annual eligibility review results for all National Enterprise 
Zones no later than June 30 of each year. 
‘‘SEC. 1400N. NATIONAL ENTERPRISE ZONE ELIGIBILITY 
CRITERIA. 
‘‘(a) NATIONAL ENTERPRISE ZONE ELIGIBILITY 
CRITERIA.—A National Enterprise Zone must— 
‘‘(1) be composed of contiguous census tracts 
(none of which may be part of an existing National 
Enterprise Zone); 
‘‘(2) have greater than 10,000 residents; 
‘‘(3) have a poverty rate two times the national 
poverty rate; 
‘‘(4) have a median household income less than 
60 percent of the national median household income; 
‘‘(5) have an unemployment rate 2.5 times the 
national average unemployment rate; and 
‘‘(6) be located entirely within a state, territory 
or the District of Columbia that the Secretary cer-
tifies has enacted conforming laws within the mean-
ing of subsection (e). 
‘‘(b) SPECIAL RULE FOR SMALL INCORPORATED CIT-
IES OR SMALL COUNTIES.—Paragraph (2) of subsection 
(a) shall not apply to a zone if the zone comprises an en-
tire incorporated city or an entire county provided that
said incorporated city or county existed on the date of en-
actment of this subchapter. 
‘‘(c) NO OVERLAP WITH EXISTING ZONES OF DIF-
FERENT TYPE.—No part of a National Enterprise Zone 
may also be a part of an Empowerment Zone, Enterprise 
Community, or Rural Development Investment Area (Sub-
chapter U zones), District of Columbia Enterprise Zone 
(subchapter W zones). However, the nominator of a pro-
posed National Enterprise Zone may indicate in his appli-
cation that the some or all of an existing subchapter U 
or subchapter W zone shall lose that designation upon its 
designation as all or part of a National Enterprise Zone. 
Said existing subchapter U or subchapter W zone shall 
lose said designation upon its designation as all or part 
of a National Enterprise Zone in a manner prescribed by 
the Secretary. 
‘‘(d) DATA.—No later than November 30th of each 
year, the Secretary shall designate which data as of which 
date shall be used by nominators to perform the calcula-
tions required in subsection (a) in applications made the 
following year. 
‘‘(e) CONFORMING LAWS.—A state, territory or the 
District of Columbia shall be deemed to have enacted con-
forming laws if it is in substantial compliance with—
‘‘(1) the No Child Left Behind Act of 2001 
(Public Law 107–110), and 
‘‘(2) its tax laws provide for either— 
‘‘(A) a substantially similar income tax 
base with respect to business income arising 
from the conduct of an active trade or business 
within a National Enterprise Zone as that pro-
vided for Federal income tax purposes and tax 
rates no higher than that imposed on businesses 
without a National Enterprise Zone, or 
‘‘(B) the imposition of no income tax with 
respect to business income arising from the con-
duct of an active trade or business within a Na-
tional Enterprise Zone. 
‘‘SEC. 1400O. EFFECT OF NATIONAL ENTERPRISE ZONE 
DESIGNATION 
ON 
INDIVIDUALS, 
ESTATES 
AND TRUSTS. 
‘‘(a) INDIVIDUAL ALTERNATIVE NATIONAL ENTER-
PRISE ZONE TAX.—If for any taxable year, any individual 
taxpayer who is resident in a National Enterprise Zone 
for the entire taxable year has any National Enterprise 
Zone taxable income, then, in lieu of any tax imposed by 
section 1 or section 55, said individual taxpayer may elect, 
in a form prescribed by the Secretary, to pay a tax which 
shall consist of the sum of—
‘‘(1) a tax computed on the taxable income re-
duced by the amount of National Enterprise Zone 
tentative taxable income (if greater than zero), at 
the rates and in the manner as if this subsection 
had not been enacted, plus 
‘‘(2) a tax of 17 percent of the National Enter-
prise Zone taxable income. 
‘‘(b) INDIVIDUAL TAXPAYER.—For purposes of this 
section, an individual taxpayer shall include an— 
‘‘(1) individual, 
‘‘(2) married individual making a single return 
jointly with his spouse, 
‘‘(3) surviving spouse, 
‘‘(4) head of household, 
‘‘(5) married individual who does not make a 
single return jointly with his or her spouse, 
‘‘(6) estate, or 
‘‘(7) trust. 
‘‘(c) 
CERTAIN
INDIVIDUALS, 
ESTATES
AND 
TRUSTS.— 
‘‘(1) JOINT FILERS.—In the case of married in-
dividuals making a single return jointly, both indi-
viduals must have been residents in a National En-
terprise Zone for their entire taxable year to qualify 
to file jointly under this section.