†
764
HR 6 EAS1S/PP
SEC. 2002. MODIFICATION OF CREDIT FOR QUALIFIED
ELECTRIC VEHICLES.
(a) AMOUNT OF CREDIT.—
(1) IN GENERAL.—Section 30(a) (relating to al-
lowance of credit) is amended by striking ‘‘10 percent
of’’.
(2) LIMITATION OF CREDIT ACCORDING TO TYPE
OF VEHICLE.—Section 30(b) (relating to limitations)
is amended—
(A) by striking paragraphs (1) and (2) and
inserting the following new paragraph:
‘‘(1) LIMITATION ACCORDING TO TYPE OF VEHI-
CLE.—The amount of the credit allowed under sub-
section (a) for any vehicle shall not exceed the greatest
of the following amounts applicable to such vehicle:
‘‘(A) In the case of a vehicle which conforms
to the Motor Vehicle Safety Standard 500 pre-
scribed by the Secretary of Transportation, as in
effect on the date of the enactment of the Energy
Tax Incentives Act of 2003, the lesser of—
‘‘(i) 10 percent of the manufacturer’s
suggested retail price of the vehicle, or
‘‘(ii) $1,500.
‘‘(B) In the case of a vehicle not described
in subparagraph (A) with a gross vehicle weight
rating not exceeding 8,500 pounds—
†
765
HR 6 EAS1S/PP
‘‘(i) $3,500, or
‘‘(ii) $6,000, if such vehicle is—
‘‘(I) capable of a driving range of
at least 100 miles on a single charge of
the vehicle’s rechargeable batteries as
measured pursuant to the urban dyna-
mometer schedules under appendix I to
part 86 of title 40, Code of Federal
Regulations, or
‘‘(II) capable of a payload capac-
ity of at least 1,000 pounds.
‘‘(C) In the case of a vehicle with a gross
vehicle weight rating exceeding 8,500 but not ex-
ceeding 14,000 pounds, $10,000.
‘‘(D) In the case of a vehicle with a gross
vehicle weight rating exceeding 14,000 but not
exceeding 26,000 pounds, $20,000.
‘‘(E) In the case of a vehicle with a gross
vehicle weight rating exceeding 26,000 pounds,
$40,000.’’, and
(B) by redesignating paragraph (3) as
paragraph (2).
(3) CONFORMING AMENDMENTS.—
†
766
HR 6 EAS1S/PP
(A) Section 53(d)(1)(B)(iii) is amended by
striking ‘‘section 30(b)(3)(B)’’ and inserting
‘‘section 30(b)(2)(B)’’.
(3) Section 55(c)(2), as amended by this Act, is
amended by striking ‘‘30(b)(3)’’ and inserting
‘‘30(b)(2)’’.
(b) QUALIFIED BATTERY ELECTRIC VEHICLE.—
(1) IN GENERAL.—Section 30(c)(1)(A) (defining
qualified electric vehicle) is amended to read as fol-
lows:
‘‘(A) which is—
‘‘(i) operated solely by use of a battery
or battery pack, or
‘‘(ii) powered primarily through the
use of an electric battery or battery pack
using a flywheel or capacitor which stores
energy produced by an electric motor
through regenerative braking to assist in ve-
hicle operation,’’.
(2) LEASED VEHICLES.—Section 30(c)(1)(C) is
amended by inserting ‘‘or lease’’ after ‘‘use’’.
(3) CONFORMING AMENDMENTS.—
(A) Subsections (a), (b)(2), and (c) of sec-
tion 30 are each amended by inserting ‘‘battery’’
after ‘‘qualified’’ each place it appears.
†
767
HR 6 EAS1S/PP
(B) The heading of subsection (c) of section
30 is amended by inserting ‘‘BATTERY’’ after
‘‘QUALIFIED’’.
(C) The heading of section 30 is amended
by inserting ‘‘BATTERY’’ after ‘‘QUALIFIED’’.
(D) The item relating to section 30 in the
table of sections for subpart B of part IV of sub-
chapter A of chapter 1 is amended by inserting
‘‘battery’’ after ‘‘qualified’’.
(E) Section 179A(c)(3) is amended by in-
serting ‘‘battery’’ before ‘‘electric’’.
