I 
109TH CONGRESS 
2D SESSION 
H. R. 6264 
To amend the Internal Revenue Code of 1986 to make technical corrections, 
and for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
SEPTEMBER 29, 2006 
Mr. THOMAS introduced the following bill; which was referred to the 
Committee on Ways and Means 
A BILL 
To amend the Internal Revenue Code of 1986 to make 
technical corrections, and for other purposes. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE; AMENDMENT OF 1986 CODE; 
TABLE OF CONTENTS. 
(a) SHORT TITLE.—This Act may be cited as the 
‘‘Tax Technical Corrections Act of 2006’’. 
(b) AMENDMENT OF 1986 CODE.—Except as other-
wise expressly provided, whenever in this Act an amend-
ment or repeal is expressed in terms of an amendment 
to, or repeal of, a section or other provision, the reference 
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shall be considered to be made to a section or other provi-
sion of the Internal Revenue Code of 1986. 
(c) TABLE OF CONTENTS.—The table of contents of 
this Act is as follows: 
Sec. 1. Short title; amendment of 1986 Code; table of contents. 
Sec. 2. Amendments related to the Tax Increase Prevention and Reconciliation 
Act of 2005. 
Sec. 3. Amendment related to the Gulf Opportunity Zone Act of 2005. 
Sec. 4. Amendments related to the Safe, Accountable, Flexible, Efficient Trans-
portation Equity Act: A Legacy for Users. 
Sec. 5. Amendments related to the Energy Policy Act of 2005. 
Sec. 6. Amendments related to the American Jobs Creation Act of 2004. 
Sec. 7. Amendment related to the Jobs and Growth Tax Relief Reconciliation 
Act of 2003. 
Sec. 8. Amendments related to the Economic Growth and Tax Relief Reconcili-
ation Act of 2001. 
Sec. 9. Amendment related to the Tax Relief Extension Act of 1999. 
Sec. 10. Amendment related to the Internal Revenue Service Restructuring and 
Reform Act of 1998. 
Sec. 11. Clerical corrections. 
SEC. 2. AMENDMENTS RELATED TO THE TAX INCREASE 
PREVENTION AND RECONCILIATION ACT OF 
2005. 
(a) AMENDMENTS RELATED TO SECTION 103 OF 
THE ACT.— 
(1) Subparagraph (A) of section 954(c)(6) is 
amended— 
(A) in the first sentence, by striking 
‘‘which is not subpart F income’’ and inserting 
‘‘which is neither subpart F income nor income 
treated as effectively connected with the con-
duct of a trade or business in the United 
States’’, and 
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(B) by striking the last sentence and in-
serting the following: ‘‘The Secretary shall pre-
scribe such regulations as may be necessary or 
appropriate to carry out this paragraph, includ-
ing such regulations as may be necessary or ap-
propriate to prevent the abuse of the purposes 
of this paragraph.’’. 
(2) Paragraph (6) of section 954(c) is amended 
by redesignating subparagraph (B) as subparagraph 
(C) and inserting after subparagraph (A) the fol-
lowing new subparagraph: 
‘‘(B) 
EXCEPTION.—Subparagraph 
(A) 
shall not apply in the case of any interest, rent, 
or royalty to the extent such interest, rent, or 
royalty creates (or increases) a deficit which 
under section 952(c) may reduce the subpart F 
income of the payor or another controlled for-
eign corporation.’’. 
(b) AMENDMENTS RELATED TO SECTION 202 OF 
THE ACT.— 
(1) Subparagraph (B) of section 355(b)(3) is 
amended to read as follows: 
‘‘(B) AFFILIATED GROUP RULE.— 
‘‘(i) IN
GENERAL.—For purposes of 
subparagraph (A), all members of such 
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corporation’s 
separate 
affiliated 
group 
shall be treated as one corporation. 
