provided at such academy, and 
‘‘(D) training teachers and other school 
personnel in such academy. 
‘‘(4) QUALIFIED
CONTRIBUTIONS.—The term 
‘qualified contribution’ means any contribution (of a 
type and quality acceptable to the eligible local edu-
cation agency) of— 
‘‘(A) equipment for use in the qualified 
zone academy (including state-of-the-art tech-
nology and vocational equipment), 
‘‘(B) technical assistance in developing 
curriculum or in training teachers in order to 
promote appropriate market driven technology 
in the classroom, 
‘‘(C) services of employees as volunteer 
mentors, 
‘‘(D) internships, field trips, or other edu-
cational opportunities outside the academy for 
students, or 
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100 
‘‘(E) any other property or service speci-
fied by the eligible local education agency.’’. 
(b) CONFORMING AMENDMENTS.— 
(1) Paragraph (1) of section 54A(d) is amended 
to read as follows: 
‘‘(1) QUALIFIED TAX CREDIT BOND.—The term 
‘qualified tax credit bond’ means— 
‘‘(A) a qualified forestry conservation 
bond, or 
‘‘(B) a qualified zone academy bond, 
which is part of an issue that meets the require-
ments of paragraphs (2), (3), (4), (5), and (6).’’. 
(2) Subparagraph (C) of section 54A(d)(2) is 
amended to read as follows: 
‘‘(C) QUALIFIED PURPOSE.—For purposes 
of this paragraph, the term ‘qualified purpose’ 
means— 
‘‘(i) in the case of a qualified forestry 
conservation bond, a purpose specified in 
section 54B(e), and 
‘‘(ii) in the case of a qualified zone 
academy bond, a purpose specified in sec-
tion 54C(a)(1).’’. 
(3) Section 1397E is amended by adding at the 
end the following new subsection: 
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101 
‘‘(m) TERMINATION.—This section shall not apply to 
any obligation issued after the date of the enactment of 
this subsection.’’. 
(4) The table of sections for subpart I of part 
IV of subchapter A of chapter 1 is amended by add-
ing at the end the following new item: 
‘‘Sec. 54C. Qualified zone academy bonds.’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to obligations issued after the date 
of the enactment of this Act. 
SEC. 232. TAX INCENTIVES FOR INVESTMENT IN THE DIS-
TRICT OF COLUMBIA. 
(a) DESIGNATION OF ZONE.— 
(1) IN
GENERAL.—Subsection (f) of section 
1400 is amended by striking ‘‘2007’’ both places it 
appears and inserting ‘‘2009’’. 
(2) EFFECTIVE DATE.—The amendments made 
by this subsection shall apply to periods beginning 
after December 31, 2007. 
(b) 
TAX-EXEMPT
ECONOMIC
DEVELOPMENT 
BONDS.— 
(1) IN
GENERAL.—Subsection (b) of section 
1400A is amended by striking ‘‘2007’’ and inserting 
‘‘2009’’. 
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102 
(2) EFFECTIVE DATE.—The amendment made 
by this subsection shall apply to bonds issued after 
December 31, 2007. 
(c) ZERO PERCENT CAPITAL GAINS RATE.— 
(1) IN
GENERAL.—Subsection (b) of section 
1400B is amended by striking ‘‘2008’’ each place it 
appears and inserting ‘‘2010’’. 
(2) CONFORMING AMENDMENTS.— 
(A) Section 1400B(e)(2) is amended— 
(i) by striking ‘‘2012’’ and inserting 
‘‘2014’’, and 
(ii) by striking ‘‘2012’’ in the heading 
thereof and inserting ‘‘2014’’. 
(B) Section 1400B(g)(2) is amended by 
striking ‘‘2012’’ and inserting ‘‘2014’’. 
(C) Section 1400F(d) is amended by strik-
ing ‘‘2012’’ and inserting ‘‘2014’’. 
(3) EFFECTIVE DATES.— 
(A) EXTENSION.—The amendments made 
by paragraph (1) shall apply to acquisitions 
after December 31, 2007. 
(B) 
CONFORMING
AMENDMENTS.—The 
amendments made by paragraph (2) shall take 
effect on the date of the enactment of this Act. 
(d) FIRST-TIME HOMEBUYER CREDIT.— 
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103 
(1) IN
GENERAL.—Subsection (i) of section 
1400C is amended by striking ‘‘2008’’ and inserting 
‘‘2010’’. 
(2) EFFECTIVE DATE.—The amendment made 
by this subsection shall apply to property purchased 
after December 31, 2007. 
SEC. 233. ECONOMIC DEVELOPMENT CREDIT FOR AMER-
ICAN SAMOA. 
(a) IN GENERAL.—Subsection (d) of section 119 of 
division A of the Tax Relief and Health Care Act of 2006 
is amended— 
(1) by striking ‘‘first two taxable years’’ and in-
serting ‘‘first 4 taxable years’’, and 
(2) by striking ‘‘January 1, 2008’’ and insert-
ing ‘‘January 1, 2010’’. 
(b) EFFECTIVE DATE.—The amendment made by 
this section shall apply to taxable years beginning after 
December 31, 2007. 
SEC. 234. ENHANCED CHARITABLE DEDUCTION FOR CON-
TRIBUTIONS OF FOOD INVENTORY. 
(a) 
IN
GENERAL.—Clause 
(iv) 
of 
section 
170(e)(3)(C) is amended by striking ‘‘December 31, 
2007’’ and inserting ‘‘December 31, 2009’’. 
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104 
(b) EFFECTIVE DATE.—The amendment made by 
this section shall apply to contributions made after De-
cember 31, 2007. 
SEC. 235. ENHANCED CHARITABLE DEDUCTION FOR CON-
TRIBUTIONS OF BOOK INVENTORY TO PUB-
LIC SCHOOLS. 
(a) 
IN
GENERAL.—Clause 
(iv) 
of 
section 
170(e)(3)(D) 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 after De-
cember 31, 2007. 
SEC. 236. ENHANCED DEDUCTION FOR QUALIFIED COM-
PUTER CONTRIBUTIONS. 
(a) IN GENERAL.—Subparagraph (G) of section 
170(e)(6) 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 during tax-
able years beginning after December 31, 2007. 
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