(F) The heading of paragraph (3) of section
179A(c) is amended by inserting ‘‘BATTERY’’ be-
fore ‘‘ELECTRIC’’.
(c) ADDITIONAL SPECIAL RULES.—Section 30(d) (re-
lating to special rules) is amended by adding at the end
the following new paragraphs:
‘‘(5) NO DOUBLE BENEFIT.—The amount of any
deduction or other credit allowable under this chapter
for any cost taken into account in computing the
amount of the credit determined under subsection (a)
shall be reduced by the amount of such credit attrib-
utable to such cost.
‘‘(6) PROPERTY
USED
BY
TAX-EXEMPT
ENTI-
TIES.—In the case of a credit amount which is allow-
†
768
HR 6 EAS1S/PP
able with respect to a vehicle which is acquired by an
entity exempt from tax under this chapter, the person
which sells or leases such vehicle to the entity shall be
treated as the taxpayer with respect to the vehicle for
purposes of this section and the credit shall be allowed
to such person, but only if the person clearly discloses
to the entity at the time of any sale or lease the spe-
cific amount of any credit otherwise allowable to the
entity under this section.
‘‘(7) 
CARRYBACK
AND
CARRYFORWARD
AL-
LOWED.—
‘‘(A) IN GENERAL.—If the credit amount al-
lowable under subsection (a) for a taxable year
exceeds the amount of the limitation under sub-
section (b)(2) for such taxable year (in this para-
graph referred to as the ‘unused credit year’),
such excess shall be allowed as a credit carryback
for each of the 3 taxable years beginning after
September 30, 2002, which precede the unused
credit year and a credit carryforward for each of
the 20 taxable years which succeed the unused
credit year.
‘‘(B) RULES.—Rules similar to the rules of
section 39 shall apply with respect to the credit
†
769
HR 6 EAS1S/PP
carryback and credit carryforward under sub-
paragraph (A).’’.
(d) EFFECTIVE DATE.—The amendments made by this
section shall apply to property placed in service after Sep-
tember 30, 2002, in taxable years ending after such date.
SEC. 2003. CREDIT FOR INSTALLATION OF ALTERNATIVE
FUELING STATIONS.
(a) IN GENERAL.—Subpart B of part IV of subchapter
A of chapter 1 (relating to foreign tax credit, etc.), as
amended by this Act, is amended by adding at the end the
following new section:
‘‘SEC. 30C. CLEAN-FUEL VEHICLE REFUELING PROPERTY
CREDIT.
‘‘(a) CREDIT ALLOWED.—There shall be allowed as a
credit against the tax imposed by this chapter for the tax-
able year an amount equal to 50 percent of the amount
paid or incurred by the taxpayer during the taxable year
for the installation of qualified clean-fuel vehicle refueling
property.
‘‘(b) LIMITATION.—The credit allowed under sub-
section (a)—
‘‘(1) with respect to any retail clean-fuel vehicle
refueling property, shall not exceed $30,000, and
‘‘(2) with respect to any residential clean-fuel ve-
hicle refueling property, shall not exceed $1,000.
†
770
HR 6 EAS1S/PP
‘‘(c) YEAR CREDIT ALLOWED.—The credit allowed
under subsection (a) shall be allowed in the taxable year
in which the qualified clean-fuel vehicle refueling property
is placed in service by the taxpayer.
‘‘(d) DEFINITIONS.—For purposes of this section—
‘‘(1) QUALIFIED CLEAN-FUEL VEHICLE REFUEL-
ING PROPERTY.—The term ‘qualified clean-fuel vehicle
refueling property’ has the same meaning given such
term by section 179A(d).
‘‘(2) RESIDENTIAL
CLEAN-FUEL
VEHICLE
RE-
FUELING PROPERTY.—The term ‘residential clean-fuel
vehicle refueling property’ means qualified clean-fuel
vehicle refueling property which is installed on prop-
erty which is used as the principal residence (within
the meaning of section 121) of the taxpayer.
‘‘(3) RETAIL CLEAN-FUEL VEHICLE REFUELING
PROPERTY.—The term ‘retail clean-fuel vehicle refuel-
ing property’ means qualified clean-fuel vehicle refuel-
ing property which is installed on property (other
than property described in paragraph (2)) used in a
trade or business of the taxpayer.
