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SECTION 1. SHORT TITLE.

    This Act may be cited as the ``National High Performance Passenger 
Rail Transportation-Oriented Development Act of 2012''.

SEC. 2. TRANSPORTATION-ORIENTED DEVELOPMENT INITIATIVE.

    (a) Establishment.--The Secretary of Transportation (in this Act 
referred to as the ``Secretary'') shall establish an initiative to 
promote passenger rail operations and transportation-oriented 
development by creating incentives for communities to encourage 
dedicated revenue sources for urban and regional rail corridor 
development.
    (b) Implementation.--The Secretary shall appoint a Planning 
Developer to oversee implementation of this initiative. The Planning 
Developer shall report to the Secretary.
    (c) Coordinating Committee.--The Secretary shall harmonize planning 
requirements and direct coordination and administration of the 
initiative between the Federal Railroad Administration and the Federal 
Transit Administration. The Secretary shall appoint a Transportation-
Oriented Development Coordinating Committee composed of the Planning 
Developer as Chair, the Administrator of the Federal Railroad 
Administration, and the Administrator of the Federal Transit 
Administration.

SEC. 3. FEDERAL INCENTIVES.

    (a) Qualified Projects.--
            (1) Criteria.--The Secretary shall establish criteria for 
        the designation of projects qualified for Federal incentives 
        pursuant to this section and the amendments made by this 
        section.
            (2) Types of projects that may qualify.--Projects that may 
        qualify for Federal incentives pursuant to this section and the 
        amendments made by this section are those that contribute to 
        the generation of revenue by the capture of increasing value 
        from development around station areas, as defined by the 
        Secretary, which are likely to make long-term contributions to 
        rail corridor development funds or similar mechanisms that help 
        finance intercity and urban passenger rail infrastructure or 
        operating expenses. Such commercial development or other 
        projects designated as qualified by the Secretary may generate 
        revenue for transportation-oriented development and rail 
        operations in the region by increasing the tax base, promoting 
        job growth, promoting cost effectiveness, facilitating 
        intermodal connectivity, combining congestion relief with 
        station development, stimulating economic development, or any 
        other appropriate means. The capture of increased value shall 
        be through the establishment of special assessment districts or 
        similar mechanisms, and distribution of revenues shall be 
        through rail corridor development funds or similar mechanisms 
        established within the regions.
            (3) Designated coordinating authority.--The Secretary shall 
        designate a State authority, or regional commission in 
        appropriate regions of the country as defined by the Secretary, 
        that petitions the Secretary to participate in the initiative 
        established under section 2. Such designated entity shall 
        provide for coordination among stakeholders, local governments, 
        and private developers in the defined region, and shall endorse 
        each project of, and be the lead party in, an application for 
        Federal incentives pursuant to this section and the amendments 
        made by this section.
    (b) Railroad Rehabilitation Improvement Financing.--Section 502 of 
the Railroad Revitalization and Regulatory Reform Act of 1976 (45 
U.S.C. 822) is amended--
            (1) in subsection (a)--
                    (A) by striking ``and'' at the end of paragraph 
                (5);
                    (B) by striking the period at the end of paragraph 
                (6) and inserting ``; and''; and
                    (C) by adding at the end the following new 
                paragraph:
            ``(7) persons conducting a qualified project (as defined in 
        section 8 of the National High Performance Passenger Rail 
        Transportation-Oriented Development Act of 2012).''; and
            (2) in subsection (b)(1)--
                    (A) by striking ``and'' at the end of subparagraph 
                (B);
                    (B) by striking the period at the end of 
                subparagraph (C) and inserting ``; or''; and
                    (C) by adding at the end the following new 
                subparagraph:
                    ``(D) conduct a qualified project (as defined by 
                the Secretary under section 3 of the National High 
                Performance Passenger Rail Transportation-Oriented 
                Development Act of 2012.''.
    (c) Transportation Infrastructure Finance.--Section 601(a)(8) of 
title 23, United States Code, is amended--
            (1) by striking ``and'' at the end of subparagraph (C);
            (2) by striking the period at the end of subparagraph (D) 
        and inserting ``; and''; and
            (3) by adding at the end the following new subparagraph:
                    ``(E) a qualified project (as defined by the 
                Secretary under section 3 of the National High 
                Performance Passenger Rail Transportation-Oriented 
                Development Act of 2012).''.
    (d) Application Priority.--In general, Federal applications to the 
Federal Railroad Administration and Federal Transit Administration for 
railroad projects that participate in the transportation-oriented 
development program under this Act shall receive a priority for funding 
in the application decision process.
    (e) Administrative Costs.--For administrative costs to carry out 
this Act, including contracting with and support for the Planning 
Developer and transportation-oriented development initial 
administrative costs of the Federal Railroad Administration and Federal 
Transit Administration for the first 5 years, the Secretary may use 
such funds as necessary which are appropriated for carrying out chapter 
6 of title 23, United States Code.
    (f) Revenue Neutral Program Cost.--The Secretary may establish a 
mechanism whereby amounts used under subsection (e) will be repaid to 
the Secretary for use in carrying out chapter 6 of title 23, United 
States Code. Repayment shall be derived from a small fee to all 
recipients of funding provided under subsection (e). The repayment 
shall commence upon substantial completion of qualified projects.