‘‘(ii) 
SEPARATE
AFFILIATED 
GROUP.—For purposes of clause (i), the 
term ‘separate affiliated group’ means, 
with respect to any corporation, the affili-
ated group which would be determined 
under section 1504(a) if such corporation 
were the common parent and section 
1504(b) did not apply. Such term shall not 
include any corporation which became a 
member of— 
‘‘(I) 
such 
separate 
affiliated 
group (determined without regard to 
this sentence), or 
‘‘(II) any other separate affili-
ated group (determined without re-
gard to this sentence) which includes 
any other corporation to which sub-
paragraph (A) applies with respect to 
the same distribution, 
during the 5-year period described in para-
graph (2)(B) by reason of one or more 
transactions in which gain or loss was rec-
ognized in whole or in part (and shall not 
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include any trade or business conducted by 
such corporation at the time it became 
such a member).’’. 
(2) Paragraph (3) of section 355(b) is amended 
by adding at the end the following new subpara-
graph: 
‘‘(E) REGULATIONS.—The Secretary shall 
prescribe regulations which provide for the 
proper application of subparagraphs (B), (C), 
and (D) of paragraph (2) with respect to dis-
tributions to which this paragraph applies.’’. 
(c) AMENDMENTS RELATED TO SECTION 515 OF 
THE ACT.—Paragraph (2) of section 911(f) is amended— 
(1) by striking ‘‘the tentative minimum tax 
under section 55’’ in the matter preceding subpara-
graph (A) and inserting ‘‘the amount determined 
under the first sentence of section 55(b)(1)(A)(i)’’, 
and 
(2) by striking ‘‘the amount which would be 
such tentative minimum tax’’ each place it appears 
in subparagraphs (A) and (B) and inserting ‘‘the 
amount which would be determined under such sen-
tence’’. 
(d) EFFECTIVE DATE.—The amendments made by 
this section shall take effect as if included in the provisions 
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of the Tax Increase Prevention and Reconciliation Act of 
2005 to which they relate. 
SEC. 3. AMENDMENT RELATED TO THE GULF OPPOR-
TUNITY ZONE ACT OF 2005. 
(a) AMENDMENT RELATED TO SECTION 303 OF THE 
ACT.—Clause (iii) of section 903(d)(2)(B) of the Amer-
ican Jobs Creation Act of 2004, as amended by section 
303 of the Gulf Opportunity Zone Act of 2005, is amended 
by inserting ‘‘or the Secretary’s delegate’’ after ‘‘The Sec-
retary of the Treasury’’. 
(b) EFFECTIVE DATE.—The amendment made by 
this section shall take effect as if included in section 303 
of the Gulf Opportunity Zone Act of 2005. 
SEC. 4. AMENDMENTS RELATED TO THE SAFE, ACCOUNT-
ABLE, 
FLEXIBLE, 
EFFICIENT 
TRANSPOR-
TATION EQUITY ACT: A LEGACY FOR USERS. 
(a) AMENDMENTS RELATED TO SECTION 11113 OF 
THE ACT.—Paragraph (3) of section 6427(i) is amend-
ed— 
(1) by inserting ‘‘or under subsection (e)(2) by 
any person with respect to an alternative fuel (as de-
fined in section 6426(d)(2))’’ after ‘‘section 6426’’ 
in subparagraph (A), 
(2) by inserting ‘‘or (e)(2)’’ after ‘‘subsection 
(e)(1)’’ in subparagraphs (A)(i) and (B), and 
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(3) by inserting ‘‘AND
ALTERNATIVE
FUEL 
CREDIT’’ after ‘‘MIXTURE CREDIT’’ in the heading 
thereof. 
(b) EFFECTIVE DATE.—The amendments made by 
this section shall take effect as if included in the provisions 
of the SAFETEA–LU to which they relate. 
SEC. 5. AMENDMENTS RELATED TO THE ENERGY POLICY 
ACT OF 2005. 
(a) AMENDMENT RELATED TO SECTION 1306 OF 
THE ACT.—Paragraph (2) of section 45J(b) is amended 
to read as follows: 
‘‘(2) AMOUNT OF NATIONAL LIMITATION.—The 
aggregate amount of national megawatt capacity 
limitation allocated by the Secretary under para-
graph (3) shall not exceed 6,000 megawatts.’’. 
