IB 
Union Calendar No. 415 
110TH CONGRESS 
2D SESSION 
H. R. 6049 
[Report No. 110–658] 
To amend the Internal Revenue Code of 1986 to provide incentives for 
energy production and conservation, to extend certain expiring provisions, 
to provide individual income tax relief, and for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
MAY 14, 2008 
Mr. RANGEL (for himself, Mr. MCDERMOTT, Mr. LEWIS of Georgia, Mr. 
NEAL of Massachusetts, Mr. POMEROY, Mr. LARSON of Connecticut, Mr. 
BLUMENAUER, Mr. CROWLEY, Mr. VAN HOLLEN, Mr. MEEK of Florida, 
Mr. DAVIS of Alabama, Mr. ARCURI, Ms. GIFFORDS, Mr. HALL of New 
York, Mr. HODES, Mr. MCNERNEY, Ms. SHEA-PORTER, and Mr. WELCH 
of Vermont) introduced the following bill; which was referred to the Com-
mittee on Ways and Means 
MAY 20, 2008 
Reported with an amendment, committed to the Committee of the Whole 
House on the State of the Union, and ordered to be printed 
[Strike out all after the enacting clause and insert the part printed in italic] 
[For text of introduced bill, see copy of bill as introduced on May 14, 2008] 
A BILL 
To amend the Internal Revenue Code of 1986 to provide 
incentives for energy production and conservation, to ex-
tend certain expiring provisions, to provide individual 
income tax relief, and for other purposes. 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00001
Fmt 6652
Sfmt 6652
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE, ETC. 
(a) SHORT TITLE.—This Act may be cited as the ‘‘Re-
newable Energy and Job Creation Act of 2008’’. 
(b) REFERENCE.—Except as otherwise expressly pro-
vided, whenever in this Act an amendment or repeal is ex-
pressed in terms of an amendment to, or repeal of, a section 
or other provision, the reference shall be considered to be 
made to a section or other provision of the Internal Revenue 
Code of 1986. 
(c) TABLE OF CONTENTS.—The table of contents for 
this Act is as follows: 
Sec. 1. Short title, etc. 
TITLE I—ENERGY TAX INCENTIVES 
Subtitle A—Energy Production Incentives 
PART I—RENEWABLE ENERGY INCENTIVES 
Sec. 101. Renewable energy credit. 
Sec. 102. Production credit for electricity produced from marine renewables. 
Sec. 103. Energy credit. 
Sec. 104. Credit for residential energy efficient property. 
Sec. 105. Special rule to implement FERC and State electric restructuring pol-
icy. 
Sec. 106. New clean renewable energy bonds. 
PART II—CARBON MITIGATION PROVISIONS 
Sec. 111. Expansion and modification of advanced coal project investment credit. 
Sec. 112. Expansion and modification of coal gasification investment credit. 
Sec. 113. Temporary increase in coal excise tax. 
Sec. 114. Special rules for refund of the coal excise tax to certain coal producers 
and exporters. 
Sec. 115. Carbon audit of the tax code. 
Subtitle B—Transportation and Domestic Fuel Security Provisions 
Sec. 121. Inclusion of cellulosic biofuel in bonus depreciation for biomass ethanol 
plant property. 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00002
Fmt 6652
Sfmt 6213
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
Sec. 122. Credits for biodiesel and renewable diesel. 
Sec. 123. Clarification that credits for fuel are designed to provide an incentive 
for United States production. 
Sec. 124. Credit for new qualified plug-in electric drive motor vehicles. 
Sec. 125. Exclusion from heavy truck tax for idling reduction units and advanced 
insulation. 
Sec. 126. Restructuring of New York Liberty Zone tax credits. 
Sec. 127. Transportation fringe benefit to bicycle commuters. 
Sec. 128. Alternative fuel vehicle refueling property credit. 
Subtitle C—Energy Conservation and Efficiency Provisions 
Sec. 141. Qualified energy conservation bonds. 
Sec. 142. Credit for nonbusiness energy property. 
Sec. 143. Energy efficient commercial buildings deduction. 
Sec. 144. Modifications of energy efficient appliance credit for appliances pro-
duced after 2007. 
Sec. 145. Accelerated recovery period for depreciation of smart meters and smart 
grid systems. 
Sec. 146. Qualified green building and sustainable design projects. 
TITLE II—ONE-YEAR EXTENSION OF TEMPORARY PROVISIONS 
Subtitle A—Extensions Primarily Affecting Individuals 
Sec. 201. Deduction for State and local sales taxes. 
Sec. 202. Deduction of qualified tuition and related expenses. 
Sec. 203. Treatment of certain dividends of regulated investment companies. 
Sec. 204. Tax-free distributions from individual retirement plans for charitable 
purposes. 
Sec. 205. Deduction for certain expenses of elementary and secondary school 
teachers. 
Sec. 206. Election to include combat pay as earned income for purposes of earned 
income tax credit. 
Sec. 207. Modification of mortgage revenue bonds for veterans. 
Sec. 208. Distributions from retirement plans to individuals called to active duty. 
Sec. 209. Stock in RIC for purposes of determining estates of nonresidents not 
citizens. 
Sec. 210. Qualified investment entities. 
Sec. 211. Exclusion of amounts received under qualified group legal services 
plans. 
Subtitle B—Extensions Primarily Affecting Businesses 
Sec. 221. Research credit. 
Sec. 222. Indian employment credit. 
Sec. 223. New markets tax credit. 
Sec. 224. Railroad track maintenance. 
Sec. 225. Fifteen-year straight-line cost recovery for qualified leasehold improve-
ments and qualified restaurant property. 
Sec. 226. Seven-year cost recovery period for motorsports racing track facility. 
Sec. 227. Accelerated depreciation for business property on Indian reservation. 
Sec. 228. Expensing of environmental remediation costs. 
Sec. 229. Deduction allowable with respect to income attributable to domestic pro-
duction activities in Puerto Rico. 
Sec. 230. Modification of tax treatment of certain payments to controlling exempt 
organizations. 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00003
Fmt 6652
Sfmt 6213
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
Sec. 231. Qualified zone academy bonds. 
Sec. 232. Tax incentives for investment in the District of Columbia. 
Sec. 233. Economic development credit for American Samoa. 
Sec. 234. Enhanced charitable deduction for contributions of food inventory. 
Sec. 235. Enhanced charitable deduction for contributions of book inventory to 
public schools. 
Sec. 236. Enhanced deduction for qualified computer contributions. 
Sec. 237. Basis adjustment to stock of S corporations making charitable contribu-
tions of property. 
Sec. 238. Work opportunity tax credit for Hurricane Katrina employees. 
Sec. 239. Subpart F exception for active financing income. 
Sec. 240. Look-thru rule for related controlled foreign corporations. 
Sec. 241. Expensing for certain qualified film and television productions. 
Subtitle C—Other Extensions 
Sec. 251. Authority to disclose information related to terrorist activities made 
permanent. 
Sec. 252. Authority for undercover operations made permanent. 
Sec. 253. Authority to disclose return information for certain veterans programs 
made permanent. 
Sec. 254. Increase in limit on cover over of rum excise tax to Puerto Rico and 
the Virgin Islands. 
Sec. 255. Parity in the application of certain limits to mental health benefits. 
TITLE III—ADDITIONAL TAX RELIEF 
Subtitle A—Individual Tax Relief 
Sec. 301. Additional standard deduction for real property taxes for nonitemizers. 
Sec. 302. Refundable child credit. 
Sec. 303. Increase of AMT refundable credit amount for individuals with long- 
term unused credits for prior year minimum tax liability, etc. 
Subtitle B—Business Related Provisions 
Sec. 311. Uniform treatment of attorney-advanced expenses and court costs in 
contingency fee cases. 
Sec. 312. Provisions related to film and television productions. 
Subtitle C—Modification of Penalty on Understatement of Taxpayer’s Liability 
by Tax Return Preparer 
Sec. 321. Modification of penalty on understatement of taxpayer’s liability by tax 
return preparer. 
Subtitle D—Extension and Expansion of Certain GO Zone Incentives 
Sec. 331. Certain GO Zone incentives. 
TITLE IV—REVENUE PROVISIONS 
Sec. 401. Nonqualified deferred compensation from certain tax indifferent parties. 
Sec. 402. Delay in application of worldwide allocation of interest. 
Sec. 403. Time for payment of corporate estimated taxes. 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00004
Fmt 6652
Sfmt 6213
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
year exceeds the prelimitation credit for 
such facility for such taxable year, the limi-
tation imposed under subparagraph (A) 
with respect to such facility for the suc-
ceeding taxable year shall be increased by 
the amount of such excess. 
‘‘(ii) 
EXCESS
CREDIT.—If 
the 
prelimitation credit with respect to any fa-
cility for any taxable year exceeds the limi-
tation imposed under subparagraph (A) 
with respect to such facility for such taxable 
year, the credit determined under subsection 
(a) with respect to such facility for the suc-
ceeding taxable year (determined before the 
application of subparagraph (A) for such 
succeeding taxable year) shall be increased 
by the amount of such excess. With respect 
to any facility, no amount may be carried 
forward under this clause to any taxable 
year beginning after the 10-year period de-
scribed in subsection (a)(2)(A)(ii) with re-
spect to such facility. 
‘‘(iii) PRELIMITATION
CREDIT.—The 
term ‘prelimitation credit’ with respect to 
any facility for a taxable year means the 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00007
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
credit determined under subsection (a) with 
respect to such facility for such taxable 
year, determined without regard to sub-
paragraph (A) and after taking into ac-
count any increase for such taxable year 
under clause (ii). 
‘‘(C) APPLICABLE PERCENTAGE.—For pur-
poses of this paragraph— 
‘‘(i) IN GENERAL.—The term ‘applica-
ble percentage’ means, with respect to any 
facility, the appropriate percentage pre-
scribed by the Secretary for the month in 
which such facility is originally placed in 
service. 
‘‘(ii) METHOD OF PRESCRIBING APPLI-
CABLE PERCENTAGES.—The applicable per-
centages prescribed by the Secretary for any 
month under clause (i) shall be percentages 
which yield over a 10-year period amounts 
of limitation under subparagraph (A) which 
have a present value equal to 35 percent of 
the eligible basis of the facility. 
‘‘(iii) METHOD OF DISCOUNTING.—The 
present value under clause (ii) shall be de-
termined— 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00008
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
‘‘(I) as of the last day of the 1st 
year of the 10-year period referred to 
in clause (ii), 
‘‘(II) by using a discount rate 
equal to the greater of 110 percent of 
the Federal long-term rate as in effect 
under section 1274(d) for the month 
preceding the month for which the ap-
plicable percentage is being prescribed, 
or 4.5 percent, and 
‘‘(III) by taking into account the 
limitation under subparagraph (A) for 
any year on the last day of such year. 
‘‘(D) ELIGIBLE
BASIS.—For purposes of 
this paragraph— 
‘‘(i) IN GENERAL.—The term ‘eligible 
basis’ means, with respect to any facility, 
the sum of— 
‘‘(I) the basis of such facility de-
termined as of the time that such facil-
ity is originally placed in service, and 
‘‘(II) the portion of the basis of 
any shared qualified property which is 
properly allocable to such facility 
under clause (ii). 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00009
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
‘‘(ii) RULES
FOR
ALLOCATION.—For 
purposes of subclause (II) of clause (i), the 
basis of shared qualified property shall be 
allocated among all qualified facilities 
which are projected to be placed in service 
and which require utilization of such prop-
erty in proportion to projected generation 
from such facilities. 
‘‘(iii) 
SHARED
QUALIFIED
PROP-
ERTY.—For purposes of this paragraph, the 
term ‘shared qualified property’ means, 
with respect to any facility, any property 
described in section 168(e)(3)(B)(vi)— 
‘‘(I) which a qualified facility will 
require for utilization of such facility, 
and 
‘‘(II) which is not a qualified fa-
cility. 
‘‘(iv) SPECIAL
RULE
RELATING
TO 
GEOTHERMAL FACILITIES.—In the case of 
any qualified facility using geothermal en-
ergy to produce electricity, the basis of such 
facility for purposes of this paragraph shall 
be determined as though intangible drilling 
and development costs described in section 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00010
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
263(c) were capitalized rather than ex-
pensed. 
‘‘(E) SPECIAL RULE FOR FIRST AND LAST 
YEAR OF CREDIT PERIOD.—In the case of any 
taxable year any portion of which is not within 
the 10-year period described in subsection 
(a)(2)(A)(ii) with respect to any facility, the 
amount of the limitation under subparagraph 
(A) with respect to such facility shall be reduced 
by an amount which bears the same ratio to the 
amount of such limitation (determined without 
regard to this subparagraph) as such portion of 
the taxable year which is not within such period 
bears to the entire taxable year. 
‘‘(F) ELECTION TO TREAT ALL FACILITIES 
PLACED IN SERVICE IN A YEAR AS 1 FACILITY.— 
At the election of the taxpayer, all qualified fa-
cilities which are part of the same project and 
which are placed in service during the same cal-
endar year shall be treated for purposes of this 
section as 1 facility which is placed in service at 
the mid-point of such year or the first day of the 
following calendar year.’’. 
(c) TRASH FACILITY CLARIFICATION.—Paragraph (7) 
of section 45(d) is amended— 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00011
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
in connection with a facility described in sub-
paragraph (A)(i), but only to the extent of the 
increased amount of electricity produced at the 
facility by reason of such new unit.’’. 
(e) SALES OF NET ELECTRICITY TO REGULATED PUB-
LIC UTILITIES TREATED AS SALES TO UNRELATED PER-
SONS.—Paragraph (4) of section 45(e) is amended by add-
ing at the end the following new sentence: ‘‘The net amount 
of electricity sold by any taxpayer to a regulated public 
utility (as defined in section 7701(a)(33)) shall be treated 
as sold to an unrelated person.’’. 
(f) MODIFICATION OF RULES FOR HYDROPOWER PRO-
DUCTION.—Subparagraph (C) of section 45(c)(8) is amend-
ed to read as follows: 
‘‘(C) NONHYDROELECTRIC DAM.—For pur-
poses of subparagraph (A), a facility is described 
in this subparagraph if— 
‘‘(i) the hydroelectric project installed 
on the nonhydroelectric dam is licensed by 
the Federal Energy Regulatory Commission 
and meets all other applicable environ-
mental, licensing, and regulatory require-
ments, 
‘‘(ii) the nonhydroelectric dam was 
placed in service before the date of the en-
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00013
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
actment of this paragraph and operated for 
flood control, navigation, or water supply 
purposes and did not produce hydroelectric 
power on the date of the enactment of this 
paragraph, and 
‘‘(iii) the hydroelectric project is oper-
ated so that the water surface elevation at 
any given location and time that would 
have occurred in the absence of the hydro-
electric project is maintained, subject to any 
license requirements imposed under applica-
ble law that change the water surface ele-
vation for the purpose of improving envi-
ronmental quality of the affected waterway. 