‘‘(e) APPLICATION WITH OTHER CREDITS.—The credit
allowed under subsection (a) for any taxable year shall not
exceed the excess (if any) of—
†
771
HR 6 EAS1S/PP
‘‘(1) the regular tax for the taxable year reduced
by the sum of the credits allowable under subpart A
and sections 27, 29, 30, and 30B, over
‘‘(2) the tentative minimum tax for the taxable
year.
‘‘(f) BASIS REDUCTION.—For purposes of this title, the
basis of any property shall be reduced by the portion of
the cost of such property taken into account under sub-
section (a).
‘‘(g) NO DOUBLE BENEFIT.—No deduction shall be al-
lowed under section 179A with respect to any property with
respect to which a credit is allowed under subsection (a).
‘‘(h) REFUELING PROPERTY INSTALLED FOR TAX-EX-
EMPT ENTITIES.—In the case of qualified clean-fuel vehicle
refueling property installed on property owned or used by
an entity exempt from tax under this chapter, the person
which installs such refueling property for the entity shall
be treated as the taxpayer with respect to the refueling prop-
erty for purposes of this section (and such refueling prop-
erty shall be treated as retail clean-fuel vehicle refueling
property) and the credit shall be allowed to such person,
but only if the person clearly discloses to the entity in any
installation contract the specific amount of the credit allow-
able under this section.
‘‘(i) CARRYFORWARD ALLOWED.—
†
772
HR 6 EAS1S/PP
‘‘(1) IN GENERAL.—If the credit amount allow-
able under subsection (a) for a taxable year exceeds
the amount of the limitation under subsection (e) for
such taxable year (referred to as the ‘unused credit
year’ in this subsection), such excess shall be allowed
as a credit carryforward for each of the 20 taxable
years following the unused credit year.
‘‘(2) RULES.—Rules similar to the rules of sec-
tion 39 shall apply with respect to the credit
carryforward under paragraph (1).
‘‘(j) SPECIAL RULES.—Rules similar to the rules of
paragraphs (4) and (5) of section 179A(e) shall apply.
‘‘(k) REGULATIONS.—The Secretary shall prescribe
such regulations as necessary to carry out the provisions
of this section.
‘‘(l) TERMINATION.—This section shall not apply to
any property placed in service—
‘‘(1) in the case of property relating to hydrogen,
after December 31, 2011, and
‘‘(2) in the case of any other property, after De-
cember 31, 2006.’’.
(b) INCENTIVE FOR PRODUCTION OF HYDROGEN AT
QUALIFIED
CLEAN-FUEL
VEHICLE
REFUELING
PROP-
ERTY.—Section 179A(d) (defining qualified clean-fuel vehi-
†
773
HR 6 EAS1S/PP
cle refueling property) is amended by adding at the end
the following new flush sentence:
‘‘In the case of clean-burning fuel which is hydrogen pro-
duced from another clean-burning fuel, paragraph (3)(A)
shall be applied by substituting ‘production, storage, or dis-
pensing’ for ‘storage or dispensing’ both places it appears.’’.
(c) CONFORMING AMENDMENTS.—(1) Section 1016(a),
as amended by this Act, is amended by striking ‘‘and’’ at
the end of paragraph (28), by striking the period at the
end of paragraph (29) and inserting ‘‘, and’’, and by add-
ing at the end the following new paragraph:
‘‘(30) to the extent provided in section 30C(f).’’.
(2) Section 55(c)(2), as amended by this Act, is
amended by inserting ‘‘30C(e),’’ after ‘‘30B(e)’’.
(3) The table of sections for subpart B of part IV of
subchapter A of chapter 1, as amended by this Act, is
amended by inserting after the item relating to section 30B
the following new item:
‘‘Sec. 30C. Clean-fuel vehicle refueling property credit.’’.
(c) EFFECTIVE DATE.—The amendments made by this
section shall apply to property placed in service after Sep-
tember 30, 2002, in taxable years ending after such date.
SEC. 2004. CREDIT FOR RETAIL SALE OF ALTERNATIVE
FUELS AS MOTOR VEHICLE FUEL.
(a) IN GENERAL.—Subpart D of part IV of subchapter
A of chapter 1 (relating to business related credits) is
†
774
HR 6 EAS1S/PP
amended by inserting after section 40 the following new sec-
tion:
‘‘SEC. 40A. CREDIT FOR RETAIL SALE OF ALTERNATIVE
FUELS AS MOTOR VEHICLE FUEL.