SEC. 4. TECHNICAL ASSISTANCE.

    (a) National Technical Assistance.--The program established under 
this Act shall provide technical assistance to the States with respect 
to--
            (1) identification of transportation-oriented development 
        opportunities;
            (2) establishment of special assessment districts in 
        regions;
            (3) establishment of rail corridor development funds; and
            (4) expediting Federal, State, and local regulatory 
        approvals.
    (b) States and Regions Outside the Northeast Corridor.--The 
Secretary, through the initiative established by this Act, shall 
provide technical assistance to the States and regions outside the 
Northeast Corridor as identified by the Secretary, and shall provide--
            (1) technical assistance on the establishment of Regional 
        Advisory Committees appropriate to carrying out the purposes of 
        this Act at the regional level; and
            (2) technical assistance at the request of a State or 
        qualified entity provided by the Planning Developer that will 
        identify stations and potential stations within a given region, 
        and conduct a preliminary survey of property available and 
        potentially available, to maximize development and commercial 
        revenue generation to financially support the development of a 
        high performance rail passenger corridor.
    (c) Northeast Corridor.--The Secretary, through the initiative 
established under this Act, shall provide technical assistance to the 
States and entities along the Northeast Corridor as identified by the 
Secretary--
            (1) on the establishment, by the Northeast Corridor 
        Infrastructure and Operations Advisory Commission established 
        under section 24905 of title 49, United States Code, of a 
        Northeast Corridor Transportation-Oriented Development Working 
        Group, which shall--
                    (A) include outside members with expertise in 
                transportation-oriented development;
                    (B) be chaired by the Planning Developer; and
                    (C) advise the Secretary and the Northeast Corridor 
                Infrastructure and Operations Advisory Commission on 
                the ways and means for carrying out the purposes of 
                this Act at the regional level; and
            (2) technical assistance provided by the Planning Developer 
        to the Secretary and identified States and entities, not more 
        than one year after the date of enactment of this Act, that 
        will identify Northeast Corridor stations and potential 
        stations, and conduct a preliminary survey of property 
        available and potentially available, to maximize development 
        and commercial revenue generation to financially support the 
        creation of a true high-speed rail corridor in the Northeast 
        Corridor.
National High Performance Passenger Rail Transportation-Oriented Development Act of 2012 - Directs the Secretary of Transportation (DOT) to establish an initiative to promote passenger rail operations and transportation-oriented development by creating rail projects qualified for federal incentives for communities to encourage dedicated revenue sources for urban and regional rail corridor development.