The Secretary, in consultation with the Federal 
Energy Regulatory Commission, shall certify if a 
hydroelectric project licensed at a nonhydro-
electric dam meets the criteria in clause (iii). 
Nothing in this section shall affect the standards 
under which the Federal Energy Regulatory 
Commission issues licenses for and regulates hy-
dropower projects under part I of the Federal 
Power Act.’’. 
(g) EFFECTIVE DATE.— 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00014
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
(1) IN GENERAL.—Except as otherwise provided 
in this subsection, the amendments made by this sec-
tion shall apply to property originally placed in serv-
ice after December 31, 2008. 
(2) 
REPEAL
OF
CREDIT
PHASEOUT.—The 
amendments made by subsection (b)(1) shall apply to 
taxable years ending after December 31, 2008. 
(3) LIMITATION BASED ON INVESTMENT IN FA-
CILITY.—The amendment made by subsection (b)(2) 
shall apply to property originally placed in service 
after December 31, 2009. 
(4) TRASH FACILITY CLARIFICATION; SALES TO 
RELATED
REGULATED
PUBLIC
UTILITIES.—The 
amendments made by subsections (c) and (e) shall 
apply to electricity produced and sold after the date 
of the enactment of this Act. 
(5) EXPANSION
OF
BIOMASS
FACILITIES.—The 
amendments made by subsection (d) shall apply to 
property placed in service after the date of the enact-
ment of this Act. 
SEC. 102. PRODUCTION CREDIT FOR ELECTRICITY PRO-
DUCED FROM MARINE RENEWABLES. 
(a) IN GENERAL.—Paragraph (1) of section 45(c) is 
amended by striking ‘‘and’’ at the end of subparagraph (G), 
by striking the period at the end of subparagraph (H) and 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00015
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
inserting ‘‘, and’’, and by adding at the end the following 
new subparagraph: 
‘‘(I) marine and hydrokinetic renewable en-
ergy.’’. 
(b) MARINE RENEWABLES.—Subsection (c) of section 
45 is amended by adding at the end the following new para-
graph: 
‘‘(10) MARINE AND HYDROKINETIC RENEWABLE 
ENERGY.— 
‘‘(A) IN GENERAL.—The term ‘marine and 
hydrokinetic renewable energy’ means energy de-
rived from— 
‘‘(i) waves, tides, and currents in 
oceans, estuaries, and tidal areas, 
‘‘(ii) free flowing water in rivers, lakes, 
and streams, 
‘‘(iii) free flowing water in an irriga-
tion system, canal, or other man-made 
channel, including projects that utilize non-
mechanical structures to accelerate the flow 
of water for electric power production pur-
poses, or 
‘‘(iv) differentials in ocean temperature 
(ocean thermal energy conversion). 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00016
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
‘‘(B) EXCEPTIONS.—Such term shall not in-
clude any energy which is derived from any 
source which utilizes a dam, diversionary struc-
ture (except as provided in subparagraph 
(A)(iii)), or impoundment for electric power pro-
duction purposes.’’. 
(c) DEFINITION OF FACILITY.—Subsection (d) of sec-
tion 45 is amended by adding at the end the following new 
paragraph: 
‘‘(11) MARINE AND HYDROKINETIC RENEWABLE 
ENERGY FACILITIES.—In the case of a facility pro-
ducing electricity from marine and hydrokinetic re-
newable energy, the term ‘qualified facility’ means 
any facility owned by the taxpayer— 
‘‘(A) which has a nameplate capacity rat-
ing of at least 150 kilowatts, and 
‘‘(B) which is originally placed in service 
on or after the date of the enactment of this 
paragraph and before January 1, 2012.’’. 
(d) CREDIT RATE.—Subparagraph (A) of section 
45(b)(4) is amended by striking ‘‘or (9)’’ and inserting ‘‘(9), 
or (11)’’. 
(e) 
COORDINATION
WITH
SMALL
IRRIGATION 
POWER.—Paragraph (5) of section 45(d), as amended by 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00017
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
section 101, is amended by striking ‘‘January 1, 2012’’ and 
inserting ‘‘the date of the enactment of paragraph (11)’’. 
(f) EFFECTIVE DATE.—The amendments made by this 
section shall apply to electricity produced and sold after 
the date of the enactment of this Act, in taxable years end-
ing after such date. 
SEC. 103. ENERGY CREDIT. 
(a) EXTENSION OF CREDIT.— 
(1) SOLAR
ENERGY
PROPERTY.—Paragraphs 
(2)(A)(i)(II) and (3)(A)(ii) of section 48(a) are each 
amended by striking ‘‘January 1, 2009’’ and insert-
ing ‘‘January 1, 2015’’. 
(2) FUEL CELL PROPERTY.—Subparagraph (E) 
of section 48(c)(1) is amended by striking ‘‘December 
31, 2008’’ and inserting ‘‘December 31, 2014’’. 
(3) MICROTURBINE
PROPERTY.—Subparagraph 
(E) of section 48(c)(2) is amended by striking ‘‘De-
cember 31, 2008’’ and inserting ‘‘December 31, 2014’’. 
(b) ALLOWANCE OF ENERGY CREDIT AGAINST ALTER-
NATIVE MINIMUM TAX.—Subparagraph (B) of section 
38(c)(4) is amended by striking ‘‘and’’ at the end of clause 
(iii), by redesignating clause (iv) as clause (v), and by in-
serting after clause (iii) the following new clause: 
‘‘(iv) the credit determined under sec-
tion 46 to the extent that such credit is at-
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00018
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
‘‘(B) DETERMINATIONS
MADE
ON
BTU 
BASIS.—The energy efficiency percentage and the 
percentages under paragraph (1)(B) shall be de-
termined on a Btu basis. 
‘‘(C) INPUT AND OUTPUT PROPERTY NOT IN-
CLUDED.—The term ‘combined heat and power 
system property’ does not include property used 
to transport the energy source to the facility or 
to distribute energy produced by the facility. 
‘‘(4) SYSTEMS USING BIOMASS.—If a system is 
designed to use biomass (within the meaning of para-
graphs (2) and (3) of section 45(c) without regard to 
the last sentence of paragraph (3)(A)) for at least 90 
percent of the energy source— 
‘‘(A) paragraph (1)(C) shall not apply, but 
‘‘(B) the amount of credit determined under 
subsection (a) with respect to such system shall 
not exceed the amount which bears the same 
ratio to such amount of credit (determined with-
out regard to this paragraph) as the energy effi-
ciency percentage of such system bears to 60 per-
cent.’’. 
(d) INCREASE OF CREDIT LIMITATION FOR FUEL CELL 
PROPERTY.—Subparagraph (B) of section 48(c)(1) is 
amended by striking ‘‘$500’’ and inserting ‘‘$1,500’’. 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00022
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
(e) PUBLIC UTILITY PROPERTY TAKEN INTO AC-
COUNT.— 
(1) IN
GENERAL.—Paragraph (3) of section 
48(a) is amended by striking the second sentence 
thereof. 
(2) CONFORMING AMENDMENTS.— 
(A) Paragraph (1) of section 48(c) is 
amended by striking subparagraph (D) and re-
designating subparagraph (E) as subparagraph 
(D). 
(B) Paragraph (2) of section 48(c) is 
amended by striking subparagraph (D) and re-
designating subparagraph (E) as subparagraph 
(D). 
(f) EFFECTIVE DATE.— 
(1) IN GENERAL.—Except as otherwise provided 
in this subsection, the amendments made by this sec-
tion shall take effect on the date of the enactment of 
this Act. 
(2) ALLOWANCE AGAINST ALTERNATIVE MINIMUM 
TAX.—The amendments made by subsection (b) shall 
apply to credits determined under section 46 of the 
Internal Revenue Code of 1986 in taxable years begin-
ning after the date of the enactment of this Act and 
to carrybacks of such credits. 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00023
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
(3) COMBINED
HEAT
AND
POWER
AND
FUEL 
CELL
PROPERTY.—The amendments made by sub-
sections (c) and (d) shall apply to periods after the 
date of the enactment of this Act, in taxable years 
ending after such date, under rules similar to the 
rules of section 48(m) of the Internal Revenue Code 
of 1986 (as in effect on the day before the date of the 
enactment of the Revenue Reconciliation Act of 1990). 
(4) PUBLIC
UTILITY
PROPERTY.—The amend-
ments made by subsection (e) shall apply to periods 
after February 13, 2008, in taxable years ending after 
such date, under rules similar to the rules of section 
48(m) of the Internal Revenue Code of 1986 (as in ef-
fect on the day before the date of the enactment of the 
Revenue Reconciliation Act of 1990). 
SEC. 104. CREDIT FOR RESIDENTIAL ENERGY EFFICIENT 
PROPERTY. 
(a) EXTENSION.—Section 25D(g) is amended by strik-
ing ‘‘December 31, 2008’’ and inserting ‘‘December 31, 
2014’’. 
(b) MAXIMUM CREDIT FOR SOLAR ELECTRIC PROP-
ERTY.— 
(1) IN
GENERAL.—Section 25D(b)(1)(A) is 
amended 
by 
striking 
‘‘$2,000’’ 
and 
inserting 
‘‘$4,000’’. 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00024
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
(2) 
CONFORMING
AMENDMENT.—Section 
25D(e)(4)(A)(i) is amended by striking ‘‘$6,667’’ and 
inserting ‘‘$13,333’’. 
(c) CREDIT FOR RESIDENTIAL WIND PROPERTY.— 
(1) IN GENERAL.—Section 25D(a) is amended by 
striking ‘‘and’’ at the end of paragraph (2), by strik-
ing the period at the end of paragraph (3) and insert-
ing ‘‘, and’’, and by adding at the end the following 
new paragraph: 
‘‘(4) 30 percent of the qualified small wind en-
ergy property expenditures made by the taxpayer 
during such year.’’. 
(2) LIMITATION.—Section 25D(b)(1) is amended 
by striking ‘‘and’’ at the end of subparagraph (B), by 
striking the period at the end of subparagraph (C) 
and inserting ‘‘, and’’, and by adding at the end the 
following new subparagraph: 
‘‘(D) $500 with respect to each half kilowatt 
of capacity (not to exceed $4,000) of wind tur-
bines for which qualified small wind energy 
property expenditures are made.’’. 
(3) QUALIFIED SMALL WIND ENERGY PROPERTY 
EXPENDITURES.— 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00025
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
(A) 
IN
GENERAL.—Section 
25D(d) 
is 
amended by adding at the end the following new 
paragraph: 
‘‘(4) QUALIFIED SMALL WIND ENERGY PROPERTY 
EXPENDITURE.—The term ‘qualified small wind en-
ergy property expenditure’ means an expenditure for 
property which uses a wind turbine to generate elec-
tricity for use in connection with a dwelling unit lo-
cated in the United States and used as a residence by 
the taxpayer.’’. 
(B) 
NO
DOUBLE
BENEFIT.—Section 
45(d)(1) is amended by adding at the end the 
following new sentence: ‘‘Such term shall not in-
clude any facility with respect to which any 
qualified small wind energy property expendi-
ture (as defined in subsection (d)(4) of section 
25D) is taken into account in determining the 
credit under such section.’’. 
(4) MAXIMUM EXPENDITURES IN CASE OF JOINT 
OCCUPANCY.—Section 25D(e)(4)(A) 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: 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00026
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
‘‘(iv) $1,667 in the case of each half 
kilowatt of capacity (not to exceed $13,333) 
of wind turbines for which qualified small 
wind energy property expenditures are 
made.’’. 
(d) CREDIT
FOR GEOTHERMAL HEAT
PUMP SYS-
TEMS.— 
(1) IN GENERAL.—Section 25D(a), as amended 
by subsection (c), is amended by striking ‘‘and’’ at the 
end of paragraph (3), by striking the period at the 
end of paragraph (4) and inserting ‘‘, and’’, and by 
adding at the end the following new paragraph: 
‘‘(5) 30 percent of the qualified geothermal heat 
pump property expenditures made by the taxpayer 
during such year.’’. 
(2) LIMITATION.—Section 25D(b)(1), as amend-
ed by subsection (c), is amended by striking ‘‘and’’ at 
the end of subparagraph (C), by striking the period 
at the end of subparagraph (D) and inserting ‘‘, 
and’’, and by adding at the end the following new 
subparagraph: 
‘‘(E) $2,000 with respect to any qualified 
geothermal heat pump property expenditures.’’. 
(3) QUALIFIED GEOTHERMAL HEAT PUMP PROP-
ERTY EXPENDITURE.—Section 25D(d), as amended by 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00027
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
subsection (c), is amended by adding at the end the 
following new paragraph: 
‘‘(5) QUALIFIED
GEOTHERMAL
HEAT
PUMP 
PROPERTY EXPENDITURE.— 
‘‘(A) IN GENERAL.—The term ‘qualified geo-
thermal heat pump property expenditure’ means 
an expenditure for qualified geothermal heat 
pump property installed on or in connection 
with a dwelling unit located in the United States 
and used as a residence by the taxpayer. 
‘‘(B) QUALIFIED GEOTHERMAL HEAT PUMP 
PROPERTY.—The term ‘qualified geothermal heat 
pump property’ means any equipment which— 
‘‘(i) uses the ground or ground water 
as a thermal energy source to heat the 
dwelling unit referred to in subparagraph 
(A) or as a thermal energy sink to cool such 
dwelling unit, and 
‘‘(ii) meets the requirements of the En-
ergy Star program which are in effect at 
the time that the expenditure for such 
equipment is made.’’. 
(4) MAXIMUM EXPENDITURES IN CASE OF JOINT 
OCCUPANCY.—Section 25D(e)(4)(A), as amended by 
subsection (c), is amended by striking ‘‘and’’ at the 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00028
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
end of clause (iii), by striking the period at the end 
of clause (iv) and inserting ‘‘, and’’, and by adding 
at the end the following new clause: 
‘‘(v) $6,667 in the case of any qualified 
geothermal heat pump property expendi-
tures.’’. 
