A bill to provide authority for the Federal Government to purchase and insure certain types of troubled assets for the purposes of providing stability to and preventing disruption in the economy and financial system and protecting taxpayers, 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.
PL 110-343 (H.R.1424), enacted 10/03/2008

122 STAT. 3765 
PUBLIC LAW 110–343—OCT. 3, 2008 
Public Law 110–343 
110th Congress 
An Act 
To provide authority for the Federal Government to purchase and insure certain 
types of troubled assets for the purposes of providing stability to and preventing 
disruption in the economy and financial system and protecting taxpayers, to 
amend the Internal Revenue Code of 1986 to provide incentives for energy produc-
tion and conservation, to extend certain expiring provisions, to provide individual 
income tax relief, and for other purposes. 
Be it enacted by the Senate and House of Representatives of 
the United States of America in Congress assembled, 
DIVISION A—EMERGENCY ECONOMIC 
STABILIZATION 
SECTION 1. SHORT TITLE AND TABLE OF CONTENTS. 
(a) SHORT TITLE.—This division may be cited as the ‘‘Emergency 
Economic Stabilization Act of 2008’’. 
(b) TABLE OF CONTENTS.—The table of contents for this division 
is as follows: 
Sec. 1. Short title and table of contents. 
Sec. 2. Purposes. 
Sec. 3. Definitions. 
TITLE I—TROUBLED ASSETS RELIEF PROGRAM 
Sec. 101. Purchases of troubled assets. 
Sec. 102. Insurance of troubled assets. 
Sec. 103. Considerations. 
Sec. 104. Financial Stability Oversight Board. 
Sec. 105. Reports. 
Sec. 106. Rights; management; sale of troubled assets; revenues and sale proceeds. 
Sec. 107. Contracting procedures. 
Sec. 108. Conflicts of interest. 
Sec. 109. Foreclosure mitigation efforts. 
Sec. 110. Assistance to homeowners. 
Sec. 111. Executive compensation and corporate governance. 
Sec. 112. Coordination with foreign authorities and central banks. 
Sec. 113. Minimization of long-term costs and maximization of benefits for tax-
payers. 
Sec. 114. Market transparency. 
Sec. 115. Graduated authorization to purchase. 
Sec. 116. Oversight and audits. 
Sec. 117. Study and report on margin authority. 
Sec. 118. Funding. 
Sec. 119. Judicial review and related matters. 
Sec. 120. Termination of authority. 
Sec. 121. Special Inspector General for the Troubled Asset Relief Program. 
Sec. 122. Increase in statutory limit on the public debt. 
Sec. 123. Credit reform. 
Sec. 124. HOPE for Homeowners amendments. 
Sec. 125. Congressional Oversight Panel. 
12 USC 5201 
note. 
Emergency 
Economic 
Stabilization Act 
of 2008. 
Oct. 3, 2008 
[H.R. 1424] 
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122 STAT. 3766 
PUBLIC LAW 110–343—OCT. 3, 2008 
Sec. 126. FDIC authority. 
Sec. 127. Cooperation with the FBI. 
Sec. 128. Acceleration of effective date. 
Sec. 129. Disclosures on exercise of loan authority. 
Sec. 130. Technical corrections. 
Sec. 131. Exchange Stabilization Fund reimbursement. 
Sec. 132. Authority to suspend mark-to-market accounting. 
Sec. 133. Study on mark-to-market accounting. 
Sec. 134. Recoupment. 
Sec. 135. Preservation of authority. 
Sec. 136. Temporary increase in deposit and share insurance coverage. 
TITLE II—BUDGET-RELATED PROVISIONS 
Sec. 201. Information for congressional support agencies. 
Sec. 202. Reports by the Office of Management and Budget and the Congressional 
Budget Office. 
Sec. 203. Analysis in President’s Budget. 
Sec. 204. Emergency treatment. 
TITLE III—TAX PROVISIONS 
Sec. 301. Gain or loss from sale or exchange of certain preferred stock. 
Sec. 302. Special rules for tax treatment of executive compensation of employers 
participating in the troubled assets relief program. 
Sec. 303. Extension of exclusion of income from discharge of qualified principal res-
idence indebtedness. 
SEC. 2. PURPOSES. 
The purposes of this Act are— 
(1) to immediately provide authority and facilities that 
the Secretary of the Treasury can use to restore liquidity and 
stability to the financial system of the United States; and 
(2) to ensure that such authority and such facilities are 
used in a manner that— 
(A) protects home values, college funds, retirement 
accounts, and life savings; 
(B) preserves homeownership and promotes jobs and 
economic growth; 
(C) maximizes overall returns to the taxpayers of the 
United States; and 
(D) provides public accountability for the exercise of 
such authority. 
SEC. 3. DEFINITIONS. 
For purposes of this Act, the following definitions shall apply: 
(1) APPROPRIATE
COMMITTEES
OF
CONGRESS.—The term 
‘‘appropriate committees of Congress’’ means— 
(A) the Committee on Banking, Housing, and Urban 
Affairs, the Committee on Finance, the Committee on the 
Budget, and the Committee on Appropriations of the 
Senate; and 
(B) the Committee on Financial Services, the Com-
mittee on Ways and Means, the Committee on the Budget, 
and the Committee on Appropriations of the House of Rep-
resentatives. 
(2) BOARD.—The term ‘‘Board’’ means the Board of Gov-
ernors of the Federal Reserve System. 
(3) 
CONGRESSIONAL
SUPPORT
AGENCIES.—The 
term 
‘‘congressional support agencies’’ means the Congressional 
Budget Office and the Joint Committee on Taxation. 
(4) CORPORATION.—The term ‘‘Corporation’’ means the Fed-
eral Deposit Insurance Corporation. 
(5) FINANCIAL INSTITUTION.—The term ‘‘financial institu-
tion’’ means any institution, including, but not limited to, any 
12 USC 5202. 
12 USC 5201. 
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122 STAT. 3767 
PUBLIC LAW 110–343—OCT. 3, 2008 
bank, savings association, credit union, security broker or 
dealer, or insurance company, established and regulated under 
the laws of the United States or any State, territory, or posses-
sion of the United States, the District of Columbia, Common-
wealth of Puerto Rico, Commonwealth of Northern Mariana 
Islands, Guam, American Samoa, or the United States Virgin 
Islands, and having significant operations in the United States, 
but excluding any central bank of, or institution owned by, 
a foreign government. 
(6) FUND.—The term ‘‘Fund’’ means the Troubled Assets 
Insurance Financing Fund established under section 102. 
(7) SECRETARY.—The term ‘‘Secretary’’ means the Secretary 
of the Treasury. 
(8) TARP.—The term ‘‘TARP’’ means the Troubled Asset 
Relief Program established under section 101. 
(9) TROUBLED ASSETS.—The term ‘‘troubled assets’’ means— 
(A) residential or commercial mortgages and any secu-
rities, obligations, or other instruments that are based 
on or related to such mortgages, that in each case was 
originated or issued on or before March 14, 2008, the 
purchase of which the Secretary determines promotes 
financial market stability; and 
(B) any other financial instrument that the Secretary, 
after consultation with the Chairman of the Board of Gov-
ernors of the Federal Reserve System, determines the pur-
chase of which is necessary to promote financial market 
stability, but only upon transmittal of such determination, 
in writing, to the appropriate committees of Congress. 
TITLE I—TROUBLED ASSETS RELIEF 
PROGRAM 
SEC. 101. PURCHASES OF TROUBLED ASSETS. 
(a) OFFICES; AUTHORITY.— 
(1) AUTHORITY.—The Secretary is authorized to establish 
the Troubled Asset Relief Program (or ‘‘TARP’’) to purchase, 
and to make and fund commitments to purchase, troubled 
assets from any financial institution, on such terms and condi-
tions as are determined by the Secretary, and in accordance 
with this Act and the policies and procedures developed and 
published by the Secretary. 
(2) COMMENCEMENT OF PROGRAM.—Establishment of the 
policies and procedures and other similar administrative 
requirements imposed on the Secretary by this Act are not 
intended to delay the commencement of the TARP. 
(3) ESTABLISHMENT OF TREASURY OFFICE.— 
(A) IN GENERAL.—The Secretary shall implement any 
program under paragraph (1) through an Office of Financial 
Stability, established for such purpose within the Office 
of Domestic Finance of the Department of the Treasury, 
which office shall be headed by an Assistant Secretary 
of the Treasury, appointed by the President, by and with 
the advice and consent of the Senate, except that an interim 
Assistant Secretary may be appointed by the Secretary. 
(B) CLERICAL AMENDMENTS.— 
12 USC 5211. 
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122 STAT. 3768 
PUBLIC LAW 110–343—OCT. 3, 2008 
(i) TITLE 5.—Section 5315 of title 5, United States 
Code, is amended in the item relating to Assistant 
Secretaries of the Treasury, by striking ‘‘(9)’’ and 
inserting ‘‘(10)’’. 
(ii) TITLE 31.—Section 301(e) of title 31, United 
States Code, is amended by striking ‘‘9’’ and inserting 
‘‘10’’. 
(b) CONSULTATION.—In exercising the authority under this sec-
tion, the Secretary shall consult with the Board, the Corporation, 
the Comptroller of the Currency, the Director of the Office of Thrift 
Supervision, the Chairman of the National Credit Union Adminis-
tration Board, and the Secretary of Housing and Urban Develop-
ment. 
(c) NECESSARY ACTIONS.—The Secretary is authorized to take 
such actions as the Secretary deems necessary to carry out the 
authorities in this Act, including, without limitation, the following: 
(1) The Secretary shall have direct hiring authority with 
respect to the appointment of employees to administer this 
Act. 
(2) Entering into contracts, including contracts for services 
authorized by section 3109 of title 5, United States Code. 
(3) Designating financial institutions as financial agents 
of the Federal Government, and such institutions shall perform 
all such reasonable duties related to this Act as financial agents 
of the Federal Government as may be required. 
(4) In order to provide the Secretary with the flexibility 
to manage troubled assets in a manner designed to minimize 
cost to the taxpayers, establishing vehicles that are authorized, 
subject to supervision by the Secretary, to purchase, hold, and 
sell troubled assets and issue obligations. 
(5) Issuing such regulations and other guidance as may 
be necessary or appropriate to define terms or carry out the 
authorities or purposes of this Act. 
(d) PROGRAM GUIDELINES.—Before the earlier of the end of 
the 2-business-day period beginning on the date of the first purchase 
of troubled assets pursuant to the authority under this section 
or the end of the 45-day period beginning on the date of enactment 
of this Act, the Secretary shall publish program guidelines, 
including the following: 
(1) Mechanisms for purchasing troubled assets. 
(2) Methods for pricing and valuing troubled assets. 
(3) Procedures for selecting asset managers. 
(4) Criteria for identifying troubled assets for purchase. 
(e) PREVENTING UNJUST ENRICHMENT.—In making purchases 
under the authority of this Act, the Secretary shall take such 
steps as may be necessary to prevent unjust enrichment of financial 
institutions participating in a program established under this sec-
tion, including by preventing the sale of a troubled asset to the 
Secretary at a higher price than what the seller paid to purchase 
the asset. This subsection does not apply to troubled assets acquired 
in a merger or acquisition, or a purchase of assets from a financial 
institution in conservatorship or receivership, or that has initiated 
bankruptcy proceedings under title 11, United States Code. 
SEC. 102. INSURANCE OF TROUBLED ASSETS. 
(a) AUTHORITY.— 
12 USC 5212. 
Publication. 
Deadline. 
Regulations. 
Financial agents. 
Contracts. 
Administration. 
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122 STAT. 3769 
PUBLIC LAW 110–343—OCT. 3, 2008 
(1) IN GENERAL.—If the Secretary establishes the program 
authorized under section 101, then the Secretary shall establish 
a program to guarantee troubled assets originated or issued 
prior to March 14, 2008, including mortgage-backed securities. 
(2) GUARANTEES.—In establishing any program under this 
subsection, the Secretary may develop guarantees of troubled 
assets and the associated premiums for such guarantees. Such 
guarantees and premiums may be determined by category or 
class of the troubled assets to be guaranteed. 
(3) EXTENT OF GUARANTEE.—Upon request of a financial 
institution, the Secretary may guarantee the timely payment 
of principal of, and interest on, troubled assets in amounts 
not to exceed 100 percent of such payments. Such guarantee 
may be on such terms and conditions as are determined by 
the Secretary, provided that such terms and conditions are 
consistent with the purposes of this Act. 
(b) REPORTS.—Not later than 90 days after the date of enact-
ment of this Act, the Secretary shall report to the appropriate 
committees of Congress on the program established under sub-
section (a). 
(c) PREMIUMS.— 
(1) IN
GENERAL.—The Secretary shall collect premiums 
from any financial institution participating in the program 
established under subsection (a). Such premiums shall be in 
an amount that the Secretary determines necessary to meet 
the purposes of this Act and to provide sufficient reserves 
pursuant to paragraph (3). 
(2) AUTHORITY
TO
BASE
PREMIUMS
ON
PRODUCT
RISK.— 
In establishing any premium under paragraph (1), the Sec-
retary may provide for variations in such rates according to 
the credit risk associated with the particular troubled asset 
that is being guaranteed. The Secretary shall publish the meth-
odology for setting the premium for a class of troubled assets 
together with an explanation of the appropriateness of the 
class of assets for participation in the program established 
under this section. The methodology shall ensure that the pre-
mium is consistent with paragraph (3). 
(3) MINIMUM LEVEL.—The premiums referred to in para-
graph (1) shall be set by the Secretary at a level necessary 
to create reserves sufficient to meet anticipated claims, based 
on an actuarial analysis, and to ensure that taxpayers are 
fully protected. 
(4) ADJUSTMENT TO PURCHASE AUTHORITY.—The purchase 
authority limit in section 115 shall be reduced by an amount 
equal to the difference between the total of the outstanding 
guaranteed obligations and the balance in the Troubled Assets 
Insurance Financing Fund. 
(d) TROUBLED ASSETS INSURANCE FINANCING FUND.— 
(1) DEPOSITS.—The Secretary shall deposit fees collected 
under this section into the Fund established under paragraph 
(2). 
(2) ESTABLISHMENT.—There is established a Troubled 
Assets Insurance Financing Fund that shall consist of the 
amounts collected pursuant to paragraph (1), and any balance 
in such fund shall be invested by the Secretary in United 
States Treasury securities, or kept in cash on hand or on 
deposit, as necessary. 
Methodology. 
Publication. 
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122 STAT. 3770 
PUBLIC LAW 110–343—OCT. 3, 2008 
(3) PAYMENTS FROM FUND.—The Secretary shall make pay-
ments from amounts deposited in the Fund to fulfill obligations 
of the guarantees provided to financial institutions under sub-
section (a). 
SEC. 103. CONSIDERATIONS. 
In exercising the authorities granted in this Act, the Secretary 
shall take into consideration— 
(1) protecting the interests of taxpayers by maximizing 
overall returns and minimizing the impact on the national 
debt; 
(2) providing stability and preventing disruption to finan-
cial markets in order to limit the impact on the economy 
and protect American jobs, savings, and retirement security; 
(3) the need to help families keep their homes and to 
stabilize communities; 
(4) in determining whether to engage in a direct purchase 
from an individual financial institution, the long-term viability 
of the financial institution in determining whether the purchase 
represents the most efficient use of funds under this Act; 
(5) ensuring that all financial institutions are eligible to 
participate in the program, without discrimination based on 
size, geography, form of organization, or the size, type, and 
number of assets eligible for purchase under this Act; 
(6) providing financial assistance to financial institutions, 
including those serving low- and moderate-income populations 
and other underserved communities, and that have assets less 
than $1,000,000,000, that were well or adequately capitalized 
as of June 30, 2008, and that as a result of the devaluation 
of the preferred government-sponsored enterprises stock will 
drop one or more capital levels, in a manner sufficient to 
restore the financial institutions to at least an adequately 
capitalized level; 
(7) the need to ensure stability for United States public 
instrumentalities, such as counties and cities, that may have 
suffered significant increased costs or losses in the current 
market turmoil; 
(8) protecting the retirement security of Americans by pur-
chasing troubled assets held by or on behalf of an eligible 
retirement plan described in clause (iii), (iv), (v), or (vi) of 
section 402(c)(8)(B) of the Internal Revenue Code of 1986, except 
that such authority shall not extend to any compensation 
arrangements subject to section 409A of such Code; and 
(9) the utility of purchasing other real estate owned and 
instruments backed by mortgages on multifamily properties. 
SEC. 104. FINANCIAL STABILITY OVERSIGHT BOARD. 
(a) ESTABLISHMENT.—There is established the Financial Sta-
bility Oversight Board, which shall be responsible for— 
(1) reviewing the exercise of authority under a program 
developed in accordance with this Act, including— 
(A) policies implemented by the Secretary and the 
Office of Financial Stability created under sections 101 
and 102, including the appointment of financial agents, 
the designation of asset classes to be purchased, and plans 
for the structure of vehicles used to purchase troubled 
assets; and 
12 USC 5214. 
12 USC 5213. 
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122 STAT. 3771 
PUBLIC LAW 110–343—OCT. 3, 2008 
(B) the effect of such actions in assisting American 
families in preserving home ownership, stabilizing financial 
markets, and protecting taxpayers; 
(2) making recommendations, as appropriate, to the Sec-
retary regarding use of the authority under this Act; and 
(3) reporting any suspected fraud, misrepresentation, or 
malfeasance to the Special Inspector General for the Troubled 
Assets Relief Program or the Attorney General of the United 
States, consistent with section 535(b) of title 28, United States 
Code. 
(b) MEMBERSHIP.—The Financial Stability Oversight Board 
shall be comprised of— 
(1) the Chairman of the Board of Governors of the Federal 
Reserve System; 
(2) the Secretary; 
(3) the Director of the Federal Housing Finance Agency; 
(4) the Chairman of the Securities Exchange Commission; 
and 
(5) the Secretary of Housing and Urban Development. 
(c) CHAIRPERSON.—The chairperson of the Financial Stability 
Oversight Board shall be elected by the members of the Board 
from among the members other than the Secretary. 
(d) MEETINGS.—The Financial Stability Oversight Board shall 
meet 2 weeks after the first exercise of the purchase authority 
of the Secretary under this Act, and monthly thereafter. 
(e) ADDITIONAL AUTHORITIES.—In addition to the responsibil-
ities described in subsection (a), the Financial Stability Oversight 
Board shall have the authority to ensure that the policies imple-
mented by the Secretary are— 
(1) in accordance with the purposes of this Act; 
(2) in the economic interests of the United States; and 
(3) consistent with protecting taxpayers, in accordance with 
section 113(a). 
(f) CREDIT REVIEW COMMITTEE.—The Financial Stability Over-
sight Board may appoint a credit review committee for the purpose 
of evaluating the exercise of the purchase authority provided under 
this Act and the assets acquired through the exercise of such 
authority, as the Financial Stability Oversight Board determines 
appropriate. 
(g) REPORTS.—The Financial Stability Oversight Board shall 
report to the appropriate committees of Congress and the Congres-
sional Oversight Panel established under section 125, not less fre-
quently than quarterly, on the matters described under subsection 
(a)(1). 
(h) TERMINATION.—The Financial Stability Oversight Board, 
and its authority under this section, shall terminate on the expira-
tion of the 15-day period beginning upon the later of— 
(1) the date that the last troubled asset acquired by the 
Secretary under section 101 has been sold or transferred out 
of the ownership or control of the Federal Government; or 
(2) the date of expiration of the last insurance contract 
issued under section 102. 
SEC. 105. REPORTS. 
(a) IN GENERAL.—Before the expiration of the 60-day period 
beginning on the date of the first exercise of the authority granted 
in section 101(a), or of the first exercise of the authority granted 
12 USC 5215. 
Reports. 
Fraud. 
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122 STAT. 3772 
PUBLIC LAW 110–343—OCT. 3, 2008 
in section 102, whichever occurs first, and every 30-day period 
thereafter, the Secretary shall report to the appropriate committees 
of Congress, with respect to each such period— 
(1) an overview of actions taken by the Secretary, including 
the considerations required by section 103 and the efforts under 
section 109; 
(2) the actual obligation and expenditure of the funds pro-
vided for administrative expenses by section 118 during such 
period and the expected expenditure of such funds in the subse-
quent period; and 
(3) a detailed financial statement with respect to the exer-
cise of authority under this Act, including— 
(A) all agreements made or renewed; 
(B) all insurance contracts entered into pursuant to 
section 102; 
(C) all transactions occurring during such period, 
including the types of parties involved; 
(D) the nature of the assets purchased; 
(E) all projected costs and liabilities; 
(F) operating expenses, including compensation for 
financial agents; 
(G) the valuation or pricing method used for each trans-
action; and 
(H) a description of the vehicles established to exercise 
such authority. 
(b) TRANCHE REPORTS TO CONGRESS.— 
(1) REPORTS.—The Secretary shall provide to the appro-
priate committees of Congress, at the times specified in para-
graph (2), a written report, including— 
(A) a description of all of the transactions made during 
the reporting period; 
(B) a description of the pricing mechanism for the 
transactions; 
(C) a justification of the price paid for and other finan-
cial terms associated with the transactions; 
(D) a description of the impact of the exercise of such 
authority on the financial system, supported, to the extent 
possible, by specific data; 
(E) a description of challenges that remain in the finan-
cial system, including any benchmarks yet to be achieved; 
and 
(F) an estimate of additional actions under the 
authority provided under this Act that may be necessary 
to address such challenges. 
(2) TIMING.—The report required by this subsection shall 
be submitted not later than 7 days after the date on which 
commitments to purchase troubled assets under the authorities 
provided in this Act first reach an aggregate of $50,000,000,000 
and not later than 7 days after each $50,000,000,000 interval 
of such commitments is reached thereafter. 
(c) REGULATORY MODERNIZATION REPORT.—The Secretary shall 
review the current state of the financial markets and the regulatory 
system and submit a written report to the appropriate committees 
of Congress not later than April 30, 2009, analyzing the current 
state of the regulatory system and its effectiveness at overseeing 
the participants in the financial markets, including the over-the- 
Deadline. 
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122 STAT. 3773 
PUBLIC LAW 110–343—OCT. 3, 2008 
counter swaps market and government-sponsored enterprises, and 
providing recommendations for improvement, including— 
(1) recommendations regarding— 
(A) whether any participants in the financial markets 
that are currently outside the regulatory system should 
become subject to the regulatory system; and 
(B) enhancement of the clearing and settlement of 
over-the-counter swaps; and 
(2) the rationale underlying such recommendations. 
(d) SHARING OF INFORMATION.—Any report required under this 
section shall also be submitted to the Congressional Oversight 
Panel established under section 125. 
(e) SUNSET.—The reporting requirements under this section 
shall terminate on the later of— 
(1) the date that the last troubled asset acquired by the 
Secretary under section 101 has been sold or transferred out 
of the ownership or control of the Federal Government; or 
(2) the date of expiration of the last insurance contract 
issued under section 102. 
SEC. 106. RIGHTS; MANAGEMENT; SALE OF TROUBLED ASSETS; REVE-
NUES AND SALE PROCEEDS. 
(a) EXERCISE OF RIGHTS.—The Secretary may, at any time, 
exercise any rights received in connection with troubled assets 
purchased under this Act. 
(b) MANAGEMENT OF TROUBLED ASSETS.—The Secretary shall 
have authority to manage troubled assets purchased under this 
Act, including revenues and portfolio risks therefrom. 
(c) SALE OF TROUBLED ASSETS.—The Secretary may, at any 
time, upon terms and conditions and at a price determined by 
the Secretary, sell, or enter into securities loans, repurchase trans-
actions, or other financial transactions in regard to, any troubled 
asset purchased under this Act. 
(d) TRANSFER TO TREASURY.—Revenues of, and proceeds from 
the sale of troubled assets purchased under this Act, or from the 
sale, exercise, or surrender of warrants or senior debt instruments 
acquired under section 113 shall be paid into the general fund 
of the Treasury for reduction of the public debt. 
(e) APPLICATION
OF
SUNSET
TO
TROUBLED
ASSETS.—The 
authority of the Secretary to hold any troubled asset purchased 
under this Act before the termination date in section 120, or to 
purchase or fund the purchase of a troubled asset under a commit-
ment entered into before the termination date in section 120, is 
not subject to the provisions of section 120. 
SEC. 107. CONTRACTING PROCEDURES. 
(a) STREAMLINED PROCESS.—For purposes of this Act, the Sec-
retary may waive specific provisions of the Federal Acquisition 
Regulation upon a determination that urgent and compelling cir-
cumstances make compliance with such provisions contrary to the 
public interest. Any such determination, and the justification for 
such determination, shall be submitted to the Committees on Over-
sight and Government Reform and Financial Services of the House 
of Representatives and the Committees on Homeland Security and 
Governmental Affairs and Banking, Housing, and Urban Affairs 
of the Senate within 7 days. 
(b) ADDITIONAL CONTRACTING REQUIREMENTS.—In any solicita-
tion or contract where the Secretary has, pursuant to subsection 
Minorities. 
Deadline. 
Waiver authority. 
12 USC 5217. 
12 USC 5216. 
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122 STAT. 3774 
PUBLIC LAW 110–343—OCT. 3, 2008 
(a), waived any provision of the Federal Acquisition Regulation 
pertaining to minority contracting, the Secretary shall develop and 
implement standards and procedures to ensure, to the maximum 
extent practicable, the inclusion and utilization of minorities (as 
such term is defined in section 1204(c) of the Financial Institutions 
Reform, Recovery, and Enforcement Act of 1989 (12 U.S.C. 1811 
note)) and women, and minority- and women-owned businesses 
(as such terms are defined in section 21A(r)(4) of the Federal 
Home Loan Bank Act (12 U.S.C. 1441a(r)(4)), in that solicitation 
or contract, including contracts to asset managers, servicers, prop-
erty managers, and other service providers or expert consultants. 
(c) ELIGIBILITY OF FDIC.—Notwithstanding subsections (a) and 
(b), the Corporation— 
(1) shall be eligible for, and shall be considered in, the 
selection of asset managers for residential mortgage loans and 
residential mortgage-backed securities; and 
(2) shall be reimbursed by the Secretary for any services 
provided. 
SEC. 108. CONFLICTS OF INTEREST. 
(a) STANDARDS REQUIRED.—The Secretary shall issue regula-
tions or guidelines necessary to address and manage or to prohibit 
conflicts of interest that may arise in connection with the adminis-
tration and execution of the authorities provided under this Act, 
including— 
(1) conflicts arising in the selection or hiring of contractors 
or advisors, including asset managers; 
(2) the purchase of troubled assets; 
(3) the management of the troubled assets held; 
(4) post-employment restrictions on employees; and 
(5) any other potential conflict of interest, as the Secretary 
deems necessary or appropriate in the public interest. 
(b) TIMING.—Regulations or guidelines required by this section 
shall be issued as soon as practicable after the date of enactment 
of this Act. 
SEC. 109. FORECLOSURE MITIGATION EFFORTS. 
(a) RESIDENTIAL MORTGAGE LOAN SERVICING STANDARDS.—To 
the extent that the Secretary acquires mortgages, mortgage backed 
securities, and other assets secured by residential real estate, 
including multifamily housing, the Secretary shall implement a 
plan that seeks to maximize assistance for homeowners and use 
the authority of the Secretary to encourage the servicers of the 
underlying mortgages, considering net present value to the tax-
payer, to take advantage of the HOPE for Homeowners Program 
under section 257 of the National Housing Act or other available 
programs to minimize foreclosures. In addition, the Secretary may 
use loan guarantees and credit enhancements to facilitate loan 
modifications to prevent avoidable foreclosures. 
(b) COORDINATION.—The Secretary shall coordinate with the 
Corporation, the Board (with respect to any mortgage or mortgage- 
backed securities or pool of securities held, owned, or controlled 
by or on behalf of a Federal reserve bank, as provided in section 
110(a)(1)(C)), the Federal Housing Finance Agency, the Secretary 
of Housing and Urban Development, and other Federal Government 
entities that hold troubled assets to attempt to identify opportuni-
ties for the acquisition of classes of troubled assets that will improve 
the ability of the Secretary to improve the loan modification and 
12 USC 5219. 
Regulations. 
12 USC 5218. 
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122 STAT. 3775 
PUBLIC LAW 110–343—OCT. 3, 2008 
restructuring process and, where permissible, to permit bona fide 
tenants who are current on their rent to remain in their homes 
under the terms of the lease. In the case of a mortgage on a 
residential rental property, the plan required under this section 
shall include protecting Federal, State, and local rental subsidies 
and protections, and ensuring any modification takes into account 
the need for operating funds to maintain decent and safe conditions 
at the property. 
(c) CONSENT TO REASONABLE LOAN MODIFICATION REQUESTS.— 
Upon any request arising under existing investment contracts, the 
Secretary shall consent, where appropriate, and considering net 
present value to the taxpayer, to reasonable requests for loss mitiga-
tion measures, including term extensions, rate reductions, principal 
write downs, increases in the proportion of loans within a trust 
or other structure allowed to be modified, or removal of other 
limitation on modifications. 
SEC. 110. ASSISTANCE TO HOMEOWNERS. 
(a) DEFINITIONS.—As used in this section— 
(1) the term ‘‘Federal property manager’’ means— 
(A) the Federal Housing Finance Agency, in its capacity 
as conservator of the Federal National Mortgage Associa-
tion and the Federal Home Loan Mortgage Corporation; 
(B) the Corporation, with respect to residential mort-
gage loans and mortgage-backed securities held by any 
bridge depository institution pursuant to section 11(n) of 
the Federal Deposit Insurance Act; and 
(C) the Board, with respect to any mortgage or mort-
gage-backed securities or pool of securities held, owned, 
or controlled by or on behalf of a Federal reserve bank, 
other than mortgages or securities held, owned, or con-
trolled in connection with open market operations under 
section 14 of the Federal Reserve Act (12 U.S.C. 353), 
or as collateral for an advance or discount that is not 
in default; 
(2) the term ‘‘consumer’’ has the same meaning as in section 
103 of the Truth in Lending Act (15 U.S.C. 1602); 
(3) the term ‘‘insured depository institution’’ has the same 
meaning as in section 3 of the Federal Deposit Insurance Act 
(12 U.S.C. 1813); and 
(4) the term ‘‘servicer’’ has the same meaning as in section 
6(i)(2) of the Real Estate Settlement Procedures Act of 1974 
(12 U.S.C. 2605(i)(2)). 
(b) HOMEOWNER ASSISTANCE BY AGENCIES.— 
(1) IN GENERAL.—To the extent that the Federal property 
manager holds, owns, or controls mortgages, mortgage backed 
securities, and other assets secured by residential real estate, 
including multifamily housing, the Federal property manager 
shall implement a plan that seeks to maximize assistance for 
homeowners and use its authority to encourage the servicers 
of the underlying mortgages, and considering net present value 
to the taxpayer, to take advantage of the HOPE for Home-
owners Program under section 257 of the National Housing 
Act or other available programs to minimize foreclosures. 
(2) MODIFICATIONS.—In the case of a residential mortgage 
loan, modifications made under paragraph (1) may include— 
(A) reduction in interest rates; 
12 USC 5220. 
Residential 
rental property. 
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122 STAT. 3776 
PUBLIC LAW 110–343—OCT. 3, 2008 
(B) reduction of loan principal; and 
(C) other similar modifications. 
(3) TENANT PROTECTIONS.—In the case of mortgages on 
residential rental properties, modifications made under para-
graph (1) shall ensure— 
(A) the continuation of any existing Federal, State, 
and local rental subsidies and protections; and 
(B) that modifications take into account the need for 
operating funds to maintain decent and safe conditions 
at the property. 
(4) TIMING.—Each Federal property manager shall develop 
and begin implementation of the plan required by this sub-
section not later than 60 days after the date of enactment 
of this Act. 
(5) REPORTS TO CONGRESS.—Each Federal property man-
ager shall, 60 days after the date of enactment of this Act 
and every 30 days thereafter, report to Congress specific 
information on the number and types of loan modifications 
made and the number of actual foreclosures occurring during 
the reporting period in accordance with this section. 
(6) CONSULTATION.—In developing the plan required by 
this subsection, the Federal property managers shall consult 
with one another and, to the extent possible, utilize consistent 
approaches to implement the requirements of this subsection. 
(c) ACTIONS WITH RESPECT
TO SERVICERS.—In any case in 
which a Federal property manager is not the owner of a residential 
mortgage loan, but holds an interest in obligations or pools of 
obligations secured by residential mortgage loans, the Federal prop-
erty manager shall— 
(1) encourage implementation by the loan servicers of loan 
modifications developed under subsection (b); and 
(2) assist in facilitating any such modifications, to the 
extent possible. 
(d) LIMITATION.—The requirements of this section shall not 
supersede any other duty or requirement imposed on the Federal 
property managers under otherwise applicable law. 
SEC. 111. EXECUTIVE COMPENSATION AND CORPORATE GOVERNANCE. 
(a) APPLICABILITY.—Any financial institution that sells troubled 
assets to the Secretary under this Act shall be subject to the 
executive compensation requirements of subsections (b) and (c) and 
the provisions under the Internal Revenue Code of 1986, as provided 
under the amendment by section 302, as applicable. 
(b) DIRECT PURCHASES.— 
(1) IN GENERAL.—Where the Secretary determines that the 
purposes of this Act are best met through direct purchases 
of troubled assets from an individual financial institution where 
no bidding process or market prices are available, and the 
Secretary receives a meaningful equity or debt position in the 
financial institution as a result of the transaction, the Secretary 
shall require that the financial institution meet appropriate 
standards for executive compensation and corporate govern-
ance. The standards required under this subsection shall be 
effective for the duration of the period that the Secretary holds 
an equity or debt position in the financial institution. 
(2) CRITERIA.—The standards required under this sub-
section shall include— 
Effective date. 
Standards. 
12 USC 5221. 
Deadline. 
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122 STAT. 3777 
PUBLIC LAW 110–343—OCT. 3, 2008 
(A) limits on compensation that exclude incentives for 
senior executive officers of a financial institution to take 
unnecessary and excessive risks that threaten the value 
of the financial institution during the period that the Sec-
retary holds an equity or debt position in the financial 
institution; 
(B) a provision for the recovery by the financial institu-
tion of any bonus or incentive compensation paid to a 
senior executive officer based on statements of earnings, 
gains, or other criteria that are later proven to be materi-
ally inaccurate; and 
(C) a prohibition on the financial institution making 
any golden parachute payment to its senior executive officer 
during the period that the Secretary holds an equity or 
debt position in the financial institution. 
(3) DEFINITION.—For purposes of this section, the term 
‘‘senior executive officer’’ means an individual who is one of 
the top 5 highly paid executives of a public company, whose 
compensation is required to be disclosed pursuant to the Securi-
ties Exchange Act of 1934, and any regulations issued there-
under, and non-public company counterparts. 
(c) AUCTION PURCHASES.—Where the Secretary determines that 
the purposes of this Act are best met through auction purchases 
of troubled assets, and only where such purchases per financial 
institution in the aggregate exceed $300,000,000 (including direct 
purchases), the Secretary shall prohibit, for such financial institu-
tion, any new employment contract with a senior executive officer 
that provides a golden parachute in the event of an involuntary 
termination, bankruptcy filing, insolvency, or receivership. The Sec-
retary shall issue guidance to carry out this paragraph not later 
than 2 months after the date of enactment of this Act, and such 
guidance shall be effective upon issuance. 
(d) SUNSET.—The provisions of subsection (c) shall apply only 
to arrangements entered into during the period during which the 
authorities under section 101(a) are in effect, as determined under 
section 120. 
SEC. 112. COORDINATION WITH FOREIGN AUTHORITIES AND CENTRAL 
BANKS. 
The Secretary shall coordinate, as appropriate, with foreign 
financial authorities and central banks to work toward the 
establishment of similar programs by such authorities and central 
banks. To the extent that such foreign financial authorities or 
banks hold troubled assets as a result of extending financing to 
financial institutions that have failed or defaulted on such financing, 
such troubled assets qualify for purchase under section 101. 
SEC. 113. MINIMIZATION OF LONG-TERM COSTS AND MAXIMIZATION 
OF BENEFITS FOR TAXPAYERS. 
(a) LONG-TERM COSTS AND BENEFITS.— 
(1) MINIMIZING NEGATIVE IMPACT.—The Secretary shall use 
the authority under this Act in a manner that will minimize 
any potential long-term negative impact on the taxpayer, taking 
into account the direct outlays, potential long-term returns 
on assets purchased, and the overall economic benefits of the 
program, including economic benefits due to improvements in 
economic activity and the availability of credit, the impact 
12 USC 5223. 
12 USC 5222. 
Guidance. 
Deadline. 
Effective date. 
Employment. 
Contracts. 
Prohibition. 
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122 STAT. 3778 
PUBLIC LAW 110–343—OCT. 3, 2008 
on the savings and pensions of individuals, and reductions 
in losses to the Federal Government. 
(2) AUTHORITY.—In carrying out paragraph (1), the Sec-
retary shall— 
(A) hold the assets to maturity or for resale for and 
until such time as the Secretary determines that the 
market is optimal for selling such assets, in order to maxi-
mize the value for taxpayers; and 
(B) sell such assets at a price that the Secretary deter-
mines, based on available financial analysis, will maximize 
return on investment for the Federal Government. 
(3) PRIVATE SECTOR PARTICIPATION.—The Secretary shall 
encourage the private sector to participate in purchases of 
troubled assets, and to invest in financial institutions, con-
sistent with the provisions of this section. 
(b) USE OF MARKET MECHANISMS.—In making purchases under 
this Act, the Secretary shall— 
(1) make such purchases at the lowest price that the Sec-
retary determines to be consistent with the purposes of this 
Act; and 
(2) maximize the efficiency of the use of taxpayer resources 
by using market mechanisms, including auctions or reverse 
auctions, where appropriate. 
(c) DIRECT PURCHASES.—If the Secretary determines that use 
of a market mechanism under subsection (b) is not feasible or 
appropriate, and the purposes of the Act are best met through 
direct purchases from an individual financial institution, the Sec-
retary shall pursue additional measures to ensure that prices paid 
for assets are reasonable and reflect the underlying value of the 
asset. 
(d) CONDITIONS ON PURCHASE AUTHORITY FOR WARRANTS AND 
DEBT INSTRUMENTS.— 
(1) IN GENERAL.—The Secretary may not purchase, or make 
any commitment to purchase, any troubled asset under the 
authority of this Act, unless the Secretary receives from the 
financial institution from which such assets are to be pur-
chased— 
(A) in the case of a financial institution, the securities 
of which are traded on a national securities exchange, 
a warrant giving the right to the Secretary to receive 
nonvoting common stock or preferred stock in such financial 
institution, or voting stock with respect to which, the Sec-
retary agrees not to exercise voting power, as the Secretary 
determines appropriate; or 
(B) in the case of any financial institution other than 
one described in subparagraph (A), a warrant for common 
or preferred stock, or a senior debt instrument from such 
financial institution, as described in paragraph (2)(C). 
(2) TERMS AND CONDITIONS.—The terms and conditions of 
any warrant or senior debt instrument required under para-
graph (1) shall meet the following requirements: 
(A) PURPOSES.—Such terms and conditions shall, at 
a minimum, be designed— 
(i) to provide for reasonable participation by the 
Secretary, for the benefit of taxpayers, in equity appre-
ciation in the case of a warrant or other equity security, 
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122 STAT. 3779 
PUBLIC LAW 110–343—OCT. 3, 2008 
or a reasonable interest rate premium, in the case 
of a debt instrument; and 
(ii) to provide additional protection for the taxpayer 
against losses from sale of assets by the Secretary 
under this Act and the administrative expenses of the 
TARP. 
(B) AUTHORITY TO SELL, EXERCISE, OR SURRENDER.— 
The Secretary may sell, exercise, or surrender a warrant 
or any senior debt instrument received under this sub-
section, based on the conditions established under subpara-
graph (A). 
(C) CONVERSION.—The warrant shall provide that if, 
after the warrant is received by the Secretary under this 
subsection, the financial institution that issued the warrant 
is no longer listed or traded on a national securities 
exchange or securities association, as described in para-
graph (1)(A), such warrants shall convert to senior debt, 
or contain appropriate protections for the Secretary to 
ensure that the Treasury is appropriately compensated 
for the value of the warrant, in an amount determined 
by the Secretary. 
(D) PROTECTIONS.—Any warrant representing securi-
ties to be received by the Secretary under this subsection 
shall contain anti-dilution provisions of the type employed 
in capital market transactions, as determined by the Sec-
retary. Such provisions shall protect the value of the securi-
ties from market transactions such as stock splits, stock 
distributions, dividends, and other distributions, mergers, 
and other forms of reorganization or recapitalization. 
(E) EXERCISE PRICE.—The exercise price for any war-
rant issued pursuant to this subsection shall be set by 
the Secretary, in the interest of the taxpayers. 
(F) SUFFICIENCY.—The financial institution shall guar-
antee to the Secretary that it has authorized shares of 
nonvoting stock available to fulfill its obligations under 
this subsection. Should the financial institution not have 
sufficient authorized shares, including preferred shares 
that may carry dividend rights equal to a multiple number 
of common shares, the Secretary may, to the extent nec-
essary, accept a senior debt note in an amount, and on 
such terms as will compensate the Secretary with equiva-
lent value, in the event that a sufficient shareholder vote 
to authorize the necessary additional shares cannot be 
obtained. 
(3) EXCEPTIONS.— 
(A) DE
MINIMIS.—The Secretary shall establish de 
minimis exceptions to the requirements of this subsection, 
based on the size of the cumulative transactions of troubled 
assets purchased from any one financial institution for 
the 
duration 
of 
the 
program, 
at 
not 
more 
than 
$100,000,000. 
(B) OTHER EXCEPTIONS.—The Secretary shall establish 
an exception to the requirements of this subsection and 
appropriate alternative requirements for any participating 
financial institution that is legally prohibited from issuing 
securities and debt instruments, so as not to allow cir-
cumvention of the requirements of this section. 
Anti-dilution 
provisions. 
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122 STAT. 3780 
PUBLIC LAW 110–343—OCT. 3, 2008 
SEC. 114. MARKET TRANSPARENCY. 