Amends the Railroad Revitalization and Regulatory Reform Act of 1976 to direct the Secretary to provide direct loans and loan guarantees for qualified rail projects. Authorizes the Secretary to make secured loans, loan guarantees, or lines of credit for such projects.

Directs the Secretary to provide technical assistance to: (1) states to identify transportation-oriented development opportunities, (2) states and regions outside the Northeast Corridor to establish Regional Advisory Committees and identify stations and potential stations within the region to maximize development and commercial revenue generation to support financially the development of a high performance rail passenger corridor, and (3) states and entities along the Northeast Corridor to establish a Northeast Corridor Transportation-Oriented Development Working Group and identify Northeast Corridor stations and potential stations to maximize development and commercial revenue generation to support financially the creation of a true high-speed rail corridor in the Northeast Corridor.

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Equitable Treatment of Investors 
Act''.

SEC. 2. SECURITIES INVESTOR PROTECTION ACT OF 1970 AMENDMENTS.

    (a) Net Equity Based on Last Statement.--Section 16(11) of the 
Securities Investor Protection Act of 1970 (15 U.S.C. 78lll(11)) is 
amended to read as follows:
            ``(11) Net equity.--
                    ``(A) In general.--The term `net equity' means the 
                dollar amount of the account or accounts of a customer, 
                to be determined by--
                            ``(i) calculating the sum which would have 
                        been owed by the debtor to such customer if the 
                        debtor had liquidated, by sale or purchase on 
                        the filing date--
                                    ``(I) all securities positions of 
                                such customer (other than customer name 
                                securities reclaimed by such customer); 
                                and
                                    ``(II) all positions in futures 
                                contracts and options on futures 
                                contracts held in a portfolio margining 
                                account carried as a securities account 
                                pursuant to a portfolio margining 
                                program approved by the Commission, 
                                including all property collateralizing 
                                such positions, to the extent that such 
                                property is not otherwise included 
                                herein; minus
                            ``(ii) any indebtedness of such customer to 
                        the debtor on the filing date; plus
                            ``(iii) any payment by such customer of 
                        such indebtedness to the debtor which is made 
                        with the approval of the trustee and within 
                        such period as the trustee may determine (but 
                        in no event more than sixty days after the 
                        publication of notice under section 8(a)).
                    ``(B) Treatment of certain commodity futures 
                contracts.--A claim for a commodity futures contract 
                received, acquired, or held in a portfolio margining 
                account pursuant to a portfolio margining program 
                approved by the Commission or a claim for a security 
                futures contract, shall be deemed to be a claim with 
                respect to such contract as of the filing date, and 
                such claim shall be treated as a claim for cash.
                    ``(C) Treatment of accounts held by a customer in 
                separate capacities.--In determining net equity under 
                this paragraph, accounts held by a customer in separate 
                capacities shall be deemed to be accounts of separate 
                customers.
                    ``(D) Reliance on final customer statement.--
                            ``(i) In general.--In determining net 
                        equity under this paragraph, the positions, 
                        options, and contracts of a customer held by 
                        the debtor, and any indebtedness of the 
                        customer to the debtor, shall be determined 
                        based on--
                                    ``(I) the information contained in 
                                the last statement received by the 
                                customer from the debtor before the 
                                filing date; and
                                    ``(II) any additional specific 
                                confirmations of the customer's 
                                positions, options, contracts, or 
                                indebtedness received after such last 
                                statement but before the filing date.
                            ``(ii) Fraud exception.--The provisions of 
                        this subparagraph shall not apply to any 
                        customer that--
                                    ``(I) knew the debtor was involved 
                                in fraudulent activity with respect to 
                                any customer of the debtor; or
                                    ``(II) was a person that--
                                            ``(aa) was, or was required 