(e) CREDIT ALLOWED AGAINST ALTERNATIVE MIN-
IMUM TAX.— 
(1) IN GENERAL.—Subsection (c) of section 25D 
is amended to read as follows: 
‘‘(c) LIMITATION
BASED
ON
AMOUNT
OF
TAX; 
CARRYFORWARD OF UNUSED CREDIT.— 
‘‘(1) LIMITATION BASED ON AMOUNT OF TAX.— 
In the case of a taxable year to which section 26(a)(2) 
does not apply, the credit allowed under subsection 
(a) for the taxable year shall not exceed the excess 
of— 
‘‘(A) the sum of the regular tax liability (as 
defined in section 26(b)) plus the tax imposed by 
section 55, over 
‘‘(B) the sum of the credits allowable under 
this subpart (other than this section) and section 
27 for the taxable year. 
‘‘(2) CARRYFORWARD OF UNUSED CREDIT.— 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00029
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
‘‘(A) RULE FOR YEARS IN WHICH ALL PER-
SONAL
CREDITS
ALLOWED
AGAINST
REGULAR 
AND ALTERNATIVE MINIMUM TAX.—In the case of 
a taxable year to which section 26(a)(2) applies, 
if the credit allowable under subsection (a) ex-
ceeds the limitation imposed by section 26(a)(2) 
for such taxable year reduced by the sum of the 
credits allowable under this subpart (other than 
this section), such excess shall be carried to the 
succeeding taxable year and added to the credit 
allowable under subsection (a) for such suc-
ceeding taxable year. 
‘‘(B) RULE FOR OTHER YEARS.—In the case 
of a taxable year to which section 26(a)(2) does 
not apply, if the credit allowable under sub-
section (a) exceeds the limitation imposed by 
paragraph (1) for such taxable year, such excess 
shall be carried to the succeeding taxable year 
and added to the credit allowable under sub-
section (a) for such succeeding taxable year.’’. 
(2) CONFORMING AMENDMENTS.— 
(A) Section 23(b)(4)(B) is amended by in-
serting ‘‘and section 25D’’ after ‘‘this section’’. 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00030
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
(B) Section 24(b)(3)(B) is amended by 
striking ‘‘and 25B’’ and inserting ‘‘, 25B, and 
25D’’. 
(C) Section 25B(g)(2) is amended by strik-
ing ‘‘section 23’’ and inserting ‘‘sections 23 and 
25D’’. 
(D) Section 26(a)(1) is amended by striking 
‘‘and 25B’’ and inserting ‘‘25B, and 25D’’. 
(f) EFFECTIVE DATE.— 
(1) IN
GENERAL.—The amendments made by 
this section shall apply to taxable years beginning 
after December 31, 2007. 
(2) APPLICATION
OF
EGTRRA
SUNSET.—The 
amendments made by subparagraphs (A) and (B) of 
subsection (e)(2) shall be subject to title IX of the Eco-
nomic Growth and Tax Relief Reconciliation Act of 
2001 in the same manner as the provisions of such 
Act to which such amendments relate. 
SEC. 105. SPECIAL RULE TO IMPLEMENT FERC AND STATE 
ELECTRIC RESTRUCTURING POLICY. 
(a) EXTENSION
FOR QUALIFIED ELECTRIC UTILI-
TIES.— 
(1) IN
GENERAL.—Paragraph (3) of section 
451(i) is amended by inserting ‘‘(before January 1, 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00031
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
2010, in the case of a qualified electric utility)’’ after 
‘‘January 1, 2008’’. 
(2) QUALIFIED ELECTRIC UTILITY.—Subsection 
(i) of section 451 is amended by redesignating para-
graphs (6) through (10) as paragraphs (7) through 
(11), respectively, and by inserting after paragraph 
(5) the following new paragraph: 
‘‘(6) QUALIFIED ELECTRIC UTILITY.—For pur-
poses of this subsection, the term ‘qualified electric 
utility’ means a person that, as of the date of the 
qualifying 
electric 
transmission 
transaction, 
is 
vertically integrated, in that it is both— 
‘‘(A) a transmitting utility (as defined in 
section 3(23) of the Federal Power Act (16 
U.S.C. 796(23))) with respect to the transmission 
facilities to which the election under this sub-
section applies, and 
‘‘(B) an electric utility (as defined in sec-
tion 3(22) of the Federal Power Act (16 U.S.C. 
796(22))).’’. 
(b) EXTENSION OF PERIOD FOR TRANSFER OF OPER-
ATIONAL CONTROL AUTHORIZED BY FERC.—Clause (ii) of 
section 451(i)(4)(B) is amended by striking ‘‘December 31, 
2007’’ and inserting ‘‘the date which is 4 years after the 
close of the taxable year in which the transaction occurs’’. 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00032
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
(c) PROPERTY
LOCATED
OUTSIDE
THE
UNITED 
STATES NOT TREATED AS EXEMPT UTILITY PROPERTY.— 
Paragraph (5) of section 451(i) is amended by adding at 
the end the following new subparagraph: 
‘‘(C) EXCEPTION FOR PROPERTY LOCATED 
OUTSIDE THE UNITED STATES.—The term ‘ex-
empt utility property’ shall not include any 
property which is located outside the United 
States.’’. 
(d) EFFECTIVE DATES.— 
(1) EXTENSION.—The amendments made by sub-
section (a) shall apply to transactions after December 
31, 2007. 
(2) TRANSFERS
OF
OPERATIONAL
CONTROL.— 
The amendment made by subsection (b) shall take ef-
fect as if included in section 909 of the American Jobs 
Creation Act of 2004. 
(3) EXCEPTION FOR PROPERTY LOCATED OUT-
SIDE THE UNITED STATES.—The amendment made by 
subsection (c) shall apply to transactions after the 
date of the enactment of this Act. 
SEC. 106. NEW CLEAN RENEWABLE ENERGY BONDS. 
(a) IN GENERAL.—Part IV of subchapter A of chapter 
1 is amended by adding at the end the following new sub-
part: 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00033
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
‘‘Subpart I—Qualified Tax Credit Bonds 
‘‘Sec. 54A. Credit to holders of qualified tax credit bonds. 
‘‘Sec. 54B. New clean renewable energy bonds. 
‘‘SEC. 54A. CREDIT TO HOLDERS OF QUALIFIED TAX CREDIT 
BONDS. 
‘‘(a) ALLOWANCE OF CREDIT.—If a taxpayer holds a 
qualified tax credit bond on one or more credit allowance 
dates of the bond during any taxable year, there shall be 
allowed as a credit against the tax imposed by this chapter 
for the taxable year an amount equal to the sum of the cred-
its determined under subsection (b) with respect to such 
dates. 
‘‘(b) AMOUNT OF CREDIT.— 
‘‘(1) IN GENERAL.—The amount of the credit de-
termined under this subsection with respect to any 
credit allowance date for a qualified tax credit bond 
is 25 percent of the annual credit determined with re-
spect to such bond. 
‘‘(2) ANNUAL CREDIT.—The annual credit deter-
mined with respect to any qualified tax credit bond 
is the product of— 
‘‘(A) the applicable credit rate, multiplied 
by 
‘‘(B) the outstanding face amount of the 
bond. 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00034
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
‘‘(3) APPLICABLE CREDIT RATE.—For purposes 
of paragraph (2), the applicable credit rate is the rate 
which the Secretary estimates will permit the 
issuance of qualified tax credit bonds with a specified 
maturity or redemption date without discount and 
without interest cost to the qualified issuer. The ap-
plicable credit rate with respect to any qualified tax 
credit bond shall be determined as of the first day on 
which there is a binding, written contract for the sale 
or exchange of the bond. 
‘‘(4) SPECIAL RULE FOR ISSUANCE AND REDEMP-
TION.—In the case of a bond which is issued during 
the 3-month period ending on a credit allowance date, 
the amount of the credit determined under this sub-
section with respect to such credit allowance date 
shall be a ratable portion of the credit otherwise deter-
mined based on the portion of the 3-month period 
during which the bond is outstanding. A similar rule 
shall apply when the bond is redeemed or matures. 
‘‘(c) LIMITATION BASED ON AMOUNT OF TAX.— 
‘‘(1) IN
GENERAL.—The credit allowed under 
subsection (a) for any taxable year shall not exceed 
the excess of— 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00035
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
‘‘(A) the sum of the regular tax liability (as 
defined in section 26(b)) plus the tax imposed by 
section 55, over 
‘‘(B) the sum of the credits allowable under 
this part (other than subpart C and this sub-
part). 
‘‘(2) CARRYOVER
OF
UNUSED
CREDIT.—If the 
credit allowable under subsection (a) exceeds the limi-
tation imposed by paragraph (1) for such taxable 
year, such excess shall be carried to the succeeding 
taxable year and added to the credit allowable under 
subsection (a) for such taxable year (determined be-
fore the application of paragraph (1) for such suc-
ceeding taxable year). 
‘‘(d) QUALIFIED TAX CREDIT BOND.—For purposes of 
this section— 
‘‘(1) QUALIFIED TAX CREDIT BOND.—The term 
‘qualified tax credit bond’ means a new clean renew-
able energy bond which is part of an issue that meets 
the requirements of paragraphs (2), (3), (4), (5), and 
(6). 
‘‘(2) SPECIAL
RULES
RELATING
TO
EXPENDI-
TURES.— 
‘‘(A) IN GENERAL.—An issue shall be treat-
ed as meeting the requirements of this paragraph 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00036
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
if, as of the date of issuance, the issuer reason-
ably expects— 
‘‘(i) 100 percent or more of the avail-
able project proceeds to be spent for 1 or 
more qualified purposes within the 3-year 
period beginning on such date of issuance, 
and 
‘‘(ii) a binding commitment with a 
third party to spend at least 10 percent of 
such available project proceeds will be in-
curred within the 6-month period beginning 
on such date of issuance. 
‘‘(B) 
FAILURE
TO
SPEND
REQUIRED 
AMOUNT OF BOND PROCEEDS WITHIN 3 YEARS.— 
‘‘(i) IN GENERAL.—To the extent that 
less than 100 percent of the available project 
proceeds of the issue are expended by the 
close of the expenditure period for 1 or more 
qualified purposes, the issuer shall redeem 
all of the nonqualified bonds within 90 days 
after the end of such period. For purposes of 
this paragraph, the amount of the non-
qualified bonds required to be redeemed 
shall be determined in the same manner as 
under section 142. 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00037
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
‘‘(ii) 
EXPENDITURE
PERIOD.—For 
purposes of this subpart, the term ‘expendi-
ture period’ means, with respect to any 
issue, the 3-year period beginning on the 
date of issuance. Such term shall include 
any extension of such period under clause 
(iii). 
‘‘(iii) EXTENSION OF PERIOD.—Upon 
submission of a request prior to the expira-
tion of the expenditure period (determined 
without regard to any extension under this 
clause), the Secretary may extend such pe-
riod if the issuer establishes that the failure 
to expend the proceeds within the original 
expenditure period is due to reasonable 
cause and the expenditures for qualified 
purposes will continue to proceed with due 
diligence. 
‘‘(C) QUALIFIED
PURPOSE.—For purposes 
of this paragraph, the term ‘qualified purpose’ 
means a purpose specified in section 54B(a)(1). 
‘‘(D) REIMBURSEMENT.—For purposes of 
this subtitle, available project proceeds of an 
issue shall be treated as spent for a qualified 
purpose if such proceeds are used to reimburse 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00038
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
the issuer for amounts paid for a qualified pur-
pose after the date that the Secretary makes an 
allocation of bond limitation with respect to such 
issue, but only if— 
‘‘(i) prior to the payment of the origi-
nal expenditure, the issuer declared its in-
tent to reimburse such expenditure with the 
proceeds of a qualified tax credit bond, 
‘‘(ii) not later than 60 days after pay-
ment of the original expenditure, the issuer 
adopts an official intent to reimburse the 
original expenditure with such proceeds, 
and 
‘‘(iii) the reimbursement is made not 
later than 18 months after the date the 
original expenditure is paid. 
‘‘(3) REPORTING.—An issue shall be treated as 
meeting the requirements of this paragraph if the 
issuer of qualified tax credit bonds submits reports 
similar to the reports required under section 149(e). 
‘‘(4) SPECIAL
RULES
RELATING
TO
ARBI-
TRAGE.— 
‘‘(A) IN GENERAL.—An issue shall be treat-
ed as meeting the requirements of this paragraph 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00039
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
if the issuer satisfies the requirements of section 
148 with respect to the proceeds of the issue. 
‘‘(B) SPECIAL
RULE
FOR
INVESTMENTS 
DURING EXPENDITURE PERIOD.—An issue shall 
not be treated as failing to meet the requirements 
of subparagraph (A) by reason of any investment 
of available project proceeds during the expendi-
ture period. 
‘‘(C) 
SPECIAL
RULE
FOR
RESERVE 
FUNDS.—An issue shall not be treated as failing 
to meet the requirements of subparagraph (A) by 
reason of any fund which is expected to be used 
to repay such issue if— 
‘‘(i) such fund is funded at a rate not 
more rapid than equal annual installments, 
‘‘(ii) such fund is funded in a manner 
reasonably expected to result in an amount 
not greater than an amount necessary to 
repay the issue, and 
‘‘(iii) the yield on such fund is not 
greater than the discount rate determined 
under paragraph (5)(B) with respect to the 
issue. 
‘‘(5) MATURITY LIMITATION.— 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00040
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
‘‘(A) IN GENERAL.—An issue shall not be 
treated as meeting the requirements of this para-
graph if the maturity of any bond which is part 
of such issue exceeds the maximum term deter-
mined by the Secretary under subparagraph (B). 
‘‘(B) MAXIMUM
TERM.—During each cal-
endar month, the Secretary shall determine the 
maximum term permitted under this paragraph 
for bonds issued during the following calendar 
month. Such maximum term shall be the term 
which the Secretary estimates will result in the 
present value of the obligation to repay the prin-
cipal on the bond being equal to 50 percent of the 
face amount of such bond. Such present value 
shall be determined using as a discount rate the 
average annual interest rate of tax-exempt obli-
gations having a term of 10 years or more which 
are issued during the month. If the term as so 
determined is not a multiple of a whole year, 
such term shall be rounded to the next highest 
whole year. 
‘‘(6) PROHIBITION ON FINANCIAL CONFLICTS OF 
INTEREST.—An issue shall be treated as meeting the 
requirements of this paragraph if the issuer certifies 
that— 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00041
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
‘‘(A) applicable State and local law require-
ments governing conflicts of interest are satisfied 
with respect to such issue, and 
‘‘(B) if the Secretary prescribes additional 
conflicts of interest rules governing the appro-
priate Members of Congress, Federal, State, and 
local officials, and their spouses, such additional 
rules are satisfied with respect to such issue. 