(a) PRICING.—To facilitate market transparency, the Secretary 
shall make available to the public, in electronic form, a description, 
amounts, and pricing of assets acquired under this Act, within 
2 business days of purchase, trade, or other disposition. 
(b) DISCLOSURE.—For each type of financial institutions that 
sells troubled assets to the Secretary under this Act, the Secretary 
shall determine whether the public disclosure required for such 
financial institutions with respect to off-balance sheet transactions, 
derivatives instruments, contingent liabilities, and similar sources 
of potential exposure is adequate to provide to the public sufficient 
information as to the true financial position of the institutions. 
If such disclosure is not adequate for that purpose, the Secretary 
shall make recommendations for additional disclosure requirements 
to the relevant regulators. 
SEC. 115. GRADUATED AUTHORIZATION TO PURCHASE. 
(a) AUTHORITY.—The authority of the Secretary to purchase 
troubled assets under this Act shall be limited as follows: 
(1) Effective upon the date of enactment of this Act, such 
authority shall be limited to $250,000,000,000 outstanding at 
any one time. 
(2) If at any time, the President submits to the Congress 
a written certification that the Secretary needs to exercise 
the authority under this paragraph, effective upon such submis-
sion, such authority shall be limited to $350,000,000,000 out-
standing at any one time. 
(3) If, at any time after the certification in paragraph 
(2) has been made, the President transmits to the Congress 
a written report detailing the plan of the Secretary to exercise 
the authority under this paragraph, unless there is enacted, 
within 15 calendar days of such transmission, a joint resolution 
described in subsection (c), effective upon the expiration of 
such 15-day period, such authority shall be limited to 
$700,000,000,000 outstanding at any one time. 
(b) AGGREGATION OF PURCHASE PRICES.—The amount of trou-
bled assets purchased by the Secretary outstanding at any one 
time shall be determined for purposes of the dollar amount limita-
tions under subsection (a) by aggregating the purchase prices of 
all troubled assets held. 
(c) JOINT RESOLUTION OF DISAPPROVAL.— 
(1) IN GENERAL.—Notwithstanding any other provision of 
this section, the Secretary may not exercise any authority to 
make purchases under this Act with regard to any amount 
in excess of $350,000,000,000 previously obligated, as described 
in this section if, within 15 calendar days after the date on 
which Congress receives a report of the plan of the Secretary 
described in subsection (a)(3), there is enacted into law a joint 
resolution disapproving the plan of the Secretary with respect 
to such additional amount. 
(2) CONTENTS OF JOINT RESOLUTION.—For the purpose of 
this section, the term ‘‘joint resolution’’ means only a joint 
resolution— 
(A) that is introduced not later than 3 calendar days 
after the date on which the report of the plan of the 
Secretary referred to in subsection (a)(3) is received by 
Congress; 
Definition. 
Effective dates. 
12 USC 5225. 
Public 
information. 
Deadline. 
12 USC 5224. 
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122 STAT. 3781 
PUBLIC LAW 110–343—OCT. 3, 2008 
(B) which does not have a preamble; 
(C) the title of which is as follows: ‘‘Joint resolution 
relating to the disapproval of obligations under the Emer-
gency Economic Stabilization Act of 2008’’; and 
(D) the matter after the resolving clause of which 
is as follows: ‘‘That Congress disapproves the obligation 
of any amount exceeding the amounts obligated as 
described in paragraphs (1) and (2) of section 115(a) of 
the Emergency Economic Stabilization Act of 2008.’’. 
(d) FAST TRACK CONSIDERATION
IN HOUSE
OF REPRESENTA-
TIVES.— 
(1) RECONVENING.—Upon receipt of a report under sub-
section (a)(3), the Speaker, if the House would otherwise be 
adjourned, shall notify the Members of the House that, pursu-
ant to this section, the House shall convene not later than 
the second calendar day after receipt of such report; 
(2) REPORTING
AND
DISCHARGE.—Any committee of the 
House of Representatives to which a joint resolution is referred 
shall report it to the House not later than 5 calendar days 
after the date of receipt of the report described in subsection 
(a)(3). If a committee fails to report the joint resolution within 
that period, the committee shall be discharged from further 
consideration of the joint resolution and the joint resolution 
shall be referred to the appropriate calendar. 
(3) PROCEEDING TO CONSIDERATION.—After each committee 
authorized to consider a joint resolution reports it to the House 
or has been discharged from its consideration, it shall be in 
order, not later than the sixth day after Congress receives 
the report described in subsection (a)(3), to move to proceed 
to consider the joint resolution in the House. All points of 
order against the motion are waived. Such a motion shall 
not be in order after the House has disposed of a motion 
to proceed on the joint resolution. The previous question shall 
be considered as ordered on the motion to its adoption without 
intervening motion. The motion shall not be debatable. A 
motion to reconsider the vote by which the motion is disposed 
of shall not be in order. 
(4) CONSIDERATION.—The joint resolution shall be consid-
ered as read. All points of order against the joint resolution 
and against its consideration are waived. The previous question 
shall be considered as ordered on the joint resolution to its 
passage without intervening motion except two hours of debate 
equally divided and controlled by the proponent and an oppo-
nent. A motion to reconsider the vote on passage of the joint 
resolution shall not be in order. 
(e) FAST TRACK CONSIDERATION IN SENATE.— 
(1) RECONVENING.—Upon receipt of a report under sub-
section (a)(3), if the Senate has adjourned or recessed for more 
than 2 days, the majority leader of the Senate, after consulta-
tion with the minority leader of the Senate, shall notify the 
Members of the Senate that, pursuant to this section, the 
Senate shall convene not later than the second calendar day 
after receipt of such message. 
(2) PLACEMENT ON CALENDAR.—Upon introduction in the 
Senate, the joint resolution shall be placed immediately on 
the calendar. 
(3) FLOOR CONSIDERATION.— 
Notification. 
Deadline. 
Waiver. 
Deadline. 
Notification. 
Deadline. 
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122 STAT. 3782 
PUBLIC LAW 110–343—OCT. 3, 2008 
(A) IN GENERAL.—Notwithstanding Rule XXII of the 
Standing Rules of the Senate, it is in order at any time 
during the period beginning on the 4th day after the date 
on which Congress receives a report of the plan of the 
Secretary described in subsection (a)(3) and ending on the 
6th day after the date on which Congress receives a report 
of the plan of the Secretary described in subsection (a)(3) 
(even though a previous motion to the same effect has 
been disagreed to) to move to proceed to the consideration 
of the joint resolution, and all points of order against 
the joint resolution (and against consideration of the joint 
resolution) are waived. The motion to proceed is not debat-
able. The motion is not subject to a motion to postpone. 
A motion to reconsider the vote by which the motion is 
agreed to or disagreed to shall not be in order. If a motion 
to proceed to the consideration of the resolution is agreed 
to, the joint resolution shall remain the unfinished business 
until disposed of. 
(B) DEBATE.—Debate on the joint resolution, and on 
all debatable motions and appeals in connection therewith, 
shall be limited to not more than 10 hours, which shall 
be divided equally between the majority and minority 
leaders or their designees. A motion further to limit debate 
is in order and not debatable. An amendment to, or a 
motion to postpone, or a motion to proceed to the consider-
ation of other business, or a motion to recommit the joint 
resolution is not in order. 
(C) VOTE ON PASSAGE.—The vote on passage shall occur 
immediately following the conclusion of the debate on a 
joint resolution, and a single quorum call at the conclusion 
of the debate if requested in accordance with the rules 
of the Senate. 
(D) RULINGS OF THE CHAIR ON PROCEDURE.—Appeals 
from the decisions of the Chair relating to the application 
of the rules of the Senate, as the case may be, to the 
procedure relating to a joint resolution shall be decided 
without debate. 
(f) RULES RELATING TO SENATE AND HOUSE OF REPRESENTA-
TIVES.— 
(1) COORDINATION
WITH
ACTION
BY
OTHER
HOUSE.—If, 
before the passage by one House of a joint resolution of that 
House, that House receives from the other House a joint resolu-
tion, then the following procedures shall apply: 
(A) The joint resolution of the other House shall not 
be referred to a committee. 
(B) With respect to a joint resolution of the House 
receiving the resolution— 
(i) the procedure in that House shall be the same 
as if no joint resolution had been received from the 
other House; but 
(ii) the vote on passage shall be on the joint resolu-
tion of the other House. 
(2) TREATMENT OF JOINT RESOLUTION OF OTHER HOUSE.— 
If one House fails to introduce or consider a joint resolution 
under this section, the joint resolution of the other House 
shall be entitled to expedited floor procedures under this sec-
tion. 
Duration. 
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122 STAT. 3783 
PUBLIC LAW 110–343—OCT. 3, 2008 
(3) TREATMENT
OF
COMPANION
MEASURES.—If, following 
passage of the joint resolution in the Senate, the Senate then 
receives the companion measure from the House of Representa-
tives, the companion measure shall not be debatable. 
(4) CONSIDERATION AFTER PASSAGE.— 
(A) IN GENERAL.—If Congress passes a joint resolution, 
the period beginning on the date the President is presented 
with the joint resolution and ending on the date the Presi-
dent takes action with respect to the joint resolution shall 
be disregarded in computing the 15-calendar day period 
described in subsection (a)(3). 
(B) VETOES.—If the President vetoes the joint resolu-
tion— 
(i) the period beginning on the date the President 
vetoes the joint resolution and ending on the date 
the Congress receives the veto message with respect 
to the joint resolution shall be disregarded in com-
puting the 15-calendar day period described in sub-
section (a)(3), and 
(ii) debate on a veto message in the Senate under 
this section shall be 1 hour equally divided between 
the majority and minority leaders or their designees. 
(5) RULES OF HOUSE OF REPRESENTATIVES AND SENATE.— 
This subsection and subsections (c), (d), and (e) are enacted 
by Congress— 
(A) as an exercise of the rulemaking power of the 
Senate and House of Representatives, respectively, and 
as such it is deemed a part of the rules of each House, 
respectively, but applicable only with respect to the proce-
dure to be followed in that House in the case of a joint 
resolution, and it supersedes other rules only to the extent 
that it is inconsistent with such rules; and 
(B) with full recognition of the constitutional right 
of either House to change the rules (so far as relating 
to the procedure of that House) at any time, in the same 
manner, and to the same extent as in the case of any 
other rule of that House. 
SEC. 116. OVERSIGHT AND AUDITS. 
(a) COMPTROLLER GENERAL OVERSIGHT.— 
(1) SCOPE OF OVERSIGHT.—The Comptroller General of the 
United States shall, upon establishment of the troubled assets 
relief program under this Act (in this section referred to as 
the ‘‘TARP’’), commence ongoing oversight of the activities and 
performance of the TARP and of any agents and representatives 
of the TARP (as related to the agent or representative’s activi-
ties on behalf of or under the authority of the TARP), including 
vehicles established by the Secretary under this Act. The sub-
jects of such oversight shall include the following: 
(A) The performance of the TARP in meeting the pur-
poses of this Act, particularly those involving— 
(i) foreclosure mitigation; 
(ii) cost reduction; 
(iii) whether it has provided stability or prevented 
disruption to the financial markets or the banking 
system; and 
(iv) whether it has protected taxpayers. 
12 USC 5226. 
Debate. 
Duration. 
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122 STAT. 3784 
PUBLIC LAW 110–343—OCT. 3, 2008 
(B) The financial condition and internal controls of 
the TARP, its representatives and agents. 
(C) Characteristics of transactions and commitments 
entered into, including transaction type, frequency, size, 
prices paid, and all other relevant terms and conditions, 
and the timing, duration and terms of any future commit-
ments to purchase assets. 
(D) Characteristics and disposition of acquired assets, 
including type, acquisition price, current market value, 
sale prices and terms, and use of proceeds from sales. 
(E) Efficiency of the operations of the TARP in the 
use of appropriated funds. 
(F) Compliance with all applicable laws and regulations 
by the TARP, its agents and representatives. 
(G) The efforts of the TARP to prevent, identify, and 
minimize conflicts of interest involving any agent or rep-
resentative performing activities on behalf of or under the 
authority of the TARP. 
(H) The efficacy of contracting procedures pursuant 
to section 107(b), including, as applicable, the efforts of 
the TARP in evaluating proposals for inclusion and con-
tracting to the maximum extent possible of minorities (as 
such term is defined in 1204(c) of the Financial Institutions 
Reform, Recovery, and Enhancement Act of 1989 (12 U.S.C. 
1811 note), women, and minority- and women-owned 
businesses, including ascertaining and reporting the total 
amount of fees paid and other value delivered by the TARP 
to all of its agents and representatives, and such amounts 
paid or delivered to such firms that are minority- and 
women-owned businesses (as such terms are defined in 
section 21A of the Federal Home Loan Bank Act (12 U.S.C. 
1441a)). 
(2) CONDUCT AND ADMINISTRATION OF OVERSIGHT.— 
(A) GAO PRESENCE.—The Secretary shall provide the 
Comptroller General with appropriate space and facilities 
in the Department of the Treasury as necessary to facilitate 
oversight of the TARP until the termination date estab-
lished in section 120. 
(B) ACCESS TO RECORDS.—To the extent otherwise con-
sistent with law, the Comptroller General shall have access, 
upon request, to any information, data, schedules, books, 
accounts, financial records, reports, files, electronic commu-
nications, or other papers, things, or property belonging 
to or in use by the TARP, or any vehicles established 
by the Secretary under this Act, and to the officers, direc-
tors, employees, independent public accountants, financial 
advisors, and other agents and representatives of the TARP 
(as related to the agent or representative’s activities on 
behalf of or under the authority of the TARP) or any 
such vehicle at such reasonable time as the Comptroller 
General may request. The Comptroller General shall be 
afforded full facilities for verifying transactions with the 
balances or securities held by depositaries, fiscal agents, 
and custodians. The Comptroller General may make and 
retain copies of such books, accounts, and other records 
as the Comptroller General deems appropriate. 
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122 STAT. 3785 
PUBLIC LAW 110–343—OCT. 3, 2008 
(C) REIMBURSEMENT
OF
COSTS.—The Treasury shall 
reimburse the Government Accountability Office for the 
full cost of any such oversight activities as billed therefor 
by the Comptroller General of the United States. Such 
reimbursements shall be credited to the appropriation 
account ‘‘Salaries and Expenses, Government Account-
ability Office’’ current when the payment is received and 
remain available until expended. 
(3) REPORTING.—The Comptroller General shall submit 
reports of findings under this section, regularly and no less 
frequently than once every 60 days, to the appropriate commit-
tees of Congress, and the Special Inspector General for the 
Troubled Asset Relief Program established under this Act on 
the activities and performance of the TARP. The Comptroller 
may also submit special reports under this subsection as war-
ranted by the findings of its oversight activities. 
(b) COMPTROLLER GENERAL AUDITS.— 
(1) ANNUAL AUDIT.—The TARP shall annually prepare and 
issue to the appropriate committees of Congress and the public 
audited financial statements prepared in accordance with gen-
erally accepted accounting principles, and the Comptroller Gen-
eral shall annually audit such statements in accordance with 
generally accepted auditing standards. The Treasury shall 
reimburse the Government Accountability Office for the full 
cost of any such audit as billed therefor by the Comptroller 
General. Such reimbursements shall be credited to the appro-
priation account ‘‘Salaries and Expenses, Government Account-
ability Office’’ current when the payment is received and remain 
available until expended. The financial statements prepared 
under this paragraph shall be on the fiscal year basis prescribed 
under section 1102 of title 31, United States Code. 
(2) AUTHORITY.—The Comptroller General may audit the 
programs, activities, receipts, expenditures, and financial trans-
actions of the TARP and any agents and representatives of 
the TARP (as related to the agent or representative’s activities 
on behalf of or under the authority of the TARP), including 
vehicles established by the Secretary under this Act. 
(3) CORRECTIVE
RESPONSES
TO
AUDIT
PROBLEMS.—The 
TARP shall— 
(A) take action to address deficiencies identified by 
the Comptroller General or other auditor engaged by the 
TARP; or 
(B) certify to appropriate committees of Congress that 
no action is necessary or appropriate. 
(c) INTERNAL CONTROL.— 
(1) ESTABLISHMENT.—The TARP shall establish and main-
tain an effective system of internal control, consistent with 
the standards prescribed under section 3512(c) of title 31, 
United States Code, that provides reasonable assurance of— 
(A) the effectiveness and efficiency of operations, 
including the use of the resources of the TARP; 
(B) the reliability of financial reporting, including 
financial statements and other reports for internal and 
external use; and 
(C) compliance with applicable laws and regulations. 
(2) REPORTING.—In conjunction with each annual financial 
statement issued under this section, the TARP shall— 
Certification. 
Public 
information. 
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122 STAT. 3786 
PUBLIC LAW 110–343—OCT. 3, 2008 
(A) state the responsibility of management for estab-
lishing and maintaining adequate internal control over 
financial reporting; and 
(B) state its assessment, as of the end of the most 
recent year covered by such financial statement of the 
TARP, of the effectiveness of the internal control over 
financial reporting. 
(d) SHARING OF INFORMATION.—Any report or audit required 
under this section shall also be submitted to the Congressional 
Oversight Panel established under section 125. 
(e) TERMINATION.—Any oversight, reporting, or audit require-
ment under this section shall terminate on the later of— 
(1) the date that the last troubled asset acquired by the 
Secretary under section 101 has been sold or transferred out 
of the ownership or control of the Federal Government; or 
(2) the date of expiration of the last insurance contract 
issued under section 102. 
SEC. 117. STUDY AND REPORT ON MARGIN AUTHORITY. 
(a) STUDY.—The Comptroller General shall undertake a study 
to determine the extent to which leverage and sudden deleveraging 
of financial institutions was a factor behind the current financial 
crisis. 
(b) CONTENT.—The study required by this section shall 
include— 
(1) an analysis of the roles and responsibilities of the 
Board, the Securities and Exchange Commission, the Secretary, 
and other Federal banking agencies with respect to monitoring 
leverage and acting to curtail excessive leveraging; 
(2) an analysis of the authority of the Board to regulate 
leverage, including by setting margin requirements, and what 
process the Board used to decide whether or not to use its 
authority; 
(3) an analysis of any usage of the margin authority by 
the Board; and 
(4) recommendations for the Board and appropriate 
committees of Congress with respect to the existing authority 
of the Board. 
(c) REPORT.—Not later than June 1, 2009, the Comptroller 
General shall complete and submit a report on the study required 
by this section to the Committee on Banking, Housing, and Urban 
Affairs of the Senate and the Committee on Financial Services 
of the House of Representatives. 
(d) SHARING
OF INFORMATION.—Any reports required under 
this section shall also be submitted to the Congressional Oversight 
Panel established under section 125. 
SEC. 118. FUNDING. 
For the purpose of the authorities granted in this Act, and 
for the costs of administering those authorities, the Secretary may 
use the proceeds of the sale of any securities issued under chapter 
31 of title 31, United States Code, and the purposes for which 
securities may be issued under chapter 31 of title 31, United States 
Code, are extended to include actions authorized by this Act, 
including the payment of administrative expenses. Any funds 
expended or obligated by the Secretary for actions authorized by 
this Act, including the payment of administrative expenses, shall 
12 USC 5228. 
12 USC 5227. 
Reports. 
Audits. 
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122 STAT. 3787 
PUBLIC LAW 110–343—OCT. 3, 2008 
be deemed appropriated at the time of such expenditure or obliga-
tion. 
SEC. 119. JUDICIAL REVIEW AND RELATED MATTERS. 
(a) JUDICIAL REVIEW.— 
(1) STANDARD.—Actions by the Secretary pursuant to the 
authority of this Act shall be subject to chapter 7 of title 
5, United States Code, including that such final actions shall 
be held unlawful and set aside if found to be arbitrary, capri-
cious, an abuse of discretion, or not in accordance with law. 
(2) LIMITATIONS ON EQUITABLE RELIEF.— 
(A) INJUNCTION.—No injunction or other form of equi-
table relief shall be issued against the Secretary for actions 
pursuant to section 101, 102, 106, and 109, other than 
to remedy a violation of the Constitution. 
(B) TEMPORARY RESTRAINING ORDER.—Any request for 
a temporary restraining order against the Secretary for 
actions pursuant to this Act shall be considered and 
granted or denied by the court within 3 days of the date 
of the request. 
(C) PRELIMINARY
INJUNCTION.—Any request for a 
preliminary injunction against the Secretary for actions 
pursuant to this Act shall be considered and granted or 
denied by the court on an expedited basis consistent with 
the provisions of rule 65(b)(3) of the Federal Rules of Civil 
Procedure, or any successor thereto. 
(D) PERMANENT
INJUNCTION.—Any request for a 
permanent injunction against the Secretary for actions 
pursuant to this Act shall be considered and granted or 
denied by the court on an expedited basis. Whenever pos-
sible, the court shall consolidate trial on the merits with 
any hearing on a request for a preliminary injunction, 
consistent with the provisions of rule 65(a)(2) of the Federal 
Rules of Civil Procedure, or any successor thereto. 
(3) LIMITATION ON ACTIONS BY PARTICIPATING COMPANIES.— 
No action or claims may be brought against the Secretary 
by any person that divests its assets with respect to its partici-
pation in a program under this Act, except as provided in 
paragraph (1), other than as expressly provided in a written 
contract with the Secretary. 
(4) STAYS.—Any injunction or other form of equitable relief 
issued against the Secretary for actions pursuant to section 
101, 102, 106, and 109, shall be automatically stayed. The 
stay shall be lifted unless the Secretary seeks a stay from 
a higher court within 3 calendar days after the date on which 
the relief is issued. 
(b) RELATED MATTERS.— 
(1) TREATMENT OF HOMEOWNERS’ RIGHTS.—The terms of 
any residential mortgage loan that is part of any purchase 
by the Secretary under this Act shall remain subject to all 
claims and defenses that would otherwise apply, notwith-
standing the exercise of authority by the Secretary under this 
Act. 
(2) SAVINGS CLAUSE.—Any exercise of the authority of the 
Secretary pursuant to this Act shall not impair the claims 
or defenses that would otherwise apply with respect to persons 
other than the Secretary. Except as established in any contract, 
Deadline. 
Contracts. 
Deadline. 
12 USC 5229. 
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122 STAT. 3788 
PUBLIC LAW 110–343—OCT. 3, 2008 
a servicer of pooled residential mortgages owes any duty to 
determine whether the net present value of the payments on 
the loan, as modified, is likely to be greater than the anticipated 
net recovery that would result from foreclosure to all investors 
and holders of beneficial interests in such investment, but 
not to any individual or groups of investors or beneficial interest 
holders, and shall be deemed to act in the best interests of 
all such investors or holders of beneficial interests if the servicer 
agrees to or implements a modification or workout plan when 
the servicer takes reasonable loss mitigation actions, including 
partial payments. 
SEC. 120. TERMINATION OF AUTHORITY. 
(a) TERMINATION.—The authorities provided under sections 
101(a), excluding section 101(a)(3), and 102 shall terminate on 
December 31, 2009. 
(b) EXTENSION UPON CERTIFICATION.—The Secretary, upon 
submission of a written certification to Congress, may extend the 
authority provided under this Act to expire not later than 2 years 
from the date of enactment of this Act. Such certification shall 
include a justification of why the extension is necessary to assist 
American families and stabilize financial markets, as well as the 
expected cost to the taxpayers for such an extension. 
SEC. 121. SPECIAL INSPECTOR GENERAL FOR THE TROUBLED ASSET 
RELIEF PROGRAM. 
(a) OFFICE OF INSPECTOR GENERAL.—There is hereby estab-
lished the Office of the Special Inspector General for the Troubled 
Asset Relief Program. 
(b) APPOINTMENT OF INSPECTOR GENERAL; REMOVAL.—(1) The 
head of the Office of the Special Inspector General for the Troubled 
Asset Relief Program is the Special Inspector General for the Trou-
bled Asset Relief Program (in this section referred to as the ‘‘Special 
Inspector General’’), who shall be appointed by the President, by 
and with the advice and consent of the Senate. 
(2) The appointment of the Special Inspector General shall 
be made on the basis of integrity and demonstrated ability in 
accounting, auditing, financial analysis, law, management analysis, 
public administration, or investigations. 
(3) The nomination of an individual as Special Inspector Gen-
eral shall be made as soon as practicable after the establishment 
of any program under sections 101 and 102. 
(4) The Special Inspector General shall be removable from 
office in accordance with the provisions of section 3(b) of the 
Inspector General Act of 1978 (5 U.S.C. App.). 
(5) For purposes of section 7324 of title 5, United States Code, 
the Special Inspector General shall not be considered an employee 
who determines policies to be pursued by the United States in 
the nationwide administration of Federal law. 
(6) The annual rate of basic pay of the Special Inspector General 
shall be the annual rate of basic pay for an Inspector General 
under section 3(e) of the Inspector General Act of 1978 (5 U.S.C. 
App.). 
(c) DUTIES.—(1) It shall be the duty of the Special Inspector 
General to conduct, supervise, and coordinate audits and investiga-
tions of the purchase, management, and sale of assets by the 
Secretary of the Treasury under any program established by the 
Secretary under section 101, and the management by the Secretary 
President. 
12 USC 5231. 
12 USC 5230. 
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122 STAT. 3789 
PUBLIC LAW 110–343—OCT. 3, 2008 
of any program established under section 102, including by col-
lecting and summarizing the following information: 
(A) A description of the categories of troubled assets pur-
chased or otherwise procured by the Secretary. 
(B) A listing of the troubled assets purchased in each 
such category described under subparagraph (A). 
(C) An explanation of the reasons the Secretary deemed 
it necessary to purchase each such troubled asset. 
(D) A listing of each financial institution that such troubled 
assets were purchased from. 
(E) A listing of and detailed biographical information on 
each person or entity hired to manage such troubled assets. 
(F) A current estimate of the total amount of troubled 
assets purchased pursuant to any program established under 
section 101, the amount of troubled assets on the books of 
the Treasury, the amount of troubled assets sold, and the 
profit and loss incurred on each sale or disposition of each 
such troubled asset. 
(G) A listing of the insurance contracts issued under section 
102. 
(2) The Special Inspector General shall establish, maintain, 
and oversee such systems, procedures, and controls as the Special 
Inspector General considers appropriate to discharge the duty under 
paragraph (1). 
(3) In addition to the duties specified in paragraphs (1) and 
(2), the Inspector General shall also have the duties and responsibil-
ities of inspectors general under the Inspector General Act of 1978. 
(d) POWERS AND AUTHORITIES.—(1) In carrying out the duties 
specified in subsection (c), the Special Inspector General shall have 
the authorities provided in section 6 of the Inspector General Act 
of 1978. 
(2) The Special Inspector General shall carry out the duties 
specified in subsection (c)(1) in accordance with section 4(b)(1) of 
the Inspector General Act of 1978. 
(e) PERSONNEL, FACILITIES, AND OTHER RESOURCES.—(1) The 
Special Inspector General may select, appoint, and employ such 
officers and employees as may be necessary for carrying out the 
duties of the Special Inspector General, subject to the provisions 
of title 5, United States Code, governing appointments in the 
competitive service, and the provisions of chapter 51 and subchapter 
III of chapter 53 of such title, relating to classification and General 
Schedule pay rates. 
(2) The Special Inspector General may obtain services as 
authorized by section 3109 of title 5, United States Code, at daily 
rates not to exceed the equivalent rate prescribed for grade GS– 
15 of the General Schedule by section 5332 of such title. 
(3) The Special Inspector General may enter into contracts 
and other arrangements for audits, studies, analyses, and other 
services with public agencies and with private persons, and make 
such payments as may be necessary to carry out the duties of 
the Inspector General. 
(4)(A) Upon request of the Special Inspector General for 
information or assistance from any department, agency, or other 
entity of the Federal Government, the head of such entity shall, 
insofar as is practicable and not in contravention of any existing 
law, furnish such information or assistance to the Special Inspector 
General, or an authorized designee. 
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122 STAT. 3790 
PUBLIC LAW 110–343—OCT. 3, 2008 
(B) Whenever information or assistance requested by the Spe-
cial Inspector General is, in the judgment of the Special Inspector 
General, unreasonably refused or not provided, the Special Inspector 
General shall report the circumstances to the appropriate commit-
tees of Congress without delay. 
(f) REPORTS.—(1) Not later than 60 days after the confirmation 
of the Special Inspector General, and every calendar quarter there-
after, the Special Inspector General shall submit to the appropriate 
committees of Congress a report summarizing the activities of the 
Special Inspector General during the 120-day period ending on 
the date of such report. Each report shall include, for the period 
covered by such report, a detailed statement of all purchases, obliga-
tions, expenditures, and revenues associated with any program 
established by the Secretary of the Treasury under sections 101 
and 102, as well as the information collected under subsection 
(c)(1). 
(2) Nothing in this subsection shall be construed to authorize 
the public disclosure of information that is— 
(A) specifically prohibited from disclosure by any other 
provision of law; 
(B) specifically required by Executive order to be protected 
from disclosure in the interest of national defense or national 
security or in the conduct of foreign affairs; or 
(C) a part of an ongoing criminal investigation. 
(3) Any reports required under this section shall also be sub-
mitted to the Congressional Oversight Panel established under 
section 125. 
(g) FUNDING.—(1) Of the amounts made available to the Sec-
retary of the Treasury under section 118, $50,000,000 shall be 
available to the Special Inspector General to carry out this section. 
(2) The amount available under paragraph (1) shall remain 
available until expended. 
(h) TERMINATION.—The Office of the Special Inspector General 
shall terminate on the later of— 
(1) the date that the last troubled asset acquired by the 
Secretary under section 101 has been sold or transferred out 
of the ownership or control of the Federal Government; or 
(2) the date of expiration of the last insurance contract 
issued under section 102. 
SEC. 122. INCREASE IN STATUTORY LIMIT ON THE PUBLIC DEBT. 
Subsection (b) of section 3101 of title 31, United States Code, 
is amended by striking out the dollar limitation contained in such 
subsection and inserting ‘‘$11,315,000,000,000’’. 
SEC. 123. CREDIT REFORM. 
(a) IN GENERAL.—Subject to subsection (b), the costs of pur-
chases of troubled assets made under section 101(a) and guarantees 
of troubled assets under section 102, and any cash flows associated 
with the activities authorized in section 102 and subsections (a), 
(b), and (c) of section 106 shall be determined as provided under 
the Federal Credit Reform Act of 1990 (2 U.S.C. 661 et. seq.). 
(b) COSTS.—For the purposes of section 502(5) of the Federal 
Credit Reform Act of 1990 (2 U.S.C. 661a(5))— 
(1) the cost of troubled assets and guarantees of troubled 
assets shall be calculated by adjusting the discount rate in 
section 502(5)(E) (2 U.S.C. 661a(5)(E)) for market risks; and 
12 USC 5232. 
Reports. 
Reports. 
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122 STAT. 3791 
PUBLIC LAW 110–343—OCT. 3, 2008 
(2) the cost of a modification of a troubled asset or guar-
antee of a troubled asset shall be the difference between the 
current estimate consistent with paragraph (1) under the terms 
of the troubled asset or guarantee of the troubled asset and 
the current estimate consistent with paragraph (1) under the 
terms of the troubled asset or guarantee of the troubled asset, 
as modified. 
SEC. 124. HOPE FOR HOMEOWNERS AMENDMENTS. 
Section 257 of the National Housing Act (12 U.S.C. 1715z– 
23) is amended— 
(1) in subsection (e)— 
(A) in paragraph (1)(B), by inserting before ‘‘a ratio’’ 
the following: ‘‘, or thereafter is likely to have, due to 
the terms of the mortgage being reset,’’; 
(B) in paragraph (2)(B), by inserting before the period 
at the end ‘‘(or such higher percentage as the Board deter-
mines, in the discretion of the Board)’’; 
(C) in paragraph (4)(A)— 
(i) in the first sentence, by inserting after ‘‘insured 
loan’’ the following: ‘‘and any payments made under 
this paragraph,’’; and 
(ii) by adding at the end the following: ‘‘Such 
actions may include making payments, which shall 
be accepted as payment in full of all indebtedness 
under the eligible mortgage, to any holder of an 
existing subordinate mortgage, in lieu of any future 
appreciation payments authorized under subparagraph 
(B).’’; and 
(2) in subsection (w), by inserting after ‘‘administrative 
costs’’ the following: ‘‘and payments pursuant to subsection 
(e)(4)(A)’’. 
SEC. 125. CONGRESSIONAL OVERSIGHT PANEL. 
(a) ESTABLISHMENT.—There is hereby established the Congres-
sional Oversight Panel (hereafter in this section referred to as 
the ‘‘Oversight Panel’’) as an establishment in the legislative branch. 
(b) DUTIES.—The Oversight Panel shall review the current state 
of the financial markets and the regulatory system and submit 
the following reports to Congress: 
(1) REGULAR REPORTS.— 
(A) IN
GENERAL.—Regular reports of the Oversight 
Panel shall include the following: 
(i) The use by the Secretary of authority under 
this Act, including with respect to the use of con-
tracting authority and administration of the program. 
(ii) The impact of purchases made under the Act 
on the financial markets and financial institutions. 
(iii) The extent to which the information made 
available on transactions under the program has 
contributed to market transparency. 
(iv) The effectiveness of foreclosure mitigation 
efforts, and the effectiveness of the program from the 
standpoint of minimizing long-term costs to the tax-
payers and maximizing the benefits for taxpayers. 
(B) TIMING.—The reports required under this para-
graph shall be submitted not later than 30 days after 
12 USC 5233. 
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122 STAT. 3792 
PUBLIC LAW 110–343—OCT. 3, 2008 
the first exercise by the Secretary of the authority under 
section 101(a) or 102, and every 30 days thereafter. 
(2) SPECIAL REPORT ON REGULATORY REFORM.—The Over-
sight Panel shall submit a special report on regulatory reform 
not later than January 20, 2009, analyzing the current state 
of the regulatory system and its effectiveness at overseeing 
the participants in the financial system and protecting con-
sumers, and providing recommendations for improvement, 
including recommendations regarding whether any participants 
in the financial markets that are currently outside the regu-
latory system should become subject to the regulatory system, 
the rationale underlying such recommendation, and whether 
there are any gaps in existing consumer protections. 
(c) MEMBERSHIP.— 
(1) IN GENERAL.—The Oversight Panel shall consist of 5 
members, as follows: 
(A) 1 member appointed by the Speaker of the House 
of Representatives. 
(B) 1 member appointed by the minority leader of 
the House of Representatives. 
(C) 1 member appointed by the majority leader of 
the Senate. 
(D) 1 member appointed by the minority leader of 
the Senate. 
(E) 1 member appointed by the Speaker of the House 
of Representatives and the majority leader of the Senate, 
after consultation with the minority leader of the Senate 
and the minority leader of the House of Representatives. 
(2) PAY.—Each member of the Oversight Panel shall each 
be paid at a rate equal to the daily equivalent of the annual 
rate of basic pay for level I of the Executive Schedule for 
each day (including travel time) during which such member 
is engaged in the actual performance of duties vested in the 
Commission. 
(3) 
PROHIBITION
OF
COMPENSATION
OF
FEDERAL 
EMPLOYEES.—Members of the Oversight Panel who are full- 
time officers or employees of the United States or Members 
of Congress may not receive additional pay, allowances, or 
benefits by reason of their service on the Oversight Panel. 
(4) TRAVEL EXPENSES.—Each member shall receive travel 
expenses, including per diem in lieu of subsistence, in accord-
ance with applicable provisions under subchapter I of chapter 
57 of title 5, United States Code. 
(5) QUORUM.—Four members of the Oversight Panel shall 
constitute a quorum but a lesser number may hold hearings. 
(6) VACANCIES.—A vacancy on the Oversight Panel shall 
be filled in the manner in which the original appointment 
was made. 
(7) MEETINGS.—The Oversight Panel shall meet at the 
call of the Chairperson or a majority of its members. 
(d) STAFF.— 
(1) IN GENERAL.—The Oversight Panel may appoint and 
fix the pay of any personnel as the Commission considers 
appropriate. 
(2) EXPERTS AND CONSULTANTS.—The Oversight Panel may 
procure temporary and intermittent services under section 
3109(b) of title 5, United States Code. 
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122 STAT. 3793 
PUBLIC LAW 110–343—OCT. 3, 2008 
(3) STAFF OF AGENCIES.—Upon request of the Oversight 
Panel, the head of any Federal department or agency may 
detail, on a reimbursable basis, any of the personnel of that 
department or agency to the Oversight Panel to assist it in 
carrying out its duties under this Act. 
(e) POWERS.— 
(1) HEARINGS AND SESSIONS.—The Oversight Panel may, 
for the purpose of carrying out this section, hold hearings, 
sit and act at times and places, take testimony, and receive 
evidence as the Panel considers appropriate and may admin-
ister oaths or affirmations to witnesses appearing before it. 
(2) POWERS OF MEMBERS AND AGENTS.—Any member or 
agent of the Oversight Panel may, if authorized by the Over-
sight Panel, take any action which the Oversight Panel is 
authorized to take by this section. 
(3) OBTAINING OFFICIAL DATA.—The Oversight Panel may 
secure directly from any department or agency of the United 
States information necessary to enable it to carry out this 
section. Upon request of the Chairperson of the Oversight 
Panel, the head of that department or agency shall furnish 
that information to the Oversight Panel. 
(4) REPORTS.—The Oversight Panel shall receive and con-
sider all reports required to be submitted to the Oversight 
Panel under this Act. 
(f) TERMINATION.—The Oversight Panel shall terminate 6 
months after the termination date specified in section 120. 
(g) FUNDING FOR EXPENSES.— 
(1) AUTHORIZATION OF APPROPRIATIONS.—There is author-
ized to be appropriated to the Oversight Panel such sums 
as may be necessary for any fiscal year, half of which shall 
be derived from the applicable account of the House of Rep-
resentatives, and half of which shall be derived from the contin-
gent fund of the Senate. 
(2) REIMBURSEMENT OF AMOUNTS.—An amount equal to 
the expenses of the Oversight Panel shall be promptly trans-
ferred by the Secretary, from time to time upon the presentment 
of a statement of such expenses by the Chairperson of the 
Oversight Panel, from funds made available to the Secretary 
under this Act to the applicable fund of the House of Represent-
atives and the contingent fund of the Senate, as appropriate, 
as reimbursement for amounts expended from such account 
and fund under paragraph (1). 
SEC. 126. FDIC AUTHORITY. 
(a) IN GENERAL.—Section 18(a) of the Federal Deposit Insurance 
Act (12 U.S.C. 1828(a)) is amended by adding at the end the 
following new paragraph: 
‘‘(4) FALSE ADVERTISING, MISUSE OF FDIC NAMES, AND MIS-
REPRESENTATION TO INDICATE INSURED STATUS.— 
‘‘(A) PROHIBITION ON FALSE ADVERTISING AND MISUSE 
OF FDIC NAMES.—No person may represent or imply that 
any deposit liability, obligation, certificate, or share is 
insured or guaranteed by the Corporation, if such deposit 
liability, obligation, certificate, or share is not insured or 
guaranteed by the Corporation— 
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122 STAT. 3794 
PUBLIC LAW 110–343—OCT. 3, 2008 
‘‘(i) by using the terms ‘Federal Deposit’, ‘Federal 
Deposit Insurance’, ‘Federal Deposit Insurance Cor-
poration’, any combination of such terms, or the abbre-
viation ‘FDIC’ as part of the business name or firm 
name of any person, including any corporation, part-
nership, business trust, association, or other business 
entity; or 
‘‘(ii) by using such terms or any other terms, sign, 
or symbol as part of an advertisement, solicitation, 
or other document. 
‘‘(B) PROHIBITION ON MISREPRESENTATIONS OF INSURED 
STATUS.—No person may knowingly misrepresent— 
‘‘(i) that any deposit liability, obligation, certificate, 
or share is insured, under this Act, if such deposit 
liability, obligation, certificate, or share is not so 
insured; or 
‘‘(ii) the extent to which or the manner in which 
any deposit liability, obligation, certificate, or share 
is insured under this Act, if such deposit liability, 
obligation, certificate, or share is not so insured, to 
the extent or in the manner represented. 
‘‘(C) AUTHORITY OF THE APPROPRIATE FEDERAL BANKING 
AGENCY.—The appropriate Federal banking agency shall 
have enforcement authority in the case of a violation of 
this paragraph by any person for which the agency is 
the appropriate Federal banking agency, or any institution- 
affiliated party thereof. 
‘‘(D) CORPORATION AUTHORITY IF THE APPROPRIATE FED-
ERAL
BANKING
AGENCY
FAILS
TO
FOLLOW
RECOMMENDA-
TION.— 
‘‘(i) RECOMMENDATION.—The Corporation may rec-
ommend in writing to the appropriate Federal banking 
agency that the agency take any enforcement action 
authorized under section 8 for purposes of enforcement 
of this paragraph with respect to any person for which 
the agency is the appropriate Federal banking agency 
or any institution-affiliated party thereof. 
‘‘(ii) AGENCY RESPONSE.—If the appropriate Fed-
eral banking agency does not, within 30 days of the 
date of receipt of a recommendation under clause (i), 
take the enforcement action with respect to this para-
graph recommended by the Corporation or provide a 
plan acceptable to the Corporation for responding to 
the situation presented, the Corporation may take the 
recommended enforcement action against such person 
or institution-affiliated party. 
‘‘(E) ADDITIONAL
AUTHORITY.—In addition to its 
authority under subparagraphs (C) and (D), for purposes 
of this paragraph, the Corporation shall have, in the same 
manner and to the same extent as with respect to a State 
nonmember insured bank— 
‘‘(i) jurisdiction over— 
‘‘(I) any person other than a person for which 
another agency is the appropriate Federal banking 
agency or any institution-affiliated party thereof; 
and 
Deadline. 
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122 STAT. 3795 
PUBLIC LAW 110–343—OCT. 3, 2008 
‘‘(II) any person that aids or abets a violation 
of this paragraph by a person described in sub-
clause (I); and 
‘‘(ii) for purposes of enforcing the requirements 
of this paragraph, the authority of the Corporation 
under— 
‘‘(I) section 10(c) to conduct investigations; and 
‘‘(II) subsections (b), (c), (d) and (i) of section 
8 to conduct enforcement actions. 