(b) AMENDMENT RELATED TO SECTION 1342 OF 
THE ACT.—So much of subsection (b) of section 30C as 
precedes paragraph (1) thereof is amended to read as fol-
lows: 
‘‘(b) LIMITATION.—The credit allowed under sub-
section (a) with respect to all alternative fuel vehicle re-
fueling property placed in service by the taxpayer during 
the taxable year at a location shall not exceed—’’. 
(c) AMENDMENTS RELATED TO SECTION 1351 OF 
THE ACT.— 
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(1) Paragraph (3) of section 41(a) is amended 
by inserting ‘‘for energy research’’ before the period 
at the end. 
(2) Paragraph (6) of section 41(f) is amended 
by adding at the end the following new subpara-
graph: 
‘‘(E) ENERGY RESEARCH.—The term ‘en-
ergy research’ does not include any research 
which is not qualified research.’’. 
(d) AMENDMENTS RELATED TO SECTION 1362 OF 
THE ACT.— 
(1)(A) Paragraph (1) of section 4041(d) is 
amended by adding at the end the following new 
sentence: ‘‘No tax shall be imposed under the pre-
ceding sentence on the sale or use of any liquid if 
tax was imposed with respect to such liquid under 
section 4081 at the Leaking Underground Storage 
Tank Trust Fund financing rate.’’. 
(B) Paragraph (3) of section 4042(b) is amend-
ed to read as follows: 
‘‘(3) EXCEPTION FOR FUEL ON WHICH LEAK-
ING UNDERGROUND STORAGE TANK TRUST FUND FI-
NANCING RATE SEPARATELY IMPOSED.—The Leak-
ing Underground Storage Tank Trust Fund financ-
ing rate under paragraph (2)(B) shall not apply to 
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the use of any fuel if tax was imposed with respect 
to such fuel under section 4041(d) or 4081 at the 
Leaking Underground Storage Tank Trust Fund fi-
nancing rate.’’. 
(C) Notwithstanding section 6430 of the Inter-
nal Revenue Code of 1986, a refund, credit, or pay-
ment may be made under subchapter B of chapter 
65 of such Code for taxes imposed with respect to 
any liquid after September 30, 2005, and before the 
date of the enactment of this Act under section 
4041(d)(1) or 4042 of such Code at the Leaking 
Underground Storage Tank Trust Fund financing 
rate to the extent that tax was imposed with respect 
to such liquid under section 4081 at the Leaking 
Underground Storage Tank Trust Fund financing 
rate. 
(2)(A) Paragraph (5) of section 4041(d) is 
amended— 
(i) by striking ‘‘(other than with respect to 
any sale for export under paragraph (3) there-
of)’’, and 
(ii) by adding at the end the following new 
sentence: ‘‘The preceding sentence shall not 
apply with respect to subsection (g)(3) and so 
much of subsection (g)(1) as relates to vessels 
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(within the meaning of section 4221(d)(3)) em-
ployed in foreign trade or trade between the 
United States and any of its possessions.’’ 
(B) Section 4082 is amended— 
(i) by striking ‘‘(other than such tax at the 
Leaking Underground Storage Tank Trust 
Fund financing rate imposed in all cases other 
than for export)’’ in subsection (a), and 
(ii) by redesignating subsections (f) and 
(g) as subsections (g) and (h) and by inserting 
after subsection (e) the following new sub-
section: 
‘‘(f) EXCEPTION
FOR
LEAKING
UNDERGROUND 
STORAGE TANK TRUST FUND FINANCING RATE.— 
‘‘(1) IN
GENERAL.—Subsection (a) shall not 
apply to the tax imposed under section 4081 at the 
Leaking Underground Storage Tank Trust Fund fi-
nancing rate. 
‘‘(2) EXCEPTION
FOR
EXPORT, ETC.—Para-
graph (1) shall not apply with respect to any fuel if 
the Secretary determines that such fuel is destined 
for export or for use by the purchaser as supplies for 
vessels (within the meaning of section 4221(d)(3)) 
employed in foreign trade or trade between the 
United States and any of its possessions.’’. 