                                        to be, registered with the 
                                        Securities and Exchange 
                                        Commission under the securities 
                                        laws (as such term is defined 
                                        under section 3(a) of the 
                                        Securities Exchange Act of 1934 
                                        (15 U.S.C. 78c(a)));
                                            ``(bb) knew, or should have 
                                        known, that the debtor was 
                                        involved in fraudulent activity 
                                        with respect to any customer of 
                                        the debtor; and
                                            ``(cc) did not notify SIPC, 
                                        the Commission, or law 
                                        enforcement personnel that the 
                                        debtor was involved in such 
                                        fraudulent activity.''.
    (b) Prohibition on Certain Recoveries.--Section 8 of the Securities 
Investor Protection Act of 1970 (15 U.S.C. 78fff-2) is amended by 
adding at the end the following new subsection:
    ``(g) Prohibition on Certain Recoveries.--Notwithstanding any other 
provision of this Act, a trustee may not recover any property 
transferred by the debtor to a customer before the filing date unless, 
at the time of such transfer, such customer--
            ``(1) knew the debtor was involved in fraudulent activity 
        with respect to any customer of the debtor; or
            ``(2) was a person that--
                    ``(A) was, or was required to be, registered with 
                the Securities and Exchange Commission under the 
                securities laws (as such term is defined under section 
                3(a) of the Securities Exchange Act of 1934 (15 U.S.C. 
                78c(a)));
                    ``(B) knew, or should have known, that the debtor 
                was involved in fraudulent activity with respect to any 
                customer of the debtor; and
                    ``(C) did not notify SIPC, the Commission, or law 
                enforcement personnel that the debtor was involved in 
                such fraudulent activity.''.
    (c) Appointment of Trustees.--
            (1) In general.--Section 5(b)(3) of the Securities Investor 
        Protection Act of 1970 (15 U.S.C. 78eee(b)(3)) is amended to 
        read as follows:
            ``(3) Appointment of trustee and attorney.--
                    ``(A) In general.--If the court issues a protective 
                decree under paragraph (1), such court shall forthwith 
                appoint, as trustee for the liquidation of the business 
                of the debtor and as attorney for the trustee, such 
                persons as the court determines best fit to serve as 
                trustee and as attorney from among the persons selected 
                by the Commission pursuant to subparagraph (B). The 
                persons appointed as trustee and as attorney for the 
                trustee may be associated with the same firm.
                    ``(B) Commission candidates.--With respect to a 
                debtor and upon the court issuing a protective decree 
                under paragraph (1), the Commission shall forthwith 
                provide the court with a list of candidates for the 
                position of trustee and attorney for the trustee for 
                such debtor.
                    ``(C) Disinterest requirement.--No person may be 
                appointed to serve as trustee or attorney for the 
                trustee if such person is not disinterested within the 
                meaning of paragraph (6), except that for any specified 
                purpose other than to represent a trustee in conducting 
                a liquidation proceeding, the trustee may, with the 
                approval of SIPC and the court, employ an attorney who 
                is not disinterested.
                    ``(D) Qualification.--A trustee appointed under 
                this paragraph shall qualify by filing a bond in the 
                manner prescribed by section 322 of title 11, United 
                States Code.''.
            (2) Effective date.--The amendment made by paragraph (1) 
        shall take effect with respect to trustees and attorneys 
        appointed after the date of the enactment of this Act.

SEC. 3. EFFECTIVE DATE.

    Except as provided under section 2(c)(2), the amendments made by 
section 2 shall take effect with respect to a liquidation proceeding 
under the Securities Investor Protection Act of 1970 that--
            (1) was in progress on the date of the enactment of this 
        Act; or
            (2) is initiated after the date of the enactment of this 
        Act.
Equitable Treatment of Investors Act - Amends the Securities Investor Protection Act of 1970 to revise the definition of "net equity."

Declares also that, in determining net equity, the positions, options, and contracts of a customer held by the debtor, and any indebtedness of the customer to the debtor, shall be determined based on: (1) the information contained in the last statement received by the customer from the debtor before the filing date; and (2) any additional specific confirmations of the customer's positions, options, contracts, or indebtedness received after such last statement but before the filing date.