‘‘(a) GENERAL RULE.—For purposes of section 38, the
alternative fuel retail sales credit for any taxable year is
the applicable amount for each gasoline gallon equivalent
of alternative fuel sold at retail by the taxpayer during such
year as a fuel to propel any qualified motor vehicle.
‘‘(b) DEFINITIONS.—For purposes of this section—
‘‘(1) APPLICABLE AMOUNT.—The term ‘applica-
ble amount’ means the amount determined in accord-
ance with the following table:
‘‘In the case of any taxable year
ending in—
The applicable amount is—
2002 and 2003 ...............................................................................
30 cents
2004 ................................................................................................
40 cents
2005 and 2006 ...............................................................................
50 cents.
‘‘(2) ALTERNATIVE FUEL.—The term ‘alternative
fuel’ means compressed natural gas, liquefied natural
gas, liquefied petroleum gas, hydrogen, and any liq-
uid at least 85 percent of the volume of which consists
of methanol or ethanol.
‘‘(3) GASOLINE GALLON EQUIVALENT.—The term
‘gasoline gallon equivalent’ means, with respect to
any alternative fuel, the amount (determined by the
Secretary) of such fuel having a Btu content of
114,000.
†
775
HR 6 EAS1S/PP
‘‘(4) QUALIFIED
MOTOR
VEHICLE.—The term
‘qualified motor vehicle’ means any motor vehicle (as
defined in section 30(c)(2)) which meets any applica-
ble Federal or State emissions standards with respect
to each fuel by which such vehicle is designed to be
propelled.
‘‘(5) SOLD AT RETAIL.—
‘‘(A) IN GENERAL.—The term ‘sold at retail’
means the sale, for a purpose other than resale,
after manufacture, production, or importation.
‘‘(B) USE TREATED AS SALE.—If any per-
son uses alternative fuel (including any use after
importation) as a fuel to propel any qualified
alternative fuel motor vehicle (as defined in sec-
tion 30B(d)(4)) before such fuel is sold at retail,
then such use shall be treated in the same man-
ner as if such fuel were sold at retail as a fuel
to propel such a vehicle by such person.
‘‘(c) NO DOUBLE BENEFIT.—The amount of any de-
duction or other credit allowable under this chapter for any
fuel taken into account in computing the amount of the
credit determined under subsection (a) shall be reduced by
the amount of such credit attributable to such fuel.
‘‘(d) PASS-THRU
IN
THE CASE
OF ESTATES
AND
TRUSTS.—Under regulations prescribed by the Secretary,
†
776
HR 6 EAS1S/PP
rules similar to the rules of subsection (d) of section 52 shall
apply.
‘‘(e) TERMINATION.—This section shall not apply to
any fuel sold at retail after December 31, 2006.’’.
(b) CREDIT TREATED AS BUSINESS CREDIT.—Section
38(b) (relating to current year business credit) is amended
by striking ‘‘plus’’ at the end of paragraph (14), by striking
the period at the end of paragraph (15) and inserting ‘‘,
plus’’, and by adding at the end the following new para-
graph:
‘‘(16) the alternative fuel retail sales credit deter-
mined under section 40A(a).’’.
(c) TRANSITIONAL RULE.—Section 39(d) (relating to
transitional rules) is amended by adding at the end the fol-
lowing new paragraph:
‘‘(11) NO CARRYBACK OF SECTION 40A CREDIT
BEFORE EFFECTIVE DATE.—No portion of the unused
business credit for any taxable year which is attrib-
utable to the alternative fuel retail sales credit deter-
mined under section 40A(a) may be carried back to
a taxable year ending before January 1, 2002.’’.
(d) CLERICAL AMENDMENT.—The table of sections for
subpart D of part IV of subchapter A of chapter 1 is amend-
ed by inserting after the item relating to section 40 the fol-
lowing new item:
‘‘Sec. 40A. Credit for retail sale of alternative fuels as motor vehicle fuel.’’.
†
777
HR 6 EAS1S/PP
(e) EFFECTIVE DATE.—The amendments made by this
section shall apply to fuel sold at retail after September
30, 2002, in taxable years ending after such date.