‘‘(e) OTHER DEFINITIONS.—For purposes of this sub-
chapter— 
‘‘(1) CREDIT
ALLOWANCE
DATE.—The term 
‘credit allowance date’ means— 
‘‘(A) March 15, 
‘‘(B) June 15, 
‘‘(C) September 15, and 
‘‘(D) December 15. 
Such term includes the last day on which the bond is 
outstanding. 
‘‘(2) BOND.—The term ‘bond’ includes any obli-
gation. 
‘‘(3) STATE.—The term ‘State’ includes the Dis-
trict of Columbia and any possession of the United 
States. 
‘‘(4) AVAILABLE PROJECT PROCEEDS.—The term 
‘available project proceeds’ means— 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00042
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
‘‘(A) the excess of— 
‘‘(i) the proceeds from the sale of an 
issue, over 
‘‘(ii) the issuance costs financed by the 
issue (to the extent that such costs do not 
exceed 2 percent of such proceeds), and 
‘‘(B) the proceeds from any investment of 
the excess described in subparagraph (A). 
‘‘(f) CREDIT TREATED AS INTEREST.—For purposes of 
this subtitle, the credit determined under subsection (a) 
shall be treated as interest which is includible in gross in-
come. 
‘‘(g) S CORPORATIONS AND PARTNERSHIPS.—In the 
case of a tax credit bond held by an S corporation or part-
nership, the allocation of the credit allowed by this section 
to the shareholders of such corporation or partners of such 
partnership shall be treated as a distribution. 
‘‘(h) BONDS HELD BY REGULATED INVESTMENT COM-
PANIES AND REAL ESTATE INVESTMENT TRUSTS.—If any 
qualified tax credit bond is held by a regulated investment 
company or a real estate investment trust, the credit deter-
mined under subsection (a) shall be allowed to shareholders 
of such company or beneficiaries of such trust (and any 
gross income included under subsection (f) with respect to 
such credit shall be treated as distributed to such share-
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00043
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
holders or beneficiaries) under procedures prescribed by the 
Secretary. 
‘‘(i) CREDITS MAY BE STRIPPED.—Under regulations 
prescribed by the Secretary— 
‘‘(1) IN GENERAL.—There may be a separation 
(including at issuance) of the ownership of a qualified 
tax credit bond and the entitlement to the credit 
under this section with respect to such bond. In case 
of any such separation, the credit under this section 
shall be allowed to the person who on the credit allow-
ance date holds the instrument evidencing the entitle-
ment to the credit and not to the holder of the bond. 
‘‘(2) CERTAIN RULES TO APPLY.—In the case of 
a separation described in paragraph (1), the rules of 
section 1286 shall apply to the qualified tax credit 
bond as if it were a stripped bond and to the credit 
under this section as if it were a stripped coupon. 
‘‘SEC. 54B. NEW CLEAN RENEWABLE ENERGY BONDS. 
‘‘(a) NEW CLEAN RENEWABLE ENERGY BOND.—For 
purposes of this subpart, the term ‘new clean renewable en-
ergy bond’ means any bond issued as part of an issue if— 
‘‘(1) 100 percent of the available project proceeds 
of such issue are to be used for capital expenditures 
incurred by public power providers or cooperative 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00044
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
electric companies for one or more qualified renewable 
energy facilities, 
‘‘(2) the bond is issued by a qualified issuer, and 
‘‘(3) the issuer designates such bond for purposes 
of this section. 
‘‘(b) REDUCED CREDIT AMOUNT.—The annual credit 
determined under section 54A(b) with respect to any new 
clean renewable energy bond shall be 70 percent of the 
amount so determined without regard to this subsection. 
‘‘(c) LIMITATION
ON
AMOUNT
OF
BONDS
DES-
IGNATED.— 
‘‘(1) IN
GENERAL.—The maximum aggregate 
face amount of bonds which may be designated under 
subsection (a) by any issuer shall not exceed the limi-
tation amount allocated under this subsection to such 
issuer. 
‘‘(2) NATIONAL
LIMITATION
ON
AMOUNT
OF 
BONDS DESIGNATED.—There is a national new clean 
renewable energy bond limitation of $2,000,000,000 
which shall be allocated by the Secretary as provided 
in paragraph (3), except that— 
‘‘(A) not more than 331⁄3 percent thereof 
may be allocated to qualified projects of public 
power providers, 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00045
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
‘‘(B) not more than 331⁄3 percent thereof 
may be allocated to qualified projects of govern-
mental bodies, and 
‘‘(C) not more than 331⁄3 percent thereof 
may be allocated to qualified projects of coopera-
tive electric companies. 
‘‘(3) METHOD OF ALLOCATION.— 
‘‘(A) ALLOCATION
AMONG
PUBLIC
POWER 
PROVIDERS.—After the Secretary determines the 
qualified projects of public power providers 
which are appropriate for receiving an alloca-
tion of the national new clean renewable energy 
bond limitation, the Secretary shall, to the max-
imum 
extent 
practicable, 
make 
allocations 
among such projects in such manner that the 
amount allocated to each such project bears the 
same ratio to the cost of such project as the limi-
tation under paragraph (2)(A) bears to the cost 
of all such projects. 
‘‘(B) ALLOCATION
AMONG
GOVERNMENTAL 
BODIES
AND
COOPERATIVE
ELECTRIC
COMPA-
NIES.—The Secretary shall make allocations of 
the amount of the national new clean renewable 
energy bond limitation described in paragraphs 
(2)(B) and (2)(C) among qualified projects of 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00046
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
governmental bodies and cooperative electric 
companies, respectively, in such manner as the 
Secretary determines appropriate. 
‘‘(d) DEFINITIONS.—For purposes of this section— 
‘‘(1) QUALIFIED
RENEWABLE
ENERGY
FACIL-
ITY.—The term ‘qualified renewable energy facility’ 
means a qualified facility (as determined under sec-
tion 45(d) without regard to paragraphs (8) and (10) 
thereof and to any placed in service date) owned by 
a public power provider, a governmental body, or a 
cooperative electric company. 
‘‘(2) PUBLIC POWER PROVIDER.—The term ‘pub-
lic power provider’ means a State utility with a serv-
ice obligation, as such terms are defined in section 
217 of the Federal Power Act (as in effect on the date 
of the enactment of this paragraph). 
‘‘(3) GOVERNMENTAL BODY.—The term ‘govern-
mental body’ means any State or Indian tribal gov-
ernment, or any political subdivision thereof. 
‘‘(4) COOPERATIVE
ELECTRIC
COMPANY.—The 
term ‘cooperative electric company’ means a mutual 
or cooperative electric company described in section 
501(c)(12) or section 1381(a)(2)(C). 
‘‘(5) CLEAN RENEWABLE ENERGY BOND LEND-
ER.—The term ‘clean renewable energy bond lender’ 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00047
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
means a lender which is a cooperative which is owned 
by, or has outstanding loans to, 100 or more coopera-
tive electric companies and is in existence on Feb-
ruary 1, 2002, and shall include any affiliated entity 
which is controlled by such lender. 
‘‘(6) QUALIFIED
ISSUER.—The term ‘qualified 
issuer’ means a public power provider, a cooperative 
electric company, a governmental body, a clean re-
newable energy bond lender, or a not-for-profit elec-
tric utility which has received a loan or loan guar-
antee under the Rural Electrification Act.’’. 
(b) REPORTING.—Subsection (d) of section 6049 is 
amended by adding at the end the following new paragraph: 
‘‘(9) REPORTING OF CREDIT ON QUALIFIED TAX 
CREDIT BONDS.— 
‘‘(A) IN GENERAL.—For purposes of sub-
section (a), the term ‘interest’ includes amounts 
includible in gross income under section 54A 
and such amounts shall be treated as paid on the 
credit allowance date (as defined in section 
54A(e)(1)). 
‘‘(B) REPORTING TO CORPORATIONS, ETC.— 
Except as otherwise provided in regulations, in 
the case of any interest described in subpara-
graph (A) of this paragraph, subsection (b)(4) of 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00048
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
this section shall be applied without regard to 
subparagraphs (A), (H), (I), (J), (K), and 
(L)(i). 
‘‘(C) REGULATORY
AUTHORITY.—The Sec-
retary may prescribe such regulations as are nec-
essary or appropriate to carry out the purposes 
of this paragraph, including regulations which 
require more frequent or more detailed report-
ing.’’. 
(c) CONFORMING AMENDMENTS.— 
(1) Sections 54(c)(2) and 1400N(l)(3)(B) are 
each amended by striking ‘‘subpart C’’ and inserting 
‘‘subparts C and I’’. 
(2) Section 1397E(c)(2) is amended by striking 
‘‘subpart H’’ and inserting ‘‘subparts H and I’’. 
(3) Section 6401(b)(1) is amended by striking 
‘‘and H’’ and inserting ‘‘H, and I’’. 
(4) The heading of subpart H of part IV of sub-
chapter A of chapter 1 is amended by striking ‘‘Cer-
tain Bonds’’ and inserting ‘‘Clean Renewable 
Energy Bonds’’. 
(5) The table of subparts for part IV of sub-
chapter A of chapter 1 is amended by striking the 
item relating to subpart H and inserting the fol-
lowing new items: 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00049
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
‘‘SUBPART H. NONREFUNDABLE CREDIT TO HOLDERS OF CLEAN RENEWABLE 
ENERGY BONDS. 
‘‘SUBPART I. QUALIFIED TAX CREDIT BONDS.’’. 
(d) APPLICATION OF CERTAIN LABOR STANDARDS ON 
PROJECTS FINANCED UNDER TAX CREDIT BONDS.—Sub-
chapter IV of chapter 31 of title 40, United States Code, 
shall apply to projects financed with the proceeds of any 
tax credit bond (as defined in section 54A of the Internal 
Revenue Code of 1986). 
(e) EFFECTIVE DATES.—The amendments made by 
this section shall apply to obligations issued after the date 
of the enactment of this Act. 
PART II—CARBON MITIGATION PROVISIONS 
SEC. 111. EXPANSION AND MODIFICATION OF ADVANCED 
COAL PROJECT INVESTMENT CREDIT. 
(a) MODIFICATION
OF
CREDIT
AMOUNT.—Section 
48A(a) is amended by striking ‘‘and’’ at the end of para-
graph (1), by striking the period at the end of paragraph 
(2) and inserting ‘‘, and’’, and by adding at the end the 
following new paragraph: 
‘‘(3) 30 percent of the qualified investment for 
such taxable year in the case of projects described in 
clause (iii) of subsection (d)(3)(B).’’. 
(b) EXPANSION
OF AGGREGATE CREDITS.—Section 
48A(d)(3)(A) is amended by striking ‘‘$1,300,000,000’’ and 
inserting ‘‘$2,550,000,000’’. 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00050
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
(c) AUTHORIZATION OF ADDITIONAL PROJECTS.— 
(1) IN GENERAL.—Subparagraph (B) of section 
48A(d)(3) is amended to read as follows: 
‘‘(B) PARTICULAR PROJECTS.—Of the dollar 
amount in subparagraph (A), the Secretary is 
authorized to certify— 
‘‘(i) $800,000,000 for integrated gasifi-
cation combined cycle projects the applica-
tion for which is submitted during the pe-
riod described in paragraph (2)(A)(i), 
‘‘(ii) $500,000,000 for projects which 
use other advanced coal-based generation 
technologies the application for which is 
submitted during the period described in 
paragraph (2)(A)(i), and 
‘‘(iii) $1,250,000,000 for advanced 
coal-based generation technology projects the 
application for which is submitted during 
the 
period 
described 
in 
paragraph 
(2)(A)(ii).’’. 
(2) APPLICATION
PERIOD
FOR
ADDITIONAL 
PROJECTS.—Subparagraph (A) of section 48A(d)(2) 
is amended to read as follows: 
‘‘(A) APPLICATION
PERIOD.—Each appli-
cant for certification under this paragraph shall 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00051
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
submit an application meeting the requirements 
of subparagraph (B). An applicant may only 
submit an application— 
‘‘(i) for an allocation from the dollar 
amount specified in clause (i) or (ii) of 
paragraph (3)(B) during the 3-year period 
beginning on the date the Secretary estab-
lishes the program under paragraph (1), 
and 
‘‘(ii) for an allocation from the dollar 
amount specified in paragraph (3)(B)(iii) 
during the 3-year period beginning at the 
earlier of the termination of the period de-
scribed in clause (i) or the date prescribed 
by the Secretary.’’. 
(3) CAPTURE AND SEQUESTRATION OF CARBON 
DIOXIDE EMISSIONS REQUIREMENT.— 
(A) IN
GENERAL.—Section 48A(e)(1) is 
amended by striking ‘‘and’’ at the end of sub-
paragraph (E), by striking the period at the end 
of subparagraph (F) and inserting ‘‘; and’’, and 
by adding at the end the following new subpara-
graph: 
‘‘(G) in the case of any project the applica-
tion for which is submitted during the period de-
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00052
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
scribed in subsection (d)(2)(A)(ii), the project in-
cludes equipment which separates and sequesters 
at least 65 percent (70 percent in the case of an 
application for reallocated credits under sub-
section (d)(4)) of such project’s total carbon diox-
ide emissions.’’. 
(B) HIGHEST
PRIORITY
FOR
PROJECTS 
WHICH
SEQUESTER
CARBON
DIOXIDE
EMIS-
SIONS.—Section 48A(e)(3) is amended by strik-
ing ‘‘and’’ at the end of subparagraph (A)(iii), 
by striking the period at the end of subpara-
graph (B)(iii) and inserting ‘‘, and’’, and by 
adding at the end the following new subpara-
graph: 
‘‘(C) give highest priority to projects with 
the greatest separation and sequestration per-
centage of total carbon dioxide emissions.’’. 
(C) RECAPTURE OF CREDIT FOR FAILURE 
TO
SEQUESTER.—Section 48A is amended by 
adding at the end the following new subsection: 
‘‘(h) RECAPTURE OF CREDIT FOR FAILURE TO SE-
QUESTER.—The Secretary shall provide for recapturing the 
benefit of any credit allowable under subsection (a) with 
respect to any project which fails to attain or maintain 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00053
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
the separation and sequestration requirements of subsection 
(e)(1)(G).’’. 
(4) ADDITIONAL PRIORITY FOR RESEARCH PART-
NERSHIPS.—Section 48A(e)(3)(B), as amended by 
paragraph (3)(B), is amended— 
(A) by striking ‘‘and’’ at the end of clause 
(ii), 
(B) by redesignating clause (iii) as clause 
(iv), and 
(C) by inserting after clause (ii) the fol-
lowing new clause: 
‘‘(iii) applicant participants who have 
a research partnership with an eligible edu-
cational institution (as defined in section 
529(e)(5)), and’’. 