‘‘(F) OTHER ACTIONS PRESERVED.—No provision of this 
paragraph shall be construed as barring any action other-
wise available, under the laws of the United States or 
any State, to any Federal or State agency or individual.’’. 
(b) ENFORCEMENT ORDERS.—Section 8(c) of the Federal Deposit 
Insurance Act (12 U.S.C. 1818(c)) is amended by adding at the 
end the following new paragraph: 
‘‘(4) FALSE ADVERTISING OR MISUSE OF NAMES TO INDICATE 
INSURED STATUS.— 
‘‘(A) TEMPORARY ORDER.— 
‘‘(i) IN
GENERAL.—If a notice of charges served 
under subsection (b)(1) specifies on the basis of par-
ticular facts that any person engaged or is engaging 
in conduct described in section 18(a)(4), the Corpora-
tion or other appropriate Federal banking agency may 
issue a temporary order requiring— 
‘‘(I) the immediate cessation of any activity 
or practice described, which gave rise to the notice 
of charges; and 
‘‘(II) affirmative action to prevent any further, 
or to remedy any existing, violation. 
‘‘(ii) EFFECT
OF
ORDER.—Any temporary order 
issued under this subparagraph shall take effect upon 
service. 
‘‘(B) EFFECTIVE PERIOD OF TEMPORARY ORDER.—A tem-
porary order issued under subparagraph (A) shall remain 
effective and enforceable, pending the completion of an 
administrative proceeding pursuant to subsection (b)(1) in 
connection with the notice of charges— 
‘‘(i) until such time as the Corporation or other 
appropriate Federal banking agency dismisses the 
charges specified in such notice; or 
‘‘(ii) if a cease-and-desist order is issued against 
such person, until the effective date of such order. 
‘‘(C) CIVIL MONEY PENALTIES.—Any violation of section 
18(a)(4) shall be subject to civil money penalties, as set 
forth in subsection (i), except that for any person other 
than an insured depository institution or an institution- 
affiliated party that is found to have violated this para-
graph, the Corporation or other appropriate Federal 
banking agency shall not be required to demonstrate any 
loss to an insured depository institution.’’. 
(c) UNENFORCEABILITY OF CERTAIN AGREEMENTS.—Section 13(c) 
of the Federal Deposit Insurance Act (12 U.S.C. 1823(c)) is amended 
by adding at the end the following new paragraph: 
‘‘(11) UNENFORCEABILITY
OF
CERTAIN
AGREEMENTS.—No 
provision contained in any existing or future standstill, con-
fidentiality, or other agreement that, directly or indirectly— 
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122 STAT. 3796 
PUBLIC LAW 110–343—OCT. 3, 2008 
‘‘(A) affects, restricts, or limits the ability of any person 
to offer to acquire or acquire, 
‘‘(B) prohibits any person from offering to acquire or 
acquiring, or 
‘‘(C) prohibits any person from using any previously 
disclosed information in connection with any such offer 
to acquire or acquisition of, 
all or part of any insured depository institution, including any 
liabilities, assets, or interest therein, in connection with any 
transaction in which the Corporation exercises its authority 
under section 11 or 13, shall be enforceable against or impose 
any liability on such person, as such enforcement or liability 
shall be contrary to public policy.’’. 
(d) TECHNICAL AND CONFORMING AMENDMENTS.—Section 18 of 
the Federal Deposit Insurance Act (12 U.S.C. 1828) is amended— 
(1) in subsection (a)(3)— 
(A) by striking ‘‘this subsection’’ the first place that 
term appears and inserting ‘‘paragraph (1)’’; and 
(B) by striking ‘‘this subsection’’ the second place that 
term appears and inserting ‘‘paragraph (2)’’; and 
(2) in the heading for subsection (a), by striking ‘‘INSURANCE 
LOGO.—’’ and inserting ‘‘REPRESENTATIONS OF DEPOSIT INSUR-
ANCE.—’’. 
SEC. 127. COOPERATION WITH THE FBI. 
Any Federal financial regulatory agency shall cooperate with 
the Federal Bureau of Investigation and other law enforcement 
agencies investigating fraud, misrepresentation, and malfeasance 
with respect to development, advertising, and sale of financial prod-
ucts. 
SEC. 128. ACCELERATION OF EFFECTIVE DATE. 
Section 203 of the Financial Services Regulatory Relief Act 
of 2006 (12 U.S.C. 461 note) is amended by striking ‘‘October 
1, 2011’’ and inserting ‘‘October 1, 2008’’. 
SEC. 129. DISCLOSURES ON EXERCISE OF LOAN AUTHORITY. 
(a) IN GENERAL.—Not later than 7 days after the date on 
which the Board exercises its authority under the third paragraph 
of section 13 of the Federal Reserve Act (12 U.S.C. 343; relating 
to discounts for individuals, partnerships, and corporations) the 
Board shall provide to the Committee on Banking, Housing, and 
Urban Affairs of the Senate and the Committee on Financial Serv-
ices of the House of Representatives a report which includes— 
(1) the justification for exercising the authority; and 
(2) the specific terms of the actions of the Board, including 
the size and duration of the lending, available information 
concerning the value of any collateral held with respect to 
such a loan, the recipient of warrants or any other potential 
equity in exchange for the loan, and any expected cost to 
the taxpayers for such exercise. 
(b) PERIODIC UPDATES.—The Board shall provide updates to 
the Committees specified in subsection (a) not less frequently than 
once every 60 days while the subject loan is outstanding, including— 
(1) the status of the loan; 
(2) the value of the collateral held by the Federal reserve 
bank which initiated the loan; and 
(3) the projected cost to the taxpayers of the loan. 
Reports. 
Deadline. 
12 USC 5235. 
12 USC 5234. 
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122 STAT. 3797 
PUBLIC LAW 110–343—OCT. 3, 2008 
(c) CONFIDENTIALITY.—The information submitted to the Con-
gress under this section shall be kept confidential, upon the written 
request of the Chairman of the Board, in which case it shall be 
made available only to the Chairpersons and Ranking Members 
of the Committees described in subsection (a). 
(d) APPLICABILITY.—The provisions of this section shall be in 
force for all uses of the authority provided under section 13 of 
the Federal Reserve Act occurring during the period beginning 
on March 1, 2008 and ending on the after the date of enactment 
of this Act, and reports described in subsection (a) shall be required 
beginning not later than 30 days after that date of enactment, 
with respect to any such exercise of authority. 
(e) SHARING OF INFORMATION.—Any reports required under this 
section shall also be submitted to the Congressional Oversight 
Panel established under section 125. 
SEC. 130. TECHNICAL CORRECTIONS. 
(a) IN GENERAL.—Section 128(b)(2) of the Truth in Lending 
Act (15 U.S.C. 1638(b)(2)), as amended by section 2502 of the 
Mortgage Disclosure Improvement Act of 2008 (Public Law 110– 
289), is amended— 
(1) in subparagraph (A), by striking ‘‘In the case’’ and 
inserting ‘‘Except as provided in subparagraph (G), in the case’’; 
and 
(2) by amending subparagraph (G) to read as follows: 
‘‘(G)(i) In the case of an extension of credit relating 
to a plan described in section 101(53D) of title 11, United 
States Code— 
‘‘(I) the requirements of subparagraphs (A) through 
(E) shall not apply; and 
‘‘(II) a good faith estimate of the disclosures 
required under subsection (a) shall be made in accord-
ance with regulations of the Board under section 121(c) 
before such credit is extended, or shall be delivered 
or placed in the mail not later than 3 business days 
after the date on which the creditor receives the writ-
ten application of the consumer for such credit, which-
ever is earlier. 
‘‘(ii) If a disclosure statement furnished within 3 busi-
ness days of the written application (as provided under 
clause (i)(II)) contains an annual percentage rate which 
is subsequently rendered inaccurate, within the meaning 
of section 107(c), the creditor shall furnish another disclo-
sure statement at the time of settlement or consummation 
of the transaction.’’. 
(b) EFFECTIVE DATE.—The amendments made by subsection 
(a) shall take effect as if included in the amendments made by 
section 2502 of the Mortgage Disclosure Improvement Act of 2008 
(Public Law 110–289). 
SEC. 131. EXCHANGE STABILIZATION FUND REIMBURSEMENT. 
(a) REIMBURSEMENT.—The Secretary shall reimburse the 
Exchange Stabilization Fund established under section 5302 of title 
31, United States Code, for any funds that are used for the Treasury 
Money Market Funds Guaranty Program for the United States 
money market mutual fund industry, from funds under this Act. 
(b) LIMITS ON USE OF EXCHANGE STABILIZATION FUND.—The 
Secretary is prohibited from using the Exchange Stabilization Fund 
12 USC 5236. 
15 USC 1638 
note. 
Disclosure 
statement. 
Deadline. 
Good faith 
estimate. 
Deadline. 
Reports. 
Effective date. 
Termination 
date. 
Reports. 
Deadline. 
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122 STAT. 3798 
PUBLIC LAW 110–343—OCT. 3, 2008 
for the establishment of any future guaranty programs for the 
United States money market mutual fund industry. 
SEC. 132. AUTHORITY TO SUSPEND MARK-TO-MARKET ACCOUNTING. 
(a) AUTHORITY.—The Securities and Exchange Commission 
shall have the authority under the securities laws (as such term 
is defined in section 3(a)(47) of the Securities Exchange Act of 
1934 (15 U.S.C. 78c(a)(47)) to suspend, by rule, regulation, or order, 
the application of Statement Number 157 of the Financial 
Accounting Standards Board for any issuer (as such term is defined 
in section 3(a)(8) of such Act) or with respect to any class or 
category of transaction if the Commission determines that is nec-
essary or appropriate in the public interest and is consistent with 
the protection of investors. 
(b) SAVINGS PROVISION.—Nothing in subsection (a) shall be 
construed to restrict or limit any authority of the Securities and 
Exchange Commission under securities laws as in effect on the 
date of enactment of this Act. 
SEC. 133. STUDY ON MARK-TO-MARKET ACCOUNTING. 
(a) STUDY.—The Securities and Exchange Commission, in con-
sultation with the Board and the Secretary, shall conduct a study 
on mark-to-market accounting standards as provided in Statement 
Number 157 of the Financial Accounting Standards Board, as such 
standards are applicable to financial institutions, including deposi-
tory institutions. Such a study shall consider at a minimum— 
(1) the effects of such accounting standards on a financial 
institution’s balance sheet; 
(2) the impacts of such accounting on bank failures in 
2008; 
(3) the impact of such standards on the quality of financial 
information available to investors; 
(4) the process used by the Financial Accounting Standards 
Board in developing accounting standards; 
(5) the advisability and feasibility of modifications to such 
standards; and 
(6) alternative accounting standards to those provided in 
such Statement Number 157. 
(b) REPORT.—The Securities and Exchange Commission shall 
submit to Congress a report of such study before the end of the 
90-day period beginning on the date of the enactment of this Act 
containing the findings and determinations of the Commission, 
including such administrative and legislative recommendations as 
the Commission determines appropriate. 
SEC. 134. RECOUPMENT. 
Upon the expiration of the 5-year period beginning upon the 
date of the enactment of this Act, the Director of the Office of 
Management and Budget, in consultation with the Director of the 
Congressional Budget Office, shall submit a report to the Congress 
on the net amount within the Troubled Asset Relief Program under 
this Act. In any case where there is a shortfall, the President 
shall submit a legislative proposal that recoups from the financial 
industry an amount equal to the shortfall in order to ensure that 
the Troubled Asset Relief Program does not add to the deficit 
or national debt. 
President. 
Legislation. 
Reports. 
Deadline. 
12 USC 5239. 
12 USC 5238. 
12 USC 5237. 
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122 STAT. 3799 
PUBLIC LAW 110–343—OCT. 3, 2008 
SEC. 135. PRESERVATION OF AUTHORITY. 
With the exception of section 131, nothing in this Act may 
be construed to limit the authority of the Secretary or the Board 
under any other provision of law. 
SEC. 136. TEMPORARY INCREASE IN DEPOSIT AND SHARE INSURANCE 
COVERAGE. 
(a) FEDERAL DEPOSIT INSURANCE ACT; TEMPORARY INCREASE 
IN DEPOSIT INSURANCE.— 
(1) INCREASED AMOUNT.—Effective only during the period 
beginning on the date of enactment of this Act and ending 
on December 31, 2009, section 11(a)(1)(E) of the Federal Deposit 
Insurance Act (12 U.S.C. 1821(a)(1)(E)) shall apply with 
‘‘$250,000’’ substituted for ‘‘$100,000’’. 
(2) TEMPORARY INCREASE NOT TO BE CONSIDERED FOR SET-
TING ASSESSMENTS.—The temporary increase in the standard 
maximum deposit insurance amount made under paragraph 
(1) shall not be taken into account by the Board of Directors 
of the Corporation for purposes of setting assessments under 
section 7(b)(2) of the Federal Deposit Insurance Act (12 U.S.C. 
1817(b)(2)). 
(3) BORROWING LIMITS TEMPORARILY LIFTED.—During the 
period beginning on the date of enactment of this Act and 
ending on December 31, 2009, the Board of Directors of the 
Corporation may request from the Secretary, and the Secretary 
shall approve, a loan or loans in an amount or amounts nec-
essary to carry out this subsection, without regard to the limita-
tions on such borrowing under section 14(a) and 15(c) of the 
Federal Deposit Insurance Act (12 U.S.C. 1824(a), 1825(c)). 
(b) FEDERAL CREDIT UNION ACT; TEMPORARY INCREASE
IN 
SHARE INSURANCE.— 
(1) INCREASED AMOUNT.—Effective only during the period 
beginning on the date of enactment of this Act and ending 
on December 31, 2009, section 207(k)(5) of the Federal Credit 
Union Act (12 U.S.C. 1787(k)(5)) shall apply with ‘‘$250,000’’ 
substituted for ‘‘$100,000’’. 
(2) TEMPORARY INCREASE NOT TO BE CONSIDERED FOR SET-
TING INSURANCE PREMIUM CHARGES AND INSURANCE DEPOSIT 
ADJUSTMENTS.—The temporary increase in the standard max-
imum share insurance amount made under paragraph (1) shall 
not be taken into account by the National Credit Union 
Administration Board for purposes of setting insurance pre-
mium charges and share insurance deposit adjustments under 
section 202(c)(2) of the Federal Credit Union Act (12 U.S.C. 
1782(c)(2)). 
(3) BORROWING LIMITS TEMPORARILY LIFTED.—During the 
period beginning on the date of enactment of this Act and 
ending on December 31, 2009, the National Credit Union 
Administration Board may request from the Secretary, and 
the Secretary shall approve, a loan or loans in an amount 
or amounts necessary to carry out this subsection, without 
regard to the limitations on such borrowing under section 
203(d)(1) of the Federal Credit Union Act (12 U.S.C. 1783(d)(1)). 
(c) NOT FOR USE IN INFLATION ADJUSTMENTS.—The temporary 
increase in the standard maximum deposit insurance amount made 
under this section shall not be used to make any inflation adjust-
ment under section 11(a)(1)(F) of the Federal Deposit Insurance 
Effective dates. 
Termination 
dates. 
12 USC 5241. 
12 USC 5240. 
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122 STAT. 3800 
PUBLIC LAW 110–343—OCT. 3, 2008 
Act (12 U.S.C. 1821(a)(1)(F)) for purposes of that Act or the Federal 
Credit Union Act. 
TITLE II—BUDGET-RELATED 
PROVISIONS 
SEC. 201. INFORMATION FOR CONGRESSIONAL SUPPORT AGENCIES. 
Upon request, and to the extent otherwise consistent with 
law, all information used by the Secretary in connection with activi-
ties authorized under this Act (including the records to which 
the Comptroller General is entitled under this Act) shall be made 
available to congressional support agencies (in accordance with 
their obligations to support the Congress as set out in their author-
izing statutes) for the purposes of assisting the committees of Con-
gress with conducting oversight, monitoring, and analysis of the 
activities authorized under this Act. 
SEC. 202. REPORTS BY THE OFFICE OF MANAGEMENT AND BUDGET 
AND THE CONGRESSIONAL BUDGET OFFICE. 
(a) REPORTS BY THE OFFICE OF MANAGEMENT AND BUDGET.— 
Within 60 days of the first exercise of the authority granted in 
section 101(a), but in no case later than December 31, 2008, and 
semiannually thereafter, the Office of Management and Budget 
shall report to the President and the Congress— 
(1) the estimate, notwithstanding section 502(5)(F) of the 
Federal Credit Reform Act of 1990 (2 U.S.C. 661a(5)(F)), as 
of the first business day that is at least 30 days prior to 
the issuance of the report, of the cost of the troubled assets, 
and guarantees of the troubled assets, determined in accordance 
with section 123; 
(2) the information used to derive the estimate, including 
assets purchased or guaranteed, prices paid, revenues received, 
the impact on the deficit and debt, and a description of any 
outstanding commitments to purchase troubled assets; and 
(3) a detailed analysis of how the estimate has changed 
from the previous report. 
Beginning with the second report under subsection (a), the Office 
of Management and Budget shall explain the differences between 
the Congressional Budget Office estimates delivered in accordance 
with subsection (b) and prior Office of Management and Budget 
estimates. 
(b) REPORTS BY THE CONGRESSIONAL BUDGET OFFICE.—Within 
45 days of receipt by the Congress of each report from the Office 
of Management and Budget under subsection (a), the Congressional 
Budget Office shall report to the Congress the Congressional Budget 
Office’s assessment of the report submitted by the Office of Manage-
ment and Budget, including— 
(1) the cost of the troubled assets and guarantees of the 
troubled assets, 
(2) the information and valuation methods used to calculate 
such cost, and 
(3) the impact on the deficit and the debt. 
(c) FINANCIAL EXPERTISE.—In carrying out the duties in this 
subsection or performing analyses of activities under this Act, the 
Director of the Congressional Budget Office may employ personnel 
and procure the services of experts and consultants. 
12 USC 5252. 
12 USC 5251. 
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122 STAT. 3801 
PUBLIC LAW 110–343—OCT. 3, 2008 
(d) AUTHORIZATION OF APPROPRIATIONS.—There are authorized 
to be appropriated such sums as may be necessary to produce 
reports required by this section. 
SEC. 203. ANALYSIS IN PRESIDENT’S BUDGET. 
(a) IN GENERAL.—Section 1105(a) of title 31, United States 
Code, is amended by adding at the end the following new paragraph: 
‘‘(35) as supplementary materials, a separate analysis of 
the budgetary effects for all prior fiscal years, the current 
fiscal year, the fiscal year for which the budget is submitted, 
and ensuing fiscal years of the actions the Secretary of the 
Treasury has taken or plans to take using any authority pro-
vided in the Emergency Economic Stabilization Act of 2008, 
including— 
‘‘(A) an estimate of the current value of all assets 
purchased, sold, and guaranteed under the authority pro-
vided in the Emergency Economic Stabilization Act of 2008 
using methodology required by the Federal Credit Reform 
Act of 1990 (2 U.S.C. 661 et seq.) and section 123 of 
the Emergency Economic Stabilization Act of 2008; 
‘‘(B) an estimate of the deficit, the debt held by the 
public, and the gross Federal debt using methodology 
required by the Federal Credit Reform Act of 1990 and 
section 123 of the Emergency Economic Stabilization Act 
of 2008; 
‘‘(C) an estimate of the current value of all assets 
purchased, sold, and guaranteed under the authority pro-
vided in the Emergency Economic Stabilization Act of 2008 
calculated on a cash basis; 
‘‘(D) a revised estimate of the deficit, the debt held 
by the public, and the gross Federal debt, substituting 
the cash-based estimates in subparagraph (C) for the esti-
mates calculated under subparagraph (A) pursuant to the 
Federal Credit Reform Act of 1990 and section 123 of 
the Emergency Economic Stabilization Act of 2008; and 
‘‘(E) the portion of the deficit which can be attributed 
to any action taken by the Secretary using authority pro-
vided by the Emergency Economic Stabilization Act of 2008 
and the extent to which the change in the deficit since 
the most recent estimate is due to a reestimate using 
the methodology required by the Federal Credit Reform 
Act of 1990 and section 123 of the Emergency Economic 
Stabilization Act of 2008.’’ 
(b) CONSULTATION.—In implementing this section, the Director 
of Office of Management and Budget shall consult periodically, 
but at least annually, with the Committee on the Budget of the 
House of Representatives, the Committee on the Budget of the 
Senate, and the Director of the Congressional Budget Office. 
(c) EFFECTIVE DATE.—This section and the amendment made 
by this section shall apply beginning with respect to the fiscal 
year 2010 budget submission of the President. 
SEC. 204. EMERGENCY TREATMENT. 
All provisions of this Act are designated as an emergency 
requirement and necessary to meet emergency needs pursuant to 
section 204(a) of S. Con. Res 21 (110th Congress), the concurrent 
resolution on the budget for fiscal year 2008 and rescissions of 
12 USC 5253. 
31 USC 1105 
note. 
31 USC 1105 
note. 
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122 STAT. 3802 
PUBLIC LAW 110–343—OCT. 3, 2008 
any amounts provided in this Act shall not be counted for purposes 
of budget enforcement. 
TITLE III—TAX PROVISIONS 
SEC. 301. GAIN OR LOSS FROM SALE OR EXCHANGE OF CERTAIN PRE-
FERRED STOCK. 
(a) IN GENERAL.—For purposes of the Internal Revenue Code 
of 1986, gain or loss from the sale or exchange of any applicable 
preferred stock by any applicable financial institution shall be 
treated as ordinary income or loss. 
(b) APPLICABLE PREFERRED STOCK.—For purposes of this sec-
tion, the term ‘‘applicable preferred stock’’ means any stock— 
(1) which is preferred stock in— 
(A) the Federal National Mortgage Association, estab-
lished pursuant to the Federal National Mortgage Associa-
tion Charter Act (12 U.S.C. 1716 et seq.), or 
(B) the Federal Home Loan Mortgage Corporation, 
established pursuant to the Federal Home Loan Mortgage 
Corporation Act (12 U.S.C. 1451 et seq.), and 
(2) which— 
(A) was held by the applicable financial institution 
on September 6, 2008, or 
(B) was sold or exchanged by the applicable financial 
institution on or after January 1, 2008, and before Sep-
tember 7, 2008. 
(c) APPLICABLE FINANCIAL INSTITUTION.—For purposes of this 
section: 
(1) IN GENERAL.—Except as provided in paragraph (2), the 
term ‘‘applicable financial institution’’ means— 
(A) a financial institution referred to in section 
582(c)(2) of the Internal Revenue Code of 1986, or 
(B) a depository institution holding company (as 
defined in section 3(w)(1) of the Federal Deposit Insurance 
Act (12 U.S.C. 1813(w)(1))). 
(2) SPECIAL RULES FOR CERTAIN SALES.—In the case of— 
(A) a sale or exchange described in subsection (b)(2)(B), 
an entity shall be treated as an applicable financial institu-
tion only if it was an entity described in subparagraph 
(A) or (B) of paragraph (1) at the time of the sale or 
exchange, and 
(B) a sale or exchange after September 6, 2008, of 
preferred stock described in subsection (b)(2)(A), an entity 
shall be treated as an applicable financial institution only 
if it was an entity described in subparagraph (A) or (B) 
of paragraph (1) at all times during the period beginning 
on September 6, 2008, and ending on the date of the 
sale or exchange of the preferred stock. 
(d) SPECIAL RULE FOR CERTAIN PROPERTY NOT HELD ON SEP-
TEMBER 6, 2008.—The Secretary of the Treasury or the Secretary’s 
delegate may extend the application of this section to all or a 
portion of the gain or loss from a sale or exchange in any case 
where— 
(1) an applicable financial institution sells or exchanges 
applicable preferred stock after September 6, 2008, which the 
applicable financial institution did not hold on such date, but 
Definition. 
Definition. 
12 USC 5261. 
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122 STAT. 3803 
PUBLIC LAW 110–343—OCT. 3, 2008 
the basis of which in the hands of the applicable financial 
institution at the time of the sale or exchange is the same 
as the basis in the hands of the person which held such stock 
on such date, or 
(2) the applicable financial institution is a partner in a 
partnership which— 
(A) held such stock on September 6, 2008, and later 
sold or exchanged such stock, or 
(B) sold or exchanged such stock during the period 
described in subsection (b)(2)(B). 
(e) REGULATORY AUTHORITY.—The Secretary of the Treasury 
or the Secretary’s delegate may prescribe such guidance, rules, 
or regulations as are necessary to carry out the purposes of this 
section. 
(f) EFFECTIVE DATE.—This section shall apply to sales or 
exchanges occurring after December 31, 2007, in taxable years 
ending after such date. 
SEC. 302. SPECIAL RULES FOR TAX TREATMENT OF EXECUTIVE COM-
PENSATION OF EMPLOYERS PARTICIPATING IN THE TROU-
BLED ASSETS RELIEF PROGRAM. 
(a) DENIAL OF DEDUCTION.—Subsection (m) of section 162 of 
the Internal Revenue Code of 1986 is amended by adding at the 
end the following new paragraph: 
‘‘(5) SPECIAL RULE FOR APPLICATION TO EMPLOYERS PARTICI-
PATING IN THE TROUBLED ASSETS RELIEF PROGRAM.— 
‘‘(A) IN
GENERAL.—In the case of an applicable 
employer, no deduction shall be allowed under this 
chapter— 
‘‘(i) in the case of executive remuneration for any 
applicable taxable year which is attributable to services 
performed by a covered executive during such 
applicable taxable year, to the extent that the amount 
of such remuneration exceeds $500,000, or 
‘‘(ii) in the case of deferred deduction executive 
remuneration for any taxable year for services per-
formed during any applicable taxable year by a covered 
executive, to the extent that the amount of such remu-
neration exceeds $500,000 reduced (but not below zero) 
by the sum of— 
‘‘(I) the executive remuneration for such 
applicable taxable year, plus 
‘‘(II) the portion of the deferred deduction 
executive remuneration for such services which 
was taken into account under this clause in a 
preceding taxable year. 
‘‘(B) APPLICABLE EMPLOYER.—For purposes of this para-
graph— 
‘‘(i) IN
GENERAL.—Except as provided in clause 
(ii), the term ‘applicable employer’ means any employer 
from whom 1 or more troubled assets are acquired 
under a program established by the Secretary under 
section 101(a) of the Emergency Economic Stabilization 
Act of 2008 if the aggregate amount of the assets 
so acquired for all taxable years exceeds $300,000,000. 
‘‘(ii) DISREGARD OF CERTAIN ASSETS SOLD THROUGH 
DIRECT PURCHASE.—If the only sales of troubled assets 
Definition. 
26 USC 162. 
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122 STAT. 3804 
PUBLIC LAW 110–343—OCT. 3, 2008 
by an employer under the program described in clause 
(i) are through 1 or more direct purchases (within 
the meaning of section 113(c) of the Emergency Eco-
nomic Stabilization Act of 2008), such assets shall not 
be taken into account under clause (i) in determining 
whether the employer is an applicable employer for 
purposes of this paragraph. 
‘‘(iii) AGGREGATION RULES.—Two or more persons 
who are treated as a single employer under subsection 
(b) or (c) of section 414 shall be treated as a single 
employer, except that in applying section 1563(a) for 
purposes of either such subsection, paragraphs (2) and 
(3) thereof shall be disregarded. 
‘‘(C) APPLICABLE TAXABLE YEAR.—For purposes of this 
paragraph, the term ‘applicable taxable year’ means, with 
respect to any employer— 
‘‘(i) the first taxable year of the employer— 
‘‘(I) which includes any portion of the period 
during which the authorities under section 101(a) 
of the Emergency Economic Stabilization Act of 
2008 are in effect (determined under section 120 
thereof), and 
‘‘(II) in which the aggregate amount of trou-
bled assets acquired from the employer during the 
taxable year pursuant to such authorities (other 
than assets to which subparagraph (B)(ii) applies), 
when added to the aggregate amount so acquired 
for 
all 
preceding 
taxable 
years, 
exceeds 
$300,000,000, and 
‘‘(ii) any subsequent taxable year which includes 
any portion of such period. 
‘‘(D) COVERED EXECUTIVE.—For purposes of this para-
graph— 
‘‘(i) IN
GENERAL.—The term ‘covered executive’ 
means, with respect to any applicable taxable year, 
any employee— 
‘‘(I) who, at any time during the portion of 
the taxable year during which the authorities 
under section 101(a) of the Emergency Economic 
Stabilization Act of 2008 are in effect (determined 
under section 120 thereof), is the chief executive 
officer of the applicable employer or the chief finan-
cial officer of the applicable employer, or an indi-
vidual acting in either such capacity, or 
‘‘(II) who is described in clause (ii). 
‘‘(ii) 
HIGHEST
COMPENSATED
EMPLOYEES.—An 
employee is described in this clause if the employee 
is 1 of the 3 highest compensated officers of the 
applicable employer for the taxable year (other than 
an individual described in clause (i)(I)), determined— 
‘‘(I) on the basis of the shareholder disclosure 
rules for compensation under the Securities 
Exchange Act of 1934 (without regard to whether 
those rules apply to the employer), and 
‘‘(II) by only taking into account employees 
employed during the portion of the taxable year 
described in clause (i)(I). 
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122 STAT. 3805 
PUBLIC LAW 110–343—OCT. 3, 2008 
‘‘(iii) EMPLOYEE
REMAINS
COVERED
EXECUTIVE.— 
If an employee is a covered executive with respect 
to an applicable employer for any applicable taxable 
year, such employee shall be treated as a covered 
executive with respect to such employer for all subse-
quent applicable taxable years and for all subsequent 
taxable years in which deferred deduction executive 
remuneration with respect to services performed in 
all such applicable taxable years would (but for this 
paragraph) be deductible. 
‘‘(E) EXECUTIVE REMUNERATION.—For purposes of this 
paragraph, the term ‘executive remuneration’ means the 
applicable employee remuneration of the covered executive, 
as determined under paragraph (4) without regard to sub-
paragraphs (B), (C), and (D) thereof. Such term shall not 
include any deferred deduction executive remuneration 
with respect to services performed in a prior applicable 
taxable year. 
‘‘(F) DEFERRED
DEDUCTION
EXECUTIVE
REMUNERA-
TION.—For purposes of this paragraph, the term ‘deferred 
deduction executive remuneration’ means remuneration 
which would be executive remuneration for services per-
formed in an applicable taxable year but for the fact that 
the deduction under this chapter (determined without 
regard to this paragraph) for such remuneration is allow-
able in a subsequent taxable year. 
‘‘(G) COORDINATION.—Rules similar to the rules of sub-
paragraphs (F) and (G) of paragraph (4) shall apply for 
purposes of this paragraph. 
‘‘(H) REGULATORY AUTHORITY.—The Secretary may pre-
scribe such guidance, rules, or regulations as are necessary 
to carry out the purposes of this paragraph and the Emer-
gency Economic Stabilization Act of 2008, including the 
extent to which this paragraph applies in the case of any 
acquisition, merger, or reorganization of an applicable 
employer.’’. 
(b) GOLDEN PARACHUTE RULE.—Section 280G of the Internal 
Revenue Code of 1986 is amended— 
(1) by redesignating subsection (e) as subsection (f), and 
(2) by inserting after subsection (d) the following new sub-
section: 
‘‘(e) SPECIAL RULE FOR APPLICATION TO EMPLOYERS PARTICI-
PATING IN THE TROUBLED ASSETS RELIEF PROGRAM.— 
‘‘(1) IN GENERAL.—In the case of the severance from employ-
ment of a covered executive of an applicable employer during 
the period during which the authorities under section 101(a) 
of the Emergency Economic Stabilization Act of 2008 are in 
effect (determined under section 120 of such Act), this section 
shall be applied to payments to such executive with the fol-
lowing modifications: 
‘‘(A) Any reference to a disqualified individual (other 
than in subsection (c)) shall be treated as a reference 
to a covered executive. 
‘‘(B) Any reference to a change described in subsection 
(b)(2)(A)(i) shall be treated as a reference to an applicable 
severance from employment of a covered executive, and 
any reference to a payment contingent on such a change 
26 USC 280G. 
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122 STAT. 3806 
PUBLIC LAW 110–343—OCT. 3, 2008 
shall be treated as a reference to any payment made during 
an applicable taxable year of the employer on account 
of such applicable severance from employment. 
‘‘(C) Any reference to a corporation shall be treated 
as a reference to an applicable employer. 
‘‘(D) The provisions of subsections (b)(2)(C), (b)(4), 
(b)(5), and (d)(5) shall not apply. 
‘‘(2) DEFINITIONS AND SPECIAL RULES.—For purposes of this 
subsection: 
‘‘(A) DEFINITIONS.—Any term used in this subsection 
which is also used in section 162(m)(5) shall have the 
meaning given such term by such section. 
‘‘(B) APPLICABLE SEVERANCE FROM EMPLOYMENT.—The 
term ‘applicable severance from employment’ means any 
severance from employment of a covered executive— 
‘‘(i) by reason of an involuntary termination of 
the executive by the employer, or 
‘‘(ii) in connection with any bankruptcy, liquida-
tion, or receivership of the employer. 
‘‘(C) COORDINATION AND OTHER RULES.— 
‘‘(i) IN GENERAL.—If a payment which is treated 
as a parachute payment by reason of this subsection 
is also a parachute payment determined without regard 
to this subsection, this subsection shall not apply to 
such payment. 
‘‘(ii) REGULATORY AUTHORITY.—The Secretary may 
prescribe such guidance, rules, or regulations as are 
necessary— 
‘‘(I) to carry out the purposes of this subsection 
and the Emergency Economic Stabilization Act of 
2008, including the extent to which this subsection 
applies in the case of any acquisition, merger, or 
reorganization of an applicable employer, 
‘‘(II) to apply this section and section 4999 
in cases where one or more payments with respect 
to any individual are treated as parachute pay-
ments by reason of this subsection, and other pay-
ments with respect to such individual are treated 
as parachute payments under this section without 
regard to this subsection, and 
‘‘(III) to prevent the avoidance of the applica-
tion of this section through the mischaracterization 
of a severance from employment as other than 
an applicable severance from employment.’’. 
(c) EFFECTIVE DATES.— 
(1) IN GENERAL.—The amendment made by subsection (a) 
shall apply to taxable years ending on or after the date of 
the enactment of this Act. 
(2) GOLDEN PARACHUTE RULE.—The amendments made by 
subsection (b) shall apply to payments with respect to 
severances occurring during the period during which the 
authorities under section 101(a) of this Act are in effect (deter-
mined under section 120 of this Act). 
26 USC 280G 
note. 
26 USC 162 note. 
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122 STAT. 3807 
PUBLIC LAW 110–343—OCT. 3, 2008 
SEC. 303. EXTENSION OF EXCLUSION OF INCOME FROM DISCHARGE 
OF QUALIFIED PRINCIPAL RESIDENCE INDEBTEDNESS. 
(a) EXTENSION.—Subparagraph (E) of section 108(a)(1) of the 
Internal Revenue Code of 1986 is amended by striking ‘‘January 
1, 2010’’ and inserting ‘‘January 1, 2013’’. 
(b) EFFECTIVE DATE.—The amendment made by this section 
shall apply to discharges of indebtedness occurring on or after 
January 1, 2010. 
DIVISION B—ENERGY IMPROVEMENT 
AND EXTENSION ACT OF 2008 
SEC. 1. SHORT TITLE, ETC. 
(a) SHORT TITLE.—This division may be cited as the ‘‘Energy 
Improvement and Extension Act of 2008’’. 
(b) REFERENCE.—Except as otherwise expressly provided, when-
ever in this division an amendment or repeal is expressed 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 division 
is as follows: 
Sec. 1. Short title, etc. 
TITLE I—ENERGY PRODUCTION INCENTIVES 
Subtitle A—Renewable Energy Incentives 
Sec. 101. Renewable energy credit. 
Sec. 102. Production credit for electricity produced from marine renewables. 
Sec. 103. Energy credit. 
Sec. 104. Energy credit for small wind property. 
Sec. 105. Energy credit for geothermal heat pump systems. 
Sec. 106. Credit for residential energy efficient property. 
Sec. 107. New clean renewable energy bonds. 
Sec. 108. Credit for steel industry fuel. 
Sec. 109. Special rule to implement FERC and State electric restructuring policy. 
Subtitle B—Carbon Mitigation and Coal 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; funding of Black Lung Disability 
Trust Fund. 
Sec. 114. Special rules for refund of the coal excise tax to certain coal producers 
and exporters. 
Sec. 115. Tax credit for carbon dioxide sequestration. 
Sec. 116. Certain income and gains relating to industrial source carbon dioxide 
treated as qualifying income for publicly traded partnerships. 
Sec. 117. Carbon audit of the tax code. 
TITLE II—TRANSPORTATION AND DOMESTIC FUEL SECURITY PROVISIONS 
Sec. 201. Inclusion of cellulosic biofuel in bonus depreciation for biomass ethanol 
plant property. 
Sec. 202. Credits for biodiesel and renewable diesel. 
Sec. 203. Clarification that credits for fuel are designed to provide an incentive for 
United States production. 
Sec. 204. Extension and modification of alternative fuel credit. 
Sec. 205. Credit for new qualified plug-in electric drive motor vehicles. 
Sec. 206. Exclusion from heavy truck tax for idling reduction units and advanced 
insulation. 
Sec. 207. Alternative fuel vehicle refueling property credit. 
Sec. 208. Certain income and gains relating to alcohol fuels and mixtures, biodiesel 
fuels and mixtures, and alternative fuels and mixtures treated as quali-
fying income for publicly traded partnerships. 
26 USC 1 et al. 
26 USC 108 note. 
26 USC 108. 
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122 STAT. 3808 
PUBLIC LAW 110–343—OCT. 3, 2008 
Sec. 209. Extension and modification of election to expense certain refineries. 
Sec. 210. Extension of suspension of taxable income limit on percentage depletion 
for oil and natural gas produced from marginal properties. 
Sec. 211. Transportation fringe benefit to bicycle commuters. 
TITLE III—ENERGY CONSERVATION AND EFFICIENCY PROVISIONS 
Sec. 301. Qualified energy conservation bonds. 
Sec. 302. Credit for nonbusiness energy property. 
Sec. 303. Energy efficient commercial buildings deduction. 
Sec. 304. New energy efficient home credit. 
Sec. 305. Modifications of energy efficient appliance credit for appliances produced 
after 2007. 
Sec. 306. Accelerated recovery period for depreciation of smart meters and smart 
grid systems. 
Sec. 307. Qualified green building and sustainable design projects. 
Sec. 308. Special depreciation allowance for certain reuse and recycling property. 
TITLE IV—REVENUE PROVISIONS 
Sec. 401. Limitation of deduction for income attributable to domestic production of 
oil, gas, or primary products thereof. 
Sec. 402. Elimination of the different treatment of foreign oil and gas extraction in-
come and foreign oil related income for purposes of the foreign tax cred-
it. 
Sec. 403. Broker reporting of customer’s basis in securities transactions. 
Sec. 404. 0.2 percent FUTA surtax. 
Sec. 405. Increase and extension of Oil Spill Liability Trust Fund tax. 
TITLE I—ENERGY PRODUCTION 
INCENTIVES 
Subtitle A—Renewable Energy Incentives 
SEC. 101. RENEWABLE ENERGY CREDIT. 
(a) EXTENSION OF CREDIT.— 
(1) 1-YEAR EXTENSION FOR WIND AND REFINED COAL FACILI-
TIES.—Paragraphs (1) and (8) of section 45(d) are each amended 
by striking ‘‘January 1, 2009’’ and inserting ‘‘January 1, 2010’’. 
(2) 2-YEAR EXTENSION FOR CERTAIN OTHER FACILITIES.— 
Each of the following provisions of section 45(d) is amended 
by striking ‘‘January 1, 2009’’ and inserting ‘‘January 1, 2011’’: 
(A) Clauses (i) and (ii) of paragraph (2)(A). 
(B) Clauses (i)(I) and (ii) of paragraph (3)(A). 
(C) Paragraph (4). 
(D) Paragraph (5). 
(E) Paragraph (6). 
(F) Paragraph (7). 
(G) Subparagraphs (A) and (B) of paragraph (9). 
(b) MODIFICATION OF REFINED COAL AS A QUALIFIED ENERGY 
RESOURCE.— 
(1) ELIMINATION OF INCREASED MARKET VALUE TEST.—Sec-
tion 45(c)(7)(A)(i) (defining refined coal), as amended by section 
108, is amended— 
(A) by striking subclause (IV), 
(B) by adding ‘‘and’’ at the end of subclause (II), and 
(C) by striking ‘‘, and’’ at the end of subclause (III) 
and inserting a period. 
(2) INCREASE IN REQUIRED EMISSION REDUCTION.—Section 
45(c)(7)(B) (defining qualified emission reduction) is amended 
by inserting ‘‘at least 40 percent of the emissions of’’ after 
‘‘nitrogen oxide and’’. 
26 USC 45. 
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122 STAT. 3809 
PUBLIC LAW 110–343—OCT. 3, 2008 
(c) TRASH FACILITY CLARIFICATION.—Paragraph (7) of section 
45(d) is amended— 
(1) by striking ‘‘facility which burns’’ and inserting ‘‘facility 
(other than a facility described in paragraph (6)) which uses’’, 
and 
(2) by striking ‘‘COMBUSTION’’. 
(d) EXPANSION OF BIOMASS FACILITIES.— 
(1) OPEN-LOOP BIOMASS FACILITIES.—Paragraph (3) of sec-
tion 45(d) is amended by redesignating subparagraph (B) as 
subparagraph (C) and by inserting after subparagraph (A) the 
following new subparagraph: 
‘‘(B) EXPANSION OF FACILITY.—Such term shall include 
a new unit placed in service after the date of the enactment 
of this subparagraph in connection with a facility described 
in subparagraph (A), but only to the extent of the increased 
amount of electricity produced at the facility by reason 
of such new unit.’’. 