Prohibits reliance on the final statement of the debtor to customer, however, if the customer: (1) knew the debtor was involved in fraudulent activity with respect to any of its customers; or (2) as a registrant under the securities laws, or a person required to be so registered, knew, or should have known, that the debtor was involved in such a fraudulent activity and did not notify the Securities Investor Protection Corporation (SIPC), the Securities Exchange Commission (SEC), or law enforcement personnel that the debtor was so involved.

Prohibits a trustee in a liquidation proceeding from recovering any property transferred by the debtor to a customer before the filing date unless, at the time of such transfer, the customer meets the same critieria.

Transfers from SIPC to the SEC authority to nominate to a court persons for appointment as trustee for the liquidation of a debtor's business and as attorney for the trustee.

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Fair Disaster Tax Relief Act of 
2008''.

SEC. 2. LOSSES ATTRIBUTABLE TO FEDERALLY DECLARED DISASTERS.

    (a) Waiver of Adjusted Gross Income Limitation.--
            (1) In general.--Subsection (h) of section 165 of the 
        Internal Revenue Code of 1986 is amended by redesignating 
        paragraphs (3) and (4) as paragraphs (4) and (5), respectively, 
        and by inserting after paragraph (2) the following new 
        paragraph:
            ``(3) Special rule for losses in federally declared 
        disasters.--
                    ``(A) In general.--If an individual has a net 
                disaster loss for any taxable year, the amount 
                determined under paragraph (2)(A)(ii) shall be the sum 
                of--
                            ``(i) such net disaster loss, and
                            ``(ii) so much of the excess referred to in 
                        the matter preceding clause (i) of paragraph 
                        (2)(A) (reduced by the amount in clause (i) of 
                        this subparagraph) as exceeds 10 percent of the 
                        adjusted gross income of the individual.
                    ``(B) Net disaster loss.--For purposes of 
                subparagraph (A), the term `net disaster loss' means 
                the excess of--
                            ``(i) the personal casualty losses--
                                    ``(I) attributable to a federally 
                                declared disaster, and
                                    ``(II) occurring in a disaster 
                                area, over
                            ``(ii) personal casualty gains.
                    ``(C) Federally declared disaster.--For purposes of 
                this paragraph--
                            ``(i) Federally declared disaster.--The 
                        term `federally declared disaster' means any 
                        disaster subsequently determined by the 
                        President of the United States to warrant 
                        assistance by the Federal Government under the 
                        Robert T. Stafford Disaster Relief and 
                        Emergency Assistance Act.
                            ``(ii) Disaster area.--The term `disaster 
                        area' means the area so determined to warrant 
                        such assistance.''.
            (2) Conforming amendments.--
                    (A) Section 165(h)(4)(B) (as so redesignated) is 
                amended by striking ``paragraph (2)'' and inserting 
                ``paragraphs (2) and (3)''.
                    (B) Section 165(i)(1) of such Code is amended by 
                striking ``loss'' and all that follows through ``Act'' 
                and inserting ``loss occurring in a disaster area (as 
                defined by clause (ii) of subsection (h)(3)(C)) and 
                attributable to a federally declared disaster (as 
                defined by clause (i) of such subsection)''.
                    (C) Section 165(i)(4) of such Code is amended by 