(5) CLERICAL AMENDMENT.—Section 48A(e)(3) 
is amended by striking ‘‘INTEGRATED GASIFICATION 
COMBINED
CYCLE’’ in the heading and inserting 
‘‘CERTAIN’’. 
(d) COMPETITIVE CERTIFICATION AWARDS MODIFICA-
TION AUTHORITY.—Section 48A, as amended by subsection 
(c)(3), is amended by adding at the end the following new 
subsection: 
‘‘(i) COMPETITIVE CERTIFICATION AWARDS MODIFICA-
TION AUTHORITY.—In implementing this section or section 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00054
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
48B, the Secretary is directed to modify the terms of any 
competitive certification award and any associated closing 
agreement where such modification— 
‘‘(1) is consistent with the objectives of such sec-
tion, 
‘‘(2) is requested by the recipient of the competi-
tive certification award, and 
‘‘(3) involves moving the project site to improve 
the potential to capture and sequester carbon dioxide 
emissions, reduce costs of transporting feedstock, and 
serve a broader customer base, 
unless the Secretary determines that the dollar amount of 
tax credits available to the taxpayer under such section 
would increase as a result of the modification or such modi-
fication would result in such project not being originally 
certified. In considering any such modification, the Sec-
retary shall consult with other relevant Federal agencies, 
including the Department of Energy.’’. 
(e) DISCLOSURE OF ALLOCATIONS.—Section 48A(d) is 
amended by adding at the end the following new paragraph: 
‘‘(5) DISCLOSURE OF ALLOCATIONS.—The Sec-
retary shall, upon making a certification under this 
subsection or section 48B(d), publicly disclose the 
identity of the applicant and the amount of the credit 
certified with respect to such applicant.’’. 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00055
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
(f) EFFECTIVE DATES.— 
(1) IN GENERAL.—Except as otherwise provided 
in this subsection, the amendments made by this sec-
tion shall apply to credits the application for which 
is submitted during the period described in section 
48A(d)(2)(A)(ii) of the Internal Revenue Code of 1986 
and which are allocated or reallocated after the date 
of the enactment of this Act. 
(2) COMPETITIVE CERTIFICATION AWARDS MODI-
FICATION AUTHORITY.—The amendment made by sub-
section (d) shall take effect on the date of the enact-
ment of this Act and is applicable to all competitive 
certification awards entered into under section 48A or 
48B of the Internal Revenue Code of 1986, whether 
such awards were issued before, on, or after such date 
of enactment. 
(3) DISCLOSURE OF ALLOCATIONS.—The amend-
ment made by subsection (e) shall apply to certifi-
cations made after the date of the enactment of this 
Act. 
(4) CLERICAL
AMENDMENT.—The amendment 
made by subsection (c)(5) shall take effect as if in-
cluded in the amendment made by section 1307(b) of 
the Energy Tax Incentives Act of 2005. 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00056
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
SEC. 112. EXPANSION AND MODIFICATION OF COAL GASIFI-
CATION INVESTMENT CREDIT. 
(a) MODIFICATION
OF
CREDIT
AMOUNT.—Section 
48B(a) is amended by inserting ‘‘(30 percent in the case 
of credits allocated under subsection (d)(1)(B))’’ after ‘‘20 
percent’’. 
(b) EXPANSION
OF AGGREGATE CREDITS.—Section 
48B(d)(1) is amended by striking ‘‘shall not exceed 
$350,000,000’’ and all that follows and inserting ‘‘shall not 
exceed— 
‘‘(A) $350,000,000, plus 
‘‘(B) $250,000,000 for qualifying gasifi-
cation projects that include equipment which 
separates and sequesters at least 75 percent of 
such project’s total carbon dioxide emissions.’’. 
(c) RECAPTURE OF CREDIT FOR FAILURE TO SEQUES-
TER.—Section 48B is amended by adding at the end the 
following new subsection: 
‘‘(f) RECAPTURE OF CREDIT FOR FAILURE TO SE-
QUESTER.—The Secretary shall provide for recapturing the 
benefit of any credit allowable under subsection (a) with 
respect to any project which fails to attain or maintain 
the separation and sequestration requirements for such 
project under subsection (d)(1).’’. 
(d) SELECTION
PRIORITIES.—Section 48B(d) is 
amended by adding at the end the following new paragraph: 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00057
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
‘‘(4) SELECTION
PRIORITIES.—In determining 
which qualifying gasification projects to certify under 
this section, the Secretary shall— 
‘‘(A) give highest priority to projects with 
the greatest separation and sequestration per-
centage of total carbon dioxide emissions, and 
‘‘(B) give high priority to applicant par-
ticipants who have a research partnership with 
an eligible educational institution (as defined in 
section 529(e)(5)).’’. 
(e) EFFECTIVE DATE.—The amendments made by this 
section shall apply to credits described in section 
48B(d)(1)(B) of the Internal Revenue Code of 1986 which 
are allocated or reallocated after the date of the enactment 
of this Act. 
SEC. 113. TEMPORARY INCREASE IN COAL EXCISE TAX. 
Paragraph (2) of section 4121(e) is amended— 
(1) by striking ‘‘January 1, 2014’’ in subpara-
graph (A) and inserting ‘‘December 31, 2018’’, and 
(2) by striking ‘‘January 1 after 1981’’ in sub-
paragraph (B) and inserting ‘‘December 31 after 
2007’’. 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00058
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
SEC. 114. SPECIAL RULES FOR REFUND OF THE COAL EX-
CISE TAX TO CERTAIN COAL PRODUCERS AND 
EXPORTERS. 
(a) REFUND.— 
(1) COAL PRODUCERS.— 
(A) IN
GENERAL.—Notwithstanding sub-
sections (a)(1) and (c) of section 6416 and sec-
tion 6511 of the Internal Revenue Code of 1986, 
if— 
(i) a coal producer establishes that 
such coal producer, or a party related to 
such coal producer, exported coal produced 
by such coal producer to a foreign country 
or shipped coal produced by such coal pro-
ducer to a possession of the United States, 
or caused such coal to be exported or 
shipped, the export or shipment of which 
was other than through an exporter who 
meets the requirements of paragraph (2), 
(ii) such coal producer filed an excise 
tax return on or after October 1, 1990, and 
on or before the date of the enactment of this 
Act, and 
(iii) such coal producer files a claim 
for refund with the Secretary not later than 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00059
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
the close of the 30-day period beginning on 
the date of the enactment of this Act, 
then the Secretary shall pay to such coal pro-
ducer an amount equal to the tax paid under 
section 4121 of such Code on such coal exported 
or shipped by the coal producer or a party re-
lated to such coal producer, or caused by the coal 
producer or a party related to such coal producer 
to be exported or shipped. 
(B) SPECIAL
RULES
FOR
CERTAIN
TAX-
PAYERS.—For purposes of this section— 
(i) IN GENERAL.—If a coal producer or 
a party related to a coal producer has re-
ceived a judgment described in clause (iii), 
such coal producer shall be deemed to have 
established the export of coal to a foreign 
country or shipment of coal to a possession 
of the United States under subparagraph 
(A)(i). 
(ii) AMOUNT OF PAYMENT.—If a tax-
payer described in clause (i) is entitled to 
a payment under subparagraph (A), the 
amount of such payment shall be reduced by 
any amount paid pursuant to the judgment 
described in clause (iii). 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00060
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
(iii) JUDGMENT DESCRIBED.—A judg-
ment is described in this subparagraph if 
such judgment— 
(I) is made by a court of com-
petent jurisdiction within the United 
States, 
(II) relates to the constitutionality 
of any tax paid on exported coal under 
section 4121 of the Internal Revenue 
Code of 1986, and 
(III) is in favor of the coal pro-
ducer or the party related to the coal 
producer. 
(2) EXPORTERS.—Notwithstanding subsections 
(a)(1) and (c) of section 6416 and section 6511 of the 
Internal Revenue Code of 1986, and a judgment de-
scribed in paragraph (1)(B)(iii) of this subsection, 
if— 
(A) an exporter establishes that such ex-
porter exported coal to a foreign country or 
shipped coal to a possession of the United States, 
or caused such coal to be so exported or shipped, 
(B) such exporter filed a tax return on or 
after October 1, 1990, and on or before the date 
of the enactment of this Act, and 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00061
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
(C) such exporter files a claim for refund 
with the Secretary not later than the close of the 
30-day period beginning on the date of the enact-
ment of this Act, 
then the Secretary shall pay to such exporter an 
amount equal to $0.825 per ton of such coal exported 
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 Federal 
Government has been made with and accepted by, the coal 
producer, a party related to such coal producer, or the ex-
porter, 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 settlement or 
stipulation entered into as of the date of the enactment of 
this Act, the terms of which contemplate a judgment con-
cerning 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— 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00062
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
(1) COAL PRODUCER.—The term ‘‘coal producer’’ 
means the person in whom is vested ownership of the 
coal immediately after the coal is severed from the 
ground, without regard to the existence of any con-
tractual arrangement for the sale or other disposition 
of the coal or the payment of any royalties 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 processing) 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 pro-
ducer or seller of such coal and— 
(A) is indicated in the shipper’s export dec-
laration or other documentation as the exporter 
of record, or 
(B) actually exported such coal to a foreign 
country or shipped such coal to a possession of 
the United States, or caused such coal to be so 
exported or shipped. 
(3) RELATED PARTY.—The term ‘‘a party related 
to such coal producer’’ means a person who— 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00063
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
(A) is related to such coal producer through 
any degree of common management, stock owner-
ship, 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 designee. 
(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 Sec-
retary 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 determination. 
(f) INTEREST.—Any refund paid pursuant to this sec-
tion shall be paid by the Secretary with interest from the 
date of overpayment determined by using the overpayment 
rate and method under section 6621 of the Internal Revenue 
Code of 1986. 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00064
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
(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 In-
ternal 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 exported 
by the exporter. 
(h) APPLICATION OF SECTION.—This section applies 
only to claims on coal exported or shipped on or after Octo-
ber 1, 1990, through the date of the enactment of this Act. 
(i) STANDING NOT CONFERRED.— 
(1) EXPORTERS.—With respect to exporters, this 
section shall not confer standing upon an exporter to 
commence, or intervene in, any judicial or adminis-
trative proceeding concerning a claim for refund by 
a coal producer of any Federal or State tax, fee, or 
royalty paid by the coal producer. 
(2) COAL PRODUCERS.—With respect to coal pro-
ducers, this section shall not confer standing upon a 
coal producer to commence, or intervene in, any judi-
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00065
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
cial or administrative proceeding concerning a claim 
for refund by an exporter of any Federal or State tax, 
fee, or royalty paid by the producer and alleged to 
have been passed on to an exporter. 
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 Internal Rev-
enue Code of 1986 to identify the types of and specific tax 
provisions that have the largest effects on carbon 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 2008 and 2009. 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00066
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
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 ‘cellulosic 
biofuel’ means any liquid fuel which is produced from 
any lignocellulosic or hemicellulosic matter that is 
available on a renewable or recurring basis.’’. 
(b) CONFORMING AMENDMENTS.—Subsection (l) of sec-
tion 168 is amended— 
(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 inserting 
‘‘CELLULOSIC BIOFUEL’’, and 
(3) by striking ‘‘CELLULOSIC BIOMASS ETHANOL’’ 
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. 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00067
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
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 sec-
tion 6426(c) is amended to read as follows: 
‘‘(2) APPLICABLE AMOUNT.—For purposes of this 
subsection, the applicable amount is $1.00.’’. 
(3) CONFORMING AMENDMENTS.— 
(A) Subsection (b) of section 40A is amend-
ed by striking paragraph (3) and by redesig-
nating paragraphs (4) and (5) as paragraphs 
(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 ‘‘subsection 
(b)(5)(C)’’ and inserting ‘‘subsection (b)(4)(C)’’. 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00068
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
(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 
(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 PE-
TROLEUM FEEDSTOCK.— 
(1) IN
GENERAL.—Paragraph (3) of section 
40A(f) (defining renewable diesel) is amended by add-
ing at the end the following flush sentence: 
‘‘Such term does not include any fuel derived from co-
processing biomass with a feedstock which is not bio-
mass. For purposes of this paragraph, the term ‘bio-
mass’ has the meaning given such term by section 
45K(c)(3).’’. 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00069
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
(2) CONFORMING AMENDMENT.—Paragraph (3) 
of section 40A(f) is amended by striking ‘‘(as defined 
in section 45K(c)(3))’’. 
(e) ELIGIBILITY OF CERTAIN AVIATION FUEL.—Para-
graph (3) of section 40A(f) (defining renewable diesel) is 
amended by adding at the end the following: ‘‘The term ‘re-
newable diesel’ also means fuel derived from biomass which 
meets the requirements of a Department of Defense speci-
fication for military jet fuel or an American Society of 
Testing and Materials specification for aviation turbine 
fuel.’’ 
(f) EFFECTIVE DATE.— 
(1) IN GENERAL.—Except as otherwise provided 
in this subsection, the amendments made by this sec-
tion 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. 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00070
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
SEC. 123. CLARIFICATION THAT CREDITS FOR FUEL ARE DE-
SIGNED TO PROVIDE AN INCENTIVE FOR 
UNITED STATES PRODUCTION. 
(a) ALCOHOL FUELS CREDIT.—Subsection (d) of sec-
tion 40 is amended by adding at the end the following new 
paragraph: 
‘‘(6) LIMITATION TO ALCOHOL WITH CONNECTION 
TO THE UNITED STATES.—No credit shall be deter-
mined under this section with respect to any alcohol 
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.’’. 
(b) BIODIESEL FUELS CREDIT.—Subsection (d) of sec-
tion 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 de-
termined under this section with respect to any bio-
diesel 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: 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00071
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
‘‘(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 
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 re-
spect to any biodiesel or alternative fuel which is pro-
duced outside the United States for use as a fuel out-
side the United States. 
For purposes of this subsection, the term ‘United States’ in-
cludes 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).’’. 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00072
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
(d) EFFECTIVE DATE.—The amendments made by this 
section shall apply to claims for credit or payment made 
on or after May 15, 2008. 
SEC. 124. CREDIT FOR NEW QUALIFIED PLUG-IN ELECTRIC 
DRIVE MOTOR VEHICLES. 
(a) IN GENERAL.—Subpart B of part IV of subchapter 
A of chapter 1 is amended by adding at the end the fol-
lowing new section: 
‘‘SEC. 30D. NEW QUALIFIED PLUG-IN ELECTRIC DRIVE 
MOTOR VEHICLES. 