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(C) Subsection (e) of section 4082 is amend-
ed— 
(i) by striking ‘‘an aircraft, the rate of tax 
under section 4081(a)(2)(A)(iii) shall be zero.’’ 
and inserting ‘‘an aircraft— 
‘‘(1) 
the 
rate 
of 
tax 
under 
section 
4081(a)(2)(A)(iii) shall be zero, and 
‘‘(2) if such aircraft is employed in foreign 
trade or trade between the United States and any of 
its possessions, the increase in such rate under sec-
tion 4081(a)(2)(B) shall be zero.’’; and 
(ii) by moving the last sentence flush with 
the margin of such subsection (following the 
paragraph (2) added by clause (i)). 
(D) Section 6430 is amended to read as follows: 
‘‘SEC. 6430. TREATMENT OF TAX IMPOSED AT LEAKING UN-
DERGROUND STORAGE TANK TRUST FUND 
FINANCING RATE. 
‘‘No refunds, credits, or payments shall be made 
under this subchapter for any tax imposed at the Leaking 
Underground Storage Tank Trust Fund financing rate, 
except in the case of fuels— 
‘‘(1) which are exempt from tax under section 
4081(a) by reason of section 4081(f)(2), 
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‘‘(2) which are exempt from tax under section 
4041(d) by reason of the last sentence of paragraph 
(5) thereof, or 
‘‘(3) with respect to which the rate increase 
under section 4081(a)(2)(B) is zero by reason of 
section 4082(e)(2).’’. 
(3) Paragraph (5) of section 4041(d) is amend-
ed by inserting ‘‘(b)(1)(A)’’ after ‘‘subsections’’. 
(e) EFFECTIVE DATE.— 
(1) IN
GENERAL.—Except as otherwise pro-
vided in this subsection, the amendments made by 
this section shall take effect as if included in the 
provisions of the Energy Policy Act of 2005 to which 
they relate. 
(2) NONAPPLICATION OF EXEMPTION FOR OFF- 
HIGHWAY BUSINESS USE.—The amendment made by 
subsection (d)(3) shall apply to fuel sold for use or 
used after the date of the enactment of this Act. 
(3) AMENDMENT
MADE
BY
THE
SAFETEA– 
LU.—The 
amendment 
made 
by 
subsection 
(d)(2)(C)(ii) shall take effect as if included in sec-
tion 11161 of the SAFETEA–LU. 
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SEC. 6. AMENDMENTS RELATED TO THE AMERICAN JOBS 
CREATION ACT OF 2004. 
(a) AMENDMENTS RELATED TO SECTION 710 OF 
THE ACT.— 
(1) Clause (ii) of section 45(c)(3)(A) is amend-
ed by striking ‘‘which is segregated from other waste 
materials and’’. 
(2) Subparagraph (B) of section 45(d)(2) is 
amended by inserting ‘‘and’’ at the end of clause (i), 
by striking clause (ii), and by redesignating clause 
(iii) as clause (ii). 
(b) AMENDMENTS RELATED TO SECTION 848 OF 
THE ACT.— 
(1) Section 470 is amended by redesignating 
subsections (e), (f), and (g) as subsections (f), (g), 
and (h) and by inserting after subsection (d) the fol-
lowing new subsection: 
‘‘(e) EXCEPTION FOR CERTAIN PARTNERSHIPS.— 
‘‘(1) IN GENERAL.—In the case of any property 
which would (but for this subsection) be tax-exempt 
use property solely by reason of section 168(h)(6), 
such property shall not be treated as tax-exempt use 
property for purposes of this section for any taxable 
year of the partnership if— 
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‘‘(A) such property is not property of a 
character subject to the allowance for deprecia-
tion, 
‘‘(B) any credit is allowable under section 
42 or 47 with respect to such property, or 
‘‘(C) except as provided in regulations pre-
scribed by the Secretary under subsection 
(h)(4), the requirements of paragraphs (2) and 
(3) are met with respect to such property for 
such taxable year. 
‘‘(2) AVAILABILITY OF FUNDS.— 
‘‘(A) IN
GENERAL.—The requirement of 
this paragraph is met for any taxable year with 
respect to any property owned by the partner-
ship if (at all times during the taxable year) not 
more than the allowable partnership amount of 
funds are— 
‘‘(i) subject to any arrangement re-
ferred to in subparagraph (C), or 
‘‘(ii) set aside or expected to be set 
aside, 
to or for the benefit of any taxable partner of 
the partnership or any lender, or to or for the 
benefit of any tax-exempt partner of the part-
nership to satisfy any obligation of such tax-ex-
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empt partners to the partnership, any taxable 
partner of the partnership, or any lender. 