(2) CLOSED-LOOP BIOMASS FACILITIES.—Paragraph (2) of sec-
tion 45(d) is amended by redesignating subparagraph (B) as 
subparagraph (C) and inserting after subparagraph (A) the 
following new subparagraph: 
‘‘(B) EXPANSION OF FACILITY.—Such term shall include 
a new unit placed in service after the date of the enactment 
of this subparagraph in connection with a facility described 
in subparagraph (A)(i), but only to the extent of the 
increased amount of electricity produced at the facility 
by reason of such new unit.’’. 
(e) MODIFICATION OF RULES FOR HYDROPOWER PRODUCTION.— 
Subparagraph (C) of section 45(c)(8) is amended to read as follows: 
‘‘(C) 
NONHYDROELECTRIC
DAM.—For 
purposes 
of 
subparagraph (A), a facility is described in this subpara-
graph if— 
‘‘(i) the hydroelectric project installed on the non-
hydroelectric dam is licensed by the Federal Energy 
Regulatory Commission and meets all other applicable 
environmental, licensing, and regulatory requirements, 
‘‘(ii) the nonhydroelectric dam was placed in service 
before the date of the enactment 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 operated so that 
the water surface elevation at any given location and 
time that would have occurred in the absence of the 
hydroelectric project is maintained, subject to any 
license requirements imposed under applicable law 
that change the water surface elevation for the purpose 
of improving environmental quality of the affected 
waterway. 
The Secretary, in consultation with the Federal Energy 
Regulatory Commission, shall certify if a hydroelectric 
project licensed at a nonhydroelectric dam meets the cri-
teria in clause (iii). Nothing in this section shall affect 
the standards under which the Federal Energy Regulatory 
Commission issues licenses for and regulates hydropower 
projects under part I of the Federal Power Act.’’. 
Certification. 
26 USC 45. 
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122 STAT. 3810 
PUBLIC LAW 110–343—OCT. 3, 2008 
(f) EFFECTIVE DATE.— 
(1) IN GENERAL.—Except as otherwise provided in this sub-
section, the amendments made by this section shall apply to 
property originally placed in service after December 31, 2008. 
(2) REFINED COAL.—The amendments made by subsection 
(b) shall apply to coal produced and sold from facilities placed 
in service after December 31, 2008. 
(3) TRASH
FACILITY
CLARIFICATION.—The amendments 
made by subsection (c) shall apply to electricity produced and 
sold after the date of the enactment of this Act. 
(4) EXPANSION OF BIOMASS FACILITIES.—The amendments 
made by subsection (d) shall apply to property placed in service 
after the date of the enactment of this Act. 
SEC. 102. PRODUCTION CREDIT FOR ELECTRICITY PRODUCED 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 inserting ‘‘, and’’, 
and by adding at the end the following new subparagraph: 
‘‘(I) marine and hydrokinetic renewable energy.’’. 
(b) MARINE RENEWABLES.—Subsection (c) of section 45 is 
amended by adding at the end the following new paragraph: 
‘‘(10) MARINE
AND
HYDROKINETIC
RENEWABLE
ENERGY.— 
‘‘(A) IN GENERAL.—The term ‘marine and hydrokinetic 
renewable energy’ means energy derived 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 irrigation system, 
canal, or other man-made channel, including projects 
that utilize nonmechanical structures to accelerate the 
flow of water for electric power production purposes, 
or 
‘‘(iv) differentials in ocean temperature (ocean 
thermal energy conversion). 
‘‘(B) EXCEPTIONS.—Such term shall not include any 
energy which is derived from any source which utilizes 
a dam, diversionary structure (except as provided in 
subparagraph (A)(iii)), or impoundment for electric power 
production purposes.’’. 
(c) DEFINITION OF FACILITY.—Subsection (d) of section 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 producing electricity from 
marine and hydrokinetic renewable energy, the term ‘qualified 
facility’ means any facility owned by the taxpayer— 
‘‘(A) which has a nameplate capacity rating 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 section 101, is amended by 
Electricity. 
Applicability. 
26 USC 45 note. 
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122 STAT. 3811 
PUBLIC LAW 110–343—OCT. 3, 2008 
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 ending 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 inserting ‘‘January 1, 2017’’. 
(2) FUEL
CELL
PROPERTY.—Subparagraph (E) of section 
48(c)(1) is amended by striking ‘‘December 31, 2008’’ and 
inserting ‘‘December 31, 2016’’. 
(3) MICROTURBINE PROPERTY.—Subparagraph (E) of section 
48(c)(2) is amended by striking ‘‘December 31, 2008’’ and 
inserting ‘‘December 31, 2016’’. 
(b) ALLOWANCE OF ENERGY CREDIT AGAINST ALTERNATIVE MIN-
IMUM TAX.— 
(1) IN GENERAL.—Subparagraph (B) of section 38(c)(4), as 
amended by the Housing Assistance Tax Act of 2008, is 
amended by redesignating clause (vi) as clause (vi) and (vii), 
respectively, and by inserting after clause (iv) the following 
new clause: 
‘‘(v) the credit determined under section 46 to the 
extent that such credit is attributable to the energy 
credit determined under section 48,’’. 
(2) 
TECHNICAL
AMENDMENT.—Clause 
(vi) 
of 
section 
38(c)(4)(B), as redesignated by paragraph (1), is amended by 
striking ‘‘section 47 to the extent attributable to’’ and inserting 
‘‘section 46 to the extent that such credit is attributable to 
the rehabilitation credit under section 47, but only with respect 
to’’. 
(c) ENERGY CREDIT FOR COMBINED HEAT AND POWER SYSTEM 
PROPERTY.— 
(1) IN GENERAL.—Section 48(a)(3)(A) is amended by striking 
‘‘or’’ at the end of clause (iii), by inserting ‘‘or’’ at the end 
of clause (iv), and by adding at the end the following new 
clause: 
‘‘(v) combined heat and power system property,’’. 
(2) COMBINED HEAT AND POWER SYSTEM PROPERTY.—Sub-
section (c) of section 48 is amended— 
(A) by striking ‘‘QUALIFIED FUEL CELL PROPERTY; 
QUALIFIED MICROTURBINE PROPERTY’’ in the heading and 
inserting ‘‘DEFINITIONS’’, and 
(B) by adding at the end the following new paragraph: 
‘‘(3) COMBINED HEAT AND POWER SYSTEM PROPERTY.— 
‘‘(A) COMBINED HEAT AND POWER SYSTEM PROPERTY.— 
The term ‘combined heat and power system property’ means 
property comprising a system— 
‘‘(i) which uses the same energy source for the 
simultaneous or sequential generation of electrical 
power, mechanical shaft power, or both, in combination 
with the generation of steam or other forms of useful 
thermal energy (including heating and cooling applica-
tions), 
‘‘(ii) which produces— 
26 USC 48. 
26 USC 45 note. 
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122 STAT. 3812 
PUBLIC LAW 110–343—OCT. 3, 2008 
‘‘(I) at least 20 percent of its total useful energy 
in the form of thermal energy which is not used 
to produce electrical or mechanical power (or com-
bination thereof), and 
‘‘(II) at least 20 percent of its total useful 
energy in the form of electrical or mechanical 
power (or combination thereof), 
‘‘(iii) the energy efficiency percentage of which 
exceeds 60 percent, and 
‘‘(iv) which is placed in service before January 
1, 2017. 
‘‘(B) LIMITATION.— 
‘‘(i) IN GENERAL.—In the case of combined heat 
and power system property with an electrical capacity 
in excess of the applicable capacity placed in service 
during the taxable year, the credit under subsection 
(a)(1) (determined without regard to this paragraph) 
for such year shall be equal to the amount which 
bears the same ratio to such credit as the applicable 
capacity bears to the capacity of such property. 
‘‘(ii) APPLICABLE CAPACITY.—For purposes of clause 
(i), the term ‘applicable capacity’ means 15 megawatts 
or a mechanical energy capacity of more than 20,000 
horsepower or an equivalent combination of electrical 
and mechanical energy capacities. 
‘‘(iii) MAXIMUM
CAPACITY.—The term ‘combined 
heat and power system property’ shall not include any 
property comprising a system if such system has a 
capacity in excess of 50 megawatts or a mechanical 
energy capacity in excess of 67,000 horsepower or an 
equivalent combination of electrical and mechanical 
energy capacities. 
‘‘(C) SPECIAL RULES.— 
‘‘(i) ENERGY
EFFICIENCY
PERCENTAGE.—For pur-
poses of this paragraph, the energy efficiency percent-
age of a system is the fraction— 
‘‘(I) the numerator of which is the total useful 
electrical, thermal, and mechanical power pro-
duced by the system at normal operating rates, 
and expected to be consumed in its normal applica-
tion, and 
‘‘(II) the denominator of which is the lower 
heating value of the fuel sources for the system. 
‘‘(ii) DETERMINATIONS MADE ON BTU BASIS.—The 
energy efficiency percentage and the percentages under 
subparagraph (A)(ii) shall be determined on a Btu 
basis. 
‘‘(iii) 
INPUT
AND
OUTPUT
PROPERTY
NOT 
INCLUDED.—The term ‘combined heat and power 
system property’ does not include property used to 
transport the energy source to the facility or to dis-
tribute energy produced by the facility. 
‘‘(D) SYSTEMS USING BIOMASS.—If a system is designed 
to use biomass (within the meaning of paragraphs (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— 
Definition. 
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122 STAT. 3813 
PUBLIC LAW 110–343—OCT. 3, 2008 
‘‘(i) subparagraph (A)(iii) shall not apply, but 
‘‘(ii) the amount of credit determined under sub-
section (a) with respect to such system shall not exceed 
the amount which bears the same ratio to such amount 
of credit (determined without regard to this subpara-
graph) as the energy efficiency percentage of such 
system bears to 60 percent.’’. 
(3) CONFORMING AMENDMENT.—Section 48(a)(1) is amended 
by striking ‘‘paragraphs (1)(B) and (2)(B)’’ and inserting ‘‘para-
graphs (1)(B), (2)(B), and (3)(B)’’. 
(d) INCREASE OF CREDIT LIMITATION FOR FUEL CELL PROP-
ERTY.—Subparagraph (B) of section 48(c)(1) is amended by striking 
‘‘$500’’ and inserting ‘‘$1,500’’. 
(e) PUBLIC UTILITY PROPERTY TAKEN INTO ACCOUNT.— 
(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 redesignating subparagraph 
(E) as subparagraph (D). 
(B) Paragraph (2) of section 48(c) is amended by 
striking subparagraph (D) and redesignating subparagraph 
(E) as subparagraph (D). 
(f) EFFECTIVE DATE.— 
(1) IN GENERAL.—Except as otherwise provided in this sub-
section, the amendments made by this section 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 deter-
mined under section 46 of the Internal Revenue Code of 1986 
in taxable years beginning after the date of the enactment 
of this Act and to carrybacks of such credits. 
(3) COMBINED HEAT AND POWER AND FUEL CELL PROPERTY.— 
The amendments made by subsections (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 amendments 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 effect on the day before the date of the enactment 
of the Revenue Reconciliation Act of 1990). 
SEC. 104. ENERGY CREDIT FOR SMALL WIND PROPERTY. 
(a) IN GENERAL.—Section 48(a)(3)(A), as amended by section 
103, is amended by striking ‘‘or’’ at the end of clause (iv), by 
adding ‘‘or’’ at the end of clause (v), and by inserting after clause 
(v) the following new clause: 
‘‘(vi) qualified small wind energy property,’’. 
(b) 30 PERCENT CREDIT.—Section 48(a)(2)(A)(i) is amended by 
striking ‘‘and’’ at the end of subclause (II) and by inserting after 
subclause (III) the following new subclause: 
‘‘(IV) qualified small wind energy property, 
and’’. 
26 USC 48 note. 
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122 STAT. 3814 
PUBLIC LAW 110–343—OCT. 3, 2008 
(c) QUALIFIED SMALL WIND ENERGY PROPERTY.—Section 48(c), 
as amended by section 103, is amended by adding at the end 
the following new paragraph: 
‘‘(4) QUALIFIED SMALL WIND ENERGY PROPERTY.— 
‘‘(A) IN
GENERAL.—The term ‘qualified small wind 
energy property’ means property which uses a qualifying 
small wind turbine to generate electricity. 
‘‘(B) LIMITATION.—In the case of qualified small wind 
energy property placed in service during the taxable year, 
the credit otherwise determined under subsection (a)(1) 
for such year with respect to all such property of the 
taxpayer shall not exceed $4,000. 
‘‘(C) QUALIFYING
SMALL
WIND
TURBINE.—The term 
‘qualifying small wind turbine’ means a wind turbine which 
has a nameplate capacity of not more than 100 kilowatts. 
‘‘(D) TERMINATION.—The term ‘qualified small wind 
energy property’ shall not include any property for any 
period after December 31, 2016.’’. 
(d) CONFORMING AMENDMENT.—Section 48(a)(1), as amended 
by section 103, is amended by striking ‘‘paragraphs (1)(B), (2)(B), 
and (3)(B)’’ and inserting ‘‘paragraphs (1)(B), (2)(B), (3)(B), and 
(4)(B)’’. 
(e) EFFECTIVE DATE.—The amendments made by this section 
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). 
SEC. 105. ENERGY CREDIT FOR GEOTHERMAL HEAT PUMP SYSTEMS. 
(a) IN GENERAL.—Subparagraph (A) of section 48(a)(3), as 
amended by this Act, is amended by striking ‘‘or’’ at the end of 
clause (v), by inserting ‘‘or’’ at the end of clause (vi), and by 
adding at the end the following new clause: 
‘‘(vii) equipment which uses the ground or ground 
water as a thermal energy source to heat a structure 
or as a thermal energy sink to cool a structure, but 
only with respect to periods ending before January 
1, 2017,’’. 
(b) EFFECTIVE DATE.—The amendments made by this section 
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). 
SEC. 106. CREDIT FOR RESIDENTIAL ENERGY EFFICIENT PROPERTY. 
(a) EXTENSION.—Section 25D(g) is amended by striking 
‘‘December 31, 2008’’ and inserting ‘‘December 31, 2016’’. 
(b) REMOVAL OF LIMITATION FOR SOLAR ELECTRIC PROPERTY.— 
(1) IN GENERAL.—Section 25D(b)(1), as amended by sub-
sections (c) and (d), is amended— 
(A) by striking subparagraph (A), and 
(B) by redesignating subparagraphs (B) through (E) 
as subparagraphs (A) through and (D), respectively. 
(2) CONFORMING
AMENDMENT.—Section 25D(e)(4)(A), as 
amended by subsections (c) and (d), is amended— 
(A) by striking clause (i), and 
26 USC 48 note. 
26 USC 48 note. 
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122 STAT. 3815 
PUBLIC LAW 110–343—OCT. 3, 2008 
(B) by redesignating clauses (ii) through (v) as clauses 
(i) and (iv), respectively. 
(c) CREDIT FOR RESIDENTIAL WIND PROPERTY.— 
(1) IN GENERAL.—Section 25D(a) is amended by striking 
‘‘and’’ at the end of paragraph (2), by striking the period at 
the end of paragraph (3) and inserting ‘‘, and’’, and by adding 
at the end the following new paragraph: 
‘‘(4) 30 percent of the qualified small wind energy 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 turbines for which qualified 
small wind energy property expenditures are made.’’. 
(3) QUALIFIED
SMALL
WIND
ENERGY
PROPERTY
EXPENDI-
TURES.— 
(A) IN GENERAL.—Section 25D(d) is amended by adding 
at the end the following new paragraph: 
‘‘(4) QUALIFIED SMALL WIND ENERGY PROPERTY EXPENDI-
TURE.—The term ‘qualified small wind energy property expendi-
ture’ means an expenditure for property which uses a wind 
turbine to generate electricity for use in connection with a 
dwelling unit located in the United States and used as a resi-
dence 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 include any facility with respect to which 
any qualified small wind energy property expenditure (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
OCCU-
PANCY.—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: 
‘‘(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 expendi-
tures are made.’’. 
(d) CREDIT FOR GEOTHERMAL HEAT PUMP SYSTEMS.— 
(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 amended by sub-
section (c), is amended by striking ‘‘and’’ at the end of subpara-
graph (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.’’. 
26 USC 25D. 
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122 STAT. 3816 
PUBLIC LAW 110–343—OCT. 3, 2008 
(3) QUALIFIED GEOTHERMAL HEAT PUMP PROPERTY EXPENDI-
TURE.—Section 25D(d), as amended by subsection (c), is 
amended by adding at the end the following new paragraph: 
‘‘(5) QUALIFIED GEOTHERMAL HEAT PUMP PROPERTY EXPENDI-
TURE.— 
‘‘(A) IN GENERAL.—The term ‘qualified geothermal 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 Energy Star 
program which are in effect at the time that the 
expenditure for such equipment is made.’’. 
(4) MAXIMUM
EXPENDITURES
IN
CASE
OF
JOINT
OCCU-
PANCY.—Section 25D(e)(4)(A), as amended by subsection (c), 
is amended by striking ‘‘and’’ at the 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 expenditures.’’. 
(e) CREDIT ALLOWED AGAINST ALTERNATIVE MINIMUM 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.— 
‘‘(A) RULE FOR YEARS IN WHICH ALL PERSONAL 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) exceeds 
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 subsection (a) exceeds the limitation 
imposed by paragraph (1) for such taxable year, such excess 
shall be carried to the succeeding taxable year and added 
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122 STAT. 3817 
PUBLIC LAW 110–343—OCT. 3, 2008 
to the credit allowable under subsection (a) for such suc-
ceeding taxable year.’’. 
(2) CONFORMING AMENDMENTS.— 
(A) Section 23(b)(4)(B) is amended by inserting ‘‘and 
section 25D’’ after ‘‘this section’’. 
(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 striking ‘‘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.—Except as provided in paragraph (2), the 
amendments made by this section shall apply to taxable years 
beginning after December 31, 2007. 
(2) SOLAR ELECTRIC PROPERTY LIMITATION.—The amend-
ments made by subsection (b) shall apply to taxable years 
beginning after December 31, 2008. 
(3) APPLICATION
OF
EGTRRA
SUNSET.—The amendments 
made by subparagraphs (A) and (B) of subsection (e)(2) shall 
be subject to title IX of the Economic Growth and Tax Relief 
Reconciliation Act of 2001 in the same manner as the provisions 
of such Act to which such amendments relate. 
SEC. 107. NEW CLEAN RENEWABLE ENERGY BONDS. 
(a) IN GENERAL.—Subpart I of part IV of subchapter A of 
chapter 1 is amended by adding at the end the following new 
section: 
‘‘SEC. 54C. NEW CLEAN RENEWABLE ENERGY BONDS. 
‘‘(a) NEW CLEAN RENEWABLE ENERGY BOND.—For purposes of 
this subpart, the term ‘new clean renewable energy 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 govern-
mental bodies, public power providers, or cooperative 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 DESIGNATED.— 
‘‘(1) IN GENERAL.—The maximum aggregate face amount 
of bonds which may be designated under subsection (a) by 
any issuer shall not exceed the limitation amount allocated 
under this subsection to such issuer. 
‘‘(2) NATIONAL
LIMITATION
ON
AMOUNT
OF
BONDS
DES-
IGNATED.—There is a national new clean renewable energy 
bond limitation of $800,000,000 which shall be allocated by 
the Secretary as provided in paragraph (3), except that— 
‘‘(A) not more than 331⁄3 percent thereof may be allo-
cated to qualified projects of public power providers, 
‘‘(B) not more than 331⁄3 percent thereof may be allo-
cated to qualified projects of governmental bodies, and 
26 USC 23 note. 
26 USC 23. 
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122 STAT. 3818 
PUBLIC LAW 110–343—OCT. 3, 2008 
‘‘(C) not more than 331⁄3 percent thereof may be allo-
cated to qualified projects of cooperative 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 allocation of the national new clean renewable energy 
bond limitation, the Secretary shall, to the maximum 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 
limitation under paragraph (2)(A) bears to the cost of all 
such projects. 
‘‘(B) ALLOCATION AMONG GOVERNMENTAL BODIES AND 
COOPERATIVE
ELECTRIC
COMPANIES.—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 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 FACILITY.—The term 
‘qualified renewable energy facility’ means a qualified facility 
(as determined under section 45(d) without regard to para-
graphs (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 ‘public power pro-
vider’ means a State utility with a service 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 ‘governmental body’ 
means any State or Indian tribal government, or any political 
subdivision thereof. 
‘‘(4) COOPERATIVE ELECTRIC COMPANY.—The term ‘coopera-
tive 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 LENDER.—The term 
‘clean renewable energy bond lender’ means a lender which 
is a cooperative which is owned by, or has outstanding loans 
to, 100 or more cooperative electric companies and is in exist-
ence on February 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 renewable energy bond lender, or 
a not-for-profit electric utility which has received a loan or 
loan guarantee under the Rural Electrification Act.’’. 
(b) CONFORMING AMENDMENTS.— 
(1) Paragraph (1) of section 54A(d) is amended to read 
as follows: 
‘‘(1) QUALIFIED TAX CREDIT BOND.—The term ‘qualified tax 
credit bond’ means— 
‘‘(A) a qualified forestry conservation bond, or 
‘‘(B) a new clean renewable energy bond, 
which is part of an issue that meets requirements of paragraphs 
(2), (3), (4), (5), and (6).’’. 
Definition. 
26 USC 54A. 
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122 STAT. 3819 
PUBLIC LAW 110–343—OCT. 3, 2008 
(2) Subparagraph (C) of section 54A(d)(2) is amended to 
read as follows: 
‘‘(C) QUALIFIED PURPOSE.—For purposes of this para-
graph, the term ‘qualified purpose’ means— 
‘‘(i) in the case of a qualified forestry conservation 
bond, a purpose specified in section 54B(e), and 
‘‘(ii) in the case of a new clean renewable energy 
bond, a purpose specified in section 54C(a)(1).’’. 
(3) The table of sections for subpart I of part IV of sub-
chapter A of chapter 1 is amended by adding at the end the 
following new item: 
‘‘Sec. 54C. Qualified clean renewable energy bonds.’’. 
(c) EXTENSION FOR CLEAN RENEWABLE ENERGY BONDS.—Sub-
section (m) of section 54 is amended by striking ‘‘December 31, 
2008’’ and inserting ‘‘December 31, 2009’’. 
(d) EFFECTIVE DATE.—The amendments made by this section 
shall apply to obligations issued after the date of the enactment 
of this Act. 
SEC. 108. CREDIT FOR STEEL INDUSTRY FUEL. 
(a) TREATMENT AS REFINED COAL.— 
(1) IN GENERAL.—Subparagraph (A) of section 45(c)(7) of 
the Internal Revenue Code of 1986 (relating to refined coal), 
as amended by this Act, is amended to read as follows: 
‘‘(A) IN
GENERAL.—The term ‘refined coal’ means a 
fuel— 
‘‘(i) which— 
‘‘(I) is a liquid, gaseous, or solid fuel produced 
from coal (including lignite) or high carbon fly 
ash, including such fuel used as a feedstock, 
‘‘(II) is sold by the taxpayer with the reason-
able expectation that it will be used for purpose 
of producing steam, 
‘‘(III) is certified by the taxpayer as resulting 
(when used in the production of steam) in a quali-
fied emission reduction, and 
‘‘(IV) is produced in such a manner as to result 
in an increase of at least 50 percent in the market 
value of the refined coal (excluding any increase 
caused by materials combined or added during 
the production process), as compared to the value 
of the feedstock coal, or 
‘‘(ii) which is steel industry fuel.’’. 
(2) STEEL INDUSTRY FUEL DEFINED.—Paragraph (7) of sec-
tion 45(c) of such Code is amended by adding at the end 
the following new subparagraph: 
‘‘(C) STEEL INDUSTRY FUEL.— 
‘‘(i) IN GENERAL.—The term ‘steel industry fuel’ 
means a fuel which— 
‘‘(I) is produced through a process of liquifying 
coal waste sludge and distributing it on coal, and 
‘‘(II) is used as a feedstock for the manufacture 
of coke. 
‘‘(ii) COAL WASTE SLUDGE.—The term ‘coal waste 
sludge’ means the tar decanter sludge and related 
Definition. 
26 USC 54 note. 
26 USC 54A. 
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122 STAT. 3820 
PUBLIC LAW 110–343—OCT. 3, 2008 
byproducts of the coking process, including such mate-
rials that have been stored in ground, in tanks and 
in lagoons, that have been treated as hazardous wastes 
under applicable Federal environmental rules absent 
liquefaction and processing with coal into a feedstock 
for the manufacture of coke.’’. 
(b) CREDIT AMOUNT.— 
(1) IN
GENERAL.—Paragraph (8) of section 45(e) of the 
Internal Revenue Code of 1986 (relating to refined coal produc-
tion facilities) is amended by adding at the end the following 
new subparagraph 
‘‘(D) SPECIAL RULE FOR STEEL INDUSTRY FUEL.— 
‘‘(i) IN GENERAL.—In the case of a taxpayer who 
produces steel industry fuel— 
‘‘(I) this paragraph shall be applied separately 
with respect to steel industry fuel and other 
refined coal, and 
‘‘(II) in applying this paragraph to steel 
industry fuel, the modifications in clause (ii) shall 
apply. 
‘‘(ii) MODIFICATIONS.— 
‘‘(I) CREDIT AMOUNT.—Subparagraph (A) shall 
be applied by substituting ‘$2 per barrel-of-oil 
equivalent’ for ‘$4.375 per ton’. 
‘‘(II) CREDIT PERIOD.—In lieu of the 10-year 
period referred to in clauses (i) and (ii)(II) of 
subparagraph (A), the credit period shall be the 
period beginning on the later of the date such 
facility was originally placed in service, the date 
the modifications described in clause (iii) were 
placed in service, or October 1, 2008, and ending 
on the later of December 31, 2009, or the date 
which is 1 year after the date such facility or 
the modifications described in clause (iii) were 
placed in service. 
‘‘(III) NO PHASEOUT.—Subparagraph (B) shall 
not apply. 
‘‘(iii) MODIFICATIONS.—The modifications described 
in this clause are modifications to an existing facility 
which allow such facility to produce steel industry 
fuel. 
‘‘(iv) BARREL-OF-OIL EQUIVALENT.—For purposes of 
this subparagraph, a barrel-of-oil equivalent is the 
amount of steel industry fuel that has a Btu content 
of 5,800,000 Btus.’’. 
(2) INFLATION ADJUSTMENT.—Paragraph (2) of section 45(b) 
of such Code is amended by inserting ‘‘the $3 amount in sub-
section (e)(8)(D)(ii)(I),’’ after ‘‘subsection (e)(8)(A),’’. 
(c) TERMINATION.—Paragraph (8) of section 45(d) of the Internal 
Revenue Code of 1986 (relating to refined coal production facility), 
as amended by this Act, is amended to read as follows: 
‘‘(8) REFINED COAL PRODUCTION FACILITY.—In the case of 
a facility that produces refined coal, the term ‘refined coal 
production facility’ means— 
‘‘(A) with respect to a facility producing steel industry 
fuel, any facility (or any modification to a facility) which 
is placed in service before January 1, 2010, and 
Applicability. 
26 USC 45. 
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122 STAT. 3821 
PUBLIC LAW 110–343—OCT. 3, 2008 
‘‘(B) with respect to any other facility producing refined 
coal, any facility placed in service after the date of the 
enactment of the American Jobs Creation Act of 2004 and 
before January 1, 2010.’’. 
(d) COORDINATION WITH CREDIT FOR PRODUCING FUEL FROM 
A NONCONVENTIONAL SOURCE.— 
(1) IN GENERAL.—Subparagraph (B) of section 45(e)(9) of 
the Internal Revenue Code of 1986 is amended— 
(A) by striking ‘‘The term’’ and inserting the following: 
‘‘(i) IN GENERAL.—The term’’, and 
(B) by adding at the end the following new clause: 
‘‘(ii) EXCEPTION FOR STEEL INDUSTRY COAL.—In the 
case of a facility producing steel industry fuel, clause 
(i) shall not apply to so much of the refined coal pro-
duced at such facility as is steel industry fuel.’’. 
(2) NO DOUBLE BENEFIT.—Section 45K(g)(2) of such Code 
is amended by adding at the end the following new subpara-
graph: 
‘‘(E) COORDINATION WITH SECTION 45.—No credit shall 
be allowed with respect to any qualified fuel which is 
steel industry fuel (as defined in section 45(c)(7)) if a credit 
is allowed to the taxpayer for such fuel under section 
45.’’. 
(e) EFFECTIVE DATE.—The amendments made by this section 
shall apply to fuel produced and sold after September 30, 2008. 
SEC. 109. SPECIAL RULE TO IMPLEMENT FERC AND STATE ELECTRIC 
RESTRUCTURING POLICY. 
(a) EXTENSION FOR QUALIFIED ELECTRIC UTILITIES.— 
(1) IN GENERAL.—Paragraph (3) of section 451(i) is amended 
by inserting ‘‘(before January 1, 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 paragraphs (6) through (10) 
as paragraphs (7) through (11), respectively, and by inserting 
after paragraph (5) the following new paragraph: 
‘‘(6) QUALIFIED
ELECTRIC
UTILITY.—For purposes 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 subsection applies, and 
‘‘(B) an electric utility (as defined in section 3(22) of 
the Federal Power Act (16 U.S.C. 796(22))).’’. 
(b) EXTENSION OF PERIOD FOR TRANSFER OF OPERATIONAL CON-
TROL 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’’. 
(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 subpara-
graph: 
‘‘(C) EXCEPTION FOR PROPERTY LOCATED OUTSIDE THE 
UNITED STATES.—The term ‘exempt utility property’ shall 
26 USC 45 note. 
26 USC 45. 
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122 STAT. 3822 
PUBLIC LAW 110–343—OCT. 3, 2008 
not include any property which is located outside the 
United States.’’. 
(d) EFFECTIVE DATES.— 
(1) EXTENSION.—The amendments made by subsection (a) 
shall apply to transactions after December 31, 2007. 
(2) TRANSFERS OF OPERATIONAL CONTROL.—The amendment 
made by subsection (b) shall take effect as if included in section 
909 of the American Jobs Creation Act of 2004. 
(3) EXCEPTION FOR PROPERTY LOCATED OUTSIDE THE UNITED 
STATES.—The amendment made by subsection (c) shall apply 
to transactions after the date of the enactment of this Act. 
Subtitle B—Carbon Mitigation and Coal 
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 paragraph (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’’. 
(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 gasification com-
bined cycle projects the application for which is sub-
mitted during the period 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 para-
graph (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 applicant for certifi-
cation under this paragraph shall submit an application 
meeting the requirements of subparagraph (B). An 
applicant may only submit an application— 
‘‘(i) for an allocation from the dollar amount speci-
fied in clause (i) or (ii) of paragraph (3)(B) during 
the 3-year period beginning on the date the Secretary 
establishes the program under paragraph (1), and 
Certification. 
26 USC 48A. 
26 USC 451 note. 
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122 STAT. 3823 
PUBLIC LAW 110–343—OCT. 3, 2008 
‘‘(ii) for an allocation from the dollar amount speci-
fied in paragraph (3)(B)(iii) during the 3-year period 
beginning at the earlier of the termination of the period 
described in clause (i) or the date prescribed by the 
Secretary.’’. 
(3) CAPTURE AND SEQUESTRATION OF CARBON DIOXIDE EMIS-
SIONS REQUIREMENT.— 
(A) IN
GENERAL.—Section 48A(e)(1) is amended by 
striking ‘‘and’’ at the end of subparagraph (E), by striking 
the period at the end of subparagraph (F) and inserting 
‘‘; and’’, and by adding at the end the following new 
subparagraph: 
‘‘(G) in the case of any project the application for which 
is submitted during the period described in subsection 
(d)(2)(A)(ii), the project includes equipment which separates 
and sequesters at least 65 percent (70 percent in the case 
of an application for reallocated credits under subsection 
(d)(4)) of such project’s total carbon dioxide emissions.’’. 
(B) HIGHEST PRIORITY FOR PROJECTS WHICH SEQUESTER 
CARBON DIOXIDE EMISSIONS.—Section 48A(e)(3) is amended 
by striking ‘‘and’’ at the end of subparagraph (A)(iii), by 
striking the period at the end of subparagraph (B)(iii) and 
inserting ‘‘, and’’, and by adding at the end the following 
new subparagraph: 
‘‘(C) give highest priority to projects with the greatest 
separation and sequestration percentage 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: 
‘‘(i) RECAPTURE OF CREDIT FOR FAILURE TO SEQUESTER.—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 require-
ments of subsection (e)(1)(G).’’. 
(4) ADDITIONAL PRIORITY FOR RESEARCH PARTNERSHIPS.— 
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 following new 
clause: 
‘‘(iii) applicant participants who have a research 
partnership with an eligible educational 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) DISCLOSURE OF ALLOCATIONS.—Section 48A(d) is amended 
by adding at the end the following new paragraph: 
‘‘(5) DISCLOSURE
OF
ALLOCATIONS.—The Secretary 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.’’. 
(e) EFFECTIVE DATES.— 
(1) IN GENERAL.—Except as otherwise provided in this sub-
section, the amendments made by this section shall apply to 
26 USC 48A note. 
26 USC 48A. 
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122 STAT. 3824 
PUBLIC LAW 110–343—OCT. 3, 2008 
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) DISCLOSURE OF ALLOCATIONS.—The amendment made 
by subsection (d) shall apply to certifications made after the 
date of the enactment of this Act. 
(3) CLERICAL AMENDMENT.—The amendment made by sub-
section (c)(5) shall take effect as if included in the amendment 
made by section 1307(b) of the Energy Tax Incentives Act 
of 2005. 
SEC. 112. EXPANSION AND MODIFICATION OF COAL GASIFICATION 
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 gasification 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 SEQUESTER.—Section 
48B is amended by adding at the end the following new subsection: 
‘‘(f) RECAPTURE OF CREDIT FOR FAILURE TO SEQUESTER.—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 require-
ments for such project under subsection (d)(1).’’. 
(d) SELECTION PRIORITIES.—Section 48B(d) is amended by 
adding at the end the following new paragraph: 
‘‘(4) SELECTION PRIORITIES.—In determining which quali-
fying gasification projects to certify under this section, the 
Secretary shall— 
‘‘(A) give highest priority to projects with the greatest 
separation and sequestration percentage of total carbon 
dioxide emissions, and 
‘‘(B) give high priority to applicant participants who 
have a research partnership with an eligible educational 
institution (as defined in section 529(e)(5)).’’. 
(e) ELIGIBLE
PROJECTS
INCLUDE
TRANSPORTATION
GRADE 
LIQUID
FUELS.—Section 48B(c)(7) (defining eligible entity) is 
amended by striking ‘‘and’’ at the end of subparagraph (F), by 
striking the period at the end of subparagraph (G) and inserting 
‘‘, and’’, and by adding at the end the following new subparagraph: 
‘‘(H) transportation grade liquid fuels.’’. 
(f) 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; FUNDING OF 
BLACK LUNG DISABILITY TRUST FUND. 
(a) EXTENSION OF TEMPORARY INCREASE.—Paragraph (2) of sec-
tion 4121(e) is amended— 
26 USC 48B note. 
26 USC 48B. 
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122 STAT. 3825 
PUBLIC LAW 110–343—OCT. 3, 2008 
(1) by striking ‘‘January 1, 2014’’ in subparagraph (A) 
and inserting ‘‘December 31, 2018’’, and 
(2) by striking ‘‘January 1 after 1981’’ in subparagraph 
(B) and inserting ‘‘December 31 after 2007’’. 
(b) RESTRUCTURING OF TRUST FUND DEBT.— 
(1) DEFINITIONS.—For purposes of this subsection— 
(A) MARKET VALUE OF THE OUTSTANDING REPAYABLE 
ADVANCES, PLUS ACCRUED INTEREST.—The term ‘‘market 
value of the outstanding repayable advances, plus accrued 
interest’’ means the present value (determined by the Sec-
retary of the Treasury as of the refinancing date and using 
the Treasury rate as the discount rate) of the stream of 
principal and interest payments derived assuming that 
each repayable advance that is outstanding on the refi-
nancing date is due on the 30th anniversary of the end 
of the fiscal year in which the advance was made to the 
Trust Fund, and that all such principal and interest pay-
ments are made on September 30 of the applicable fiscal 
year. 
(B) REFINANCING DATE.—The term ‘‘refinancing date’’ 
means the date occurring 2 days after the enactment of 
this Act. 
(C) 
REPAYABLE
ADVANCE.—The 
term 
‘‘repayable 
advance’’ means an amount that has been appropriated 
to the Trust Fund in order to make benefit payments 
and other expenditures that are authorized under section 
9501 of the Internal Revenue Code of 1986 and are required 
to be repaid when the Secretary of the Treasury determines 
that monies are available in the Trust Fund for such pur-
pose. 
(D) TREASURY RATE.—The term ‘‘Treasury rate’’ means 
a rate determined by the Secretary of the Treasury, taking 
into consideration current market yields on outstanding 
marketable obligations of the United States of comparable 
maturities. 
(E) TREASURY 1-YEAR RATE.—The term ‘‘Treasury 1- 
year rate’’ means a rate determined by the Secretary of 
the Treasury, taking into consideration current market 
yields on outstanding marketable obligations of the United 
States with remaining periods to maturity of approximately 
1 year, to have been in effect as of the close of business 
1 business day prior to the date on which the Trust Fund 
issues obligations to the Secretary of the Treasury under 
paragraph (2)(B). 
(2) REFINANCING OF OUTSTANDING PRINCIPAL OF REPAYABLE 
ADVANCES AND UNPAID INTEREST ON SUCH ADVANCES.— 
(A) TRANSFER TO GENERAL FUND.—On the refinancing 
date, the Trust Fund shall repay the market value of 
the outstanding repayable advances, plus accrued interest, 
by transferring into the general fund of the Treasury the 
following sums: 
(i) The proceeds from obligations that the Trust 
Fund shall issue to the Secretary of the Treasury in 
such amounts as the Secretaries of Labor and the 
Treasury shall determine and bearing interest at the 
Treasury rate, and that shall be in such forms and 
denominations and be subject to such other terms and 
26 USC 9501 
note. 
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122 STAT. 3826 
PUBLIC LAW 110–343—OCT. 3, 2008 
conditions, including maturity, as the Secretary of the 
Treasury shall prescribe. 
(ii) All, or that portion, of the appropriation made 
to the Trust Fund pursuant to paragraph (3) that 
is needed to cover the difference defined in that para-
graph. 
(B) REPAYMENT OF OBLIGATIONS.—In the event that 
the Trust Fund is unable to repay the obligations that 
it has issued to the Secretary of the Treasury under 
subparagraph (A)(i) and this subparagraph, or is unable 
to make benefit payments and other authorized expendi-
tures, the Trust Fund shall issue obligations to the Sec-
retary of the Treasury in such amounts as may be nec-
essary to make such repayments, payments, and expendi-
tures, with a maturity of 1 year, and bearing interest 
at the Treasury 1-year rate. These obligations shall be 
in such forms and denominations and be subject to such 
other terms and conditions as the Secretary of the Treasury 
shall prescribe. 
(C) AUTHORITY
TO
ISSUE
OBLIGATIONS.—The Trust 
Fund is authorized to issue obligations to the Secretary 
of the Treasury under subparagraphs (A)(i) and (B). The 
Secretary of the Treasury is authorized to purchase such 
obligations of the Trust Fund. For the purposes of making 
such purchases, the Secretary of the Treasury may use 
as a public debt transaction the proceeds from the sale 
of any securities issued under chapter 31 of title 31, United 
States Code, and the purposes for which securities may 
be issued under such chapter are extended to include any 
purchase of such Trust Fund obligations under this 
subparagraph. 
(3) ONE-TIME
APPROPRIATION.—There is hereby appro-
priated to the Trust Fund an amount sufficient to pay to 
the general fund of the Treasury the difference between— 
(A) the market value of the outstanding repayable 
advances, plus accrued interest; and 
(B) the proceeds from the obligations issued by the 
Trust Fund to the Secretary of the Treasury under para-
graph (2)(A)(i). 
(4) PREPAYMENT OF TRUST FUND OBLIGATIONS.—The Trust 
Fund is authorized to repay any obligation issued to the Sec-
retary of the Treasury under subparagraphs (A)(i) and (B) 
of paragraph (2) prior to its maturity date by paying a prepay-
ment price that would, if the obligation being prepaid (including 
all unpaid interest accrued thereon through the date of prepay-
ment) were purchased by a third party and held to the maturity 
date of such obligation, produce a yield to the third-party pur-
chaser for the period from the date of purchase to the maturity 
date of such obligation substantially equal to the Treasury 
yield on outstanding marketable obligations of the United 
States having a comparable maturity to this period. 
SEC. 114. SPECIAL RULES FOR REFUND OF THE COAL EXCISE TAX 
TO CERTAIN COAL PRODUCERS AND EXPORTERS. 
(a) REFUND.— 
(1) COAL PRODUCERS.— 
26 USC 4121 
note. 
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122 STAT. 3827 
PUBLIC LAW 110–343—OCT. 3, 2008 
(A) IN GENERAL.—Notwithstanding subsections (a)(1) 
and (c) of section 6416 and section 6511 of the Internal 
Revenue Code of 1986, if— 
(i) a coal producer establishes that such coal pro-
ducer, 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 
producer 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 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 producer 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 related 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 TAXPAYERS.—For pur-
poses of this section— 
(i) IN
GENERAL.—If a coal producer or a party 
related to a coal producer has received 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 taxpayer described 
in clause (i) is entitled to a payment under subpara-
graph (A), the amount of such payment shall be 
reduced by any amount paid pursuant to the judgment 
described in clause (iii). 
(iii) 
JUDGMENT
DESCRIBED.—A 
judgment 
is 
described in this subparagraph if such judgment— 
(I) is made by a court of competent 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 producer 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 described in paragraph (1)(B)(iii) of 
this subsection, if— 
(A) an exporter establishes that such exporter 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 
Deadlines. 
Deadline. 
Deadlines. 