‘‘(a) ALLOWANCE OF CREDIT.—There shall be allowed 
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 respect to 
each new qualified plug-in electric drive motor vehicle 
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. 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00073
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
‘‘(3) BATTERY CAPACITY.—In the case of a vehi-
cle 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 excess 
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 character 
subject to an allowance for depreciation shall be treat-
ed 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 al-
lowable under subpart A for such taxable year. 
‘‘(B) LIMITATION
BASED
ON
AMOUNT
OF 
TAX.—In the case of a taxable year to which sec-
tion 26(a)(2) does not apply, the credit allowed 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00074
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
under subsection (a) for any taxable year (deter-
mined after application of paragraph (1)) shall 
not exceed the excess of— 
‘‘(i) the sum of the regular tax liability 
(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 (as defined in section 30(c)(2))— 
‘‘(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 con-
formity under the Clean Air Act and meets or 
exceeds the Bin 5 Tier II emission standard es-
VerDate Aug 31 2005 
01:24 May 21, 2008
Jkt 069200
PO 00000
Frm 00075
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
tablished in regulations prescribed by the Ad-
ministrator of the Environmental Protection 
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) OTHER TERMS.—The terms ‘passenger auto-
mobile’, ‘light truck’, and ‘manufacturer’ have the 
meanings given such terms in regulations prescribed 
by the Administrator of the Environmental Protection 
Agency for purposes of the administration of title II 
of the Clean Air Act (42 U.S.C. 7521 et seq.). 
‘‘(4) BATTERY CAPACITY.—The term ‘capacity’ 
means, with respect to any battery, the quantity of 
electricity which the battery is capable of storing, ex-
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00076
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
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. 
‘‘(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 calendar 
quarters of the phaseout period, and 
VerDate Aug 31 2005 
01:24 May 21, 2008
Jkt 069200
PO 00000
Frm 00077
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
‘‘(C) 0 percent for each calendar quarter 
thereafter. 
‘‘(4) CONTROLLED
GROUPS.—Rules similar to 
the rules of section 30B(f)(4) shall apply for purposes 
of this subsection. 
‘‘(f) SPECIAL RULES.— 
‘‘(1) BASIS REDUCTION.—The basis of any prop-
erty for which a credit is allowable under subsection 
(a) shall be reduced by the amount of such credit (de-
termined without regard to subsection (c)). 
‘‘(2) RECAPTURE.—The Secretary shall, by regu-
lations, 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 re-
ferred to in section 50(b)(1) or with respect 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. 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00078
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
‘‘(5) PROPERTY USED BY TAX-EXEMPT ENTITY; 
INTERACTION WITH AIR QUALITY AND MOTOR VEHICLE 
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 VEHI-
CLE 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 30D (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— 
(1) by striking ‘‘and’’ each place it appears at 
the end of any paragraph, 
(2) by striking ‘‘plus’’ each place it appears at 
the end of any paragraph, 
(3) by striking the period at the end of para-
graph (31) and inserting ‘‘, plus’’, and 
(4) by adding at the end the following new para-
graph: 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00079
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
‘‘(32) the portion of the new qualified plug-in 
electric drive motor vehicle credit to which section 
30D(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 30D’’. 
(B) Section 25(e)(1)(C)(ii) is amended by insert-
ing ‘‘30D,’’ after ‘‘25D,’’. 
(C) Section 25B(g)(2), as amended by section 
104, is amended by striking ‘‘and 25D’’ and inserting 
‘‘, 25D, and 30D’’. 
(D) Section 26(a)(1), as amended by section 104, 
is amended by striking ‘‘and 25D’’ and inserting 
‘‘25D, and 30D’’. 
(E) Section 1400C(d)(2) is amended by striking 
‘‘and 25D’’ and inserting ‘‘25D, and 30D’’. 
(2) Section 1016(a) is amended by striking 
‘‘and’’ at the end of paragraph (35), by striking the 
period at the end of paragraph (36) and inserting 
‘‘, and’’, and by adding at the end the following new 
paragraph: 
‘‘(37) 
to 
the 
extent 
provided 
in 
section 
30D(f)(1).’’. 
VerDate Aug 31 2005 
01:24 May 21, 2008
Jkt 069200
PO 00000
Frm 00080
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
(3) Section 6501(m) is amended by inserting 
‘‘30D(f)(4),’’ after ‘‘30C(e)(5),’’. 
(4) The table of sections for subpart B of part IV 
of subchapter A of chapter 1 is amended by adding 
at the end the following new item: 
‘‘Sec. 30D. 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 cred-
it 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 ‘‘sections 27 and 30’’. 
(B) Paragraph (3) of section 55(c) is 
amended by striking ‘‘30B(g)(2),’’. 
(f) EFFECTIVE DATE.— 
(1) IN GENERAL.—Except as otherwise provided 
in this subsection, the amendments made by this sec-
tion shall apply to taxable years beginning after De-
cember 31, 2008. 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00081
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
(2) TREATMENT OF ALTERNATIVE MOTOR VEHI-
CLE CREDIT AS PERSONAL CREDIT.—The amendments 
made by subsection (e) shall apply to taxable years 
beginning after December 31, 2007. 
(g) APPLICATION OF EGTRRA SUNSET.—The amend-
ment made by subsection (d)(1)(A) shall be subject to title 
IX of the Economic Growth and Tax Relief Reconciliation 
Act of 2001 in the same manner as the provision 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 adding 
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 oper-
ation of the main drive engine while the vehicle 
is temporarily parked or remains stationary 
using one or more devices affixed to a tractor, 
and 
‘‘(B) is certified by the Secretary of Energy, 
in consultation with the Administrator of the 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00082
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
Environmental Protection Agency and the Sec-
retary of Transportation, to reduce idling of such 
vehicle at a motor vehicle rest stop or other loca-
tion where such vehicles are temporarily 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. RESTRUCTURING OF NEW YORK LIBERTY ZONE 
TAX CREDITS. 
(a) IN GENERAL.—Part I of subchapter Y of chapter 
1 is amended by redesignating section 1400L as section 
1400K and by adding at the end the following new section: 
‘‘SEC. 1400L. NEW YORK LIBERTY ZONE TAX CREDITS. 
‘‘(a) IN GENERAL.—In the case of a New York Liberty 
Zone governmental unit, there shall be allowed as a credit 
against any taxes imposed for any payroll period by section 
3402 for which such governmental unit is liable under sec-
tion 3403 an amount equal to so much of the portion of 
the qualifying project expenditure amount allocated under 
subsection (b)(3) to such governmental unit for the calendar 
year as is allocated by such governmental unit to such pe-
riod under subsection (b)(4). 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00083
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
‘‘(b) QUALIFYING PROJECT EXPENDITURE AMOUNT.— 
For purposes of this section— 
‘‘(1) IN GENERAL.—The term ‘qualifying project 
expenditure amount’ means, with respect to any cal-
endar year, the sum of— 
‘‘(A) the total expenditures paid or incurred 
during such calendar year by all New York Lib-
erty Zone governmental units and the Port Au-
thority of New York and New Jersey for any 
portion of qualifying projects located wholly 
within the City of New York, New York, and 
‘‘(B) any such expenditures— 
‘‘(i) paid or incurred in any preceding 
calendar year which begins after the date of 
enactment of this section, and 
‘‘(ii) not previously allocated under 
paragraph (3). 
‘‘(2) QUALIFYING
PROJECT.—The term ‘quali-
fying project’ means any transportation infrastruc-
ture project, including highways, mass transit sys-
tems, railroads, airports, ports, and waterways, in or 
connecting with the New York Liberty Zone (as de-
fined in section 1400K(h)), which is designated as a 
qualifying project under this section jointly by the 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00084
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
Governor of the State of New York and the Mayor of 
the City of New York, New York. 
‘‘(3) GENERAL ALLOCATION.— 
‘‘(A) IN
GENERAL.—The Governor of the 
State of New York and the Mayor of the City of 
New York, New York, shall jointly allocate to 
each New York Liberty Zone governmental unit 
the portion of the qualifying project expenditure 
amount which may be taken into account by 
such governmental unit under subsection (a) for 
any calendar year in the credit period. 
‘‘(B) AGGREGATE
LIMIT.—The aggregate 
amount which may be allocated under subpara-
graph (A) for all calendar years in the credit pe-
riod shall not exceed $2,000,000,000. 
‘‘(C) 
ANNUAL
LIMIT.—The 
aggregate 
amount which may be allocated under subpara-
graph (A) for any calendar year in the credit pe-
riod shall not exceed the sum of— 
‘‘(i) $115,000,000 ($425,000,000 in the 
case of the last 2 years in the credit period), 
plus 
‘‘(ii) the aggregate amount authorized 
to be allocated under this paragraph for all 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00085
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
preceding calendar years in the credit pe-
riod which was not so allocated. 
‘‘(D) UNALLOCATED AMOUNTS AT END OF 
CREDIT PERIOD.—If, as of the close of the credit 
period, the amount under subparagraph (B) ex-
ceeds the aggregate amount allocated under sub-
paragraph (A) for all calendar years in the cred-
it period, the Governor of the State of New York 
and the Mayor of the City of New York, New 
York, may jointly allocate to New York Liberty 
Zone governmental units for any calendar year 
in the 5-year period following the credit period 
an amount equal to— 
‘‘(i) the lesser of— 
‘‘(I) such excess, or 
‘‘(II) the qualifying project ex-
penditure amount for such calendar 
year, reduced by 
‘‘(ii) the aggregate amount allocated 
under this subparagraph for all preceding 
calendar years. 
‘‘(4) ALLOCATION TO PAYROLL PERIODS.—Each 
New York Liberty Zone governmental unit which has 
been allocated a portion of the qualifying project ex-
penditure amount under paragraph (3) for a cal-
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00086
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
endar year may allocate such portion to payroll peri-
ods beginning in such calendar year as such govern-
mental unit determines appropriate. 
‘‘(c) CARRYOVER OF UNUSED ALLOCATIONS.— 
‘‘(1) IN GENERAL.—Except as provided in para-
graph (2), if the amount allocated under subsection 
(b)(3) to a New York Liberty Zone governmental unit 
for any calendar year exceeds the aggregate taxes im-
posed by section 3402 for which such governmental 
unit is liable under section 3403 for periods begin-
ning in such year, such excess shall be carried to the 
succeeding calendar year and added to the allocation 
of such governmental unit for such succeeding cal-
endar year. 
‘‘(2) REALLOCATION.—If a New York Liberty 
Zone governmental unit does not use an amount allo-
cated to it under subsection (b)(3) within the time 
prescribed by the Governor of the State of New York 
and the Mayor of the City of New York, New York, 
then such amount shall after such time be treated for 
purposes of subsection (b)(3) in the same manner as 
if it had never been allocated. 
‘‘(d) DEFINITIONS AND SPECIAL RULES.—For pur-
poses of this section— 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00087
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
‘‘(1) CREDIT PERIOD.—The term ‘credit period’ 
means the 12-year period beginning on January 1, 
2009. 
‘‘(2) NEW YORK LIBERTY ZONE GOVERNMENTAL 
UNIT.—The term ‘New York Liberty Zone govern-
mental unit’ means— 
‘‘(A) the State of New York, 
‘‘(B) the City of New York, New York, and 
‘‘(C) any agency or instrumentality of such 
State or City. 
‘‘(3) TREATMENT OF FUNDS.—Any expenditure 
for a qualifying project taken into account for pur-
poses of the credit under this section shall be consid-
ered State and local funds for the purpose of any Fed-
eral program. 
‘‘(4) TREATMENT OF CREDIT AMOUNTS FOR PUR-
POSES
OF
WITHHOLDING
TAXES.—For purposes of 
this title, a New York Liberty Zone governmental 
unit shall be treated as having paid to the Secretary, 
on the day on which wages are paid to employees, an 
amount equal to the amount of the credit allowed to 
such entity under subsection (a) with respect to such 
wages, but only if such governmental unit deducts 
and withholds wages for such payroll period under 
section 3401 (relating to wage withholding). 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00088
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
‘‘(e) REPORTING.—The Governor of the State of New 
York and the Mayor of the City of New York, New York, 
shall jointly submit to the Secretary an annual report— 
‘‘(1) which certifies— 
‘‘(A) the qualifying project expenditure 
amount for the calendar year, and 
‘‘(B) the amount allocated to each New York 
Liberty Zone governmental unit under sub-
section (b)(3) for the calendar year, and 
‘‘(2) includes such other information as the Sec-
retary may require to carry out this section. 
‘‘(f) GUIDANCE.—The Secretary may prescribe such 
guidance as may be necessary or appropriate to ensure com-
pliance with the purposes of this section.’’. 
(b) TERMINATION OF SPECIAL ALLOWANCE AND EX-
PENSING.—Subparagraph (A) of section 1400K(b)(2), as re-
designated by subsection (a), is amended by striking the 
parenthetical therein and inserting ‘‘(in the case of nonresi-
dential real property and residential rental property, the 
date of the enactment of the Renewable Energy and Job Cre-
ation Act of 2008 or, if acquired pursuant to a binding 
contract in effect on such enactment date, December 31, 
2009)’’. 
(c) CONFORMING AMENDMENTS.— 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00089
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
(1) Section 38(c)(3)(B) is amended by striking 
‘‘section 1400L(a)’’ and inserting ‘‘section 1400K(a)’’. 
(2) Section 168(k)(2)(D)(ii) is amended by strik-
ing ‘‘section 1400L(c)(2)’’ and inserting ‘‘section 
1400K(c)(2)’’. 
(3) The table of sections for part I of subchapter 
Y of chapter 1 is amended by redesignating the item 
relating to section 1400L as an item relating to sec-
tion 1400K and by inserting after such item the fol-
lowing new item: 
‘‘Sec. 1400L. New York Liberty Zone tax credits.’’. 
(d) EFFECTIVE DATE.—The amendments made by this 
section shall take effect on the date of the enactment of this 
Act. 
SEC. 127. 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 sub-
paragraph (B) and inserting ‘‘, and’’, and by adding at 
the end the following new subparagraph: 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00090
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
‘‘(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 storage, 
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 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00091
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
multiplied by the number of qualified bicy-
cle commuting months during such year. 
‘‘(iii) QUALIFIED BICYCLE COMMUTING 
MONTH.—The term ‘qualified bicycle com-
muting month’ means, with respect 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 reimbursement)’’ after 
‘‘qualified transportation fringe’’. 
