I
103D CONGRESS
1ST SESSION
H. R. 1443
To amend the Internal Revenue Code of 1986 to provide a tax credit to
businesses which mine metallurgical coal and are required to make con-
tributions to the UMWA Combined Benefit Fund created by the Energy
Policy Act of 1992.
IN THE HOUSE OF REPRESENTATIVES
MARCH 24, 1993
Mr. BOUCHER (for himself, Mr. PAYNE of Virginia, Mr. SISISKY, Mr. BLILEY,
Mr. PICKETT, Mrs. BYRNE, Mr. MORAN, Mr. GOODLATTE, Mr. GILLMOR,
and Ms. KAPTUR) introduced the following bill; which was referred to the
Committee on Ways and Means
A BILL
To amend the Internal Revenue Code of 1986 to provide
a tax credit to businesses which mine metallurgical coal
and are required to make contributions to the UMWA
Combined Benefit Fund created by the Energy Policy
Act of 1992.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. METALLURGICAL COAL MINING CREDIT.
(a) GENERAL RULE.—Subpart D of part IV of sub-
chapter A of chapter 1 of the Internal Revenue Code of
1986 (relating to business related credits) is amended by
adding at the end thereof the following new section:
‘‘SEC. 45A. METALLURGICAL COAL MINING CREDIT.
‘‘(a) GENERAL RULE.—For purposes of section 38,
the metallurgical coal mining credit determined under this
section for the taxable year is the lesser of—
‘‘(1) the applicable percentage of the aggregate
amount of the premiums paid or accrued by the tax-
payer during the taxable year pursuant to chapter
99 of this title (relating to coal industry health bene-
fits), or
‘‘(2) 7.5 percent of the aggregate gross revenue
from the sale of qualified metallurgical coal sold by
the taxpayer during the taxable year to an unrelated
person.
‘‘(b) QUALIFICATION.—No credit shall be determined
under subsection (a) with respect to any taxpayer unless
at least 20 percent of the total tons of qualified coal sold
by the taxpayer during each of the 4 preceding taxable
years was qualified metallurgical coal. For purposes of the
preceding sentence, only coal produced from an economic
interest held by the taxpayer shall be taken into account.
‘‘(c) DEFINITIONS AND SPECIAL RULES.—For pur-
poses of this section—
‘‘(1) APPLICABLE PERCENTAGE.—The applica-
ble percentage is the percentage of the aggregate
tons of qualified coal sold by the taxpayer during the
taxable year to unrelated persons which consists of
qualified metallurgical coal. In no event shall the ap-
plicable percentage exceed 75 percent.
‘‘(2) QUALIFIED METALLURGICAL COAL.—The
term ‘qualified metallurgical coal’ means any bitu-
minous coal which—
‘‘(A) is used in the production of iron and
steel, and
‘‘(B) is processed by, or produced from an
economic interest held by, a signatory operator.
‘‘(3) UNRELATED
PERSON.—The term ‘unre-
lated person’ has the same meaning as when used in
section 29.
‘‘(4) AFFILIATED GROUPS.—All members of the
same affiliated group (as defined in section 1504)
shall be treated as one taxpayer for purposes of this
section and the credit determined under subsection
(a) with respect to such one taxpayer shall be allo-
cated among such members in such manner as the
Secretary may prescribe.
‘‘(5) ECONOMIC
INTEREST.—The term ‘eco-
nomic interest’ means an interest with respect to
which an allowance for depletion is allowable.
‘‘(6) BITUMINOUS
COAL.—The term ‘bitu-
minous coal’ means coal classified as bituminous
coal according to the publication of the American
Society for Testing and Materials under the title
‘Standard Classification of Coals by Rank’ (ASTM
D 338–91A), as in effect on the date of the enact-
ment of chapter 99.
‘‘(7) QUALIFIED
COAL.—The term ‘qualified
coal’ means any bituminous coal which is produced
and processed by a signatory operator from an eco-
nomic interest held by a signatory operator.
‘‘(8) SIGNATORY OPERATOR.—The term ‘signa-
tory operator’ has the meaning given such term by
section 9701(c)(1), and shall include all members of
the affiliated group of which such signatory operator
is a member that are also signatory operators.
‘‘(9) TON.—The term ‘ton’ means 2,000
pounds.’’
(b) CREDIT MADE PART OF GENERAL BUSINESS
CREDIT.—Subsection (b) of section 38 is amended by
striking ‘‘plus’’ at the end of paragraph (7), by striking
the period at the end of paragraph (8) and inserting
‘‘, plus’’, and by adding at the end thereof the following
new paragraph:
‘‘(9) the metallurgical coal credit determined
under section 45A.’’
(c) CREDIT MAY OFFSET 90 PERCENT OF MINIMUM
TAX.—Subsection (c) of section 38 of such Code is amend-
ed by redesignating paragraph (2) as paragraph (3) and
by inserting after paragraph (1) the following new para-
graph:
‘‘(2) METALLURGICAL COAL CREDIT MAY OFF-
SET 90 PERCENT OF MINIMUM TAX.—
‘‘(A) IN GENERAL.—In the case of a tax-
payer entitled to a credit determined under sec-
tion 45A, the amount determined under para-
graph (1)(A) shall be reduced by the lesser of—
‘‘(i) the portion of the metallurgical
coal credit not used against the normal
limitation, or
‘‘(ii) 90 percent of the taxpayer’s ten-
tative minimum tax for the taxable year.
‘‘(B) PORTION OF METALLURGICAL COAL
CREDIT NOT USED AGAINST NORMAL LIMITA-
TION.—For purposes of subparagraph (A) the
portion of the metallurgical coal credit not used
against the normal limitation is the excess (if
any) of—
‘‘(i) the portion of the credit under
subsection (a) which is attributable to the
metallurgical coal credit determined under
section 45A, over
‘‘(ii) the limitation of paragraph (1)
(determined without regard to this para-
graph) reduced by the portion of the credit
under subsection (a) which is not so attrib-
utable.’’
(d) CLERICAL AMENDMENT.—The table of sections
for subpart D of part IV of subchapter A of chapter 1
of such Code is amended by adding at the end thereof
the following new item:
‘‘Sec. 45A. Metallurgical coal mining credit.’’
(e) EFFECTIVE DATE.—The amendments made by
this section shall take effect on January 1, 1993.
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