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122 STAT. 3828 
PUBLIC LAW 110–343—OCT. 3, 2008 
(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 enactment 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 exporter, 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 ‘‘settle-
ment with the Federal Government’’ shall not include any settle-
ment or stipulation entered into as of the date of the enactment 
of this Act, the terms of which contemplate a judgment concerning 
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— 
(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 contractual 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 arrange-
ment, 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 producer or seller of such coal and— 
(A) is indicated in the shipper’s export declaration 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— 
(A) is related to such coal producer through any degree 
of common management, stock ownership, or voting control, 
(B) is related (within the meaning of section 144(a)(3) 
of the Internal Revenue Code of 1986) to such coal producer, 
or 
(C) has a contract, fee arrangement, or any other agree-
ment 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 Secretary determines that the 
Deadline. 
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122 STAT. 3829 
PUBLIC LAW 110–343—OCT. 3, 2008 
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 section shall 
be paid by the Secretary with interest from the date of overpayment 
determined by using the overpayment rate and method under sec-
tion 6621 of the Internal Revenue Code of 1986. 
(g) DENIAL
OF DOUBLE BENEFIT.—The payment under sub-
section (a) with respect to any coal shall not exceed— 
(1) in the case of a payment to a coal producer, the amount 
of tax paid under section 4121 of the Internal 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 October 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 administrative proceeding con-
cerning 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 producers, this 
section shall not confer standing upon a coal producer to com-
mence, or intervene in, any judicial or administrative pro-
ceeding 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. TAX CREDIT FOR CARBON DIOXIDE SEQUESTRATION. 
(a) IN GENERAL.—Subpart D of part IV of subchapter A of 
chapter 1 (relating to business credits) is amended by adding at 
the end the following new section: 
‘‘SEC. 45Q. CREDIT FOR CARBON DIOXIDE SEQUESTRATION. 
‘‘(a) GENERAL RULE.—For purposes of section 38, the carbon 
dioxide sequestration credit for any taxable year is an amount 
equal to the sum of— 
‘‘(1) $20 per metric ton of qualified carbon dioxide which 
is— 
‘‘(A) captured by the taxpayer at a qualified facility, 
and 
‘‘(B) disposed of by the taxpayer in secure geological 
storage, and 
‘‘(2) $10 per metric ton of qualified carbon dioxide which 
is— 
‘‘(A) captured by the taxpayer at a qualified facility, 
and 
‘‘(B) used by the taxpayer as a tertiary injectant in 
a qualified enhanced oil or natural gas recovery project. 
‘‘(b) QUALIFIED CARBON DIOXIDE.—For purposes of this sec-
tion— 
‘‘(1) IN
GENERAL.—The term ‘qualified carbon dioxide’ 
means carbon dioxide captured from an industrial source 
which— 
Definition. 
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122 STAT. 3830 
PUBLIC LAW 110–343—OCT. 3, 2008 
‘‘(A) would otherwise be released into the atmosphere 
as industrial emission of greenhouse gas, and 
‘‘(B) is measured at the source of capture and verified 
at the point of disposal or injection. 
‘‘(2) RECYCLED
CARBON
DIOXIDE.—The term ‘qualified 
carbon dioxide’ includes the initial deposit of captured carbon 
dioxide used as a tertiary injectant. Such term does not include 
carbon dioxide that is re-captured, recycled, and re-injected 
as part of the enhanced oil and natural gas recovery process. 
‘‘(c) QUALIFIED FACILITY.—For purposes of this section, the term 
‘qualified facility’ means any industrial facility— 
‘‘(1) which is owned by the taxpayer, 
‘‘(2) at which carbon capture equipment is placed in service, 
and 
‘‘(3) which captures not less than 500,000 metric tons of 
carbon dioxide during the taxable year. 
‘‘(d) SPECIAL RULES AND OTHER DEFINITIONS.—For purposes 
of this section— 
‘‘(1) ONLY
CARBON
DIOXIDE
CAPTURED
AND
DISPOSED
OF 
OR USED WITHIN THE UNITED STATES TAKEN INTO ACCOUNT.— 
The credit under this section shall apply only with respect 
to qualified carbon dioxide the capture and disposal or use 
of which is within— 
‘‘(A) the United States (within the meaning of section 
638(1)), or 
‘‘(B) a possession of the United States (within the 
meaning of section 638(2)). 
‘‘(2) SECURE GEOLOGICAL STORAGE.—The Secretary, in con-
sultation with the Administrator of the Environmental Protec-
tion Agency, shall establish regulations for determining ade-
quate security measures for the geological storage of carbon 
dioxide under subsection (a)(1)(B) such that the carbon dioxide 
does not escape into the atmosphere. Such term shall include 
storage at deep saline formations and unminable coal seems 
under such conditions as the Secretary may determine under 
such regulations. 
‘‘(3) TERTIARY INJECTANT.—The term ‘tertiary injectant’ has 
the same meaning as when used within section 193(b)(1). 
‘‘(4) QUALIFIED ENHANCED OIL OR NATURAL GAS RECOVERY 
PROJECT.—The term ‘qualified enhanced oil or natural gas 
recovery project’ has the meaning given the term ‘qualified 
enhanced oil recovery project’ by section 43(c)(2), by substituting 
‘crude oil or natural gas’ for ‘crude oil’ in subparagraph (A)(i) 
thereof. 
‘‘(5) CREDIT ATTRIBUTABLE TO TAXPAYER.—Any credit under 
this section shall be attributable to the person that captures 
and physically or contractually ensures the disposal of or the 
use as a tertiary injectant of the qualified carbon dioxide, 
except to the extent provided in regulations prescribed by the 
Secretary. 
‘‘(6) RECAPTURE.—The Secretary shall, by regulations, pro-
vide for recapturing the benefit of any credit allowable under 
subsection (a) with respect to any qualified carbon dioxide 
which ceases to be captured, disposed of, or used as a tertiary 
injectant in a manner consistent with the requirements of 
this section. 
Regulations. 
Regulations. 
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122 STAT. 3831 
PUBLIC LAW 110–343—OCT. 3, 2008 
‘‘(7) INFLATION ADJUSTMENT.—In the case of any taxable 
year beginning in a calendar year after 2009, there shall be 
substituted for each dollar amount contained in subsection 
(a) an amount equal to the product of— 
‘‘(A) such dollar amount, multiplied by 
‘‘(B) the inflation adjustment factor for such calendar 
year determined under section 43(b)(3)(B) for such calendar 
year, determined by substituting ‘2008’ for ‘1990’. 
‘‘(e) APPLICATION OF SECTION.—The credit under this section 
shall apply with respect to qualified carbon dioxide before the 
end of the calendar year in which the Secretary, in consultation 
with the Administrator of the Environmental Protection Agency, 
certifies that 75,000,000 metric tons of qualified carbon dioxide 
have been captured and disposed of or used as a tertiary injectant.’’. 
(b) CONFORMING AMENDMENT.—Section 38(b) (relating to gen-
eral business credit) is amended by striking ‘‘plus’’ at the end 
of paragraph (32), by striking the period at the end of paragraph 
(33) and inserting ‘‘, plus’’, and by adding at the end of following 
new paragraph: 
‘‘(34) the carbon dioxide sequestration credit determined 
under section 45Q(a).’’. 
(c) CLERICAL AMENDMENT.—The table of sections for subpart 
B of part IV of subchapter A of chapter 1 (relating to other credits) 
is amended by adding at the end the following new section: 
‘‘Sec. 45Q. Credit for carbon dioxide sequestration.’’. 
(d) EFFECTIVE DATE.—The amendments made by this section 
shall apply to carbon dioxide captured after the date of the enact-
ment of this Act. 
SEC. 116. CERTAIN INCOME AND GAINS RELATING TO INDUSTRIAL 
SOURCE CARBON DIOXIDE TREATED AS QUALIFYING 
INCOME FOR PUBLICLY TRADED PARTNERSHIPS. 
(a) IN
GENERAL.—Subparagraph (E) of section 7704(d)(1) 
(defining qualifying income) is amended by inserting ‘‘or industrial 
source carbon dioxide’’ after ‘‘timber)’’. 
(b) EFFECTIVE DATE.—The amendment made by this section 
shall take effect on the date of the enactment of this Act, in 
taxable years ending after such date. 
SEC. 117. 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 Revenue 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 2009 and 2010. 
Contracts. 
26 USC 7704 
note. 
26 USC 38 note. 
26 USC 38. 
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122 STAT. 3832 
PUBLIC LAW 110–343—OCT. 3, 2008 
TITLE II—TRANSPORTATION AND DO-
MESTIC FUEL SECURITY PROVISIONS 
SEC. 201. INCLUSION OF CELLULOSIC BIOFUEL IN BONUS DEPRECIA-
TION 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 section 168 
is amended— 
(1) by striking ‘‘cellulosic biomass ethanol’’ each place it 
appears and inserting ‘‘cellulosic biofuel’’, 
(2) by striking ‘‘CELLULOSIC BIOMASS ETHANOL’’ 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. 
SEC. 202. CREDITS FOR BIODIESEL AND RENEWABLE DIESEL. 
(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 section 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 amended by striking 
paragraph (3) and by redesignating 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)’’. 
(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 BIO-
MASS.—Paragraph (3) of section 40A(f) is amended— 
(1) by striking ‘‘diesel fuel’’ and inserting ‘‘liquid fuel’’, 
(2) by striking ‘‘using a thermal depolymerization process’’, 
and 
Applicability. 
26 USC 168 note. 
26 USC 168. 
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122 STAT. 3833 
PUBLIC LAW 110–343—OCT. 3, 2008 
(3) by inserting ‘‘, or other equivalent standard approved 
by the Secretary’’ after ‘‘D396’’. 
(d) COPRODUCTION OF RENEWABLE DIESEL WITH PETROLEUM 
FEEDSTOCK.— 
(1) IN
GENERAL.—Paragraph (3) of section 40A(f) is 
amended by adding at the end the following new sentences: 
‘‘Such term does not include any fuel derived from coprocessing 
biomass with a feedstock which is not biomass. For purposes 
of this paragraph, the term ‘biomass’ has the meaning given 
such term by section 45K(c)(3).’’. 
(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.—Subsection (f) of 
section 40A (relating to renewable diesel) is amended by adding 
at the end the following new paragraph: 
‘‘(4) CERTAIN AVIATION FUEL.— 
‘‘(A) IN GENERAL.—Except as provided in the last 3 
sentences of paragraph (3), the term ‘renewable diesel’ 
shall include fuel derived from biomass which meets the 
requirements of a Department of Defense specification for 
military jet fuel or an American Society of Testing and 
Materials specification for aviation turbine fuel. 
‘‘(B) APPLICATION OF MIXTURE CREDITS.—In the case 
of fuel which is treated as renewable diesel solely by reason 
of subparagraph (A), subsection (b)(1) and section 6426(c) 
shall be applied with respect to such fuel by treating ker-
osene as though it were diesel fuel.’’. 
(f) MODIFICATION
RELATING
TO
DEFINITION
OF
AGRI-BIO-
DIESEL.—Paragraph (2) of section 40A(d) (relating to agri-biodiesel) 
is amended by striking ‘‘and mustard seeds’’ and inserting ‘‘mustard 
seeds, and camelina’’. 
(g) EFFECTIVE DATE.— 
(1) IN GENERAL.—Except as otherwise provided in this sub-
section, the amendments made by this section shall apply to 
fuel produced, and sold or used, after December 31, 2008. 
(2) COPRODUCTION OF RENEWABLE DIESEL WITH PETROLEUM 
FEEDSTOCK.—The amendment made by subsection (d) shall 
apply to fuel produced, and sold or used, after the date of 
the enactment of this Act. 
SEC. 203. CLARIFICATION THAT CREDITS FOR FUEL ARE DESIGNED 
TO PROVIDE AN INCENTIVE FOR UNITED STATES PRODUC-
TION. 
(a) ALCOHOL FUELS CREDIT.—Subsection (d) of section 40 is 
amended by adding at the end the following new paragraph: 
‘‘(7) LIMITATION
TO
ALCOHOL
WITH
CONNECTION
TO
THE 
UNITED STATES.—No credit shall be determined under this sec-
tion 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 section 40A 
is amended by adding at the end the following new paragraph: 
‘‘(5) LIMITATION TO BIODIESEL WITH CONNECTION TO THE 
UNITED STATES.—No credit shall be determined under this sec-
tion with respect to any biodiesel which is produced outside 
the United States for use as a fuel outside the United States. 
Applicability. 
26 USC 40A note. 
Definition. 
26 USC 40A. 
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122 STAT. 3834 
PUBLIC LAW 110–343—OCT. 3, 2008 
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: 
‘‘(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 respect to any biodiesel 
or alternative fuel which is produced outside the United States 
for use as a fuel outside the United States. 
For purposes of this subsection, the term ‘United States’ includes 
any possession of the United States.’’. 
(2) CONFORMING
AMENDMENT.—Subsection (e) of section 
6427 is amended by redesignating paragraph (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 payable 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).’’. 
(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. 204. EXTENSION AND MODIFICATION OF ALTERNATIVE FUEL 
CREDIT. 
(a) EXTENSION.— 
(1) ALTERNATIVE FUEL CREDIT.—Paragraph (4) of section 
6426(d) (relating to alternative fuel credit) is amended by 
striking ‘‘September 30, 2009’’ and inserting ‘‘December 31, 
2009’’. 
(2) ALTERNATIVE FUEL MIXTURE CREDIT.—Paragraph (3) of 
section 6426(e) (relating to alternative fuel mixture credit) is 
amended by striking ‘‘September 30, 2009’’ and inserting 
‘‘December 31, 2009’’. 
(3) PAYMENTS.—Subparagraph (C) of section 6427(e)(5) 
(relating to termination) is amended by striking ‘‘September 
30, 2009’’ and inserting ‘‘December 31, 2009’’. 
(b) MODIFICATIONS.— 
(1) ALTERNATIVE
FUEL
TO
INCLUDE
COMPRESSED
OR 
LIQUIFIED
BIOMASS
GAS.—Paragraph (2) of section 6426(d) 
(relating to alternative fuel credit) is amended by striking ‘‘and’’ 
at the end of subparagraph (E), by redesignating subparagraph 
(F) as subparagraph (G), and by inserting after subparagraph 
(E) the following new subparagraph: 
‘‘(F) compressed or liquefied gas derived from biomass 
(as defined in section 45K(c)(3)), and’’. 
(2) CREDIT ALLOWED FOR AVIATION USE OF FUEL.—Para-
graph (1) of section 6426(d) is amended by inserting ‘‘sold 
by the taxpayer for use as a fuel in aviation,’’ after ‘‘motorboat,’’. 
(c) CARBON CAPTURE REQUIREMENT FOR CERTAIN FUELS.— 
Applicability. 
26 USC 40 note. 
26 USC 6426. 
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122 STAT. 3835 
PUBLIC LAW 110–343—OCT. 3, 2008 
(1) IN
GENERAL.—Subsection (d) of section 6426, as 
amended by subsection (a), is amended by redesignating para-
graph (4) as paragraph (5) and by inserting after paragraph 
(3) the following new paragraph: 
‘‘(4) CARBON CAPTURE REQUIREMENT.— 
‘‘(A) IN GENERAL.—The requirements of this paragraph 
are met if the fuel is certified, under such procedures 
as required by the Secretary, as having been derived from 
coal produced at a gasification facility which separates 
and sequesters not less than the applicable percentage 
of such facility’s total carbon dioxide emissions. 
‘‘(B) 
APPLICABLE
PERCENTAGE.—For 
purposes 
of 
subparagraph (A), the applicable percentage is— 
‘‘(i) 50 percent in the case of fuel produced after 
September 30, 2009, and on or before December 30, 
2009, and 
‘‘(ii) 75 percent in the case of fuel produced after 
December 30, 2009.’’. 
(2) CONFORMING AMENDMENT.—Subparagraph (E) of section 
6426(d)(2) is amended by inserting ‘‘which meets the require-
ments of paragraph (4) and which is’’ after ‘‘any liquid fuel’’. 
(d) EFFECTIVE DATE.—The amendments made by this section 
shall apply to fuel sold or used after the date of the enactment 
of this Act. 
SEC. 205. CREDIT FOR NEW QUALIFIED PLUG-IN ELECTRIC DRIVE 
MOTOR VEHICLES. 
(a) PLUG-IN ELECTRIC DRIVE MOTOR VEHICLE CREDIT.—Subpart 
B of part IV of subchapter A of chapter 1 (relating to other credits) 
is amended by adding at the end the following new section: 
‘‘SEC. 30D. NEW QUALIFIED PLUG-IN ELECTRIC DRIVE MOTOR 
VEHICLES. 
‘‘(a) ALLOWANCE OF CREDIT.— 
‘‘(1) IN GENERAL.—There shall be allowed as a credit against 
the tax imposed by this chapter for the taxable year an amount 
equal to the applicable amount with respect to each new quali-
fied plug-in electric drive motor vehicle placed in service by 
the taxpayer during the taxable year. 
‘‘(2) APPLICABLE AMOUNT.—For purposes of paragraph (1), 
the applicable amount is sum of— 
‘‘(A) $2,500, plus 
‘‘(B) $417 for each kilowatt hour of traction battery 
capacity in excess of 4 kilowatt hours. 
‘‘(b) LIMITATIONS.— 
‘‘(1) LIMITATION BASED ON WEIGHT.—The amount of the 
credit allowed under subsection (a) by reason of subsection 
(a)(2) shall not exceed— 
‘‘(A) $7,500, in the case of any new qualified plug- 
in electric drive motor vehicle with a gross vehicle weight 
rating of not more than 10,000 pounds, 
‘‘(B) $10,000, in the case of any new qualified plug- 
in electric drive motor vehicle with a gross vehicle weight 
rating of more than 10,000 pounds but not more than 
14,000 pounds, 
‘‘(C) $12,500, in the case of any new qualified plug- 
in electric drive motor vehicle with a gross vehicle weight 
26 USC 6426 
note. 
26 USC 6426. 
Certification. 
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122 STAT. 3836 
PUBLIC LAW 110–343—OCT. 3, 2008 
rating of more than 14,000 pounds but not more than 
26,000 pounds, and 
‘‘(D) $15,000, in the case of any new qualified plug- 
in electric drive motor vehicle with a gross vehicle weight 
rating of more than 26,000 pounds. 
‘‘(2) LIMITATION ON NUMBER OF PASSENGER VEHICLES AND 
LIGHT TRUCKS ELIGIBLE FOR CREDIT.— 
‘‘(A) IN GENERAL.—In the case of a new qualified plug- 
in electric drive motor vehicle sold during the phaseout 
period, only the applicable percentage of the credit other-
wise allowable under subsection (a) shall be allowed. 
‘‘(B) PHASEOUT
PERIOD.—For purposes of this sub-
section, the phaseout period is the period beginning with 
the second calendar quarter following the calendar quarter 
which includes the first date on which the total number 
of such new qualified plug-in electric drive motor vehicles 
sold for use in the United States after December 31, 2008, 
is at least 250,000. 
‘‘(C) 
APPLICABLE
PERCENTAGE.—For 
purposes 
of 
subparagraph (A), the applicable percentage is— 
‘‘(i) 50 percent for the first 2 calendar quarters 
of the phaseout period, 
‘‘(ii) 25 percent for the 3d and 4th calendar quar-
ters of the phaseout period, and 
‘‘(iii) 0 percent for each calendar quarter thereafter. 
‘‘(D) CONTROLLED GROUPS.—Rules similar to the rules 
of section 30B(f)(4) shall apply for purposes of this sub-
section. 
‘‘(c) 
NEW
QUALIFIED
PLUG-IN
ELECTRIC
DRIVE
MOTOR 
VEHICLE.—For purposes of this section, the term ‘new qualified 
plug-in electric drive motor vehicle’ means a motor vehicle— 
‘‘(1) which draws propulsion using a traction battery with 
at least 4 kilowatt hours of capacity, 
‘‘(2) which uses an offboard source of energy to recharge 
such battery, 
‘‘(3) which, in the case of a passenger vehicle or light 
truck which has a gross vehicle weight rating of not more 
than 8,500 pounds, has received a certificate of conformity 
under the Clean Air Act and meets or exceeds the equivalent 
qualifying California low emission vehicle standard under sec-
tion 243(e)(2) of the Clean Air Act for that make and model 
year, and 
‘‘(A) in the case of a vehicle having a gross vehicle 
weight rating of 6,000 pounds or less, the Bin 5 Tier 
II emission standard established in regulations prescribed 
by the Administrator of the Environmental Protection 
Agency under section 202(i) of the Clean Air Act for that 
make and model year vehicle, and 
‘‘(B) in the case of a vehicle having a gross vehicle 
weight rating of more than 6,000 pounds but not more 
than 8,500 pounds, the Bin 8 Tier II emission standard 
which is so established, 
‘‘(4) the original use of which commences with the taxpayer, 
‘‘(5) which is acquired for use or lease by the taxpayer 
and not for resale, and 
‘‘(6) which is made by a manufacturer. 
‘‘(d) APPLICATION WITH OTHER CREDITS.— 
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122 STAT. 3837 
PUBLIC LAW 110–343—OCT. 3, 2008 
‘‘(1) BUSINESS CREDIT TREATED AS PART OF GENERAL BUSI-
NESS CREDIT.—So much of the credit which would be allowed 
under subsection (a) for any taxable year (determined without 
regard to this subsection) that is attributable to property of 
a character subject to an allowance for depreciation shall be 
treated 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 (deter-
mined after application of paragraph (1)) shall be treated 
as a credit allowable under subpart A for such taxable 
year. 
‘‘(B) 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 any tax-
able year (determined 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. 
‘‘(e) OTHER DEFINITIONS AND SPECIAL RULES.—For purposes 
of this section— 
‘‘(1) MOTOR VEHICLE.—The term ‘motor vehicle’ has the 
meaning given such term by section 30(c)(2). 
‘‘(2) OTHER
TERMS.—The terms ‘passenger automobile’, 
‘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 adminis-
tration of title II of the Clean Air Act (42 U.S.C. 7521 et 
seq.). 
‘‘(3) 
TRACTION
BATTERY
CAPACITY.—Traction 
battery 
capacity shall be measured in kilowatt hours from a 100 percent 
state of charge to a zero percent state of charge. 
‘‘(4) REDUCTION IN BASIS.—For purposes of this subtitle, 
the basis of any property for which a credit is allowable under 
subsection (a) shall be reduced by the amount of such credit 
so allowed. 
‘‘(5) NO DOUBLE BENEFIT.—The amount of any deduction 
or other credit allowable under this chapter for a new qualified 
plug-in electric drive motor vehicle shall be reduced by the 
amount of credit allowed under subsection (a) for such vehicle 
for the taxable year. 
‘‘(6) PROPERTY USED BY TAX-EXEMPT ENTITY.—In the case 
of a vehicle the use of which is described in paragraph (3) 
or (4) of section 50(b) and which is not subject to a lease, 
the person who sold such vehicle to the person or entity using 
such vehicle shall be treated as the taxpayer that placed such 
vehicle in service, but only if such person clearly discloses 
to such person or entity in a document the amount of any 
credit allowable under subsection (a) with respect to such 
vehicle (determined without regard to subsection (b)(2)). 
‘‘(7) PROPERTY
USED
OUTSIDE
UNITED
STATES, ETC., NOT 
QUALIFIED.—No credit shall be allowable under subsection (a) 
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122 STAT. 3838 
PUBLIC LAW 110–343—OCT. 3, 2008 
with respect to any property referred to in section 50(b)(1) 
or with respect to the portion of the cost of any property 
taken into account under section 179. 
‘‘(8) RECAPTURE.—The Secretary shall, by regulations, pro-
vide 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 (including recapture in the 
case of a lease period of less than the economic life of a 
vehicle). 
‘‘(9) ELECTION TO NOT TAKE CREDIT.—No credit shall be 
allowed under subsection (a) for any vehicle if the taxpayer 
elects not to have this section apply to such vehicle. 
‘‘(10) INTERACTION WITH AIR QUALITY AND MOTOR VEHICLE 
SAFETY STANDARDS.—Unless otherwise provided in this section, 
a motor vehicle shall not be considered eligible for a credit 
under this section unless such vehicle is in compliance with— 
‘‘(A) the applicable provisions of the Clean Air Act 
for the applicable make and model year of the vehicle 
(or applicable air quality provisions of State law in the 
case of a State which has adopted such provision under 
a waiver under section 209(b) of the Clean Air Act), and 
‘‘(B) the motor vehicle safety provisions of sections 
30101 through 30169 of title 49, United States Code. 
‘‘(f) REGULATIONS.— 
‘‘(1) IN GENERAL.—Except as provided in paragraph (2), 
the Secretary shall promulgate such regulations as necessary 
to carry out the provisions of this section. 
‘‘(2) COORDINATION IN PRESCRIPTION OF CERTAIN REGULA-
TIONS.—The Secretary of the Treasury, in coordination with 
the Secretary of Transportation and the Administrator of the 
Environmental Protection Agency, shall prescribe such regula-
tions as necessary to determine whether a motor vehicle meets 
the requirements to be eligible for a credit under this section. 
‘‘(g) TERMINATION.—This section shall not apply to property 
purchased after December 31, 2014.’’. 
(b) 
COORDINATION
WITH
ALTERNATIVE
MOTOR
VEHICLE 
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 allowable under section 
30D (determined without regard to subsection (d) thereof) 
shall not be taken into account under this section.’’. 
(c) CREDIT MADE PART OF GENERAL BUSINESS CREDIT.—Section 
38(b), as amended by this Act, is amended by striking ‘‘plus’’ at 
the end of paragraph (33), by striking the period at the end of 
paragraph (34) and inserting ‘‘plus’’, and by adding at the end 
the following new paragraph: 
‘‘(35) the portion of the new qualified plug-in electric drive 
motor vehicle credit to which section 30D(d)(1) applies.’’. 
(d) CONFORMING AMENDMENTS.— 
(1)(A) Section 24(b)(3)(B), as amended by section 106, is 
amended by striking ‘‘and 25D’’ and inserting ‘‘25D, and 30D’’. 
(B) Section 25(e)(1)(C)(ii) is amended by inserting ‘‘30D,’’ 
after ‘‘25D,’’. 
(C) Section 25B(g)(2), as amended by section 106, is 
amended by striking ‘‘and 25D’’ and inserting ‘‘, 25D, and 
30D’’. 
26 USC 30B. 
Regulations. 
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122 STAT. 3839 
PUBLIC LAW 110–343—OCT. 3, 2008 
(D) Section 26(a)(1), as amended by section 106, 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(e)(4).’’. 
(3) Section 6501(m) is amended by inserting ‘‘30D(e)(9),’’ 
after ‘‘30C(e)(5),’’. 
(4) The table of sections for subpart B of part IV of sub-
chapter 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) EFFECTIVE DATE.—The amendments made by this section 
shall apply to taxable years beginning after December 31, 2008. 
(f) APPLICATION OF EGTRRA SUNSET.—The amendment 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. 206. EXCLUSION FROM HEAVY TRUCK TAX FOR IDLING REDUC-
TION UNITS AND ADVANCED INSULATION. 
(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 operation of the main drive engine 
while the vehicle is temporarily parked or remains sta-
tionary using one or more devices affixed to a tractor, 
and 
‘‘(B) is determined by the Administrator of the Environ-
mental Protection Agency, in consultation with the Sec-
retary of Energy and the Secretary of Transportation, to 
reduce idling of such vehicle at a motor vehicle rest stop 
or other location 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. 207. ALTERNATIVE FUEL VEHICLE REFUELING PROPERTY 
CREDIT. 
(a) EXTENSION OF CREDIT.—Paragraph (2) of section 30C(g) 
is amended by striking ‘‘December 31, 2009’’ and inserting 
‘‘December 31, 2010’’. 
(b) INCLUSION OF ELECTRICITY AS A CLEAN-BURNING FUEL.— 
Section 30C(c)(2) is amended by adding at the end the following 
new subparagraph: 
‘‘(C) Electricity.’’. 
Applicability. 
26 USC 4053 
note. 
26 USC 24 note. 
Applicability. 
26 USC 24 note. 
26 USC 1400C. 
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122 STAT. 3840 
PUBLIC LAW 110–343—OCT. 3, 2008 
(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. 
SEC. 208. CERTAIN INCOME AND GAINS RELATING TO ALCOHOL FUELS 
AND MIXTURES, BIODIESEL FUELS AND MIXTURES, AND 
ALTERNATIVE FUELS AND MIXTURES TREATED AS QUALI-
FYING INCOME FOR PUBLICLY TRADED PARTNERSHIPS. 
(a) IN GENERAL.—Subparagraph (E) of section 7704(d)(1), as 
amended by this Act, is amended by striking ‘‘or industrial source 
carbon dioxide’’ and inserting ‘‘, industrial source carbon dioxide, 
or the transportation or storage of any fuel described in subsection 
(b), (c), (d), or (e) of section 6426, or any alcohol fuel defined 
in section 6426(b)(4)(A) or any biodiesel fuel as defined in section 
40A(d)(1)’’ after ‘‘timber)’’. 
(b) EFFECTIVE DATE.—The amendment made by this section 
shall take effect on the date of the enactment of this Act, in 
taxable years ending after such date. 
SEC. 209. EXTENSION AND MODIFICATION OF ELECTION TO EXPENSE 
CERTAIN REFINERIES. 
(a) EXTENSION.—Paragraph (1) of section 179C(c) (relating to 
qualified refinery property) is amended— 
(1) by striking ‘‘January 1, 2012’’ in subparagraph (B) 
and inserting ‘‘January 1, 2014’’, and 
(2) by striking ‘‘January 1, 2008’’ each place it appears 
in subparagraph (F) and inserting ‘‘January 1, 2010’’. 
(b) INCLUSION OF FUEL DERIVED FROM SHALE AND TAR SANDS.— 
(1) IN GENERAL.—Subsection (d) of section 179C is amended 
by inserting ‘‘, or directly from shale or tar sands’’ after ‘‘(as 
defined in section 45K(c))’’. 
(2) CONFORMING
AMENDMENT.—Paragraph (2) of section 
179C(e) is amended by inserting ‘‘shale, tar sands, or’’ before 
‘‘qualified fuels’’. 
(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. 
SEC. 210. EXTENSION OF SUSPENSION OF TAXABLE INCOME LIMIT 
ON PERCENTAGE DEPLETION FOR OIL AND NATURAL GAS 
PRODUCED FROM MARGINAL PROPERTIES. 
Subparagraph (H) of section 613A(c)(6) (relating to oil and 
gas produced from marginal properties) is amended by striking 
‘‘for any taxable year’’ and all that follows and inserting ‘‘for any 
taxable year— 
‘‘(i) beginning after December 31, 1997, and before 
January 1, 2008, or 
‘‘(ii) beginning after December 31, 2008, and before 
January 1, 2010.’’. 
SEC. 211. TRANSPORTATION FRINGE BENEFIT TO BICYCLE COM-
MUTERS. 
(a) IN GENERAL.—Paragraph (1) of section 132(f) is amended 
by adding at the end the following: 
‘‘(D) Any qualified bicycle commuting reimbursement.’’. 
(b) LIMITATION ON EXCLUSION.—Paragraph (2) of section 132(f) 
is amended by striking ‘‘and’’ at the end of subparagraph (A), 
Applicability. 
26 USC 179C 
note. 
26 USC 7704 
note. 
26 USC 7704. 
Applicability. 
26 USC 30C note. 
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122 STAT. 3841 
PUBLIC LAW 110–343—OCT. 3, 2008 
by striking the period at the end of subparagraph (B) and inserting 
‘‘, and’’, and by adding at the end the following new subparagraph: 
‘‘(C) the applicable annual limitation in the case of 
any qualified bicycle commuting reimbursement.’’. 
(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
REIMBURSE-
MENT.—The 
term 
‘qualified 
bicycle 
commuting 
reimbursement’ means, with respect to any calendar 
year, any employer reimbursement during the 15- 
month period beginning with the first day of such 
calendar year for reasonable expenses incurred by the 
employee during such calendar year for the purchase 
of a bicycle and bicycle improvements, repair, and stor-
age, if such bicycle is regularly used for travel between 
the employee’s residence and place of employment. 
‘‘(ii) APPLICABLE ANNUAL LIMITATION.—The term 
‘applicable annual limitation’ means, with respect to 
any employee for any calendar year, the product of 
$20 multiplied by the number of qualified bicycle com-
muting months during such year. 
‘‘(iii) QUALIFIED BICYCLE COMMUTING MONTH.—The 
term ‘qualified bicycle commuting 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 between the employee’s resi-
dence 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.—Paragraph (4) of sec-
tion 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 December 31, 2008. 
TITLE III—ENERGY CONSERVATION 
AND EFFICIENCY PROVISIONS 
SEC. 301. QUALIFIED ENERGY CONSERVATION BONDS. 
(a) IN GENERAL.—Subpart I of part IV of subchapter A of 
chapter 1, as amended by section 107, is amended by adding at 
the end the following new section: 
‘‘SEC. 54D. QUALIFIED ENERGY CONSERVATION BONDS. 
‘‘(a) QUALIFIED ENERGY CONSERVATION BOND.—For purposes 
of this subchapter, the term ‘qualified energy conservation 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, 
‘‘(2) the bond is issued by a State or local government, 
and 
Applicability. 
26 USC 132 note. 
26 USC 132. 
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122 STAT. 3842 
PUBLIC LAW 110–343—OCT. 3, 2008 
‘‘(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 qualified energy conserva-
tion bond shall be 70 percent of the amount so determined without 
regard to this subsection. 
‘‘(c) LIMITATION ON AMOUNT OF BONDS DESIGNATED.—The max-
imum 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
DES-
IGNATED.—There is a national qualified energy conservation bond 
limitation of $800,000,000. 
‘‘(e) ALLOCATIONS.— 
‘‘(1) IN
GENERAL.—The limitation applicable under sub-
section (d) shall be allocated by the Secretary among the States 
in proportion to the population of the States. 
‘‘(2) ALLOCATIONS TO LARGEST LOCAL GOVERNMENTS.— 
‘‘(A) IN GENERAL.—In the case of any State in which 
there is a large local government, each such local govern-
ment shall be allocated a portion of such State’s allocation 
which bears the same ratio to the State’s allocation (deter-
mined without regard to this subparagraph) as the popu-
lation of such large local government bears to the popu-
lation of such State. 
‘‘(B) ALLOCATION OF UNUSED LIMITATION TO STATE.— 
The amount allocated under this subsection to a large 
local government may be reallocated by such local govern-
ment to the State in which such local government is located. 
‘‘(C) LARGE LOCAL GOVERNMENT.—For purposes of this 
section, the term ‘large local government’ 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 designate bonds which are not private activity bonds. 
‘‘(f) QUALIFIED CONSERVATION PURPOSE.—For purposes of this 
section— 
‘‘(1) IN GENERAL.—The term ‘qualified conservation purpose’ 
means any of the following: 
‘‘(A) Capital expenditures incurred for purposes of— 
‘‘(i) reducing energy consumption in publicly-owned 
buildings by at least 20 percent, 
‘‘(ii) implementing green community programs, 
‘‘(iii) rural development involving the production 
of electricity from renewable energy resources, or 
‘‘(iv) any qualified facility (as determined 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 research in— 
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122 STAT. 3843 
PUBLIC LAW 110–343—OCT. 3, 2008 
‘‘(i) development of cellulosic ethanol or other non-
fossil fuels, 
‘‘(ii) technologies for the capture and sequestration 
of carbon dioxide produced through the use of fossil 
fuels, 
‘‘(iii) increasing the efficiency of existing tech-
nologies 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 expendi-
tures to reduce pollution from vehicles used for mass com-
muting. 
‘‘(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 otherwise, 
‘‘(iii) advanced battery manufacturing technologies, 
‘‘(iv) technologies to reduce peak use of electricity, 
or 
‘‘(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 promote energy 
efficiency. 
‘‘(2) SPECIAL RULES FOR PRIVATE ACTIVITY BONDS.—For pur-
poses of this section, in the case of any private activity bond, 
the term ‘qualified conservation 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 enactment of this section. 
‘‘(2) SPECIAL
RULE
FOR
COUNTIES.—In determining the 
population of any county for purposes of this section, any popu-
lation of such county which is taken into account in determining 
the population of any municipality which is a large local govern-
ment shall not be taken into account in determining the popu-
lation of such county. 
‘‘(h) APPLICATION TO INDIAN TRIBAL GOVERNMENTS.—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 treated for pur-
poses 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 government shall 
be treated as a qualified energy conservation bond only if 
issued as part of an issue the available project proceeds of 
which are used for purposes for which such Indian tribal 
government could issue bonds to which section 103(a) applies.’’. 
(b) CONFORMING AMENDMENTS.— 
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122 STAT. 3844 
PUBLIC LAW 110–343—OCT. 3, 2008 
(1) Paragraph (1) of section 54A(d), as amended by this 
Act, is amended to read as follows: 
‘‘(1) QUALIFIED TAX CREDIT BOND.—The term ‘qualified tax 
credit bond’ means— 
‘‘(A) a qualified forestry conservation bond, 
‘‘(B) a new clean renewable energy bond, or 
‘‘(C) 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 amended by 
this Act, is amended to read as follows: 
‘‘(C) QUALIFIED PURPOSE.—For purposes of this para-
graph, the term ‘qualified purpose’ means— 
‘‘(i) in the case of a qualified forestry conservation 
bond, a purpose specified in section 54B(e), 
‘‘(ii) in the case of a new clean renewable energy 
bond, a purpose specified in section 54C(a)(1), and 
‘‘(iii) in the case of a qualified energy conservation 
bond, a purpose specified in section 54D(a)(1).’’. 
(3) The table of sections for subpart I of part IV of sub-
chapter A of chapter 1, as amended by this Act, is amended 
by adding at the end the following new item: 
‘‘Sec. 54D. 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. 302. CREDIT FOR NONBUSINESS ENERGY PROPERTY. 
(a) EXTENSION
OF CREDIT.—Section 25C(g) is amended by 
striking ‘‘placed in service after December 31, 2007’’ and inserting 
‘‘placed in service— 
‘‘(1) after December 31, 2007, and before January 1, 2009, 
or 
‘‘(2) after December 31, 2009.’’. 
(b) QUALIFIED BIOMASS FUEL PROPERTY.— 
(1) IN GENERAL.—Section 25C(d)(3) is amended— 
(A) by striking ‘‘and’’ at the end of subparagraph (D), 
(B) by striking the period at the end of subparagraph 
(E) and inserting ‘‘, and’’, and 
(C) by adding at the end the following new subpara-
graph: 
‘‘(F) a stove which uses the burning of biomass 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 
efficiency 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 renewable or recurring basis, 
including agricultural crops and trees, wood and wood waste 
and residues (including wood pellets), plants (including aquatic 
plants), grasses, residues, and fibers.’’. 
(c) MODIFICATION OF WATER HEATER REQUIREMENTS.—Section 
25C(d)(3)(E) is amended by inserting ‘‘or a thermal efficiency of 
at least 90 percent’’ after ‘‘0.80’’. 
Applicability. 
26 USC 54A note. 
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122 STAT. 3845 
PUBLIC LAW 110–343—OCT. 3, 2008 
(d) COORDINATION WITH CREDIT FOR QUALIFIED GEOTHERMAL 
HEAT PUMP PROPERTY EXPENDITURES.— 
(1) IN
GENERAL.—Paragraph (3) of section 25C(d), as 
amended by subsections (b) and (c), is amended by striking 
subparagraph (C) and by redesignating subparagraphs (D), (E), 
and (F) as subparagraphs (C), (D), and (E), respectively. 
(2) CONFORMING AMENDMENT.—Subparagraph (C) of section 
25C(d)(2) is amended to read as follows: 
‘‘(C) REQUIREMENTS AND STANDARDS FOR AIR CONDI-
TIONERS AND HEAT PUMPS.—The standards and require-
ments 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 Refrigeration Institute that are 
prepared in partnership with the Consortium for 
Energy Efficiency.’’. 
(e) MODIFICATION OF QUALIFIED ENERGY EFFICIENCY IMPROVE-
MENTS.— 
(1) IN
GENERAL.—Paragraph (1) of section 25C(c) is 
amended by inserting ‘‘, or an asphalt roof with appropriate 
cooling granules,’’ before ‘‘which meet the Energy Star program 
requirements’’. 
(2) BUILDING
ENVELOPE
COMPONENT.—Subparagraph (D) 
of section 25C(c)(2) is amended— 
(A) by inserting ‘‘or asphalt roof’’ after ‘‘metal roof’’, 
and 
(B) by inserting ‘‘or cooling granules’’ after ‘‘pigmented 
coatings’’. 
(f) EFFECTIVE DATES.— 
(1) IN GENERAL.—Except as provided in paragraph (2), the 
amendments made this section shall apply to expenditures 
made after December 31, 2008. 
(2) MODIFICATION
OF
QUALIFIED
ENERGY
EFFICIENCY 
IMPROVEMENTS.—The amendments made by subsection (e) shall 
apply to property placed in service after the date of the enact-
ment of this Act. 
SEC. 303. ENERGY EFFICIENT COMMERCIAL BUILDINGS DEDUCTION. 
Subsection (h) of section 179D is amended by striking 
‘‘December 31, 2008’’ and inserting ‘‘December 31, 2013’’. 
SEC. 304. NEW ENERGY EFFICIENT HOME CREDIT. 
Subsection (g) of section 45L (relating to termination) is 
amended by striking ‘‘December 31, 2008’’ and inserting ‘‘December 
31, 2009’’. 
SEC. 305. MODIFICATIONS OF ENERGY EFFICIENT APPLIANCE 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 subsection (a)— 
‘‘(1) DISHWASHERS.—The applicable amount is— 
‘‘(A) $45 in the case of a dishwasher which is manufac-
tured in calendar year 2008 or 2009 and which uses no 
Applicability. 
26 USC 25C note. 
26 USC 25C. 
Public 
information. 