‘‘(B) 
ALLOWABLE
PARTNERSHIP 
AMOUNT.—For purposes of this subsection, the 
term ‘allowable partnership amount’ means, as 
of any date, the greater of— 
‘‘(i) the sum of— 
‘‘(I) 20 percent of the sum of the 
taxable partners’ capital accounts de-
termined as of such date under the 
rules of section 704(b), plus 
‘‘(II) 20 percent of the sum of 
the taxable partners’ share of the re-
course liabilities of the partnership as 
determined under section 752, or 
‘‘(ii) 20 percent of the aggregate debt 
of the partnership as of such date. 
‘‘(iii) NO
ALLOWABLE
PARTNERSHIP 
AMOUNT
FOR
ARRANGEMENTS
OUTSIDE 
THE
PARTNERSHIP.—The allowable part-
nership amount shall be zero with respect 
to any set aside or arrangement under 
which any of the funds referred to in sub-
paragraph (A) are not partnership prop-
erty. 
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‘‘(C) ARRANGEMENTS.—The arrangements 
referred to in this subparagraph include a loan 
by a tax-exempt partner or the partnership to 
any taxable partner, the partnership, or any 
lender and any arrangement referred to in sub-
section (d)(1)(B). 
‘‘(D) SPECIAL RULES.— 
‘‘(i) EXCEPTION
FOR
SHORT-TERM 
FUNDS.—Funds which are set aside, or 
subject to any arrangement, for a period of 
less than 12 months shall not be taken 
into account under subparagraph (A). Ex-
cept as provided by the Secretary, all re-
lated set asides and arrangements shall be 
treated as 1 arrangement for purposes of 
this clause. 
‘‘(ii) 
ECONOMIC
RELATIONSHIP 
TEST.—Funds shall not be taken into ac-
count under subparagraph (A) if such 
funds— 
‘‘(I) bear no connection to the 
economic relationships among the 
partners, and 
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‘‘(II) bear no connection to the 
economic relationships among the 
partners and the partnership. 
‘‘(iii) REASONABLE
PERSON
STAND-
ARD.—For 
purpose 
of 
subparagraph 
(A)(ii), funds shall be treated as set aside 
or expected to be set aside only if a reason-
able person would conclude, based on the 
facts and circumstances, that such funds 
are set aside or expected to be set aside. 
‘‘(3) OPTION TO PURCHASE.— 
‘‘(A) IN
GENERAL.—The requirement of 
this paragraph is met for any taxable year with 
respect to any property owned by the partner-
ship if (at all times during such taxable year)— 
‘‘(i) each tax-exempt partner does not 
have an option to purchase (or compel dis-
tribution of) such property or any direct or 
indirect interest in the partnership at any 
time other than at the fair market value of 
such property or interest at the time of 
such purchase or distribution, and 
‘‘(ii) the partnership and each taxable 
partner does not have an option to sell (or 
compel distribution of) such property or 
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any direct or indirect interest in the part-
nership to a tax-exempt partner at any 
time other than at the fair market value of 
such property or interest at the time of 
such sale or distribution. 
‘‘(B) OPTION
FOR
DETERMINATION
OF 
FAIR MARKET VALUE.—Under regulations pre-
scribed by the Secretary, a value of property de-
termined on the basis of a formula shall be 
treated for purposes of subparagraph (A) as the 
fair market value of such property if such value 
is determined on the basis of objective criteria 
that are reasonably designed to approximate the 
fair market value of such property at the time 
of the purchase, sale, or distribution, as the 
case may be.’’. 
(2) Subsection (g) of section 470, as redesig-
nated by paragraph (1), is amended by adding at 
the end the following new paragraphs: 
‘‘(5) TAX-EXEMPT PARTNER.—The term ‘tax- 
exempt partner’ means, with respect to any partner-
ship, any partner of such partnership which is a tax- 
exempt entity within the meaning of section 
168(h)(6). 
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