SEC. 2005. SMALL ETHANOL PRODUCER CREDIT.
(a) ALLOCATION OF ALCOHOL FUELS CREDIT TO PA-
TRONS OF A COOPERATIVE.—Section 40(g) (relating to al-
cohol used as fuel) is amended by adding at the end the
following new paragraph:
‘‘(6) ALLOCATION
OF
SMALL
ETHANOL
PRO-
DUCER CREDIT TO PATRONS OF COOPERATIVE.—
‘‘(A) ELECTION TO ALLOCATE.—
‘‘(i) IN GENERAL.—In the case of a co-
operative organization described in section
1381(a), any portion of the credit deter-
mined under subsection (a)(3) for the tax-
able year may, at the election of the organi-
zation, be apportioned pro rata among pa-
trons of the organization on the basis of the
quantity or value of business done with or
for such patrons for the taxable year.
‘‘(ii) FORM
AND
EFFECT
OF
ELEC-
TION.—An election under clause (i) for any
taxable year shall be made on a timely filed
return for such year. Such election, once
†
778
HR 6 EAS1S/PP
made, shall be irrevocable for such taxable
year.
‘‘(B) TREATMENT OF ORGANIZATIONS AND
PATRONS.—The amount of the credit apportioned
to patrons under subparagraph (A)—
‘‘(i) shall not be included in the
amount determined under subsection (a)
with respect to the organization for the tax-
able year,
‘‘(ii) shall be included in the amount
determined under subsection (a) for the tax-
able year of each patron for which the pa-
tronage dividends for the taxable year de-
scribed in subparagraph (A) are included in
gross income, and
‘‘(iii) shall be included in gross income
of such patrons for the taxable year in the
manner and to the extent provided in sec-
tion 87.
‘‘(C) SPECIAL
RULES
FOR
DECREASE
IN
CREDITS FOR TAXABLE YEAR.—If the amount of
the credit of a cooperative organization deter-
mined under subsection (a)(3) for a taxable year
is less than the amount of such credit shown on
†
779
HR 6 EAS1S/PP
the return of the cooperative organization for
such year, an amount equal to the excess of—
‘‘(i) such reduction, over
‘‘(ii) the amount not apportioned to
such patrons under subparagraph (A) for
the taxable year,
shall be treated as an increase in tax imposed by
this chapter on the organization. Such increase
shall not be treated as tax imposed by this chap-
ter for purposes of determining the amount of
any credit under this chapter or for purposes of
section 55.’’.
(b) IMPROVEMENTS TO SMALL ETHANOL PRODUCER
CREDIT.—
(1) DEFINITION
OF
SMALL
ETHANOL
PRO-
DUCER.—Section 40(g) (relating to definitions and
special rules for eligible small ethanol producer cred-
it) is amended by striking ‘‘30,000,000’’ each place it
appears and inserting ‘‘60,000,000’’.
(2) SMALL ETHANOL PRODUCER CREDIT NOT A
PASSIVE
ACTIVITY
CREDIT.—Clause (i) of section
469(d)(2)(A) is amended by striking ‘‘subpart D’’ and
inserting ‘‘subpart D, other than section 40(a)(3),’’.
(3) ALLOWING
CREDIT
AGAINST
ENTIRE
REG-
ULAR TAX AND MINIMUM TAX.—
†
780
HR 6 EAS1S/PP
(A) IN GENERAL.—Subsection (c) of section
38 (relating to limitation based on amount of
tax), as amended by section 301(b) of the Job
Creation and Worker Assistance Act of 2002, is
amended by redesignating paragraph (4) as
paragraph (5) and by inserting after paragraph
(3) the following new paragraph:
‘‘(4) SPECIAL RULES FOR SMALL ETHANOL PRO-
DUCER CREDIT.—
‘‘(A) IN GENERAL.—In the case of the small
ethanol producer credit—
‘‘(i) this section and section 39 shall be
applied separately with respect to the cred-
it, and
‘‘(ii) in applying paragraph (1) to the
credit—
‘‘(I) the amounts in subpara-
graphs (A) and (B) thereof shall be
treated as being zero, and
‘‘(II) the limitation under para-
graph (1) (as modified by subclause
(I)) shall be reduced by the credit al-
lowed under subsection (a) for the tax-
able year (other than the small ethanol
producer credit).