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122 STAT. 3846 
PUBLIC LAW 110–343—OCT. 3, 2008 
more than 324 kilowatt hours per year and 5.8 gallons 
per cycle, and 
‘‘(B) $75 in the case of a dishwasher which is manufac-
tured 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 gallons per cycle for dishwashers 
designed for greater 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 modified energy factor and does not 
exceed a 8.0 water consumption factor, 
‘‘(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 calendar 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 calendar 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 manufac-
tured in calendar year 2008, and consumes 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 manufac-
tured in calendar year 2008 or 2009, and consumes at 
least 23 percent but no more than 24.9 percent less kilowatt 
hours per year than the 2001 energy conservation stand-
ards, 
‘‘(C) $100 in the case of a refrigerator which is manu-
factured in calendar year 2008, 2009, or 2010, and con-
sumes 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 manufactured 
in calendar year 2008, 2009, or 2010 and which consumes 
at least 30 percent less energy than the 2001 energy con-
servation standards.’’. 
(b) ELIGIBLE PRODUCTION.— 
(1) SIMILAR TREATMENT FOR ALL APPLIANCES.—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, and by moving such 
paragraphs 2 ems to the left. 
(2) MODIFICATION OF BASE PERIOD.—Paragraph (2) of sec-
tion 45M(c), as amended by paragraph (1), is amended by 
striking ‘‘3-calendar year’’ and inserting ‘‘2-calendar year’’. 
26 USC 45M. 
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122 STAT. 3847 
PUBLIC LAW 110–343—OCT. 3, 2008 
(c) TYPES OF ENERGY EFFICIENT APPLIANCES.—Subsection (d) 
of section 45M is amended to read as follows: 
‘‘(d) TYPES OF ENERGY EFFICIENT APPLIANCE.—For purposes 
of this section, the types of energy efficient appliances 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 section 45M(e) 
is amended to read as follows: 
‘‘(1) AGGREGATE CREDIT AMOUNT ALLOWED.—The aggregate 
amount of credit allowed under subsection (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 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 REFRIGERATORS AND 
CLOTHES
WASHERS.—Refrigerators described 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) is 
amended to read as follows: 
‘‘(1) QUALIFIED ENERGY EFFICIENT APPLIANCE.—The term 
‘qualified energy efficient appliance’ means— 
‘‘(A) any dishwasher described in subsection (b)(1), 
‘‘(B) any clothes washer described in subsection (b)(2), 
and 
‘‘(C) any refrigerator described in subsection (b)(3).’’. 
(2) CLOTHES WASHER.—Section 45M(f)(3) is amended by 
inserting ‘‘commercial’’ before ‘‘residential’’ the second place 
it appears. 
(3) TOP-LOADING CLOTHES WASHER.—Subsection (f) of sec-
tion 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 para-
graph: 
‘‘(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: 
‘‘(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. 
26 USC 45M. 
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122 STAT. 3848 
PUBLIC LAW 110–343—OCT. 3, 2008 
‘‘(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. 306. ACCELERATED RECOVERY PERIOD FOR DEPRECIATION 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 inserting at 
the end the following new paragraph: 
‘‘(18) QUALIFIED SMART ELECTRIC METERS.— 
‘‘(A) IN GENERAL.—The term ‘qualified smart electric 
meter’ means any smart electric meter which— 
‘‘(i) is placed in service by a taxpayer who is a 
supplier of electric energy or a provider of electric 
energy services, and 
‘‘(ii) does not have a class life (determined without 
regard to subsection (e)) of less than 10 years. 
‘‘(B) SMART ELECTRIC METER.—For purposes of subpara-
graph (A), the term ‘smart electric meter’ means any time- 
based meter and related 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 information 
between supplier or provider and the customer’s elec-
tric 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. 
‘‘(19) QUALIFIED SMART ELECTRIC GRID SYSTEMS.— 
‘‘(A) IN GENERAL.—The term ‘qualified smart electric 
grid system’ means any smart grid property which— 
‘‘(i) is used as part of a system for electric distribu-
tion grid communications, monitoring, and manage-
ment placed in service by a taxpayer who is a supplier 
of electric energy or a provider of electric energy serv-
ices, and 
‘‘(ii) does not have a class life (determined without 
regard to subsection (e)) of less than 10 years. 
‘‘(B) SMART
GRID
PROPERTY.—For the purposes of 
subparagraph (A), the term ‘smart grid property’ means 
electronics and related equipment that is capable of— 
‘‘(i) sensing, collecting, and monitoring data of or 
from all portions of a utility’s electric distribution grid, 
Applicability. 
26 USC 45M 
note. 
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122 STAT. 3849 
PUBLIC LAW 110–343—OCT. 3, 2008 
‘‘(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.’’. 
(c) CONTINUED APPLICATION OF 150 PERCENT DECLINING BAL-
ANCE METHOD.—Paragraph (2) of section 168(b) is amended by 
striking ‘‘or’’ at the end of subparagraph (B), by redesignating 
subparagraph (C) as subparagraph (D), and by inserting after 
subparagraph (B) the following new subparagraph: 
‘‘(C) any property (other than property described 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. 307. 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 ‘‘October 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 amended by striking 
‘‘issuance,’’ and inserting ‘‘issuance of the last issue with respect 
to such project,’’. 
SEC. 308. SPECIAL DEPRECIATION ALLOWANCE FOR CERTAIN REUSE 
AND RECYCLING PROPERTY. 
(a) IN GENERAL.—Section 168 is amended by adding at the 
end the following new subsection: 
‘‘(m) SPECIAL ALLOWANCE FOR CERTAIN REUSE AND RECYCLING 
PROPERTY.— 
‘‘(1) IN GENERAL.—In the case of any qualified reuse and 
recycling property— 
‘‘(A) the depreciation deduction provided by section 
167(a) for the taxable year in which such property is placed 
in service shall include an allowance equal to 50 percent 
of the adjusted basis of the qualified reuse and recycling 
property, and 
‘‘(B) the adjusted basis of the qualified reuse and 
recycling property shall be reduced by the amount of such 
deduction before computing the amount otherwise allow-
able as a depreciation deduction under this chapter for 
such taxable year and any subsequent taxable year. 
‘‘(2) QUALIFIED REUSE AND RECYCLING PROPERTY.—For pur-
poses of this subsection— 
‘‘(A) IN
GENERAL.—The term ‘qualified reuse and 
recycling property’ means any reuse and recycling prop-
erty— 
‘‘(i) to which this section applies, 
‘‘(ii) which has a useful life of at least 5 years, 
‘‘(iii) the original use of which commences with 
the taxpayer after August 31, 2008, and 
Effective date. 
26 USC 142 note. 
Applicability. 
26 USC 168 note. 
26 USC 168. 
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122 STAT. 3850 
PUBLIC LAW 110–343—OCT. 3, 2008 
‘‘(iv) which is— 
‘‘(I) acquired by purchase (as defined in section 
179(d)(2)) by the taxpayer after August 31, 2008, 
but only if no written binding contract for the 
acquisition was in effect before September 1, 2008, 
or 
‘‘(II) acquired by the taxpayer pursuant to a 
written binding contract which was entered into 
after August 31, 2008. 
‘‘(B) EXCEPTIONS.— 
‘‘(i) BONUS DEPRECIATION PROPERTY UNDER SUB-
SECTION (k).—The term ‘qualified reuse and recycling 
property’ shall not include any property to which sec-
tion 168(k) applies. 
‘‘(ii) ALTERNATIVE DEPRECIATION PROPERTY.—The 
term ‘qualified reuse and recycling property’ shall not 
include any property to which the alternative deprecia-
tion system under subsection (g) applies, determined 
without regard to paragraph (7) of subsection (g) 
(relating to election to have system apply). 
‘‘(iii) ELECTION OUT.—If a taxpayer makes an elec-
tion under this clause with respect to any class of 
property for any taxable year, this subsection shall 
not apply to all property in such class placed in service 
during such taxable year. 
‘‘(C) SPECIAL RULE FOR SELF-CONSTRUCTED PROPERTY.— 
In the case of a taxpayer manufacturing, constructing, 
or producing property for the taxpayer’s own use, the 
requirements of clause (iv) of subparagraph (A) shall be 
treated as met if the taxpayer begins manufacturing, con-
structing, or producing the property after August 31, 2008. 
‘‘(D) DEDUCTION
ALLOWED
IN
COMPUTING
MINIMUM 
TAX.—For purposes of determining alternative minimum 
taxable income under section 55, the deduction under sub-
section (a) for qualified reuse and recycling property shall 
be determined under this section without regard to any 
adjustment under section 56. 
‘‘(3) DEFINITIONS.—For purposes of this subsection— 
‘‘(A) REUSE AND RECYCLING PROPERTY.— 
‘‘(i) IN GENERAL.—The term ‘reuse and recycling 
property’ means any machinery and equipment (not 
including buildings or real estate), along with all 
appurtenances thereto, including software necessary 
to operate such equipment, which is used exclusively 
to collect, distribute, or recycle qualified reuse and 
recyclable materials. 
‘‘(ii) EXCLUSION.—Such term does not include 
rolling stock or other equipment used to transport 
reuse and recyclable materials. 
‘‘(B) QUALIFIED REUSE AND RECYCLABLE MATERIALS.— 
‘‘(i) IN GENERAL.—The term ‘qualified reuse and 
recyclable materials’ means scrap plastic, scrap glass, 
scrap textiles, scrap rubber, scrap packaging, recovered 
fiber, scrap ferrous and nonferrous metals, or electronic 
scrap generated by an individual or business. 
‘‘(ii) ELECTRONIC SCRAP.—For purposes of clause 
(i), the term ‘electronic scrap’ means— 
Effective date. 
Effective date. 
Effective dates. 
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122 STAT. 3851 
PUBLIC LAW 110–343—OCT. 3, 2008 
‘‘(I) any cathode ray tube, flat panel screen, 
or similar video display device with a screen size 
greater than 4 inches measured diagonally, or 
‘‘(II) any central processing unit. 
‘‘(C) RECYCLING OR RECYCLE.—The term ‘recycling’ or 
‘recycle’ means that process (including sorting) by which 
worn or superfluous materials are manufactured or proc-
essed into specification grade commodities that are suitable 
for use as a replacement or substitute for virgin materials 
in manufacturing tangible consumer and commercial prod-
ucts, including packaging.’’. 
(b) EFFECTIVE DATE.—The amendment made by this section 
shall apply to property placed in service after August 31, 2008. 
TITLE IV—REVENUE PROVISIONS 
SEC. 401. LIMITATION OF DEDUCTION FOR INCOME ATTRIBUTABLE 
TO DOMESTIC PRODUCTION OF OIL, GAS, OR PRIMARY 
PRODUCTS THEREOF. 
(a) IN GENERAL.—Section 199(d) is amended by redesignating 
paragraph (9) as paragraph (10) and by inserting after paragraph 
(8) the following new paragraph: 
‘‘(9) SPECIAL RULE FOR TAXPAYERS WITH OIL RELATED QUALI-
FIED PRODUCTION ACTIVITIES INCOME.— 
‘‘(A) IN GENERAL.—If a taxpayer has oil related quali-
fied production activities income for any taxable year begin-
ning after 2009, the amount otherwise allowable as a 
deduction under subsection (a) shall be reduced by 3 per-
cent of the least of— 
‘‘(i) the oil related qualified production activities 
income of the taxpayer for the taxable year, 
‘‘(ii) the qualified production activities income of 
the taxpayer for the taxable year, or 
‘‘(iii) taxable income (determined without regard 
to this section). 
‘‘(B) OIL RELATED QUALIFIED PRODUCTION ACTIVITIES 
INCOME.—For purposes of this paragraph, the term ‘oil 
related qualified production activities income’ means for 
any taxable year the qualified production activities income 
which is attributable to the production, refining, processing, 
transportation, or distribution of oil, gas, or any primary 
product thereof during such taxable year. 
‘‘(C) PRIMARY PRODUCT.—For purposes of this para-
graph, the term ‘primary product’ has the same meaning 
as when used in section 927(a)(2)(C), as in effect before 
its repeal.’’. 
(b) CONFORMING AMENDMENT.—Section 199(d)(2) (relating to 
application to individuals) is amended by striking ‘‘subsection 
(a)(1)(B)’’ and inserting ‘‘subsections (a)(1)(B) and (d)(9)(A)(iii)’’. 
(c) EFFECTIVE DATE.—The amendments made by this section 
shall apply to taxable years beginning after December 31, 2008. 
Applicability. 
26 USC 199 note. 
26 USC 199. 
Applicability. 
26 USC 168 note. 
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122 STAT. 3852 
PUBLIC LAW 110–343—OCT. 3, 2008 
SEC. 402. ELIMINATION OF THE DIFFERENT TREATMENT OF FOREIGN 
OIL AND GAS EXTRACTION INCOME AND FOREIGN OIL 
RELATED INCOME FOR PURPOSES OF THE FOREIGN TAX 
CREDIT. 
(a) IN GENERAL.—Subsections (a) and (b) of section 907 (relating 
to special rules in case of foreign oil and gas income) are amended 
to read as follows: 
‘‘(a) REDUCTION IN AMOUNT ALLOWED AS FOREIGN TAX UNDER 
SECTION 901.—In applying section 901, the amount of any foreign 
oil and gas taxes paid or accrued (or deemed to have been paid) 
during the taxable year which would (but for this subsection) be 
taken into account for purposes of section 901 shall be reduced 
by the amount (if any) by which the amount of such taxes exceeds 
the product of— 
‘‘(1) the amount of the combined foreign oil and gas income 
for the taxable year, 
‘‘(2) multiplied by— 
‘‘(A) in the case of a corporation, the percentage which 
is equal to the highest rate of tax specified under section 
11(b), or 
‘‘(B) in the case of an individual, a fraction the numer-
ator of which is the tax against which the credit under 
section 901(a) is taken and the denominator of which is 
the taxpayer’s entire taxable income. 
‘‘(b) COMBINED FOREIGN OIL AND GAS INCOME; FOREIGN OIL 
AND GAS TAXES.—For purposes of this section— 
‘‘(1) COMBINED FOREIGN OIL AND GAS INCOME.—The term 
‘combined foreign oil and gas income’ means, with respect to 
any taxable year, the sum of— 
‘‘(A) foreign oil and gas extraction income, and 
‘‘(B) foreign oil related income. 
‘‘(2) FOREIGN OIL AND GAS TAXES.—The term ‘foreign oil 
and gas taxes’ means, with respect to any taxable year, the 
sum of— 
‘‘(A) oil and gas extraction taxes, and 
‘‘(B) any income, war profits, and excess profits taxes 
paid or accrued (or deemed to have been paid or accrued 
under section 902 or 960) during the taxable year with 
respect to foreign oil related income (determined without 
regard to subsection (c)(4)) or loss which would be taken 
into account for purposes of section 901 without regard 
to this section.’’. 
(b) RECAPTURE OF FOREIGN OIL AND GAS LOSSES.—Paragraph 
(4) of section 907(c) (relating to recapture of foreign oil and gas 
extraction losses by recharacterizing later extraction income) is 
amended to read as follows: 
‘‘(4) RECAPTURE OF FOREIGN OIL AND GAS LOSSES BY RE-
CHARACTERIZING
LATER
COMBINED
FOREIGN
OIL
AND
GAS 
INCOME.— 
‘‘(A) IN GENERAL.—The combined foreign oil and gas 
income of a taxpayer for a taxable year (determined without 
regard to this paragraph) shall be reduced— 
‘‘(i) first by the amount determined under subpara-
graph (B), and 
‘‘(ii) then by the amount determined under 
subparagraph (C). 
26 USC 907. 
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122 STAT. 3853 
PUBLIC LAW 110–343—OCT. 3, 2008 
The aggregate amount of such reductions shall be treated 
as income (from sources without the United States) which 
is not combined foreign oil and gas income. 
‘‘(B) REDUCTION FOR PRE-2009 FOREIGN OIL EXTRACTION 
LOSSES.—The reduction under this paragraph shall be 
equal to the lesser of— 
‘‘(i) the foreign oil and gas extraction income of 
the taxpayer for the taxable year (determined without 
regard to this paragraph), or 
‘‘(ii) the excess of— 
‘‘(I) the aggregate amount of foreign oil extrac-
tion losses for preceding taxable years beginning 
after December 31, 1982, and before January 1, 
2009, over 
‘‘(II) so much of such aggregate amount as 
was recharacterized under this paragraph (as in 
effect before and after the date of the enactment 
of the Energy Improvement and Extension Act 
of 2008) for preceding taxable years beginning 
after December 31, 1982. 
‘‘(C) REDUCTION FOR POST-2008 FOREIGN OIL AND GAS 
LOSSES.—The reduction under this paragraph shall be 
equal to the lesser of— 
‘‘(i) the combined foreign oil and gas income of 
the taxpayer for the taxable year (determined without 
regard to this paragraph), reduced by an amount equal 
to the reduction under subparagraph (A) for the taxable 
year, or 
‘‘(ii) the excess of— 
‘‘(I) the aggregate amount of foreign oil and 
gas losses for preceding taxable years beginning 
after December 31, 2008, over 
‘‘(II) so much of such aggregate amount as 
was recharacterized under this paragraph for pre-
ceding taxable years beginning after December 31, 
2008. 
‘‘(D) FOREIGN OIL AND GAS LOSS DEFINED.— 
‘‘(i) IN GENERAL.—For purposes of this paragraph, 
the term ‘foreign oil and gas loss’ means the amount 
by which— 
‘‘(I) the gross income for the taxable year from 
sources without the United States and its posses-
sions (whether or not the taxpayer chooses the 
benefits of this subpart for such taxable year) 
taken into account in determining the combined 
foreign oil and gas income for such year, is 
exceeded by 
‘‘(II) the sum of the deductions properly appor-
tioned or allocated thereto. 
‘‘(ii) NET OPERATING LOSS DEDUCTION NOT TAKEN 
INTO
ACCOUNT.—For purposes of clause (i), the net 
operating loss deduction allowable for the taxable year 
under section 172(a) shall not be taken into account. 
‘‘(iii) EXPROPRIATION
AND
CASUALTY
LOSSES
NOT 
TAKEN INTO ACCOUNT.—For purposes of clause (i), there 
shall not be taken into account— 
Effective dates. 
Effective dates. 
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122 STAT. 3854 
PUBLIC LAW 110–343—OCT. 3, 2008 
‘‘(I) any foreign expropriation loss (as defined 
in section 172(h) (as in effect on the day before 
the date of the enactment of the Revenue Reconcili-
ation Act of 1990)) for the taxable year, or 
‘‘(II) any loss for the taxable year which arises 
from fire, storm, shipwreck, or other casualty, or 
from theft, 
to the extent such loss is not compensated for by insur-
ance or otherwise. 
‘‘(iv) FOREIGN OIL EXTRACTION LOSS.—For purposes 
of subparagraph (B)(ii)(I), foreign oil extraction losses 
shall be determined under this paragraph as in effect 
on the day before the date of the enactment of the 
Energy Improvement and Extension Act of 2008.’’. 
(c) CARRYBACK
AND CARRYOVER
OF DISALLOWED CREDITS.— 
Section 907(f) (relating to carryback and carryover of disallowed 
credits) is amended— 
(1) by striking ‘‘oil and gas extraction taxes’’ each place 
it appears and inserting ‘‘foreign oil and gas taxes’’, and 
(2) by adding at the end the following new paragraph: 
‘‘(4) TRANSITION RULES FOR PRE-2009 AND 2009 DISALLOWED 
CREDITS.— 
‘‘(A) PRE-2009
CREDITS.—In the case of any unused 
credit year beginning before January 1, 2009, this sub-
section shall be applied to any unused oil and gas extraction 
taxes carried from such unused credit year to a year begin-
ning after December 31, 2008— 
‘‘(i) by substituting ‘oil and gas extraction taxes’ 
for ‘foreign oil and gas taxes’ each place it appears 
in paragraphs (1), (2), and (3), and 
‘‘(ii) by computing, for purposes of paragraph 
(2)(A), the limitation under subparagraph (A) for the 
year to which such taxes are carried by substituting 
‘foreign oil and gas extraction income’ for ‘foreign oil 
and gas income’ in subsection (a). 
‘‘(B) 2009 CREDITS.—In the case of any unused credit 
year beginning in 2009, the amendments made to this 
subsection by the Energy Improvement and Extension Act 
of 2008 shall be treated as being in effect for any preceding 
year beginning before January 1, 2009, solely for purposes 
of determining how much of the unused foreign oil and 
gas taxes for such unused credit year may be deemed 
paid or accrued in such preceding year.’’. 
(d) CONFORMING AMENDMENT.—Section 6501(i) is amended by 
striking ‘‘oil and gas extraction taxes’’ and inserting ‘‘foreign oil 
and gas taxes’’. 
(e) EFFECTIVE DATE.—The amendments made by this section 
shall apply to taxable years beginning after December 31, 2008. 
SEC. 403. BROKER REPORTING OF CUSTOMER’S BASIS IN SECURITIES 
TRANSACTIONS. 
(a) IN GENERAL.— 
(1) BROKER REPORTING FOR SECURITIES TRANSACTIONS.— 
Section 6045 is amended by adding at the end the following 
new subsection: 
‘‘(g) ADDITIONAL INFORMATION REQUIRED IN THE CASE OF SECU-
RITIES TRANSACTIONS, ETC.— 
26 USC 907 note. 
Effective date. 
26 USC 907. 
Effective date. 
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122 STAT. 3855 
PUBLIC LAW 110–343—OCT. 3, 2008 
‘‘(1) IN
GENERAL.—If a broker is otherwise required to 
make a return under subsection (a) with respect to the gross 
proceeds of the sale of a covered security, the broker shall 
include in such return the information described in paragraph 
(2). 
‘‘(2) ADDITIONAL INFORMATION REQUIRED.— 
‘‘(A) IN
GENERAL.—The information required under 
paragraph (1) to be shown on a return with respect to 
a covered security of a customer shall include the cus-
tomer’s adjusted basis in such security and whether any 
gain or loss with respect to such security is long-term 
or short-term (within the meaning of section 1222). 
‘‘(B) DETERMINATION
OF
ADJUSTED
BASIS.—For pur-
poses of subparagraph (A)— 
‘‘(i) IN GENERAL.—The customer’s adjusted basis 
shall be determined— 
‘‘(I) in the case of any security (other than 
any stock for which an average basis method is 
permissible under section 1012), in accordance 
with the first-in first-out method unless the cus-
tomer notifies the broker by means of making an 
adequate identification of the stock sold or trans-
ferred, and 
‘‘(II) in the case of any stock for which an 
average basis method is permissible under section 
1012, in accordance with the broker’s default 
method unless the customer notifies the broker 
that he elects another acceptable method under 
section 1012 with respect to the account in which 
such stock is held. 
‘‘(ii) EXCEPTION FOR WASH SALES.—Except as other-
wise provided by the Secretary, the customer’s adjusted 
basis shall be determined without regard to section 
1091 (relating to loss from wash sales of stock or 
securities) unless the transactions occur in the same 
account with respect to identical securities. 
‘‘(3) COVERED SECURITY.—For purposes of this subsection— 
‘‘(A) IN GENERAL.—The term ‘covered security’ means 
any specified security acquired on or after the applicable 
date if such security— 
‘‘(i) was acquired through a transaction in the 
account in which such security is held, or 
‘‘(ii) was transferred to such account from an 
account in which such security was a covered security, 
but only if the broker received a statement under sec-
tion 6045A with respect to the transfer. 
‘‘(B) SPECIFIED SECURITY.—The term ‘specified security’ 
means— 
‘‘(i) any share of stock in a corporation, 
‘‘(ii) any note, bond, debenture, or other evidence 
of indebtedness, 
‘‘(iii) any commodity, or contract or derivative with 
respect to such commodity, if the Secretary determines 
that adjusted basis reporting is appropriate for pur-
poses of this subsection, and 
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122 STAT. 3856 
PUBLIC LAW 110–343—OCT. 3, 2008 
‘‘(iv) any other financial instrument with respect 
to which the Secretary determines that adjusted basis 
reporting is appropriate for purposes of this subsection. 
‘‘(C) APPLICABLE
DATE.—The term ‘applicable date’ 
means— 
‘‘(i) January 1, 2011, in the case of any specified 
security which is stock in a corporation (other than 
any stock described in clause (ii)), 
‘‘(ii) January 1, 2012, in the case of any stock 
for which an average basis method is permissible under 
section 1012, and 
‘‘(iii) January 1, 2013, or such later date deter-
mined by the Secretary in the case of any other speci-
fied security. 
‘‘(4) TREATMENT OF S CORPORATIONS.—In the case of the 
sale of a covered security acquired by an S corporation (other 
than a financial institution) after December 31, 2011, such 
S corporation shall be treated in the same manner as a partner-
ship for purposes of this section. 
‘‘(5) SPECIAL RULES FOR SHORT SALES.—In the case of a 
short sale, reporting under this section shall be made for the 
year in which such sale is closed.’’. 
(2) BROKER
INFORMATION
REQUIRED
WITH
RESPECT
TO 
OPTIONS.—Section 6045, as amended by subsection (a), is 
amended by adding at the end the following new subsection: 
‘‘(h) APPLICATION TO OPTIONS ON SECURITIES.— 
‘‘(1) EXERCISE OF OPTION.—For purposes of this section, 
if a covered security is acquired or disposed of pursuant to 
the exercise of an option that was granted or acquired in 
the same account as the covered security, the amount received 
with respect to the grant or paid with respect to the acquisition 
of such option shall be treated as an adjustment to gross 
proceeds or as an adjustment to basis, as the case may be. 
‘‘(2) LAPSE OR CLOSING TRANSACTION.—In the case of the 
lapse 
(or 
closing 
transaction 
(as 
defined 
in 
section 
1234(b)(2)(A))) of an option on a specified security or the exer-
cise of a cash-settled option on a specified security, reporting 
under subsections (a) and (g) with respect to such option shall 
be made for the calendar year which includes the date of 
such lapse, closing transaction, or exercise. 
‘‘(3) PROSPECTIVE
APPLICATION.—Paragraphs (1) and (2) 
shall not apply to any option which is granted or acquired 
before January 1, 2013. 
‘‘(4) DEFINITIONS.—For purposes of this subsection, the 
terms ‘covered security’ and ‘specified security’ shall have the 
meanings given such terms in subsection (g)(3).’’. 
(3) EXTENSION OF PERIOD FOR STATEMENTS SENT TO CUS-
TOMERS.— 
(A) IN
GENERAL.—Subsection (b) of section 6045 is 
amended by striking ‘‘January 31’’ and inserting ‘‘February 
15’’. 
(B) STATEMENTS RELATED TO SUBSTITUTE PAYMENTS.— 
Subsection (d) of section 6045 is amended— 
(i) by striking ‘‘at such time and’’, and 
(ii) by inserting after ‘‘other item.’’ the following 
new sentence: ‘‘The written statement required under 
the preceding sentence shall be furnished on or before 
Deadline. 
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122 STAT. 3857 
PUBLIC LAW 110–343—OCT. 3, 2008 
February 15 of the year following the calendar year 
in which the payment was made.’’. 
(C) OTHER STATEMENTS.—Subsection (b) of section 6045 
is amended by adding at the end the following: ‘‘In the 
case of a consolidated reporting statement (as defined in 
regulations) with respect to any customer, any statement 
which would otherwise be required to be furnished on 
or before January 31 of a calendar year with respect to 
any item reportable to the taxpayer shall instead be 
required to be furnished on or before February 15 of such 
calendar year if furnished with such consolidated reporting 
statement.’’. 
(b) DETERMINATION
OF
BASIS
OF
CERTAIN
SECURITIES
ON 
ACCOUNT BY ACCOUNT OR AVERAGE BASIS METHOD.—Section 1012 
is amended— 
(1) by striking ‘‘The basis of property’’ and inserting the 
following: 
‘‘(a) IN GENERAL.—The basis of property’’, 
(2) by striking ‘‘The cost of real property’’ and inserting 
the following: 
‘‘(b) SPECIAL RULE FOR APPORTIONED REAL ESTATE TAXES.— 
The cost of real property’’, and 
(3) by adding at the end the following new subsections: 
‘‘(c) DETERMINATIONS BY ACCOUNT.— 
‘‘(1) IN GENERAL.—In the case of the sale, exchange, or 
other disposition of a specified security on or after the applicable 
date, the conventions prescribed by regulations under this sec-
tion shall be applied on an account by account basis. 
‘‘(2) APPLICATION TO CERTAIN FUNDS.— 
‘‘(A) IN GENERAL.—Except as provided in subparagraph 
(B), any stock for which an average basis method is permis-
sible under section 1012 which is acquired before January 
1, 2012, shall be treated as a separate account from any 
such stock acquired on or after such date. 
‘‘(B) ELECTION
FUND
FOR
TREATMENT
AS
SINGLE 
ACCOUNT.—If a fund described in subparagraph (A) elects 
to have this subparagraph apply with respect to one or 
more of its stockholders— 
‘‘(i) subparagraph (A) shall not apply with respect 
to any stock in such fund held by such stockholders, 
and 
‘‘(ii) all stock in such fund which is held by such 
stockholders shall be treated as covered securities 
described in section 6045(g)(3) without regard to the 
date of the acquisition of such stock. 
A rule similar to the rule of the preceding sentence shall 
apply with respect to a broker holding such stock as a 
nominee. 
‘‘(3) DEFINITIONS.—For purposes of this section, the terms 
‘specified security’ and ‘applicable date’ shall have the meaning 
given such terms in section 6045(g). 
‘‘(d) AVERAGE BASIS FOR STOCK ACQUIRED PURSUANT TO A DIVI-
DEND REINVESTMENT PLAN.— 
‘‘(1) IN GENERAL.—In the case of any stock acquired after 
December 31, 2010, in connection with a dividend reinvestment 
plan, the basis of such stock while held as part of such plan 
Deadline. 
26 USC 6045. 
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122 STAT. 3858 
PUBLIC LAW 110–343—OCT. 3, 2008 
shall be determined using one of the methods which may be 
used for determining the basis of stock in an open-end fund. 
‘‘(2) TREATMENT
AFTER
TRANSFER.—In the case of the 
transfer to another account of stock to which paragraph (1) 
applies, such stock shall have a cost basis in such other account 
equal to its basis in the dividend reinvestment plan imme-
diately before such transfer (properly adjusted for any fees 
or other charges taken into account in connection with such 
transfer). 
‘‘(3) SEPARATE
ACCOUNTS; ELECTION
FOR
TREATMENT
AS 
SINGLE ACCOUNT.—Rules similar to the rules of subsection (c)(2) 
shall apply for purposes of this subsection. 
‘‘(4) DIVIDEND REINVESTMENT PLAN.—For purposes of this 
subsection— 
‘‘(A) IN
GENERAL.—The term ‘dividend reinvestment 
plan’ means any arrangement under which dividends on 
any stock are reinvested in stock identical to the stock 
with respect to which the dividends are paid. 
‘‘(B) INITIAL STOCK ACQUISITION TREATED AS ACQUIRED 
IN
CONNECTION
WITH
PLAN.—Stock shall be treated as 
acquired in connection with a dividend reinvestment plan 
if such stock is acquired pursuant to such plan or if the 
dividends paid on such stock are subject to such plan.’’. 
(c) INFORMATION BY TRANSFERORS TO AID BROKERS.— 
(1) IN GENERAL.—Subpart B of part III of subchapter A 
of chapter 61 is amended by inserting after section 6045 the 
following new section: 
‘‘SEC. 6045A. INFORMATION REQUIRED IN CONNECTION WITH TRANS-
FERS OF COVERED SECURITIES TO BROKERS. 
‘‘(a) FURNISHING
OF INFORMATION.—Every applicable person 
which transfers to a broker (as defined in section 6045(c)(1)) a 
security which is a covered security (as defined in section 6045(g)(3)) 
in the hands of such applicable person shall furnish to such broker 
a written statement in such manner and setting forth such informa-
tion as the Secretary may by regulations prescribe for purposes 
of enabling such broker to meet the requirements of section 6045(g). 
‘‘(b) APPLICABLE PERSON.—For purposes of subsection (a), the 
term ‘applicable person’ means— 
‘‘(1) any broker (as defined in section 6045(c)(1)), and 
‘‘(2) any other person as provided by the Secretary in 
regulations. 
‘‘(c) TIME FOR FURNISHING STATEMENT.—Except as otherwise 
provided by the Secretary, any statement required by subsection 
(a) shall be furnished not later than 15 days after the date of 
the transfer described in such subsection.’’. 
(2) ASSESSABLE
PENALTIES.—Paragraph (2) of section 
6724(d), as amended by the Housing Assistance Tax Act of 
2008, is amended by redesignating subparagraphs (I) through 
(DD) as subparagraphs (J) through (EE), respectively, and by 
inserting after subparagraph (H) the following new subpara-
graph: 
‘‘(I) section 6045A (relating to information required 
in connection with transfers of covered securities to bro-
kers),’’. 
(3) CLERICAL AMENDMENT.—The table of sections for sub-
part B of part III of subchapter A of chapter 61 is amended 
Ante, p. 2911. 
Applicability. 
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122 STAT. 3859 
PUBLIC LAW 110–343—OCT. 3, 2008 
by inserting after the item relating to section 6045 the following 
new item: 
‘‘Sec. 6045A. Information required in connection with transfers of covered securities 
to brokers.’’. 
(d) ADDITIONAL ISSUER INFORMATION TO AID BROKERS.— 
(1) IN GENERAL.—Subpart B of part III of subchapter A 
of chapter 61, as amended by subsection (b), is amended by 
inserting after section 6045A the following new section: 
‘‘SEC. 6045B. RETURNS RELATING TO ACTIONS AFFECTING BASIS OF 
SPECIFIED SECURITIES. 
‘‘(a) IN GENERAL.—According to the forms or regulations pre-
scribed by the Secretary, any issuer of a specified security shall 
make a return setting forth— 
‘‘(1) a description of any organizational action which affects 
the basis of such specified security of such issuer, 
‘‘(2) the quantitative effect on the basis of such specified 
security resulting from such action, and 
‘‘(3) such other information as the Secretary may prescribe. 
‘‘(b) TIME FOR FILING RETURN.—Any return required by sub-
section (a) shall be filed not later than the earlier of— 
‘‘(1) 45 days after the date of the action described in sub-
section (a), or 
‘‘(2) January 15 of the year following the calendar year 
during which such action occurred. 
‘‘(c) STATEMENTS TO BE FURNISHED TO HOLDERS OF SPECIFIED 
SECURITIES OR THEIR NOMINEES.—According to the forms or regula-
tions prescribed by the Secretary, every person required to make 
a return under subsection (a) with respect to a specified security 
shall furnish to the nominee with respect to the specified security 
(or certificate holder if there is no nominee) a written statement 
showing— 
‘‘(1) the name, address, and phone number of the informa-
tion contact of the person required to make such return, 
‘‘(2) the information required to be shown on such return 
with respect to such security, and 
‘‘(3) such other information as the Secretary may prescribe. 
The written statement required under the preceding sentence shall 
be furnished to the holder on or before January 15 of the year 
following the calendar year during which the action described in 
subsection (a) occurred. 
‘‘(d) SPECIFIED SECURITY.—For purposes of this section, the 
term ‘specified security’ has the meaning given such term by section 
6045(g)(3)(B). No return shall be required under this section with 
respect to actions described in subsection (a) with respect to a 
specified security which occur before the applicable date (as defined 
in section 6045(g)(3)(C)) with respect to such security. 
‘‘(e) PUBLIC REPORTING IN LIEU OF RETURN.—The Secretary 
may waive the requirements under subsections (a) and (c) with 
respect to a specified security, if the person required to make 
the return under subsection (a) makes publicly available, in such 
form and manner as the Secretary determines necessary to carry 
out the purposes of this section— 
‘‘(1) the name, address, phone number, and email address 
of the information contact of such person, and 
‘‘(2) the information described in paragraphs (1), (2), and 
(3) of subsection (a).’’. 
Deadline. 
Regulations. 
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122 STAT. 3860 
PUBLIC LAW 110–343—OCT. 3, 2008 
(2) ASSESSABLE PENALTIES.— 
(A) Subparagraph (B) of section 6724(d)(1), as amended 
by the Housing Assistance Tax Act of 2008, is amended 
by redesignating clause (iv) and each of the clauses which 
follow as clauses (v) through (xxiii), respectively, and by 
inserting after clause (iii) the following new clause: 
‘‘(iv) section 6045B(a) (relating to returns relating 
to actions affecting basis of specified securities),’’. 
(B) Paragraph (2) of section 6724(d), as amended by 
the Housing Assistance Tax Act of 2008 and by subsection 
(c)(2), is amended by redesignating subparagraphs (J) 
through (EE) as subparagraphs (K) through (FF), respec-
tively, and by inserting after subparagraph (I) the following 
new subparagraph: 
‘‘(J) subsections (c) and (e) of section 6045B (relating 
to returns relating to actions affecting basis of specified 
securities),’’. 
(3) CLERICAL AMENDMENT.—The table of sections for sub-
part B of part III of subchapter A of chapter 61, as amended 
by subsection (b)(3), is amended by inserting after the item 
relating to section 6045A the following new item: 
‘‘Sec. 6045B. Returns relating to actions affecting basis of specified securities.’’. 
(e) EFFECTIVE DATE.— 
(1) IN GENERAL.—Except as otherwise provided in this sub-
section, the amendments made by this section shall take effect 
on January 1, 2011. 
(2) EXTENSION OF PERIOD FOR STATEMENTS SENT TO CUS-
TOMERS.—The amendments made by subsection (a)(3) shall 
apply to statements required to be furnished after December 
31, 2008. 
SEC. 404. 0.2 PERCENT FUTA SURTAX. 
(a) IN GENERAL.—Section 3301 (relating to rate of tax) is 
amended— 
(1) by striking ‘‘through 2008’’ in paragraph (1) and 
inserting ‘‘through 2009’’, and 
(2) by striking ‘‘calendar year 2009’’ in paragraph (2) and 
inserting ‘‘calendar year 2010’’. 
(b) EFFECTIVE DATE.—The amendments made by this section 
shall apply to wages paid after December 31, 2008. 
SEC. 405. INCREASE AND EXTENSION OF OIL SPILL LIABILITY TRUST 
FUND TAX. 
(a) INCREASE IN RATE.— 
(1) IN GENERAL.—Section 4611(c)(2)(B) (relating to rates) 
is amended by striking ‘‘is 5 cents a barrel.’’ and inserting 
‘‘is— 
‘‘(i) in the case of crude oil received or petroleum 
products entered before January 1, 2017, 8 cents a 
barrel, and 
‘‘(ii) in the case of crude oil received or petroleum 
products entered after December 31, 2016, 9 cents 
a barrel.’’. 
(2) EFFECTIVE DATE.—The amendment made by this sub-
section shall apply on and after the first day of the first calendar 
quarter beginning more than 60 days after the date of the 
enactment of this Act. 
26 USC 4611 
note. 
26 USC 3301 
note. 
26 USC 3301. 
Applicability. 
26 USC 1012 
note. 
26 USC 6724. 
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122 STAT. 3861 
PUBLIC LAW 110–343—OCT. 3, 2008 
(b) EXTENSION.— 
(1) IN GENERAL.—Section 4611(f) (relating to application 
of Oil Spill Liability Trust Fund financing rate) is amended 
by striking paragraphs (2) and (3) and inserting the following 
new paragraph: 
‘‘(2) TERMINATION.—The Oil Spill Liability Trust Fund 
financing rate shall not apply after December 31, 2017.’’. 
(2) 
CONFORMING
AMENDMENT.—Section 
4611(f)(1) 
is 
amended by striking ‘‘paragraphs (2) and (3)’’ and inserting 
‘‘paragraph (2)’’. 
(3) EFFECTIVE DATE.—The amendments made by this sub-
section shall take effect on the date of the enactment of this 
Act. 
DIVISION C—TAX EXTENDERS AND 
ALTERNATIVE MINIMUM TAX RELIEF 
SEC. 1. SHORT TITLE; AMENDMENT OF 1986 CODE; TABLE OF CON-
TENTS. 
(a) SHORT TITLE.—This division may be cited as the ‘‘Tax 
Extenders and Alternative Minimum Tax Relief Act of 2008’’. 
(b) AMENDMENT OF 1986 CODE.—Except as otherwise expressly 
provided, whenever in this division an amendment or repeal is 
expressed 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 of this division 
is as follows: 
Sec. 1. Short title; amendment of 1986 Code; table of contents. 
TITLE I—ALTERNATIVE MINIMUM TAX RELIEF 
Sec. 101. Extension of alternative minimum tax relief for nonrefundable personal 
credits. 
Sec. 102. Extension of increased alternative minimum tax exemption amount. 
Sec. 103. Increase of AMT refundable credit amount for individuals with long-term 
unused credits for prior year minimum tax liability, etc. 
TITLE II—EXTENSION OF INDIVIDUAL TAX PROVISIONS 
Sec. 201. Deduction for State and local sales taxes. 
Sec. 202. Deduction of qualified tuition and related expenses. 
Sec. 203. Deduction for certain expenses of elementary and secondary school teach-
ers. 
Sec. 204. Additional standard deduction for real property taxes for nonitemizers. 
Sec. 205. Tax-free distributions from individual retirement plans for charitable pur-
poses. 
Sec. 206. Treatment of certain dividends of regulated investment companies. 
Sec. 207. Stock in RIC for purposes of determining estates of nonresidents not citi-
zens. 
Sec. 208. Qualified investment entities. 
TITLE III—EXTENSION OF BUSINESS TAX PROVISIONS 
Sec. 301. Extension and modification of research credit. 
Sec. 302. New markets tax credit. 
Sec. 303. Subpart F exception for active financing income. 
Sec. 304. Extension of look-thru rule for related controlled foreign corporations. 
Sec. 305. Extension of 15-year straight-line cost recovery for qualified leasehold im-
provements and qualified restaurant improvements; 15-year straight- 
line cost recovery for certain improvements to retail space. 
Sec. 306. Modification of tax treatment of certain payments to controlling exempt 
organizations. 
26 USC 1 note. 
Tax Extenders 
and Alternative 
Minimum Tax 
Relief Act 
of 2008. 
26 USC 4611 
note. 
26 USC 4611. 
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122 STAT. 3862 
PUBLIC LAW 110–343—OCT. 3, 2008 
Sec. 307. Basis adjustment to stock of S corporations making charitable contribu-
tions of property. 
Sec. 308. Increase in limit on cover over of rum excise tax to Puerto Rico and the 
Virgin Islands. 
Sec. 309. Extension of economic development credit for American Samoa. 