                striking ``Presidentially declared disaster (as defined 
                by section 1033(h)(3))'' and inserting ``federally 
                declared disaster (as defined by subsection 
                (h)(3)(C)(i)''.
                    (D)(i) So much of subsection (h) of section 1033 of 
                such Code as precedes subparagraph (A) of paragraph (1) 
                thereof is amended to read as follows:
    ``(h) Special Rules for Property Damaged by Federally Declared 
Disasters.--
            ``(1) Principal residences.--If the taxpayer's principal 
        residence or any of its contents is located in a disaster area 
        and is compulsorily or involuntarily converted as a result of a 
        federally declared disaster--''.
                    (ii) Paragraph (2) of section 1033(h) of such Code 
                is amended by striking ``investment'' and all that 
                follows through ``disaster'' and inserting ``investment 
                located in a disaster area and compulsorily or 
                involuntarily converted as a result of a federally 
                declared disaster''.
                    (iii) Paragraph (3) of section 1033(h) is amended 
                to read as follows:
            ``(3) Federally declared disaster; disaster area.--The 
        terms ``federally declared disaster'' and ``disaster area'' 
        shall have the respective meaning given such terms by section 
        165(h)(3)(C).''.
                    (iv) Section 139(c)(2) of such Code is amended to 
                read as follows:
            ``(2) federally declared disaster (as defined by section 
        165(h)(3)(C)(i)),''.
                    (v) Subclause (II) of section 172(b)(1)(F)(ii) of 
                such Code is amended by striking ``Presidentially 
                declared disasters (as defined in section 1033(h)(3))'' 
                and inserting ``federally declared disasters (as 
                defined by subsection (h)(3)(C)(i))''.
                    (vi) Subclause (III) of section 172(b)(1)(F)(ii) of 
                such Code is amended by striking ``Presidentially 
                declared disasters'' and inserting ``federally declared 
                disasters''.
                    (vii) Subsection (a) of section 7508A of such Code 
                is amended by striking ``Presidentially declared 
                disaster (as defined in section 1033(h)(3))'' and 
                inserting ``federally declared disaster (as defined by 
                section 165(h)(3)(C)(i))''.
    (b) Increase in Standard Deduction by Disaster Casualty Loss.--
            (1) In general.--Paragraph (1) of section 63(c) of such 
        Code (defining standard deduction) 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) the disaster loss deduction.''.
            (2) Disaster loss deduction.--Subsection (c) of section 63 
        of such Code is amended by adding at the end the following new 
        paragraph:
            ``(8) Disaster loss deduction.--For the purposes of 
        paragraph (1), the term `disaster loss deduction' means the net 
        disaster loss (as defined in section 165(h)(3)(B)).''.
            (3) Allowance in computing alternative minimum taxable 
        income.--Subparagraph (E) of section 56(b)(1) of such Code 
        (relating to standard deduction and deduction for personal 
        exemptions not allowed) is amended by adding at the end the 
        following new sentence: ``The preceding sentence shall not 
        apply to so much of the standard deduction as is determined 
        under section 63(c)(1)(D).''.
    (c) Increase in Limitation on Individual Loss Per Casualty.--
Paragraph (1) of section 165(h) of such Code (relating to treatment of 
casualty gains and losses) is amended by striking ``$100'' and 
inserting ``$500''.
    (d) Effective Dates.--
            (1) Except as provided by paragraph (2), the amendments 
        made by this section shall apply to taxable years beginning 
        after December 31, 2007.
            (2) The amendment made by subsection (c) shall apply to 
        taxable years beginning after December 31, 2008.