(e) EFFECTIVE DATE.—The amendments made by this 
section shall apply to taxable years beginning after Decem-
ber 31, 2008. 
SEC. 128. ALTERNATIVE FUEL VEHICLE REFUELING PROP-
ERTY CREDIT. 
(a) INCREASE IN CREDIT AMOUNT.—Section 30C is 
amended— 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00092
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
(1) by striking ‘‘30 percent’’ in subsection (a) 
and inserting ‘‘50 percent’’, and 
(2) by striking ‘‘$30,000’’ in subsection (b)(1) 
and inserting ‘‘$50,000’’. 
(b) EXTENSION OF CREDIT.—Paragraph (2) of section 
30C(g) is amended by striking ‘‘December 31, 2009’’ and 
inserting ‘‘December 31, 2010’’. 
(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. 
Subtitle C—Energy Conservation 
and Efficiency Provisions 
SEC. 141. QUALIFIED ENERGY CONSERVATION BONDS. 
(a) IN GENERAL.—Subpart I of part IV of subchapter 
A of chapter 1, as added by section 106, is amended by 
adding at the end the following new section: 
‘‘SEC. 54C. QUALIFIED ENERGY CONSERVATION BONDS. 
‘‘(a) QUALIFIED ENERGY CONSERVATION BOND.—For 
purposes of this subchapter, the term ‘qualified energy con-
servation bond’ means any bond issued as part of an issue 
if— 
‘‘(1) 100 percent of the available project proceeds 
of such issue are to be used for one or more qualified 
conservation purposes, 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00093
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
‘‘(2) the bond is issued by a State or local gov-
ernment, and 
‘‘(3) the issuer designates such bond for purposes 
of this section. 
‘‘(b) REDUCED CREDIT AMOUNT.—The annual credit 
determined under section 54A(b) with respect to any quali-
fied energy conservation bond shall be 70 percent of the 
amount so determined without regard to this subsection. 
‘‘(c) LIMITATION
ON
AMOUNT
OF
BONDS
DES-
IGNATED.—The maximum aggregate face amount of bonds 
which may be designated under subsection (a) by any issuer 
shall not exceed the limitation amount allocated to such 
issuer under subsection (e). 
‘‘(d) NATIONAL LIMITATION ON AMOUNT OF BONDS 
DESIGNATED.—There is a national qualified energy con-
servation bond limitation of $3,000,000,000. 
‘‘(e) ALLOCATIONS.— 
‘‘(1) IN
GENERAL.—The limitation applicable 
under subsection (d) shall be allocated by the Sec-
retary among the States in proportion to the popu-
lation of the States. 
‘‘(2) ALLOCATIONS TO LARGEST LOCAL GOVERN-
MENTS.— 
‘‘(A) IN
GENERAL.—In the case of any 
State in which there is a large local government, 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00094
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
each such local government shall be allocated a 
portion of such State’s allocation which bears the 
same ratio to the State’s allocation (determined 
without regard to this subparagraph) as the pop-
ulation of such large local government bears to 
the population of such State. 
‘‘(B) ALLOCATION OF UNUSED LIMITATION 
TO
STATE.—The amount allocated under this 
subsection to a large local government may be re-
allocated by such local government to the State 
in which such local government is located. 
‘‘(C) LARGE
LOCAL
GOVERNMENT.—For 
purposes of this section, the term ‘large local gov-
ernment’ means any municipality or county if 
such municipality or county has a population of 
100,000 or more. 
‘‘(3) ALLOCATION TO ISSUERS; RESTRICTION ON 
PRIVATE ACTIVITY BONDS.—Any allocation under this 
subsection to a State or large local government shall 
be allocated by such State or large local government 
to issuers within the State in a manner that results 
in not less than 70 percent of the allocation to such 
State or large local government being used to des-
ignate bonds which are not private activity bonds. 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00095
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
‘‘(f) QUALIFIED CONSERVATION PURPOSE.—For pur-
poses of this section— 
‘‘(1) IN GENERAL.—The term ‘qualified conserva-
tion purpose’ means any of the following: 
‘‘(A) Capital expenditures incurred for pur-
poses of— 
‘‘(i) reducing energy consumption in 
publicly-owned buildings by at least 20 per-
cent, 
‘‘(ii) implementing green community 
programs, 
‘‘(iii) rural development involving the 
production of electricity from renewable en-
ergy resources, or 
‘‘(iv) any qualified facility (as deter-
mined under section 45(d) without regard 
to paragraphs (8) and (10) thereof and 
without regard to any placed in service 
date). 
‘‘(B) Expenditures with respect to research 
facilities, and research grants, to support re-
search in— 
‘‘(i) development of cellulosic ethanol 
or other nonfossil fuels, 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00096
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
‘‘(ii) technologies for the capture and 
sequestration of carbon dioxide produced 
through the use of fossil fuels, 
‘‘(iii) increasing the efficiency of exist-
ing technologies for producing nonfossil 
fuels, 
‘‘(iv) automobile battery technologies 
and other technologies to reduce fossil fuel 
consumption in transportation, or 
‘‘(v) technologies to reduce energy use 
in buildings. 
‘‘(C) Mass commuting facilities and related 
facilities that reduce the consumption of energy, 
including expenditures to reduce pollution from 
vehicles used for mass commuting. 
‘‘(D) Demonstration projects designed to 
promote the commercialization of— 
‘‘(i) green building technology, 
‘‘(ii) conversion of agricultural waste 
for use in the production of fuel or other-
wise, 
‘‘(iii) advanced battery manufacturing 
technologies, 
‘‘(iv) technologies to reduce peak use of 
electricity, or 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00097
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
‘‘(v) technologies for the capture and 
sequestration of carbon dioxide emitted from 
combusting fossil fuels in order to produce 
electricity. 
‘‘(E) Public education campaigns to pro-
mote energy efficiency. 
‘‘(2) SPECIAL
RULES
FOR
PRIVATE
ACTIVITY 
BONDS.—For purposes of this section, in the case of 
any private activity bond, the term ‘qualified con-
servation purposes’ shall not include any expenditure 
which is not a capital expenditure. 
‘‘(g) POPULATION.— 
‘‘(1) IN GENERAL.—The population of any State 
or local government shall be determined for purposes 
of this section as provided in section 146(j) for the 
calendar year which includes the date of the enact-
ment of this section. 
‘‘(2) SPECIAL RULE FOR COUNTIES.—In deter-
mining the population of any county for purposes of 
this section, any population of such county which is 
taken into account in determining the population of 
any municipality which is a large local government 
shall not be taken into account in determining the 
population of such county. 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00098
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
‘‘(h) APPLICATION
TO
INDIAN
TRIBAL
GOVERN-
MENTS.—An Indian tribal government shall be treated for 
purposes of this section in the same manner as a large local 
government, except that— 
‘‘(1) an Indian tribal government shall be treat-
ed for purposes of subsection (e) as located within a 
State to the extent of so much of the population of 
such government as resides within such State, and 
‘‘(2) any bond issued by an Indian tribal gov-
ernment shall be treated as a qualified energy con-
servation bond only if issued as part of an issue the 
available project proceeds of which are used for pur-
poses for which such Indian tribal government could 
issue bonds to which section 103(a) applies.’’. 
(b) CONFORMING AMENDMENTS.— 
(1) Paragraph (1) of section 54A(d), as added by 
section 106, is amended to read as follows: 
‘‘(1) QUALIFIED TAX CREDIT BOND.—The term 
‘qualified tax credit bond’ means— 
‘‘(A) a new clean renewable energy bond, or 
‘‘(B) a qualified energy conservation bond, 
which is part of an issue that meets requirements of 
paragraphs (2), (3), (4), (5), and (6).’’. 
(2) Subparagraph (C) of section 54A(d)(2), as 
added by section 106, is amended to read as follows: 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00099
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
100 
‘‘(C) QUALIFIED
PURPOSE.—For purposes 
of this paragraph, the term ‘qualified purpose’ 
means— 
‘‘(i) in the case of a new clean renew-
able energy bond, a purpose specified in sec-
tion 54B(a)(1), and 
‘‘(ii) in the case of a qualified energy 
conservation bond, a purpose specified in 
section 54C(a)(1).’’. 
(3) The table of sections for subpart I of part IV 
of subchapter A of chapter 1 is amended by adding 
at the end the following new item: 
‘‘Sec. 54C. Qualified energy conservation 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. 142. CREDIT FOR NONBUSINESS ENERGY PROPERTY. 
(a) EXTENSION
OF
CREDIT.—Section 25C(g) is 
amended by striking ‘‘December 31, 2007’’ and inserting 
‘‘December 31, 2008’’. 
(b) QUALIFIED BIOMASS FUEL PROPERTY.— 
(1) IN GENERAL.—Section 25C(d)(3) is amend-
ed— 
(A) by striking ‘‘and’’ at the end of sub-
paragraph (D), 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00100
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
101 
(B) by striking the period at the end of sub-
paragraph (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 amended 
by adding at the end the following new paragraph: 
‘‘(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 (includ-
ing wood pellets), plants (including aquatic plants), 
grasses, residues, and fibers.’’. 
(c) COORDINATION WITH CREDIT
FOR QUALIFIED 
GEOTHERMAL HEAT PUMP PROPERTY EXPENDITURES.— 
(1) IN
GENERAL.—Paragraph (3) of section 
25C(d), as amended by subsection (b), is amended by 
striking subparagraph (C) and by redesignating sub-
paragraphs (D), (E), and (F) as subparagraphs (C), 
(D), and (E), respectively. 
VerDate Aug 31 2005 
01:24 May 21, 2008
Jkt 069200
PO 00000
Frm 00101
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
102 
(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 respect 
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 Refrigera-
tion Institute that are prepared in partner-
ship with the Consortium for Energy Effi-
ciency.’’. 
(d) EFFECTIVE DATE.—The amendments made this 
section shall apply to expenditures made after December 31, 
2007. 
SEC. 143. ENERGY EFFICIENT COMMERCIAL BUILDINGS DE-
DUCTION. 
Subsection (h) of section 179D is amended by striking 
‘‘December 31, 2008’’ and inserting ‘‘December 31, 2013’’. 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00102
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
103 
SEC. 144. 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 cycle (5.5 gal-
lons per cycle for dishwashers designed for great-
er 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 calendar 
year 2008 which meets or exceeds a 1.72 modi-
fied energy factor and does not exceed a 8.0 
water consumption factor, 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00103
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
104 
‘‘(B) $125 in the case of a residential top- 
loading clothes washer manufactured in calendar 
year 2008 or 2009 which meets or exceeds 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. 
‘‘(3) REFRIGERATORS.—The applicable amount 
is— 
‘‘(A) $50 in the case of a refrigerator which 
is manufactured in calendar year 2008, and con-
sumes 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 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00104
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
105 
than 24.9 percent less kilowatt hours per year 
than the 2001 energy conservation standards, 
‘‘(C) $100 in the case of a refrigerator 
which is manufactured in calendar year 2008, 
2009, or 2010, and consumes at least 25 percent 
but not more than 29.9 percent less kilowatt 
hours per year than the 2001 energy conserva-
tion standards, and 
‘‘(D) $200 in the case of a refrigerator man-
ufactured in calendar year 2008, 2009, or 2010 
and which consumes at least 30 percent less en-
ergy than the 2001 energy conservation stand-
ards.’’. 
(b) ELIGIBLE PRODUCTION.— 
(1) SIMILAR
TREATMENT
FOR
ALL
APPLI-
ANCES.—Subsection (c) of section 45M is amended— 
(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, 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00105
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
106 
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.—Sub-
section (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 appli-
ances are— 
‘‘(1) dishwashers described in subsection (b)(1), 
‘‘(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 taxable 
year shall not exceed $75,000,000 reduced by the 
amount of the credit allowed under subsection (a) to 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00106
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
107 
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 de-
scribed in subsection (b)(3)(D) and clothes washers 
described in subsection (b)(2)(D) shall not be taken 
into account under paragraph (1).’’. 
(e) QUALIFIED ENERGY EFFICIENT APPLIANCES.— 
(1) IN
GENERAL.—Paragraph (1) of section 
45M(f) (defining qualified energy efficient appliance) 
is amended to read as follows: 
‘‘(1) QUALIFIED
ENERGY
EFFICIENT
APPLI-
ANCE.—The term ‘qualified energy efficient appliance’ 
means— 
‘‘(A) any dishwasher described in subsection 
(b)(1), 
‘‘(B) any clothes washer described in sub-
section (b)(2), and 
‘‘(C) any refrigerator described in sub-
section (b)(3).’’. 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00107
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
108 
(2) CLOTHES
WASHER.—Section 45M(f)(3) is 
amended by inserting ‘‘commercial’’ before ‘‘residen-
tial’’ the second place it appears. 
(3) 
TOP-LOADING
CLOTHES
WASHER.—Sub-
section (f) of section 45M is amended by redesignating 
paragraphs (4), (5), (6), and (7) as paragraphs (5), 
(6), (7), and (8), respectively, and by inserting after 
paragraph (3) the following new paragraph: 
‘‘(4) 
TOP-LOADING
CLOTHES
WASHER.—The 
term ‘top-loading clothes washer’ means a clothes 
washer which has the clothes container compartment 
access located on the top of the machine and which 
operates on a vertical axis.’’. 
(4) REPLACEMENT OF ENERGY FACTOR.—Section 
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 CONSUMPTION 
FACTOR.—Section 45M(f), as amended by paragraph 
(3), is amended by adding at the end the following: 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00108
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
109 
‘‘(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 weighted per- 
cycle water consumption divided by the cubic foot (or 
liter) capacity of the clothes washer.’’. 
(f) EFFECTIVE DATE.—The amendments made by this 
section shall apply to appliances produced after December 
31, 2007. 
SEC. 145. 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: 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00109
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
110 
‘‘(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 provider 
of electric energy services. 
‘‘(B) SMART ELECTRIC METER.—For pur-
poses of subparagraph (A), the term ‘smart elec-
tric meter’ means any time-based meter and re-
lated communication equipment which is capable 
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 infor-
mation 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. 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00110
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
111 
‘‘(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 
taxpayer who is a supplier of electric energy or 
a provider of electric energy services. 
‘‘(B) SMART GRID PROPERTY.—For the pur-
poses of subparagraph (A), the term ‘smart grid 
property’ means electronics and related equip-
ment that is capable of— 
‘‘(i) sensing, collecting, and monitoring 
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.’’. 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00111
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
112 
(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 fol-
lowing new subparagraph: 
‘‘(C) any property (other than property de-
scribed in paragraph (3)) which is a qualified 
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. 146. QUALIFIED GREEN BUILDING AND SUSTAINABLE 
DESIGN PROJECTS. 