Sec. 310. Extension of mine rescue team training credit. 
Sec. 311. Extension of election to expense advanced mine safety equipment. 
Sec. 312. Deduction allowable with respect to income attributable to domestic pro-
duction activities in Puerto Rico. 
Sec. 313. Qualified zone academy bonds. 
Sec. 314. Indian employment credit. 
Sec. 315. Accelerated depreciation for business property on Indian reservations. 
Sec. 316. Railroad track maintenance. 
Sec. 317. Seven-year cost recovery period for motorsports racing track facility. 
Sec. 318. Expensing of environmental remediation costs. 
Sec. 319. Extension of work opportunity tax credit for Hurricane Katrina employ-
ees. 
Sec. 320. Extension of increased rehabilitation credit for structures in the Gulf Op-
portunity Zone. 
Sec. 321. Enhanced deduction for qualified computer contributions. 
Sec. 322. Tax incentives for investment in the District of Columbia. 
Sec. 323. Enhanced charitable deductions for contributions of food inventory. 
Sec. 324. Extension of enhanced charitable deduction for contributions of book in-
ventory. 
Sec. 325. Extension and modification of duty suspension on wool products; wool re-
search fund; wool duty refunds. 
TITLE IV—EXTENSION OF TAX ADMINISTRATION PROVISIONS 
Sec. 401. Permanent authority for undercover operations. 
Sec. 402. Permanent authority for disclosure of information relating to terrorist ac-
tivities. 
TITLE V—ADDITIONAL TAX RELIEF AND OTHER TAX PROVISIONS 
Subtitle A—General Provisions 
Sec. 501. $8,500 income threshold used to calculate refundable portion of child tax 
credit. 
Sec. 502. Provisions related to film and television productions. 
Sec. 503. Exemption from excise tax for certain wooden arrows designed for use by 
children. 
Sec. 504. Income averaging for amounts received in connection with the Exxon 
Valdez litigation. 
Sec. 505. Certain farming business machinery and equipment treated as 5-year 
property. 
Sec. 506. Modification of penalty on understatement of taxpayer’s liability by tax 
return preparer. 
Subtitle B—Paul Wellstone and Pete Domenici Mental Health Parity and Addiction 
Equity Act of 2008 
Sec. 511. Short title. 
Sec. 512. Mental health parity. 
TITLE VI—OTHER PROVISIONS 
Sec. 601. Secure rural schools and community self-determination program. 
Sec. 602. Transfer to abandoned mine reclamation fund. 
TITLE VII—DISASTER RELIEF 
Subtitle A—Heartland and Hurricane Ike Disaster Relief 
Sec. 701. Short title. 
Sec. 702. Temporary tax relief for areas damaged by 2008 Midwestern severe 
storms, tornados, and flooding. 
Sec. 703. Reporting requirements relating to disaster relief contributions. 
Sec. 704. Temporary tax-exempt bond financing and low-income housing tax relief 
for areas damaged by Hurricane Ike. 
Subtitle B—National Disaster Relief 
Sec. 706. Losses attributable to federally declared disasters. 
Sec. 707. Expensing of Qualified Disaster Expenses. 
Sec. 708. Net operating losses attributable to federally declared disasters. 
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122 STAT. 3863 
PUBLIC LAW 110–343—OCT. 3, 2008 
Sec. 709. Waiver of certain mortgage revenue bond requirements following feder-
ally declared disasters. 
Sec. 710. Special depreciation allowance for qualified disaster property. 
Sec. 711. Increased expensing for qualified disaster assistance property. 
Sec. 712. Coordination with Heartland disaster relief. 
TITLE VIII—SPENDING REDUCTIONS AND APPROPRIATE REVENUE 
RAISERS FOR NEW TAX RELIEF POLICY 
Sec. 801. Nonqualified deferred compensation from certain tax indifferent parties. 
TITLE I—ALTERNATIVE MINIMUM TAX 
RELIEF 
SEC. 101. EXTENSION OF ALTERNATIVE MINIMUM TAX RELIEF FOR 
NONREFUNDABLE PERSONAL CREDITS. 
(a) IN GENERAL.—Paragraph (2) of section 26(a) (relating to 
special rule for taxable years 2000 through 2007) is amended— 
(1) by striking ‘‘or 2007’’ and inserting ‘‘2007, or 2008’’, 
and 
(2) by striking ‘‘2007’’ in the heading thereof and inserting 
‘‘2008’’. 
(b) EFFECTIVE DATE.—The amendments made by this section 
shall apply to taxable years beginning after December 31, 2007. 
SEC. 102. EXTENSION OF INCREASED ALTERNATIVE MINIMUM TAX 
EXEMPTION AMOUNT. 
(a) IN GENERAL.—Paragraph (1) of section 55(d) (relating to 
exemption amount) is amended— 
(1) by striking ‘‘($66,250 in the case of taxable years begin-
ning in 2007)’’ in subparagraph (A) and inserting ‘‘($69,950 
in the case of taxable years beginning in 2008)’’, and 
(2) by striking ‘‘($44,350 in the case of taxable years begin-
ning in 2007)’’ in subparagraph (B) and inserting ‘‘($46,200 
in the case of taxable years beginning in 2008)’’. 
(b) EFFECTIVE DATE.—The amendments made by this section 
shall apply to taxable years beginning after December 31, 2007. 
SEC. 103. INCREASE OF AMT REFUNDABLE CREDIT AMOUNT FOR 
INDIVIDUALS WITH LONG-TERM UNUSED CREDITS FOR 
PRIOR YEAR MINIMUM TAX LIABILITY, 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 unused 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 refundable credit 
amount determined under this paragraph for the taxpayer’s 
preceding taxable year (determined without regard to sub-
section (f)(2)).’’. 
(b) TREATMENT OF CERTAIN UNDERPAYMENTS, INTEREST, AND 
PENALTIES ATTRIBUTABLE TO THE TREATMENT OF INCENTIVE STOCK 
OPTIONS.—Section 53 is amended by adding at the end the following 
new subsection: 
26 USC 55 note. 
26 USC 26 note. 
26 USC 26. 
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122 STAT. 3864 
PUBLIC LAW 110–343—OCT. 3, 2008 
‘‘(f) TREATMENT OF CERTAIN UNDERPAYMENTS, INTEREST, AND 
PENALTIES ATTRIBUTABLE TO THE TREATMENT OF INCENTIVE STOCK 
OPTIONS.— 
‘‘(1) ABATEMENT.—Any underpayment of tax outstanding 
on the date of the enactment of this subsection which is attrib-
utable to the application of section 56(b)(3) for any taxable 
year ending before January 1, 2008, and any interest or penalty 
with respect to such underpayment which is outstanding on 
such date of enactment, is hereby abated. The amount deter-
mined under subsection (b)(1) shall not include any tax abated 
under the preceding sentence. 
‘‘(2) INCREASE IN CREDIT FOR CERTAIN INTEREST AND PEN-
ALTIES
ALREADY
PAID.—The AMT refundable 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 aggregate amount of the interest and penalties which 
were paid by the taxpayer before the date of the enactment 
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 paragraph (2), the 
amendments made by this section shall apply to taxable years 
beginning after December 31, 2007. 
(2) ABATEMENT.—Section 53(f)(1), as added by subsection 
(b), shall take effect on the date of the enactment of this 
Act. 
TITLE II—EXTENSION OF INDIVIDUAL 
TAX PROVISIONS 
SEC. 201. DEDUCTION FOR STATE AND LOCAL SALES TAXES. 
(a) IN GENERAL.—Subparagraph (I) of section 164(b)(5) is 
amended by striking ‘‘January 1, 2008’’ and inserting ‘‘January 
1, 2010’’. 
(b) EFFECTIVE DATE.—The amendment made by this section 
shall apply to taxable years beginning after December 31, 2007. 
SEC. 
202. 
DEDUCTION 
OF 
QUALIFIED 
TUITION 
AND 
RELATED 
EXPENSES. 
(a) IN GENERAL.—Subsection (e) of section 222 (relating to 
termination) is amended by striking ‘‘December 31, 2007’’ and 
inserting ‘‘December 31, 2009’’. 
(b) EFFECTIVE DATE.—The amendment made by this section 
shall apply to taxable years beginning after December 31, 2007. 
SEC. 203. DEDUCTION FOR CERTAIN EXPENSES OF ELEMENTARY AND 
SECONDARY SCHOOL TEACHERS. 
(a) IN GENERAL.—Subparagraph (D) of section 62(a)(2) (relating 
to certain expenses of elementary and secondary school teachers) 
is amended by striking ‘‘or 2007’’ and inserting ‘‘2007, 2008, or 
2009’’. 
(b) EFFECTIVE DATE.—The amendment made by subsection (a) 
shall apply to taxable years beginning after December 31, 2007. 
26 USC 62 note. 
26 USC 222 note. 
26 USC 164 note. 
26 USC 164. 
26 USC 53 note. 
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122 STAT. 3865 
PUBLIC LAW 110–343—OCT. 3, 2008 
SEC. 204. ADDITIONAL STANDARD DEDUCTION FOR REAL PROPERTY 
TAXES FOR NONITEMIZERS. 
(a) IN GENERAL.—Subparagraph (C) of section 63(c)(1), as added 
by the Housing Assistance Tax Act of 2008, is amended by inserting 
‘‘or 2009’’ after ‘‘2008’’. 
(b) EFFECTIVE DATE.—The amendment made by this section 
shall apply to taxable years beginning after December 31, 2008. 
SEC. 205. TAX-FREE DISTRIBUTIONS FROM INDIVIDUAL RETIREMENT 
PLANS FOR CHARITABLE PURPOSES. 
(a) IN
GENERAL.—Subparagraph (F) of section 408(d)(8) 
(relating to termination) is amended by striking ‘‘December 31, 
2007’’ and inserting ‘‘December 31, 2009’’. 
(b) EFFECTIVE DATE.—The amendment made by this section 
shall apply to distributions made in taxable years beginning after 
December 31, 2007. 
SEC. 206. TREATMENT OF CERTAIN DIVIDENDS OF REGULATED 
INVESTMENT COMPANIES. 
(a) INTEREST-RELATED DIVIDENDS.—Subparagraph (C) of section 
871(k)(1) (defining interest-related dividend) is amended by striking 
‘‘December 31, 2007’’ and inserting ‘‘December 31, 2009’’. 
(b) SHORT-TERM CAPITAL GAIN DIVIDENDS.—Subparagraph (C) 
of section 871(k)(2) (defining short-term capital gain dividend) is 
amended by striking ‘‘December 31, 2007’’ and inserting ‘‘December 
31, 2009’’. 
(c) EFFECTIVE DATE.—The amendments made by this section 
shall apply to dividends with respect to taxable years of regulated 
investment companies beginning after December 31, 2007. 
SEC. 207. STOCK IN RIC FOR PURPOSES OF DETERMINING ESTATES 
OF NONRESIDENTS NOT CITIZENS. 
(a) IN GENERAL.—Paragraph (3) of section 2105(d) (relating 
to stock in a RIC) is amended by striking ‘‘December 31, 2007’’ 
and inserting ‘‘December 31, 2009’’. 
(b) EFFECTIVE DATE.—The amendment made by this section 
shall apply to decedents dying after December 31, 2007. 
SEC. 208. QUALIFIED INVESTMENT ENTITIES. 
(a) IN GENERAL.—Clause (ii) of section 897(h)(4)(A) (relating 
to termination) is amended by striking ‘‘December 31, 2007’’ and 
inserting ‘‘December 31, 2009’’. 
(b) EFFECTIVE DATE.—The amendment made by subsection (a) 
shall take effect on January 1, 2008. 
TITLE III—EXTENSION OF BUSINESS 
TAX PROVISIONS 
SEC. 301. EXTENSION AND MODIFICATION OF RESEARCH CREDIT. 
(a) EXTENSION.— 
(1) IN GENERAL.—Section 41(h) (relating to termination) 
is amended by striking ‘‘December 31, 2007’’ and inserting 
‘‘December 31, 2009’’ in paragraph (1)(B). 
(2) CONFORMING AMENDMENT.—Subparagraph (D) of sec-
tion 45C(b)(1) (relating to special rule) is amended by striking 
26 USC 897 note. 
26 USC 2105 
note. 
26 USC 871 note. 
26 USC 408 note. 
26 USC 63 note. 
26 USC 63. 
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122 STAT. 3866 
PUBLIC LAW 110–343—OCT. 3, 2008 
‘‘after December 31, 2007’’ and inserting ‘‘after December 31, 
2009’’. 
(b) TERMINATION OF ALTERNATIVE INCREMENTAL CREDIT.—Sec-
tion 41(h) is amended by redesignating paragraph (2) as paragraph 
(3), and by inserting after paragraph (1) the following new para-
graph: 
‘‘(2) TERMINATION OF ALTERNATIVE INCREMENTAL CREDIT.— 
No election under subsection (c)(4) shall apply to taxable years 
beginning after December 31, 2008.’’. 
(c) MODIFICATION OF ALTERNATIVE SIMPLIFIED CREDIT.—Para-
graph (5)(A) of section 41(c) (relating to election of alternative 
simplified credit) is amended by striking ‘‘12 percent’’ and inserting 
‘‘14 percent (12 percent in the case of taxable years ending before 
January 1, 2009)’’. 
(d) TECHNICAL CORRECTION.—Paragraph (3) of section 41(h) 
is amended to read as follows: 
‘‘(2) COMPUTATION
FOR
TAXABLE
YEAR
IN
WHICH
CREDIT 
TERMINATES.—In the case of any taxable year with respect 
to which this section applies to a number of days which is 
less than the total number of days in such taxable year— 
‘‘(A) the amount determined under subsection (c)(1)(B) 
with respect to such taxable year shall be the amount 
which bears the same ratio to such amount (determined 
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, and 
‘‘(B) for purposes of subsection (c)(5), the average quali-
fied research expenses for the preceding 3 taxable years 
shall be the amount which bears the same ratio to such 
average qualified research expenses (determined 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.’’. 
(e) EFFECTIVE DATE.— 
(1) IN GENERAL.—Except as provided in paragraph (2), the 
amendments made by this section shall apply to taxable years 
beginning after December 31, 2007. 
(2) EXTENSION.—The amendments made by subsection (a) 
shall apply to amounts paid or incurred after December 31, 
2007. 
SEC. 302. NEW MARKETS TAX CREDIT. 
Subparagraph (D) of section 45D(f)(1) (relating to national 
limitation on amount of investments designated) is amended by 
striking ‘‘and 2008’’ and inserting ‘‘2008, and 2009’’. 
SEC. 303. SUBPART F EXCEPTION FOR ACTIVE FINANCING INCOME. 
(a) EXEMPT INSURANCE INCOME.—Paragraph (10) of section 
953(e) (relating to application) is amended— 
(1) by striking ‘‘January 1, 2009’’ and inserting ‘‘January 
1, 2010’’, and 
(2) by striking ‘‘December 31, 2008’’ and inserting 
‘‘December 31, 2009’’. 
(b) EXCEPTION TO TREATMENT AS FOREIGN PERSONAL HOLDING 
COMPANY INCOME.—Paragraph (9) of section 954(h) (relating to 
application) is amended by striking ‘‘January 1, 2009’’ and inserting 
‘‘January 1, 2010’’. 
26 USC 41 note. 
Applicability. 
26 USC 41. 
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122 STAT. 3867 
PUBLIC LAW 110–343—OCT. 3, 2008 
SEC. 304. EXTENSION OF LOOK-THRU RULE FOR RELATED CON-
TROLLED FOREIGN CORPORATIONS. 
(a) IN
GENERAL.—Subparagraph (C) of section 954(c)(6) 
(relating to application) is amended by striking ‘‘January 1, 2009’’ 
and inserting ‘‘January 1, 2010’’. 
(b) EFFECTIVE DATE.—The amendment made by this section 
shall apply to taxable years of foreign corporations beginning after 
December 31, 2007, and to taxable years of United States share-
holders with or within which such taxable years of foreign corpora-
tions end. 
SEC. 305. EXTENSION OF 15-YEAR STRAIGHT-LINE COST RECOVERY 
FOR QUALIFIED LEASEHOLD IMPROVEMENTS AND QUALI-
FIED RESTAURANT IMPROVEMENTS; 15-YEAR STRAIGHT- 
LINE COST RECOVERY FOR CERTAIN IMPROVEMENTS TO 
RETAIL SPACE. 
(a) EXTENSION
OF LEASEHOLD
AND RESTAURANT IMPROVE-
MENTS.— 
(1) IN GENERAL.—Clauses (iv) and (v) of section 168(e)(3)(E) 
(relating to 15-year property) are each amended by striking 
‘‘January 1, 2008’’ and inserting ‘‘January 1, 2010’’. 
(2) EFFECTIVE DATE.—The amendments made by this sub-
section shall apply to property placed in service after December 
31, 2007. 
(b) TREATMENT TO INCLUDE NEW CONSTRUCTION.— 
(1) IN GENERAL.—Paragraph (7) of section 168(e) (relating 
to classification of property) is amended to read as follows: 
‘‘(7) QUALIFIED RESTAURANT PROPERTY.— 
‘‘(A) IN GENERAL.—The term ‘qualified restaurant prop-
erty’ means any section 1250 property which is— 
‘‘(i) a building, if such building is placed in service 
after December 31, 2008, and before January 1, 2010, 
or 
‘‘(ii) an improvement to a building, 
if more than 50 percent of the building’s square footage 
is devoted to preparation of, and seating for on-premises 
consumption of, prepared meals. 
‘‘(B) EXCLUSION FROM BONUS DEPRECIATION.—Property 
described in this paragraph shall not be considered quali-
fied property for purposes of subsection (k).’’. 
(2) EFFECTIVE DATE.—The amendment made by this sub-
section shall apply to property placed in service after December 
31, 2008. 
(c) RECOVERY PERIOD FOR DEPRECIATION OF CERTAIN IMPROVE-
MENTS TO RETAIL SPACE.— 
(1) 
15-YEAR
RECOVERY
PERIOD.—Section 
168(e)(3)(E) 
(relating to 15-year property) is amended by striking ‘‘and’’ 
at the end of clause (vii), by striking the period at the end 
of clause (viii) and inserting ‘‘, and’’, and by adding at the 
end the following new clause: 
‘‘(ix) any qualified retail improvement property 
placed in service after December 31, 2008, and before 
January 1, 2010.’’. 
(2) QUALIFIED
RETAIL
IMPROVEMENT
PROPERTY.—Section 
168(e) is amended by adding at the end the following new 
paragraph: 
‘‘(8) QUALIFIED RETAIL IMPROVEMENT PROPERTY.— 
26 USC 168 note. 
26 USC 168 note. 
26 USC 954 note. 
26 USC 954. 
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122 STAT. 3868 
PUBLIC LAW 110–343—OCT. 3, 2008 
‘‘(A) IN GENERAL.—The term ‘qualified retail improve-
ment property’ means any improvement to an interior por-
tion of a building which is nonresidential real property 
if— 
‘‘(i) such portion is open to the general public and 
is used in the retail trade or business of selling tangible 
personal property to the general public, and 
‘‘(ii) such improvement is placed in service more 
than 3 years after the date the building was first 
placed in service. 
‘‘(B) IMPROVEMENTS MADE BY OWNER.—In the case of 
an improvement made by the owner of such improvement, 
such improvement shall be qualified retail improvement 
property (if at all) only so long as such improvement is 
held by such owner. Rules similar to the rules under para-
graph (6)(B) shall apply for purposes of the preceding sen-
tence. 
‘‘(C) CERTAIN
IMPROVEMENTS
NOT
INCLUDED.—Such 
term shall not include any improvement for which the 
expenditure is attributable to— 
‘‘(i) the enlargement of the building, 
‘‘(ii) any elevator or escalator, 
‘‘(iii) any structural component benefitting a 
common area, or 
‘‘(iv) the internal structural framework of the 
building. 
‘‘(D) EXCLUSION FROM BONUS DEPRECIATION.—Property 
described in this paragraph shall not be considered quali-
fied property for purposes of subsection (k). 
‘‘(E) TERMINATION.—Such term shall not include any 
improvement placed in service after December 31, 2009.’’. 
(3) REQUIREMENT TO USE STRAIGHT LINE METHOD.—Section 
168(b)(3) is amended by adding at the end the following new 
subparagraph: 
‘‘(I) Qualified retail improvement property described 
in subsection (e)(8).’’. 
(4) ALTERNATIVE SYSTEM.—The table contained in section 
168(g)(3)(B) is amended by inserting after the item relating 
to subparagraph (E)(viii) the following new item: 
‘‘(E)(ix) .............................................................................
39’’. 
(5) EFFECTIVE DATE.—The amendments made by this sub-
section shall apply to property placed in service after December 
31, 2008. 
SEC. 306. MODIFICATION OF TAX TREATMENT OF CERTAIN PAYMENTS 
TO CONTROLLING EXEMPT ORGANIZATIONS. 
(a) IN GENERAL.—Clause (iv) of section 512(b)(13)(E) (relating 
to termination) is amended by striking ‘‘December 31, 2007’’ and 
inserting ‘‘December 31, 2009’’. 
(b) EFFECTIVE DATE.—The amendment made by this section 
shall apply to payments received or accrued after December 31, 
2007. 
26 USC 512 note. 
26 USC 168 note. 
26 USC 168. 
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122 STAT. 3869 
PUBLIC LAW 110–343—OCT. 3, 2008 
SEC. 307. BASIS ADJUSTMENT TO STOCK OF S CORPORATIONS MAKING 
CHARITABLE CONTRIBUTIONS OF PROPERTY. 
(a) IN
GENERAL.—The last sentence of section 1367(a)(2) 
(relating to decreases in basis) is amended by striking ‘‘December 
31, 2007’’ and inserting ‘‘December 31, 2009’’. 
(b) EFFECTIVE DATE.—The amendment made by this section 
shall apply to contributions made in taxable years beginning after 
December 31, 2007. 
SEC. 308. INCREASE IN LIMIT ON COVER OVER OF RUM EXCISE TAX 
TO PUERTO RICO AND THE VIRGIN ISLANDS. 
(a) IN GENERAL.—Paragraph (1) of section 7652(f) is amended 
by striking ‘‘January 1, 2008’’ and inserting ‘‘January 1, 2010’’. 
(b) EFFECTIVE DATE.—The amendment made by this section 
shall apply to distilled spirits brought into the United States after 
December 31, 2007. 
SEC. 309. EXTENSION OF ECONOMIC DEVELOPMENT CREDIT FOR 
AMERICAN SAMOA. 
(a) IN GENERAL.—Subsection (d) of section 119 of division A 
of the Tax Relief and Health Care Act of 2006 is amended— 
(1) by striking ‘‘first two taxable years’’ and inserting ‘‘first 
4 taxable years’’, and 
(2) by striking ‘‘January 1, 2008’’ and inserting ‘‘January 
1, 2010’’. 
(b) EFFECTIVE DATE.—The amendments made by this section 
shall apply to taxable years beginning after December 31, 2007. 
SEC. 310. EXTENSION OF MINE RESCUE TEAM TRAINING CREDIT. 
Section 45N(e) (relating to termination) is amended by striking 
‘‘December 31, 2008’’ and inserting ‘‘December 31, 2009’’. 
SEC. 311. EXTENSION OF ELECTION TO EXPENSE ADVANCED MINE 
SAFETY EQUIPMENT. 
Section 179E(g) (relating to termination) is amended by striking 
‘‘December 31, 2008’’ and inserting ‘‘December 31, 2009’’. 
SEC. 312. DEDUCTION ALLOWABLE WITH RESPECT TO INCOME ATTRIB-
UTABLE 
TO 
DOMESTIC 
PRODUCTION 
ACTIVITIES 
IN 
PUERTO RICO. 
(a) IN
GENERAL.—Subparagraph (C) of section 199(d)(8) 
(relating to termination) is amended— 
(1) by striking ‘‘first 2 taxable years’’ and inserting ‘‘first 
4 taxable years’’, and 
(2) by striking ‘‘January 1, 2008’’ and inserting ‘‘January 
1, 2010’’. 
(b) EFFECTIVE DATE.—The amendments made by this section 
shall apply to taxable years beginning after December 31, 2007. 
SEC. 313. QUALIFIED ZONE ACADEMY BONDS. 
(a) IN GENERAL.—Subpart I of part IV of subchapter A of 
chapter 1 is amended by adding at the end the following new 
section: 
‘‘SEC. 54E. QUALIFIED ZONE ACADEMY BONDS. 
‘‘(a) QUALIFIED ZONE ACADEMY BONDS.—For purposes of this 
subchapter, the term ‘qualified zone academy bond’ means any 
bond issued as part of an issue if— 
26 USC 199 note. 
26 USC 30A note. 
26 USC 30A note. 
26 USC 7652 
note. 
26 USC 1367. 
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122 STAT. 3870 
PUBLIC LAW 110–343—OCT. 3, 2008 
‘‘(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 edu-
cation agency, 
‘‘(2) the bond is issued by a State or local government 
within the jurisdiction of which such academy 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 requirement of subsection (b) 
will be met with respect to such academy, and 
‘‘(C) certifies that it has the written approval of the 
eligible local education agency for such bond issuance. 
‘‘(b) PRIVATE BUSINESS CONTRIBUTION REQUIREMENT.—For pur-
poses of subsection (a), the private business contribution require-
ment of this subsection is met with respect to any issue if the 
eligible local education agency that established the qualified zone 
academy has written commitments 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 DESIGNATED.— 
‘‘(1) NATIONAL
LIMITATION.—There is a national zone 
academy bond limitation for each calendar year. Such limitation 
is $400,000,000 for 2008 and 2009, and, except as provided 
in paragraph (4), zero thereafter. 
‘‘(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 respec-
tive populations of individuals 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 
be allocated by the State education agency to qualified 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 para-
graph (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 during 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 following cal-
endar 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 unused limitation year. For purposes 
of the preceding sentence, a limitation amount shall be 
treated as used on a first-in first-out basis. 
‘‘(C) COORDINATION WITH SECTION 1397E.—Any carry-
over determined under section 1397E(e)(4) (relating to 
carryover of unused limitation) with respect to any State 
to calendar year 2008 or 2009 shall be treated for purposes 
Certification. 
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122 STAT. 3871 
PUBLIC LAW 110–343—OCT. 3, 2008 
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 carry-
over 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 
education 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, increase graduation and employ-
ment rates, and better prepare students for the rigors 
of college and the increasingly complex workforce, 
‘‘(B) students in such public school or program (as 
the case may be) will be subject to the same academic 
standards and assessments as other students educated by 
the eligible local education 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 (including 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 
established under the National School Lunch Act. 
‘‘(2) ELIGIBLE LOCAL EDUCATION AGENCY.—For purposes of 
this section, the term ‘eligible local education agency’ means 
any local educational agency as defined in section 9101 of 
the Elementary and Secondary Education Act of 1965. 
‘‘(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 established, 
‘‘(B) providing equipment for use at such academy, 
‘‘(C) developing course materials for education to be 
provided at such academy, and 
‘‘(D) training teachers and other school personnel in 
such academy. 
‘‘(4) QUALIFIED CONTRIBUTIONS.—The term ‘qualified con-
tribution’ means any contribution (of a type and quality accept-
able to the eligible local education agency) of— 
‘‘(A) equipment for use in the qualified zone academy 
(including state-of-the-art technology and vocational equip-
ment), 
‘‘(B) technical assistance in developing curriculum or 
in training teachers in order to promote appropriate market 
driven technology in the classroom, 
‘‘(C) services of employees as volunteer mentors, 
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122 STAT. 3872 
PUBLIC LAW 110–343—OCT. 3, 2008 
‘‘(D) internships, field trips, or other educational 
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 this 
Act, is amended by striking ‘‘or’’ at the end of subparagraph 
(B), by inserting ‘‘or’’ at the end of subparagraph (C), and 
by inserting after subparagraph (C) the following new subpara-
graph: 
‘‘(D) a qualified zone academy bond,’’. 
(2) Subparagraph (C) of section 54A(d)(2), as amended by 
this Act, 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: 
‘‘(iv) in the case of a qualified zone academy bond, 
a purpose specified in section 54E(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 obliga-
tion issued after the date of the enactment of the Tax Extenders 
and Alternative Minimum Tax Relief Act of 2008.’’. 
(4) The table of sections for subpart I of part IV of sub-
chapter A of chapter 1 is amended by adding at the end the 
following new item: 
‘‘Sec. 54E. Qualified zone academy 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. 314. INDIAN EMPLOYMENT CREDIT. 
(a) IN GENERAL.—Subsection (f) of section 45A (relating to 
termination) is amended by striking ‘‘December 31, 2007’’ and 
inserting ‘‘December 31, 2009’’. 
(b) EFFECTIVE DATE.—The amendment made by this section 
shall apply to taxable years beginning after December 31, 2007. 
SEC. 315. ACCELERATED DEPRECIATION FOR BUSINESS PROPERTY 
ON INDIAN RESERVATIONS. 
(a) IN GENERAL.—Paragraph (8) of section 168(j) (relating to 
termination) is amended by striking ‘‘December 31, 2007’’ and 
inserting ‘‘December 31, 2009’’. 
(b) EFFECTIVE DATE.—The amendment made by this section 
shall apply to property placed in service after December 31, 2007. 
SEC. 316. RAILROAD TRACK MAINTENANCE. 
(a) IN GENERAL.—Subsection (f) of section 45G (relating to 
application of section) is amended by striking ‘‘January 1, 2008’’ 
and inserting ‘‘January 1, 2010’’. 
(b) CREDIT ALLOWED AGAINST ALTERNATIVE MINIMUM TAX.— 
Subparagraph (B) of section 38(c)(4), as amended by this Act, is 
amended— 
(1) by redesignating clauses (v), (vi), and (vii) as clauses 
(vi), (vii), and (viii), respectively, and 
(2) by inserting after clause (iv) the following new clause: 
‘‘(v) the credit determined under section 45G,’’. 
(c) EFFECTIVE DATES.— 
26 USC 168 note. 
26 USC 45A note. 
26 USC 54A note. 
26 USC 54A. 
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122 STAT. 3873 
PUBLIC LAW 110–343—OCT. 3, 2008 
(1) The amendment made by subsection (a) shall apply 
to expenditures paid or incurred during taxable years beginning 
after December 31, 2007. 
(2) The amendments made by subsection (b) shall apply 
to credits determined under section 45G of the Internal Revenue 
Code of 1986 in taxable years beginning after December 31, 
2007, and to carrybacks of such credits. 
SEC. 317. SEVEN-YEAR COST RECOVERY PERIOD FOR MOTORSPORTS 
RACING TRACK FACILITY. 
(a) IN
GENERAL.—Subparagraph (D) of section 168(i)(15) 
(relating to termination) is amended by striking ‘‘December 31, 
2007’’ and inserting ‘‘December 31, 2009’’. 
(b) EFFECTIVE DATE.—The amendment made by this section 
shall apply to property placed in service after December 31, 2007. 
SEC. 318. EXPENSING OF ENVIRONMENTAL REMEDIATION COSTS. 
(a) IN GENERAL.—Subsection (h) of section 198 (relating to 
termination) is amended by striking ‘‘December 31, 2007’’ and 
inserting ‘‘December 31, 2009’’. 
(b) EFFECTIVE DATE.—The amendment made by this section 
shall apply to expenditures paid or incurred after December 31, 
2007. 
SEC. 319. EXTENSION OF WORK OPPORTUNITY TAX CREDIT FOR 
HURRICANE KATRINA EMPLOYEES. 
(a) IN GENERAL.—Paragraph (1) of section 201(b) of the Katrina 
Emergency Tax Relief Act of 2005 is amended by striking ‘‘2- 
year’’ and inserting ‘‘4-year’’. 
(b) EFFECTIVE DATE.—The amendment made by subsection (a) 
shall apply to individuals hired after August 27, 2007. 
SEC. 320. EXTENSION OF INCREASED REHABILITATION CREDIT FOR 
STRUCTURES IN THE GULF OPPORTUNITY ZONE. 
(a) IN GENERAL.—Subsection (h) of section 1400N is amended 
by striking ‘‘December 31, 2008’’ and inserting ‘‘December 31, 2009’’. 
(b) EFFECTIVE DATE.—The amendment made by this section 
shall apply to expenditures paid or incurred after the date of the 
enactment of this Act. 
SEC. 321. ENHANCED DEDUCTION FOR QUALIFIED COMPUTER CON-
TRIBUTIONS. 
(a) IN GENERAL.—Subparagraph (G) of section 170(e)(6) is 
amended by striking ‘‘December 31, 2007’’ and inserting ‘‘December 
31, 2009’’. 
(b) EFFECTIVE DATE.—The amendment made by this section 
shall apply to contributions made during taxable years beginning 
after December 31, 2007. 
SEC. 322. TAX INCENTIVES FOR INVESTMENT IN THE DISTRICT OF 
COLUMBIA. 
(a) DESIGNATION OF ZONE.— 
(1) IN GENERAL.—Subsection (f) of section 1400 is amended 
by striking ‘‘2007’’ both places it appears and inserting ‘‘2009’’. 
(2) EFFECTIVE DATE.—The amendments made by this sub-
section shall apply to periods beginning after December 31, 
2007. 
(b) TAX-EXEMPT ECONOMIC DEVELOPMENT BONDS.— 
26 USC 1400 
note. 
26 USC 170 note. 
26 USC 1400N 
note. 
119 Stat. 2020. 
26 USC 198 note. 
26 USC 168 note. 
26 USC 168. 
26 USC 38 note. 
26 USC 45G 
note. 
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122 STAT. 3874 
PUBLIC LAW 110–343—OCT. 3, 2008 
(1) IN
GENERAL.—Subsection (b) of section 1400A is 
amended by striking ‘‘2007’’ and inserting ‘‘2009’’. 
(2) EFFECTIVE DATE.—The amendment made by this sub-
section shall apply to bonds issued after December 31, 2007. 
(c) ZERO PERCENT CAPITAL GAINS RATE.— 
(1) IN
GENERAL.—Subsection (b) of section 1400B is 
amended by striking ‘‘2008’’ each place it appears and inserting 
‘‘2010’’. 
(2) CONFORMING AMENDMENTS.— 
(A) Section 1400B(e)(2) is amended— 
(i) by striking ‘‘2012’’ and inserting ‘‘2014’’, and 
(ii) by striking ‘‘2012’’ in the heading thereof and 
inserting ‘‘2014’’. 
(B) Section 1400B(g)(2) is amended by striking ‘‘2012’’ 
and inserting ‘‘2014’’. 
(C) Section 1400F(d) is amended by striking ‘‘2012’’ 
and inserting ‘‘2014’’. 
(3) EFFECTIVE DATES.— 
(A) EXTENSION.—The amendments made by paragraph 
(1) shall apply to acquisitions after December 31, 2007. 
(B) CONFORMING
AMENDMENTS.—The amendments 
made by paragraph (2) shall take effect on the date of 
the enactment of this Act. 
(d) FIRST-TIME HOMEBUYER CREDIT.— 
(1) IN
GENERAL.—Subsection (i) of section 1400C is 
amended by striking ‘‘2008’’ and inserting ‘‘2010’’. 
(2) EFFECTIVE DATE.—The amendment made by this sub-
section shall apply to property purchased after December 31, 
2007. 
SEC. 323. ENHANCED CHARITABLE DEDUCTIONS FOR CONTRIBUTIONS 
OF FOOD INVENTORY. 
(a) INCREASED AMOUNT OF DEDUCTION.— 
(1) IN GENERAL.—Clause (iv) of section 170(e)(3)(C) (relating 
to termination) is amended by striking ‘‘December 31, 2007’’ 
and inserting ‘‘December 31, 2009’’. 
(2) EFFECTIVE DATE.—The amendment made by this sub-
section shall apply to contributions made after December 31, 
2007. 
(b) TEMPORARY SUSPENSION OF LIMITATIONS ON CHARITABLE 
CONTRIBUTIONS.— 
(1) IN
GENERAL.—Section 170(b) is amended by adding 
at the end the following new paragraph: 
‘‘(3) TEMPORARY
SUSPENSION
OF
LIMITATIONS
ON
CHARI-
TABLE CONTRIBUTIONS.—In the case of a qualified farmer or 
rancher (as defined in paragraph (1)(E)(v)), any charitable con-
tribution of food— 
‘‘(A) to which subsection (e)(3)(C) applies (without 
regard to clause (ii) thereof), and 
‘‘(B) which is made during the period beginning on 
the date of the enactment of this paragraph and before 
January 1, 2009, 
shall be treated for purposes of paragraph (1)(E) or (2)(B), 
whichever is applicable, as if it were a qualified conservation 
contribution which is made by a qualified farmer or rancher 
and which otherwise meets the requirements of such para-
graph.’’. 
26 USC 170 note. 
26 USC 1400C 
note. 
26 USC 1400B 
note. 
26 USC 1400A. 
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122 STAT. 3875 
PUBLIC LAW 110–343—OCT. 3, 2008 
(2) EFFECTIVE DATE.—The amendment made by this sub-
section shall apply to taxable years ending after the date of 
the enactment of this Act. 
SEC. 324. EXTENSION OF ENHANCED CHARITABLE DEDUCTION FOR 
CONTRIBUTIONS OF BOOK INVENTORY. 
(a) EXTENSION.—Clause (iv) of section 170(e)(3)(D) (relating 
to termination) is amended by striking ‘‘December 31, 2007’’ and 
inserting ‘‘December 31, 2009’’. 
(b) CLERICAL AMENDMENT.—Clause (iii) of section 170(e)(3)(D) 
(relating to certification by donee) is amended by inserting ‘‘of 
books’’ after ‘‘to any contribution’’. 
(c) EFFECTIVE DATE.—The amendments made by this section 
shall apply to contributions made after December 31, 2007. 
SEC. 325. EXTENSION AND MODIFICATION OF DUTY SUSPENSION ON 
WOOL PRODUCTS; WOOL RESEARCH FUND; WOOL DUTY 
REFUNDS. 
(a) EXTENSION OF TEMPORARY DUTY REDUCTIONS.—Each of the 
following headings of the Harmonized Tariff Schedule of the United 
States is amended by striking the date in the effective period 
column and inserting ‘‘12/31/2014’’: 
(1) Heading 9902.51.11 (relating to fabrics of worsted wool). 
(2) Heading 9902.51.13 (relating to yarn of combed wool). 
(3) Heading 9902.51.14 (relating to wool fiber, waste, 
garnetted stock, combed wool, or wool top). 
(4) Heading 9902.51.15 (relating to fabrics of combed wool). 
(5) Heading 9902.51.16 (relating to fabrics of combed wool). 
(b) EXTENSION OF DUTY REFUNDS AND WOOL RESEARCH TRUST 
FUND.— 
(1) IN
GENERAL.—Section 4002(c) of the Wool Suit and 
Textile Trade Extension Act of 2004 (Public Law 108–429; 
118 Stat. 2603) is amended— 
(A) in paragraph (3)(C), by striking ‘‘2010’’ and 
inserting ‘‘2015’’; and 
(B) in paragraph (6)(A), by striking ‘‘through 2009’’ 
and inserting ‘‘through 2014’’. 
(2) SUNSET.—Section 506(f) of the Trade and Development 
Act of 2000 (Public 106–200; 114 Stat. 303 (7 U.S.C. 7101 
note)) is amended by striking ‘‘2010’’ and inserting ‘‘2015’’. 
TITLE IV—EXTENSION OF TAX 
ADMINISTRATION PROVISIONS 
SEC. 401. PERMANENT AUTHORITY FOR UNDERCOVER OPERATIONS. 
(a) IN GENERAL.—Section 7608(c) (relating to rules relating 
to undercover operations) is amended by striking paragraph (6). 
(b) EFFECTIVE DATE.—The amendment made by this section 
shall apply to operations conducted after the date of the enactment 
of this Act. 
SEC. 402. PERMANENT AUTHORITY FOR DISCLOSURE OF INFORMA-
TION RELATING TO TERRORIST ACTIVITIES. 
(a) DISCLOSURE OF RETURN INFORMATION TO APPRISE APPRO-
PRIATE OFFICIALS OF TERRORIST ACTIVITIES.—Subparagraph (C) of 
section 6103(i)(3) is amended by striking clause (iv). 
26 USC 7608 
note. 
26 USC 170 note. 
26 USC 170. 
26 USC 170 note. 
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122 STAT. 3876 
PUBLIC LAW 110–343—OCT. 3, 2008 
(b) DISCLOSURE UPON REQUEST OF INFORMATION RELATING TO 
TERRORIST ACTIVITIES.—Paragraph (7) of section 6103(i) is amended 
by striking subparagraph (E). 
(c) EFFECTIVE DATE.—The amendments made by this section 
shall apply to disclosures after the date of the enactment of this 
Act. 
TITLE V—ADDITIONAL TAX RELIEF AND 
OTHER TAX PROVISIONS 
Subtitle A—General Provisions 
SEC. 501. $8,500 INCOME THRESHOLD USED TO CALCULATE REFUND-
ABLE PORTION OF CHILD TAX CREDIT. 
(a) IN GENERAL.—Section 24(d) is amended by adding at the 
end the following new paragraph: 
‘‘(4) SPECIAL RULE FOR 2008.—Notwithstanding paragraph 
(3), in the case of any taxable year beginning in 2008, the 
dollar amount in effect for such taxable year under paragraph 
(1)(B)(i) shall be $8,500.’’. 
(b) EFFECTIVE DATE.—The amendment made by this section 
shall apply to taxable years beginning after December 31, 2007. 
SEC. 502. PROVISIONS RELATED TO FILM AND TELEVISION PRODUC-
TIONS. 
(a) EXTENSION OF EXPENSING RULES FOR QUALIFIED FILM AND 
TELEVISION PRODUCTIONS.—Section 181(f) (relating to termination) 
is amended by striking ‘‘December 31, 2008’’ and inserting 
‘‘December 31, 2009’’. 
(b) MODIFICATION
OF LIMITATION
ON EXPENSING.—Subpara-
graph (A) of section 181(a)(2) is amended to read as follows: 
‘‘(A) IN GENERAL.—Paragraph (1) shall not apply to 
so much of the aggregate cost of any qualified film or 
television production as exceeds $15,000,000.’’. 