SEC. 3. EXPENSING OF QUALIFIED DISASTER EXPENSES.

    (a) In General.--Part VI of subchapter B of chapter 1 of the 
Internal Revenue Code of 1986 (relating to itemized deductions for 
individuals and corporations) is amended by inserting after section 198 
the following new section:

``SEC. 198A. EXPENSING OF QUALIFIED DISASTER EXPENSES.

    ``(a) In General.--A taxpayer may elect to treat any qualified 
disaster expenses which are paid or incurred by the taxpayer as an 
expense which is not chargeable to capital account. Any expense which 
is so treated shall be allowed as a deduction for the taxable year in 
which it is paid or incurred.
    ``(b) Qualified Disaster Expense.--For purposes of this section, 
the term `qualified disaster expense' means any expenditure--
            ``(1) which is paid or incurred in connection with a trade 
        or business or with business-related property,
            ``(2) which is--
                    ``(A) for the abatement or control of hazardous 
                substances that were released on account of a federally 
                declared disaster,
                    ``(B) for the removal of debris from, or the 
                demolition of structures on, real property which is 
                business-related property damaged or destroyed as a 
                result of a federally declared disaster, or
                    ``(C) for the repair of business-related property 
                damaged as a result of a federally declared disaster, 
                and
            ``(3) is otherwise chargeable to capital account.
    ``(c) Other Definitions.--For purposes of this section--
            ``(1) Business-related property.--The term `business-
        related property' means property--
                    ``(A) held by the taxpayer for use in a trade or 
                business or for the production of income, or
                    ``(B) described in section 1221(a)(1) in the hands 
                of the taxpayer.
            ``(2) Federally declared disaster.--The term `federally 
        declared disaster' has the meaning given such term by section 
        165(h)(3)(C)(i).
    ``(d) Deduction Recaptured as Ordinary Income on Sale, etc.--Solely 
for purposes of section 1245, in the case of property to which a 
qualified disaster expense would have been capitalized but for this 
section--
            ``(1) the deduction allowed by this section for such 
        expense shall be treated as a deduction for depreciation, and
            ``(2) such property (if not otherwise section 1245 
        property) shall be treated as section 1245 property solely for 
        purposes of applying section 1245 to such deduction.
    ``(e) Coordination With Other Provisions.--Sections 198, 280B, and 
468 shall not apply to amounts which are treated as expenses under this 
section.
    ``(f) Regulations.--The Secretary shall prescribe such regulations 
as may be necessary or appropriate to carry out the purposes of this 
section.''.
    (b) Clerical Amendment.--The table of sections for part VI of 
subchapter B of chapter 1 of such Code is amended by inserting after 
the item relating to section 198 the following new item:

``Sec. 198A. Expensing of Qualified Disaster Expenses.''.
    (c) Effective Date.--The amendments made by this section shall 
apply to amounts paid or incurred after December 31, 2007.

SEC. 4. NET OPERATING LOSSES ATTRIBUTABLE TO FEDERALLY DECLARED 
              DISASTERS.

    (a) In General.--Paragraph (1) of section 172(b) of the Internal 
Revenue Code of 1986 (relating to years to which loss may be carried) 
is amended by adding at the end the following new subparagraph:
                    ``(J) Certain losses attributable to federally 
                declared disasters.--In the case of a taxpayer who has 
                a qualified disaster loss (as defined in subsection 
                (j)), such loss shall be a net operating loss carryback 
                to each of the 5 taxable years preceding the taxable 
                year of such loss.''.
    (b) Qualified Disaster Loss.--Section 172 of such Code (relating to 
net operating loss deduction) is amended by redesignating subsections 
(j) and (k) as subsections (k) and (l), respectively, and by inserting 
after subsection (i) the following new subsection:
    ``(j) Rules Relating to Qualified Disaster Losses.--For purposes of 
this section--
            ``(1) In general.--The term `qualified disaster loss' means 
        the lesser of--
                    ``(A) the sum of--
                            ``(i) the losses allowable under section 
                        165 for the taxable year--
                                    ``(I) attributable to a federally 
                                declared disaster (as defined in 
                                section 165(h)(3)(C)(i)), and
                                    ``(II) occurring in a disaster area 
                                (as defined in section 
                                165(h)(3)(C)(ii)), and
                            ``(ii) the deduction for the taxable year 
                        for qualified disaster expenses which is 
                        allowable under section 198A(a) or which would 
                        be so allowable if not otherwise treated as an 
                        expense, or
                    ``(B) the net operating loss for such taxable year.
            ``(2) Coordination with subsection (b)(2).--For purposes of 
        applying subsection (b)(2), a qualified disaster loss for any 
        taxable year shall be treated in a manner similar to the manner 
        in which a specified liability loss is treated.
            ``(3) Election.--Any taxpayer entitled to a 5-year 
        carryback under subsection (b)(1)(J) from any loss year may 
        elect to have the carryback period with respect to such loss 
        year determined without regard to subsection (b)(1)(J). Such 
        election shall be made in such manner as may be prescribed by 
        the Secretary and shall be made by the due date (including 
        extensions of time) for filing the taxpayer's return for the 
        taxable year of the net operating loss. Such election, once 
        made for any taxable year, shall be irrevocable for such 
        taxable year.''.
    (c) Loss Deduction Allowed in Computing Alternative Minimum Taxable 
Income.--Subsection (d) of section 56 of such Code (defining 
alternative tax net operating loss deduction) is amended by adding at 
the end the following new paragraph:
            ``(3) Net operating loss attributable to federally declared 
        disasters.--In the case of a taxpayer which has a qualified 
        disaster loss (as defined by section 172(b)(1)(J)) for the 
        taxable year, paragraph (1) shall be applied by increasing the 
        amount determined under subparagraph (A)(ii)(I) thereof by the 
        sum of the carrybacks and carryovers of such loss.''.
    (d) Conforming Amendments.--
            (1) Clause (ii) of section 172(b)(1)(F) of such Code is 
        amended by inserting ``or qualified disaster loss (as defined 
        in subsection (j))'' before the period at the end of the last 
        sentence.
            (2) Paragraph (1) of section 172(i) of such Code is amended 
        by adding at the end the following new flush sentence:
        ``Such term shall not include any qualified disaster loss (as 
        defined in subsection (j)).''.
    (e) Effective Date.--The amendments made by this section shall 
apply to losses arising in taxable years beginning after December 31, 
2007.