(a) IN GENERAL.—Paragraph (8) of section 142(l) is 
amended by striking ‘‘September 30, 2009’’ and inserting 
‘‘September 30, 2012’’. 
(b) TREATMENT OF CURRENT REFUNDING BONDS.— 
Paragraph (9) of section 142(l) is amended by striking ‘‘Oc-
tober 1, 2009’’ and inserting ‘‘October 1, 2012’’. 
(c) ACCOUNTABILITY.—The second sentence of section 
701(d) of the American Jobs Creation Act of 2004 is amend-
ed by striking ‘‘issuance,’’ and inserting ‘‘issuance of the 
last issue with respect to such project,’’. 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00112
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
116 
SEC. 208. DISTRIBUTIONS FROM RETIREMENT PLANS TO IN-
DIVIDUALS CALLED TO ACTIVE DUTY. 
(a) IN GENERAL.—Clause (iv) of section 72(t)(2)(G) 
is amended by striking ‘‘December 31, 2007’’ and inserting 
‘‘January 1, 2009’’. 
(b) EFFECTIVE DATE.—The amendment made by this 
section shall apply to individuals ordered or called to active 
duty on or after December 31, 2007. 
SEC. 209. 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 inserting 
‘‘December 31, 2008’’. 
(b) EFFECTIVE DATE.—The amendment made by this 
section shall apply to decedents dying after December 31, 
2007. 
SEC. 210. 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, 2008’’. 
(b) EFFECTIVE DATE.—The amendment made by sub-
section (a) shall take effect on January 1, 2008, except that 
such amendment shall not apply to the application of with-
holding requirements with respect to any payment made 
on or before the date of the enactment of this Act. 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00116
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
117 
SEC. 211. EXCLUSION OF AMOUNTS RECEIVED UNDER 
QUALIFIED GROUP LEGAL SERVICES PLANS. 
(a) IN GENERAL.—Subsection (e) of section 120 is 
amended by striking ‘‘shall not apply to taxable years be-
ginning after June 30, 1992’’ and inserting ‘‘shall apply 
to taxable years beginning after December 31, 2007, and 
before January 1, 2009’’. 
(b) EFFECTIVE DATE.—The amendments made by this 
section shall apply to taxable years beginning after Decem-
ber 31, 2007. 
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, 2008’’. 
(b) COMPUTATION OF CREDIT FOR TAXABLE YEAR IN 
WHICH CREDIT TERMINATES.—Paragraph (2) of section 
41(h) is amended to read as follows: 
‘‘(2) COMPUTATION
OF
CREDIT
FOR
TAXABLE 
YEAR IN WHICH CREDIT TERMINATES.— 
‘‘(A) IN GENERAL.—In the case of any tax-
able year with respect to which this section ap-
plies 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 tax-
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00117
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
118 
able year shall be the amount which bears the 
same ratio to such applicable amount (deter-
mined 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 pur-
poses of subparagraph (A), the term ‘applicable 
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 
‘‘(iii) in the case of a taxable year with 
respect to which an election under sub-
section (c)(5) (relating to election of alter-
native simplified credit) is in effect, the av-
erage qualified research expenses for the 3 
taxable years preceding the taxable year.’’. 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00118
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
119 
(c) CONFORMING AMENDMENT.—Subparagraph (D) of 
section 45C(b)(1) is amended by striking ‘‘December 31, 
2007’’ and inserting ‘‘December 31, 2008’’. 
(d) EFFECTIVE DATE.—The amendments made by this 
section shall apply to amounts paid or incurred after De-
cember 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, 2008’’. 
(b) EFFECTIVE DATE.—The amendment made by this 
section shall apply to taxable years beginning after Decem-
ber 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, 2009’’. 
(b) EFFECTIVE DATE.—The amendment made by this 
section shall apply to expenditures paid or incurred during 
taxable years beginning after December 31, 2007. 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00119
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
120 
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, 2009’’. 
(b) EFFECTIVE DATE.—The amendments made by this 
section shall apply to property placed in service after De-
cember 31, 2007. 
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, 2008’’. 
(b) EFFECTIVE DATE.—The amendment made by this 
section shall apply to property placed in service after De-
cember 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 inserting 
‘‘December 31, 2008’’. 
(b) EFFECTIVE DATE.—The amendment made by this 
section shall apply to property placed in service after De-
cember 31, 2007. 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00120
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
121 
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, 2008’’. 
(b) EFFECTIVE DATE.—The amendment made by this 
section shall apply to expenditures paid or incurred after 
December 31, 2007. 
SEC. 229. DEDUCTION ALLOWABLE WITH RESPECT TO IN-
COME ATTRIBUTABLE TO DOMESTIC PRODUC-
TION 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 3 taxable years’’, and 
(2) by striking ‘‘January 1, 2008’’ and inserting 
‘‘January 1, 2009’’. 
(b) EFFECTIVE DATE.—The amendments made by this 
section shall apply to taxable years beginning after Decem-
ber 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, 2008’’. 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00121
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
122 
(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 subchapter 
A of chapter 1, as amended by sections 106 and 141, is 
amended by adding at the end the following new section: 
‘‘SEC. 54D. 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 proceeds 
of such issue are to be used for a qualified purpose 
with respect to a qualified zone academy established 
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 assurances 
that the private business contribution require-
ment of subsection (b) will be met with respect 
to such academy, and 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00122
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
123 
‘‘(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 business 
contribution requirement of this subsection is met with re-
spect to any issue if the eligible local education agency that 
established the qualified zone academy has written commit-
ments from private entities to make qualified 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, except as provided in paragraph (4), zero there-
after. 
‘‘(2) ALLOCATION OF LIMITATION.—The national 
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 individ-
uals 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 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00123
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
124 
be allocated by the State education agency to quali-
fied 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 
qualified zone academy shall not exceed the limitation 
amount allocated to such academy under paragraph 
(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 un-
used limitation year. For purposes of the pre-
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00124
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
125 
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 
section 
1397E(e)(4) (relating to carryover of unused 
limitation) with respect to any State to calendar 
year 2008 shall be treated for purposes of this 
section as a carryover with respect to such State 
for such calendar year under subparagraph (A), 
and the limitation of subparagraph (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, in-
crease graduation and employment rates, and 
better prepare students for the rigors of college 
and the increasingly complex workforce, 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00125
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
126 
‘‘(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 edu-
cation agency, 
‘‘(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 (in-
cluding any such zone or community designated 
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 estab-
lished under the National School Lunch Act. 
‘‘(2) ELIGIBLE LOCAL EDUCATION AGENCY.—For 
purposes of this section, the term ‘eligible local edu-
cation agency’ means any local educational agency as 
defined in section 9101 of the Elementary and Sec-
ondary Education Act of 1965. 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00126
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
127 
‘‘(3) QUALIFIED PURPOSE.—The term ‘qualified 
purpose’ means, with respect to any qualified zone 
academy— 
‘‘(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 per-
sonnel 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 technology 
and vocational equipment), 
‘‘(B) technical assistance in developing cur-
riculum or in training teachers in order to pro-
mote appropriate market driven technology in 
the classroom, 
‘‘(C) services of employees as volunteer men-
tors, 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00127
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
128 
‘‘(D) internships, field trips, or other edu-
cational opportunities outside the academy for 
students, or 
‘‘(E) any other property or service specified 
by the eligible local education agency.’’. 
(b) CONFORMING AMENDMENTS.— 
(1) Paragraph (1) of section 54A(d), as amended 
by sections 106 and 141, is amended by striking ‘‘or’’ 
at the end of subparagraph (A), by inserting ‘‘or’’ at 
the end of subparagraph (B), and by inserting after 
subparagraph (B) the following new subparagraph: 
‘‘(C) a qualified zone academy bond,’’. 
(2) Subparagraph (C) of section 54A(d)(2), as 
amended by sections 106 and 141, is amended by 
striking ‘‘and’’ at the end of clause (i), by striking the 
period at the end of clause (ii) and inserting ‘‘, and’’, 
and by adding at the end the following new clause: 
‘‘(iii) in the case of a qualified zone 
academy bond, a purpose specified in sec-
tion 54D(a)(1).’’. 
(3) Section 1397E is amended by adding at the 
end the following new subsection: 
‘‘(m) TERMINATION.—This section shall not apply to 
any obligation issued after the date of the enactment of this 
Act.’’. 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00128
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
136 
(b) EFFECTIVE DATE.—The amendment made by this 
section shall apply to distilled spirits brought into the 
United States after December 31, 2007. 
SEC. 255. PARITY IN THE APPLICATION OF CERTAIN LIMITS 
TO MENTAL HEALTH BENEFITS. 
Subsection (f) of section 9812 is amended— 
(1) by striking ‘‘and’’ at the end of paragraph 
(2), and 
(2) by striking paragraph (3) and inserting the 
following new paragraphs: 
‘‘(3) on or after January 1, 2008, and before the 
date of the enactment of the Renewable Energy and 
Job Creation Act of 2008, and 
‘‘(4) after December 31, 2008.’’. 
TITLE III—ADDITIONAL TAX 
RELIEF 
Subtitle A—Individual Tax Relief 
SEC. 301. ADDITIONAL STANDARD DEDUCTION FOR REAL 
PROPERTY TAXES FOR NONITEMIZERS. 
(a) IN GENERAL.—Section 63(c)(1) (defining standard 
deduction) is amended by striking ‘‘and’’ at the end of sub-
paragraph (A), by striking the period at the end of subpara-
graph (B) and inserting ‘‘, and’’, and by adding at the end 
the following new subparagraph: 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00136
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
137 
‘‘(C) in the case of any taxable year begin-
ning in 2008, the real property tax deduction.’’. 
(b) DEFINITION.—Section 63(c) is amended by adding 
at the end the following new paragraph: 
‘‘(7) REAL
PROPERTY
TAX
DEDUCTION.—For 
purposes of paragraph (1), the real property tax de-
duction is the lesser of— 
‘‘(A) the amount allowable as a deduction 
under this chapter for State and local taxes de-
scribed in section 164(a)(1), or 
‘‘(B) $350 ($700 in the case of a joint re-
turn). 
Any taxes taken into account under section 62(a) 
shall not be taken into account under this para-
graph.’’. 
(c) EFFECTIVE DATE.—The amendments made by this 
section shall apply to taxable years beginning after Decem-
ber 31, 2007. 
SEC. 302. 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 2008)’’ after 
‘‘$10,000’’. 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00137
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
138 
(b) EFFECTIVE DATE.—The amendment made by sub-
section (a) shall apply to taxable years beginning after De-
cember 31, 2007. 
SEC. 303. INCREASE OF AMT REFUNDABLE CREDIT AMOUNT 
FOR INDIVIDUALS WITH LONG-TERM UNUSED 
CREDITS FOR PRIOR YEAR MINIMUM TAX LI-
ABILITY, ETC. 
(a) IN GENERAL.—Paragraph (2) of section 53(e) is 
amended to read as follows: 
‘‘(2) AMT REFUNDABLE CREDIT AMOUNT.—For 
purposes of paragraph (1), the term ‘AMT refundable 
credit amount’ means, with respect to any taxable 
year, the amount (not in excess of the long-term un-
used minimum tax credit for such taxable year) equal 
to the greater of— 
‘‘(A) 50 percent of the long-term unused 
minimum tax credit for such taxable year, or 
‘‘(B) the amount (if any) of the AMT re-
fundable credit amount for the taxpayer’s pre-
ceding taxable year (determined without regard 
to subsection (f)(2)).’’. 
(b) TREATMENT OF CERTAIN UNDERPAYMENTS, IN-
TEREST, AND PENALTIES ATTRIBUTABLE TO THE TREAT-
MENT
OF INCENTIVE STOCK OPTIONS.—Section 53 is 
amended by adding at the end the following new subsection: 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00138
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
139 
‘‘(f) TREATMENT OF CERTAIN UNDERPAYMENTS, IN-
TEREST, AND PENALTIES ATTRIBUTABLE TO THE TREAT-
MENT OF INCENTIVE STOCK OPTIONS.— 
‘‘(1) ABATEMENT.—Any underpayment of tax 
outstanding on the date of the enactment of this sub-
section which is attributable to the application of sec-
tion 56(b)(3) for any taxable year ending before Jan-
uary 1, 2008 (and any interest or penalty with re-
spect to such underpayment which is outstanding on 
such date of enactment), is hereby abated. The 
amount determined under subsection (b)(1) shall not 
include any tax abated under the preceding sentence. 
‘‘(2) INCREASE IN CREDIT FOR CERTAIN INTER-
EST AND PENALTIES ALREADY PAID.—The AMT re-
fundable credit amount, and the minimum tax credit 
determined under subsection (b), for the taxpayer’s 
first 2 taxable years beginning after December 31, 
2007, shall each be increased by 50 percent of the ag-
gregate amount of the interest and penalties which 
were paid by the taxpayer before the date of the enact-
ment of this subsection and which would (but for such 
payment) have been abated under paragraph (1).’’. 
(c) EFFECTIVE DATE.— 
(1) IN GENERAL.—Except as provided in para-
graph (2), the amendment made by this section shall 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00139
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS
140 
apply to taxable years beginning after December 31, 
2007. 
(2) ABATEMENT.—Section 53(f)(1) of the Inter-
nal Revenue Code of 1986, as added by subsection (b), 
shall take effect on the date of the enactment of this 
Act. 
Subtitle B—Business Related 
Provisions 
SEC. 311. UNIFORM TREATMENT OF ATTORNEY-ADVANCED 
EXPENSES AND COURT COSTS IN CONTIN-
GENCY FEE CASES. 
(a) IN GENERAL.—Section 162 is amended by redesig-
nating subsection (q) as subsection (r) and by inserting 
after subsection (p) the following new subsection: 
‘‘(q) ATTORNEY-ADVANCED EXPENSES
AND COURT 
COSTS IN CONTINGENCY FEE CASES.—In the case of any 
expense or court cost which is paid or incurred in the course 
of the trade or business of practicing law and the repayment 
of which is contingent on a recovery by judgment or settle-
ment in the action to which such expense or cost relates, 
the deduction under subsection (a) shall be determined as 
if such expense or cost was not subject to repayment.’’. 
(b) EFFECTIVE DATE.—The amendment made by this 
section shall apply to expenses and costs paid or incurred 
VerDate Aug 31 2005 
22:38 May 20, 2008
Jkt 069200
PO 00000
Frm 00140
Fmt 6652
Sfmt 6203
E:\BILLS\H6049.RH
H6049
pwalker on PROD1PC71 with BILLS