SEC. 5. WAIVER OF CERTAIN MORTGAGE REVENUE BOND REQUIREMENTS FOLLOWING 
              FEDERALLY DECLARED DISASTERS.

    (a) In General.--Paragraph (11) of section 143(k) of the Internal 
Revenue Code of 1986 is amended to read as follows:
            ``(11) Special rules for federally declared disasters.--
                    ``(A) Principal residence destroyed.--If the 
                principal residence (within the meaning of section 121) 
                of a taxpayer is--
                            ``(i) rendered unsafe for use as a 
                        residence by reason of a federally declared 
                        disaster, or
                            ``(ii) demolished or relocated by reason of 
                        an order of the government of a State or 
                        political subdivision thereof on account of a 
                        federally declared disaster,
                then for the 2-year period beginning on the date of the 
                disaster declaration, subsection (d)(1) shall not apply 
                with respect to such taxpayer and subsection (e) shall 
                be applied by substituting `110' for `90' in paragraph 
                (1) thereof.
                    ``(B) Principle residence damaged.--
                            ``(i) In general.--If the principal 
                        residence (within the meaning of section 121) 
                        of a taxpayer resulting from a federally 
                        declared disaster was damaged, any owner-
                        financing provided in connection with the 
                        repair or reconstruction of such residence 
                        shall be treated as a qualified rehabilitation 
                        loan.
                            ``(ii) Limitation.--The aggregate owner-
                        financing to which clause (i) applies shall not 
                        exceed the lesser of--
                                    ``(I) the cost of such repair or 
                                reconstruction, or
                                    ``(II) $150,000.
                    ``(C) Federally declared disaster.--For purposes of 
                this paragraph, the term `federally declared disaster' 
                has the meaning given such term by section 
                165(h)(3)(C)(i).''.
    (b) Effective Date.--The amendment made by subsection (a) shall 
apply to disasters occurring after December 31, 2007.

Fair Disaster Tax Relief Act of 2008 - Amends the Internal Revenue Code to provide special tax rules for individuals affected by a federally declared disaster, including: (1) allowance of all personal casualty losses incurred in a federally declared disaster in excess of $500; (2) an increase in the standard tax deduction for disaster losses; (3) full expensing of business-related disaster cleanup expenses; (4) extension of the net operating loss carryback period from two to five years for disaster-related losses; and (5) allowance of tax-exempt bond financing of low-interest loans for principal residences damaged in a federally declared disaster.