(c) MODIFICATIONS TO DEDUCTION FOR DOMESTIC ACTIVITIES.— 
(1) DETERMINATION OF W–2 WAGES.—Paragraph (2) of sec-
tion 199(b) is amended by adding at the end the following 
new subparagraph: 
‘‘(D) SPECIAL RULE FOR QUALIFIED FILM.—In the case 
of a qualified film, such term shall include compensation 
for services performed in the United States by actors, 
production personnel, directors, and producers.’’. 
(2) DEFINITION OF QUALIFIED FILM.—Paragraph (6) of sec-
tion 199(c) is amended by adding at the end the following: 
‘‘A qualified film shall include any copyrights, trademarks, or 
other intangibles with respect to such film. The methods and 
means of distributing a qualified film shall not affect the avail-
ability of the deduction under this section.’’. 
(3) PARTNERSHIPS.—Subparagraph (A) of section 199(d)(1) 
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: 
‘‘(iv) in the case of each partner of a partnership, 
or shareholder of an S corporation, who owns (directly 
or indirectly) at least 20 percent of the capital interests 
26 USC 24 note. 
26 USC 6103 
note. 
26 USC 6103. 
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122 STAT. 3877 
PUBLIC LAW 110–343—OCT. 3, 2008 
in such partnership or of the stock of such S corpora-
tion— 
‘‘(I) such partner or shareholder shall be 
treated as having engaged directly in any film 
produced by such partnership or S corporation, 
and 
‘‘(II) such partnership or S corporation shall 
be treated as having engaged directly in any film 
produced by such partner or shareholder.’’. 
(d) CONFORMING AMENDMENT.—Section 181(d)(3)(A) is amended 
by striking ‘‘actors’’ and all that follows and inserting ‘‘actors, 
production personnel, directors, and producers.’’. 
(e) EFFECTIVE DATES.— 
(1) IN GENERAL.—Except as otherwise provided in this sub-
section, the amendments made by this section shall apply to 
qualified film and television productions commencing after 
December 31, 2007. 
(2) DEDUCTION.—The amendments made by subsection (c) 
shall apply to taxable years beginning after December 31, 2007. 
SEC. 503. EXEMPTION FROM EXCISE TAX FOR CERTAIN WOODEN 
ARROWS DESIGNED FOR USE BY CHILDREN. 
(a) IN GENERAL.—Paragraph (2) of section 4161(b) is amended 
by redesignating subparagraph (B) as subparagraph (C) and by 
inserting after subparagraph (A) the following new subparagraph: 
‘‘(B) 
EXEMPTION
FOR
CERTAIN
WOODEN
ARROW 
SHAFTS.—Subparagraph (A) shall not apply to any shaft 
consisting of all natural wood with no laminations or artifi-
cial means of enhancing the spine of such shaft (whether 
sold separately or incorporated as part of a finished or 
unfinished product) of a type used in the manufacture 
of any arrow which after its assembly— 
‘‘(i) measures 5⁄16 of an inch or less in diameter, 
and 
‘‘(ii) is not suitable for use with a bow described 
in paragraph (1)(A).’’. 
(b) EFFECTIVE DATE.—The amendments made by this section 
shall apply to shafts first sold after the date of enactment of 
this Act. 
SEC. 504. INCOME AVERAGING FOR AMOUNTS RECEIVED IN CONNEC-
TION WITH THE EXXON VALDEZ LITIGATION. 
(a) INCOME AVERAGING
OF AMOUNTS RECEIVED FROM
THE 
EXXON VALDEZ LITIGATION.—For purposes of section 1301 of the 
Internal Revenue Code of 1986— 
(1) any qualified taxpayer who receives any qualified settle-
ment income in any taxable year shall be treated as engaged 
in a fishing business (determined without regard to the commer-
cial nature of the business), and 
(2) such qualified settlement income shall be treated as 
income attributable to such a fishing business for such taxable 
year. 
(b) CONTRIBUTIONS
OF AMOUNTS RECEIVED
TO RETIREMENT 
ACCOUNTS.— 
(1) IN
GENERAL.—Any qualified taxpayer who receives 
qualified settlement income during the taxable year may, at 
any time before the end of the taxable year in which such 
income was received, make one or more contributions to an 
26 USC 4161 
note. 
26 USC 181 note. 
26 USC 181. 
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122 STAT. 3878 
PUBLIC LAW 110–343—OCT. 3, 2008 
eligible retirement plan of which such qualified taxpayer is 
a beneficiary in an aggregate amount not to exceed the lesser 
of— 
(A) $100,000 (reduced by the amount of qualified settle-
ment income contributed to an eligible retirement plan 
in prior taxable years pursuant to this subsection), or 
(B) the amount of qualified settlement income received 
by the individual during the taxable year. 
(2) TIME WHEN CONTRIBUTIONS DEEMED MADE.—For pur-
poses of paragraph (1), a qualified taxpayer shall be deemed 
to have made a contribution to an eligible retirement plan 
on the last day of the taxable year in which such income 
is received if the contribution is made on account of such 
taxable year and is made not later than the time prescribed 
by law for filing the return for such taxable year (not including 
extensions thereof). 
(3) TREATMENT OF CONTRIBUTIONS TO ELIGIBLE RETIREMENT 
PLANS.—For purposes of the Internal Revenue Code of 1986, 
if a contribution is made pursuant to paragraph (1) with respect 
to qualified settlement income, then— 
(A) except as provided in paragraph (4)— 
(i) to the extent of such contribution, the qualified 
settlement income shall not be included in taxable 
income, and 
(ii) for purposes of section 72 of such Code, such 
contribution shall not be considered to be investment 
in the contract, 
(B) the qualified taxpayer shall, to the extent of the 
amount of the contribution, be treated— 
(i) as having received the qualified settlement 
income— 
(I) in the case of a contribution to an individual 
retirement 
plan 
(as 
defined 
under 
section 
7701(a)(37) of such Code), in a distribution 
described in section 408(d)(3) of such Code, and 
(II) in the case of any other eligible retirement 
plan, in an eligible rollover distribution (as defined 
under section 402(f)(2) of such Code), and 
(ii) as having transferred the amount to the eligible 
retirement plan in a direct trustee to trustee transfer 
within 60 days of the distribution, 
(C) section 408(d)(3)(B) of the Internal Revenue Code 
of 1986 shall not apply with respect to amounts treated 
as a rollover under this paragraph, and 
(D) section 408A(c)(3)(B) of the Internal Revenue Code 
of 1986 shall not apply with respect to amounts contributed 
to a Roth IRA (as defined under section 408A(b) of such 
Code) or a designated Roth contribution to an applicable 
retirement plan (within the meaning of section 402A of 
such Code) under this paragraph. 
(4) SPECIAL RULE FOR ROTH IRAS AND ROTH 401(k)S.—For 
purposes of the Internal Revenue Code of 1986, if a contribution 
is made pursuant to paragraph (1) with respect to qualified 
settlement income to a Roth IRA (as defined under section 
408A(b) of such Code) or as a designated Roth contribution 
to an applicable retirement plan (within the meaning of section 
402A of such Code), then— 
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122 STAT. 3879 
PUBLIC LAW 110–343—OCT. 3, 2008 
(A) the qualified settlement income shall be includible 
in taxable income, and 
(B) for purposes of section 72 of such Code, such con-
tribution shall be considered to be investment in the con-
tract. 
(5) ELIGIBLE RETIREMENT PLAN.—For purpose of this sub-
section, the term ‘‘eligible retirement plan’’ has the meaning 
given such term under section 402(c)(8)(B) of the Internal Rev-
enue Code of 1986. 
(c) TREATMENT
OF QUALIFIED SETTLEMENT INCOME UNDER 
EMPLOYMENT TAXES.— 
(1) SECA.—For purposes of chapter 2 of the Internal Rev-
enue Code of 1986 and section 211 of the Social Security Act, 
no portion of qualified settlement income received by a qualified 
taxpayer shall be treated as self-employment income. 
(2) FICA.—For purposes of chapter 21 of the Internal Rev-
enue Code of 1986 and section 209 of the Social Security Act, 
no portion of qualified settlement income received by a qualified 
taxpayer shall be treated as wages. 
(d) QUALIFIED TAXPAYER.—For purposes of this section, the 
term ‘‘qualified taxpayer’’ means— 
(1) any individual who is a plaintiff in the civil action 
In re Exxon Valdez, No. 89–095–CV (HRH) (Consolidated) (D. 
Alaska); or 
(2) any individual who is a beneficiary of the estate of 
such a plaintiff who— 
(A) acquired the right to receive qualified settlement 
income from that plaintiff; and 
(B) was the spouse or an immediate relative of that 
plaintiff. 
(e) QUALIFIED SETTLEMENT INCOME.—For purposes of this sec-
tion, the term ‘‘qualified settlement income’’ means any interest 
and punitive damage awards which are— 
(1) otherwise includible in taxable income, and 
(2) received (whether as lump sums or periodic payments) 
in connection with the civil action In re Exxon Valdez, No. 
89–095–CV (HRH) (Consolidated) (D. Alaska) (whether pre- 
or post-judgment and whether related to a settlement or judg-
ment). 
SEC. 505. CERTAIN FARMING BUSINESS MACHINERY AND EQUIPMENT 
TREATED AS 5-YEAR PROPERTY. 
(a) IN GENERAL.—Section 168(e)(3)(B) (defining 5-year property) 
is amended by striking ‘‘and’’ at the end of clause (v), by striking 
the period at the end of clause (vi)(III) and inserting ‘‘, and’’, 
and by inserting after clause (vi) the following new clause: 
‘‘(vii) any machinery or equipment (other than any 
grain bin, cotton ginning asset, fence, or other land 
improvement) which is used in a farming business 
(as defined in section 263A(e)(4)), the original use of 
which commences with the taxpayer after December 
31, 2008, and which is placed in service before January 
1, 2010.’’. 
(b) ALTERNATIVE SYSTEM.—The table contained in section 
168(g)(3)(B) (relating to special rule for certain property assigned 
to classes) is amended by inserting after the item relating to 
subparagraph (B)(iii) the following: 
26 USC 168. 
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122 STAT. 3880 
PUBLIC LAW 110–343—OCT. 3, 2008 
(B)(vii) ........................................................................
10’’. 
(c) EFFECTIVE DATE.—The amendments made by this section 
shall apply to property placed in service after December 31, 2008. 
SEC. 506. MODIFICATION OF PENALTY ON UNDERSTATEMENT OF TAX-
PAYER’S LIABILITY BY TAX RETURN PREPARER. 
(a) IN GENERAL.—Subsection (a) of section 6694 is amended 
to read as follows: 
‘‘(a) UNDERSTATEMENT DUE
TO UNREASONABLE POSITIONS.— 
‘‘(1) IN GENERAL.—If a tax return preparer— 
‘‘(A) prepares any return or claim of refund with respect 
to which any part of an understatement of liability is 
due to a position described in paragraph (2), and 
‘‘(B) knew (or reasonably should have known) of the 
position, 
such tax return preparer shall pay a penalty with respect 
to each such return or claim in an amount equal to the greater 
of $1,000 or 50 percent of the income derived (or to be derived) 
by the tax return preparer with respect to the return or claim. 
‘‘(2) UNREASONABLE POSITION.— 
‘‘(A) IN
GENERAL.—Except as otherwise provided in 
this paragraph, a position is described in this paragraph 
unless there is or was substantial authority for the position. 
‘‘(B) DISCLOSED POSITIONS.—If the position was dis-
closed as provided in section 6662(d)(2)(B)(ii)(I) and is not 
a position to which subparagraph (C) applies, the position 
is described in this paragraph unless there is a reasonable 
basis for the position. 
‘‘(C) TAX SHELTERS AND REPORTABLE TRANSACTIONS.— 
If the position is with respect to a tax shelter (as defined 
in section 6662(d)(2)(C)(ii)) or a reportable transaction to 
which section 6662A applies, the position is described in 
this paragraph unless it is reasonable to believe that the 
position would more likely than not be sustained on its 
merits. 
‘‘(3) REASONABLE CAUSE EXCEPTION.—No penalty shall be 
imposed under this subsection if it is shown that there is 
reasonable cause for the understatement and the tax return 
preparer acted in good faith.’’. 
(b) EFFECTIVE DATE.—The amendment made by this section 
shall apply— 
(1) in the case of a position other than a position described 
in subparagraph (C) of section 6694(a)(2) of the Internal Rev-
enue Code of 1986 (as amended by this section), to returns 
prepared after May 25, 2007, and 
(2) in the case of a position described in such subparagraph 
(C), to returns prepared for taxable years ending after the 
date of the enactment of this Act. 
26 USC 6694 
note. 
26 USC 6694. 
26 USC 168 note. 
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122 STAT. 3881 
PUBLIC LAW 110–343—OCT. 3, 2008 
Subtitle 
B—Paul 
Wellstone 
and 
Pete 
Domenici Mental Health Parity and Ad-
diction Equity Act of 2008 
SEC. 511. SHORT TITLE. 
This subtitle may be cited as the ‘‘Paul Wellstone and Pete 
Domenici Mental Health Parity and Addiction Equity Act of 2008’’. 
SEC. 512. MENTAL HEALTH PARITY. 
(a) AMENDMENTS
TO ERISA.—Section 712 of the Employee 
Retirement Income Security Act of 1974 (29 U.S.C. 1185a) is 
amended— 
(1) in subsection (a), by adding at the end the following: 
‘‘(3) FINANCIAL
REQUIREMENTS
AND
TREATMENT
LIMITA-
TIONS.— 
‘‘(A) IN GENERAL.—In the case of a group health plan 
(or health insurance coverage offered in connection with 
such a plan) that provides both medical and surgical bene-
fits and mental health or substance use disorder benefits, 
such plan or coverage shall ensure that— 
‘‘(i) the financial requirements applicable to such 
mental health or substance use disorder benefits are 
no more restrictive than the predominant financial 
requirements applied to substantially all medical and 
surgical benefits covered by the plan (or coverage), 
and there are no separate cost sharing requirements 
that are applicable only with respect to mental health 
or substance use disorder benefits; and 
‘‘(ii) the treatment limitations applicable to such 
mental health or substance use disorder benefits are 
no more restrictive than the predominant treatment 
limitations applied to substantially all medical and 
surgical benefits covered by the plan (or coverage) and 
there are no separate treatment limitations that are 
applicable only with respect to mental health or sub-
stance use disorder benefits. 
‘‘(B) DEFINITIONS.—In this paragraph: 
‘‘(i) FINANCIAL REQUIREMENT.—The term ‘financial 
requirement’ 
includes 
deductibles, 
copayments, 
coinsurance, and out-of-pocket expenses, but excludes 
an aggregate lifetime limit and an annual limit subject 
to paragraphs (1) and (2), 
‘‘(ii) PREDOMINANT.—A financial requirement or 
treatment limit is considered to be predominant if it 
is the most common or frequent of such type of limit 
or requirement. 
‘‘(iii) TREATMENT
LIMITATION.—The term ‘treat-
ment limitation’ includes limits on the frequency of 
treatment, number of visits, days of coverage, or other 
similar limits on the scope or duration of treatment. 
‘‘(4) AVAILABILITY OF PLAN INFORMATION.—The criteria for 
medical necessity determinations made under the plan with 
respect to mental health or substance use disorder benefits 
(or the health insurance coverage offered in connection with 
the plan with respect to such benefits) shall be made available 
42 USC 201 note. 
Paul Wellstone 
and Pete 
Domenici Mental 
Health Parity and 
Addiction Equity 
Act of 2008. 
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122 STAT. 3882 
PUBLIC LAW 110–343—OCT. 3, 2008 
by the plan administrator (or the health insurance issuer 
offering such coverage) in accordance with regulations to any 
current or potential participant, beneficiary, or contracting pro-
vider upon request. The reason for any denial under the plan 
(or coverage) of reimbursement or payment for services with 
respect to mental health or substance use disorder benefits 
in the case of any participant or beneficiary shall, on request 
or as otherwise required, be made available by the plan 
administrator (or the health insurance issuer offering such 
coverage) to the participant or beneficiary in accordance with 
regulations. 
‘‘(5) OUT-OF-NETWORK PROVIDERS.—In the case of a plan 
or coverage that provides both medical and surgical benefits 
and mental health or substance use disorder benefits, if the 
plan or coverage provides coverage for medical or surgical bene-
fits provided by out-of-network providers, the plan or coverage 
shall provide coverage for mental health or substance use dis-
order benefits provided by out-of-network providers in a manner 
that is consistent with the requirements of this section.’’; 
(2) in subsection (b), by amending paragraph (2) to read 
as follows: 
‘‘(2) in the case of a group health plan (or health insurance 
coverage offered in connection with such a plan) that provides 
mental health or substance use disorder benefits, as affecting 
the terms and conditions of the plan or coverage relating to 
such benefits under the plan or coverage, except as provided 
in subsection (a).’’; 
(3) in subsection (c)— 
(A) in paragraph (1)(B)— 
(i) by inserting ‘‘(or 1 in the case of an employer 
residing in a State that permits small groups to include 
a single individual)’’ after ‘‘at least 2’’ the first place 
that such appears; and 
(ii) by striking ‘‘and who employs at least 2 
employees on the first day of the plan year’’; and 
(B) by striking paragraph (2) and inserting the fol-
lowing: 
‘‘(2) COST EXEMPTION.— 
‘‘(A) IN GENERAL.—With respect to a group health plan 
(or health insurance coverage offered in connection with 
such a plan), if the application of this section to such 
plan (or coverage) results in an increase for the plan year 
involved of the actual total costs of coverage with respect 
to medical and surgical benefits and mental health and 
substance use disorder benefits under the plan (as deter-
mined and certified under subparagraph (C)) by an amount 
that exceeds the applicable percentage described in 
subparagraph (B) of the actual total plan costs, the provi-
sions of this section shall not apply to such plan (or cov-
erage) during the following plan year, and such exemption 
shall apply to the plan (or coverage) for 1 plan year. An 
employer may elect to continue to apply mental health 
and substance use disorder parity pursuant to this section 
with respect to the group health plan (or coverage) involved 
regardless of any increase in total costs. 
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122 STAT. 3883 
PUBLIC LAW 110–343—OCT. 3, 2008 
‘‘(B) APPLICABLE PERCENTAGE.—With respect to a plan 
(or coverage), the applicable percentage described in this 
subparagraph shall be— 
‘‘(i) 2 percent in the case of the first plan year 
in which this section is applied; and 
‘‘(ii) 1 percent in the case of each subsequent plan 
year. 
‘‘(C) DETERMINATIONS BY ACTUARIES.—Determinations 
as to increases in actual costs under a plan (or coverage) 
for purposes of this section shall be made and certified 
by a qualified and licensed actuary who is a member in 
good standing of the American Academy of Actuaries. All 
such determinations shall be in a written report prepared 
by the actuary. The report, and all underlying documenta-
tion relied upon by the actuary, shall be maintained by 
the group health plan or health insurance issuer for a 
period of 6 years following the notification made under 
subparagraph (E). 
‘‘(D) 6-MONTH DETERMINATIONS.—If a group health plan 
(or a health insurance issuer offering coverage in connection 
with a group health plan) seeks an exemption under this 
paragraph, determinations under subparagraph (A) shall 
be made after such plan (or coverage) has complied with 
this section for the first 6 months of the plan year involved. 
‘‘(E) NOTIFICATION.— 
‘‘(i) IN GENERAL.—A group health plan (or a health 
insurance issuer offering coverage in connection with 
a group health plan) that, based upon a certification 
described under subparagraph (C), qualifies for an 
exemption under this paragraph, and elects to imple-
ment the exemption, shall promptly notify the Sec-
retary, the appropriate State agencies, and participants 
and beneficiaries in the plan of such election. 
‘‘(ii) REQUIREMENT.—A notification to the Secretary 
under clause (i) shall include— 
‘‘(I) a description of the number of covered 
lives under the plan (or coverage) involved at the 
time of the notification, and as applicable, at the 
time of any prior election of the cost-exemption 
under this paragraph by such plan (or coverage); 
‘‘(II) for both the plan year upon which a cost 
exemption is sought and the year prior, a descrip-
tion of the actual total costs of coverage with 
respect to medical and surgical benefits and 
mental health and substance use disorder benefits 
under the plan; and 
‘‘(III) for both the plan year upon which a 
cost exemption is sought and the year prior, the 
actual total costs of coverage with respect to 
mental health and substance use disorder benefits 
under the plan. 
‘‘(iii) CONFIDENTIALITY.—A notification to the Sec-
retary under clause (i) shall be confidential. The Sec-
retary shall make available, upon request and on not 
more than an annual basis, an anonymous itemization 
of such notifications, that includes— 
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122 STAT. 3884 
PUBLIC LAW 110–343—OCT. 3, 2008 
‘‘(I) a breakdown of States by the size and 
type of employers submitting such notification; and 
‘‘(II) a summary of the data received under 
clause (ii). 
‘‘(F) AUDITS BY APPROPRIATE AGENCIES.—To determine 
compliance with this paragraph, the Secretary may audit 
the books and records of a group health plan or health 
insurance issuer relating to an exemption, including any 
actuarial reports prepared pursuant to subparagraph (C), 
during the 6 year period following the notification of such 
exemption under subparagraph (E). A State agency 
receiving a notification under subparagraph (E) may also 
conduct such an audit with respect to an exemption covered 
by such notification.’’; 
(4) in subsection (e), by striking paragraph (4) and inserting 
the following: 
‘‘(4) MENTAL HEALTH BENEFITS.—The term ‘mental health 
benefits’ means benefits with respect to services for mental 
health conditions, as defined under the terms of the plan and 
in accordance with applicable Federal and State law. 
‘‘(5) SUBSTANCE USE DISORDER BENEFITS.—The term ‘sub-
stance use disorder benefits’ means benefits with respect to 
services for substance use disorders, as defined under the terms 
of the plan and in accordance with applicable Federal and 
State law.’’; 
(5) by striking subsection (f); 
(6) by inserting after subsection (e) the following: 
‘‘(f) SECRETARY REPORT.—The Secretary shall, by January 1, 
2012, and every two years thereafter, submit to the appropriate 
committees of Congress a report on compliance of group health 
plans (and health insurance coverage offered in connection with 
such plans) with the requirements of this section. Such report 
shall include the results of any surveys or audits on compliance 
of group health plans (and health insurance coverage offered in 
connection with such plans) with such requirements and an analysis 
of the reasons for any failures to comply. 
‘‘(g) NOTICE AND ASSISTANCE.—The Secretary, in cooperation 
with the Secretaries of Health and Human Services and Treasury, 
as appropriate, shall publish and widely disseminate guidance and 
information for group health plans, participants and beneficiaries, 
applicable State and local regulatory bodies, and the National 
Association of Insurance Commissioners concerning the require-
ments of this section and shall provide assistance concerning such 
requirements and the continued operation of applicable State law. 
Such guidance and information shall inform participants and bene-
ficiaries of how they may obtain assistance under this section, 
including, where appropriate, assistance from State consumer and 
insurance agencies.’’; 
(7) by striking ‘‘mental health benefits’’ and inserting 
‘‘mental health and substance use disorder benefits’’ each place 
it appears in subsections (a)(1)(B)(i), (a)(1)(C), (a)(2)(B)(i), and 
(a)(2)(C); and 
(8) by striking ‘‘mental health benefits’’ and inserting 
‘‘mental health or substance use disorder benefits’’ each place 
it appears (other than in any provision amended by the previous 
paragraph). 
Publication. 
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122 STAT. 3885 
PUBLIC LAW 110–343—OCT. 3, 2008 
(b) AMENDMENTS TO PUBLIC HEALTH SERVICE ACT.—Section 
2705 of the Public Health Service Act (42 U.S.C. 300gg–5) is 
amended— 
(1) in subsection (a), by adding at the end the following: 
‘‘(3) FINANCIAL
REQUIREMENTS
AND
TREATMENT
LIMITA-
TIONS.— 
‘‘(A) IN GENERAL.—In the case of a group health plan 
(or health insurance coverage offered in connection with 
such a plan) that provides both medical and surgical bene-
fits and mental health or substance use disorder benefits, 
such plan or coverage shall ensure that— 
‘‘(i) the financial requirements applicable to such 
mental health or substance use disorder benefits are 
no more restrictive than the predominant financial 
requirements applied to substantially all medical and 
surgical benefits covered by the plan (or coverage), 
and there are no separate cost sharing requirements 
that are applicable only with respect to mental health 
or substance use disorder benefits; and 
‘‘(ii) the treatment limitations applicable to such 
mental health or substance use disorder benefits are 
no more restrictive than the predominant treatment 
limitations applied to substantially all medical and 
surgical benefits covered by the plan (or coverage) and 
there are no separate treatment limitations that are 
applicable only with respect to mental health or sub-
stance use disorder benefits. 
‘‘(B) DEFINITIONS.—In this paragraph: 
‘‘(i) FINANCIAL REQUIREMENT.—The term ‘financial 
requirement’ 
includes 
deductibles, 
copayments, 
coinsurance, and out-of-pocket expenses, but excludes 
an aggregate lifetime limit and an annual limit subject 
to paragraphs (1) and (2). 
‘‘(ii) PREDOMINANT.—A financial requirement or 
treatment limit is considered to be predominant if it 
is the most common or frequent of such type of limit 
or requirement. 
‘‘(iii) TREATMENT
LIMITATION.—The term ‘treat-
ment limitation’ includes limits on the frequency of 
treatment, number of visits, days of coverage, or other 
similar limits on the scope or duration of treatment. 
‘‘(4) AVAILABILITY OF PLAN INFORMATION.—The criteria for 
medical necessity determinations made under the plan with 
respect to mental health or substance use disorder benefits 
(or the health insurance coverage offered in connection with 
the plan with respect to such benefits) shall be made available 
by the plan administrator (or the health insurance issuer 
offering such coverage) in accordance with regulations to any 
current or potential participant, beneficiary, or contracting pro-
vider upon request. The reason for any denial under the plan 
(or coverage) of reimbursement or payment for services with 
respect to mental health or substance use disorder benefits 
in the case of any participant or beneficiary shall, on request 
or as otherwise required, be made available by the plan 
administrator (or the health insurance issuer offering such 
coverage) to the participant or beneficiary in accordance with 
regulations. 
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122 STAT. 3886 
PUBLIC LAW 110–343—OCT. 3, 2008 
‘‘(5) OUT-OF-NETWORK PROVIDERS.—In the case of a plan 
or coverage that provides both medical and surgical benefits 
and mental health or substance use disorder benefits, if the 
plan or coverage provides coverage for medical or surgical bene-
fits provided by out-of-network providers, the plan or coverage 
shall provide coverage for mental health or substance use dis-
order benefits provided by out-of-network providers in a manner 
that is consistent with the requirements of this section.’’; 
(2) in subsection (b), by amending paragraph (2) to read 
as follows: 
‘‘(2) in the case of a group health plan (or health insurance 
coverage offered in connection with such a plan) that provides 
mental health or substance use disorder benefits, as affecting 
the terms and conditions of the plan or coverage relating to 
such benefits under the plan or coverage, except as provided 
in subsection (a).’’; 
(3) in subsection (c)— 
(A) in paragraph (1), by inserting before the period 
the following: ‘‘(as defined in section 2791(e)(4), except that 
for purposes of this paragraph such term shall include 
employers with 1 employee in the case of an employer 
residing in a State that permits small groups to include 
a single individual)’’; and 
(B) by striking paragraph (2) and inserting the fol-
lowing: 
‘‘(2) COST EXEMPTION.— 
‘‘(A) IN GENERAL.—With respect to a group health plan 
(or health insurance coverage offered in connection with 
such a plan), if the application of this section to such 
plan (or coverage) results in an increase for the plan year 
involved of the actual total costs of coverage with respect 
to medical and surgical benefits and mental health and 
substance use disorder benefits under the plan (as deter-
mined and certified under subparagraph (C)) by an amount 
that exceeds the applicable percentage described in 
subparagraph (B) of the actual total plan costs, the provi-
sions of this section shall not apply to such plan (or cov-
erage) during the following plan year, and such exemption 
shall apply to the plan (or coverage) for 1 plan year. An 
employer may elect to continue to apply mental health 
and substance use disorder parity pursuant to this section 
with respect to the group health plan (or coverage) involved 
regardless of any increase in total costs. 
‘‘(B) APPLICABLE PERCENTAGE.—With respect to a plan 
(or coverage), the applicable percentage described in this 
subparagraph shall be— 
‘‘(i) 2 percent in the case of the first plan year 
in which this section is applied; and 
‘‘(ii) 1 percent in the case of each subsequent plan 
year. 
‘‘(C) DETERMINATIONS BY ACTUARIES.—Determinations 
as to increases in actual costs under a plan (or coverage) 
for purposes of this section shall be made and certified 
by a qualified and licensed actuary who is a member in 
good standing of the American Academy of Actuaries. All 
such determinations shall be in a written report prepared 
Reports. 
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122 STAT. 3887 
PUBLIC LAW 110–343—OCT. 3, 2008 
by the actuary. The report, and all underlying documenta-
tion relied upon by the actuary, shall be maintained by 
the group health plan or health insurance issuer for a 
period of 6 years following the notification made under 
subparagraph (E). 
‘‘(D) 6-MONTH DETERMINATIONS.—If a group health plan 
(or a health insurance issuer offering coverage in connection 
with a group health plan) seeks an exemption under this 
paragraph, determinations under subparagraph (A) shall 
be made after such plan (or coverage) has complied with 
this section for the first 6 months of the plan year involved. 
‘‘(E) NOTIFICATION.— 
‘‘(i) IN GENERAL.—A group health plan (or a health 
insurance issuer offering coverage in connection with 
a group health plan) that, based upon a certification 
described under subparagraph (C), qualifies for an 
exemption under this paragraph, and elects to imple-
ment the exemption, shall promptly notify the Sec-
retary, the appropriate State agencies, and participants 
and beneficiaries in the plan of such election. 
‘‘(ii) REQUIREMENT.—A notification to the Secretary 
under clause (i) shall include— 
‘‘(I) a description of the number of covered 
lives under the plan (or coverage) involved at the 
time of the notification, and as applicable, at the 
time of any prior election of the cost-exemption 
under this paragraph by such plan (or coverage); 
‘‘(II) for both the plan year upon which a cost 
exemption is sought and the year prior, a descrip-
tion of the actual total costs of coverage with 
respect to medical and surgical benefits and 
mental health and substance use disorder benefits 
under the plan; and 
‘‘(III) for both the plan year upon which a 
cost exemption is sought and the year prior, the 
actual total costs of coverage with respect to 
mental health and substance use disorder benefits 
under the plan. 
‘‘(iii) CONFIDENTIALITY.—A notification to the Sec-
retary under clause (i) shall be confidential. The Sec-
retary shall make available, upon request and on not 
more than an annual basis, an anonymous itemization 
of such notifications, that includes— 
‘‘(I) a breakdown of States by the size and 
type of employers submitting such notification; and 
‘‘(II) a summary of the data received under 
clause (ii). 
‘‘(F) AUDITS BY APPROPRIATE AGENCIES.—To determine 
compliance with this paragraph, the Secretary may audit 
the books and records of a group health plan or health 
insurance issuer relating to an exemption, including any 
actuarial reports prepared pursuant to subparagraph (C), 
during the 6 year period following the notification of such 
exemption under subparagraph (E). A State agency 
receiving a notification under subparagraph (E) may also 
conduct such an audit with respect to an exemption covered 
by such notification.’’; 
Records. 
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122 STAT. 3888 
PUBLIC LAW 110–343—OCT. 3, 2008 
(4) in subsection (e), by striking paragraph (4) and inserting 
the following: 
‘‘(4) MENTAL HEALTH BENEFITS.—The term ‘mental health 
benefits’ means benefits with respect to services for mental 
health conditions, as defined under the terms of the plan and 
in accordance with applicable Federal and State law. 
‘‘(5) SUBSTANCE USE DISORDER BENEFITS.—The term ‘sub-
stance use disorder benefits’ means benefits with respect to 
services for substance use disorders, as defined under the terms 
of the plan and in accordance with applicable Federal and 
State law.’’; 
(5) by striking subsection (f); 
(6) by striking ‘‘mental health benefits’’ and inserting 
‘‘mental health and substance use disorder benefits’’ each place 
it appears in subsections (a)(1)(B)(i), (a)(1)(C), (a)(2)(B)(i), and 
(a)(2)(C); and 
(7) by striking ‘‘mental health benefits’’ and inserting 
‘‘mental health or substance use disorder benefits’’ each place 
it appears (other than in any provision amended by the previous 
paragraph). 
(c) AMENDMENTS TO INTERNAL REVENUE CODE.—Section 9812 
of the Internal Revenue Code of 1986 is amended— 
(1) in subsection (a), by adding at the end the following: 
‘‘(3) FINANCIAL
REQUIREMENTS
AND
TREATMENT
LIMITA-
TIONS.— 
‘‘(A) IN GENERAL.—In the case of a group health plan 
that provides both medical and surgical benefits and mental 
health or substance use disorder benefits, such plan shall 
ensure that— 
‘‘(i) the financial requirements applicable to such 
mental health or substance use disorder benefits are 
no more restrictive than the predominant financial 
requirements applied to substantially all medical and 
surgical benefits covered by the plan, and there are 
no separate cost sharing requirements that are 
applicable only with respect to mental health or sub-
stance use disorder benefits; and 
‘‘(ii) the treatment limitations applicable to such 
mental health or substance use disorder benefits are 
no more restrictive than the predominant treatment 
limitations applied to substantially all medical and 
surgical benefits covered by the plan and there are 
no separate treatment limitations that are applicable 
only with respect to mental health or substance use 
disorder benefits. 
‘‘(B) DEFINITIONS.—In this paragraph: 
‘‘(i) FINANCIAL REQUIREMENT.—The term ‘financial 
requirement’ 
includes 
deductibles, 
copayments, 
coinsurance, and out-of-pocket expenses, but excludes 
an aggregate lifetime limit and an annual limit subject 
to paragraphs (1) and (2), 
‘‘(ii) PREDOMINANT.—A financial requirement or 
treatment limit is considered to be predominant if it 
is the most common or frequent of such type of limit 
or requirement. 
‘‘(iii) TREATMENT
LIMITATION.—The term ‘treat-
ment limitation’ includes limits on the frequency of 
26 USC 9812. 
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122 STAT. 3889 
PUBLIC LAW 110–343—OCT. 3, 2008 
treatment, number of visits, days of coverage, or other 
similar limits on the scope or duration of treatment. 
‘‘(4) AVAILABILITY OF PLAN INFORMATION.—The criteria for 
medical necessity determinations made under the plan with 
respect to mental health or substance use disorder benefits 
shall be made available by the plan administrator in accordance 
with regulations to any current or potential participant, bene-
ficiary, or contracting provider upon request. The reason for 
any denial under the plan of reimbursement or payment for 
services with respect to mental health or substance use disorder 
benefits in the case of any participant or beneficiary shall, 
on request or as otherwise required, be made available by 
the plan administrator to the participant or beneficiary in 
accordance with regulations. 
‘‘(5) OUT-OF-NETWORK PROVIDERS.—In the case of a plan 
that provides both medical and surgical benefits and mental 
health or substance use disorder benefits, if the plan provides 
coverage for medical or surgical benefits provided by out-of- 
network providers, the plan shall provide coverage for mental 
health or substance use disorder benefits provided by out-of- 
network providers in a manner that is consistent with the 
requirements of this section.’’; 
(2) in subsection (b), by amending paragraph (2) to read 
as follows: 
‘‘(2) in the case of a group health plan that provides mental 
health or substance use disorder benefits, as affecting the terms 
and conditions of the plan relating to such benefits under 
the plan, except as provided in subsection (a).’’; 
(3) in subsection (c)— 
(A) by amending paragraph (1) to read as follows: 
‘‘(1) SMALL EMPLOYER EXEMPTION.— 
‘‘(A) IN GENERAL.—This section shall not apply to any 
group health plan for any plan year of a small employer. 
‘‘(B) SMALL EMPLOYER.—For purposes of subparagraph 
(A), the term ‘small employer’ means, with respect to a 
calendar year and a plan year, an employer who employed 
an average of at least 2 (or 1 in the case of an employer 
residing in a State that permits small groups to include 
a single individual) but not more than 50 employees on 
business days during the preceding calendar year. For pur-
poses of the preceding sentence, all persons treated as 
a single employer under subsection (b), (c), (m), or (o) 
of section 414 shall be treated as 1 employer and rules 
similar to rules of subparagraphs (B) and (C) of section 
4980D(d)(2) shall apply.’’; and 
(B) by striking paragraph (2) and inserting the fol-
lowing: 
‘‘(2) COST EXEMPTION.— 
‘‘(A) IN GENERAL.—With respect to a group health plan, 
if the application of this section to such plan results in 
an increase for the plan year involved of the actual total 
costs of coverage with respect to medical and surgical bene-
fits and mental health and substance use disorder benefits 
under the plan (as determined and certified under subpara-
graph (C)) by an amount that exceeds the applicable 
percentage described in subparagraph (B) of the actual 
total plan costs, the provisions of this section shall not 
Applicability. 
Applicability. 
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122 STAT. 3890 
PUBLIC LAW 110–343—OCT. 3, 2008 
apply to such plan during the following plan year, and 
such exemption shall apply to the plan for 1 plan year. 
An employer may elect to continue to apply mental health 
and substance use disorder parity pursuant to this section 
with respect to the group health plan involved regardless 
of any increase in total costs. 
‘‘(B) APPLICABLE PERCENTAGE.—With respect to a plan, 
the applicable percentage described in this subparagraph 
shall be— 
‘‘(i) 2 percent in the case of the first plan year 
in which this section is applied; and 
‘‘(ii) 1 percent in the case of each subsequent plan 
year. 
‘‘(C) DETERMINATIONS BY ACTUARIES.—Determinations 
as to increases in actual costs under a plan for purposes 
of this section shall be made and certified by a qualified 
and licensed actuary who is a member in good standing 
of the American Academy of Actuaries. All such determina-
tions shall be in a written report prepared by the actuary. 
The report, and all underlying documentation relied upon 
by the actuary, shall be maintained by the group health 
plan for a period of 6 years following the notification made 
under subparagraph (E). 
‘‘(D) 6-MONTH DETERMINATIONS.—If a group health plan 
seeks an exemption under this paragraph, determinations 
under subparagraph (A) shall be made after such plan 
has complied with this section for the first 6 months of 
the plan year involved. 
‘‘(E) NOTIFICATION.— 
‘‘(i) IN GENERAL.—A group health plan that, based 
upon a certification described under subparagraph (C), 
qualifies for an exemption under this paragraph, and 
elects to implement the exemption, shall promptly 
notify the Secretary, the appropriate State agencies, 
and participants and beneficiaries in the plan of such 
election. 
‘‘(ii) REQUIREMENT.—A notification to the Secretary 
under clause (i) shall include— 
‘‘(I) a description of the number of covered 
lives under the plan involved at the time of the 
notification, and as applicable, at the time of any 
prior election of the cost-exemption under this 
paragraph by such plan; 
‘‘(II) for both the plan year upon which a cost 
exemption is sought and the year prior, a descrip-
tion of the actual total costs of coverage with 
respect to medical and surgical benefits and 
mental health and substance use disorder benefits 
under the plan; and 
‘‘(III) for both the plan year upon which a 
cost exemption is sought and the year prior, the 
actual total costs of coverage with respect to 
mental health and substance use disorder benefits 
under the plan. 
‘‘(iii) CONFIDENTIALITY.—A notification to the Sec-
retary under clause (i) shall be confidential. The Sec-
retary shall make available, upon request and on not 
Records. 
Reports. 
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122 STAT. 3891 
PUBLIC LAW 110–343—OCT. 3, 2008 
more than an annual basis, an anonymous itemization 
of such notifications, that includes— 
‘‘(I) a breakdown of States by the size and 
type of employers submitting such notification; and 
‘‘(II) a summary of the data received under 
clause (ii). 
‘‘(F) AUDITS BY APPROPRIATE AGENCIES.—To determine 
compliance with this paragraph, the Secretary may audit 
the books and records of a group health plan relating 
to an exemption, including any actuarial reports prepared 
pursuant to subparagraph (C), during the 6 year period 
following the notification of such exemption under subpara-
graph (E). A State agency receiving a notification under 
subparagraph (E) may also conduct such an audit with 
respect to an exemption covered by such notification.’’; 
(4) in subsection (e), by striking paragraph (4) and inserting 
the following: 
‘‘(4) MENTAL HEALTH BENEFITS.—The term ‘mental health 
benefits’ means benefits with respect to services for mental 
health conditions, as defined under the terms of the plan and 
in accordance with applicable Federal and State law. 
‘‘(5) SUBSTANCE USE DISORDER BENEFITS.—The term ‘sub-
stance use disorder benefits’ means benefits with respect to 
services for substance use disorders, as defined under the terms 
of the plan and in accordance with applicable Federal and 
State law.’’; 
(5) by striking subsection (f); 
(6) by striking ‘‘mental health benefits’’ and inserting 
‘‘mental health and substance use disorder benefits’’ each place 
it appears in subsections (a)(1)(B)(i), (a)(1)(C), (a)(2)(B)(i), and 
(a)(2)(C); and 
(7) by striking ‘‘mental health benefits’’ and inserting 
‘‘mental health or substance use disorder benefits’’ each place 
it appears (other than in any provision amended by the previous 
paragraph). 
(d) REGULATIONS.—Not later than 1 year after the date of 
enactment of this Act, the Secretaries of Labor, Health and Human 
Services, and the Treasury shall issue regulations to carry out 
the amendments made by subsections (a), (b), and (c), respectively. 
(e) EFFECTIVE DATE.— 
(1) IN GENERAL.—The amendments made by this section 
shall apply with respect to group health plans for plan years 
beginning after the date that is 1 year after the date of enact-
ment of this Act, regardless of whether regulations have been 
issued to carry out such amendments by such effective date, 
except that the amendments made by subsections (a)(5), (b)(5), 
and (c)(5), relating to striking of certain sunset provisions, 
shall take effect on January 1, 2009. 
(2) SPECIAL
RULE
FOR
COLLECTIVE
BARGAINING
AGREE-
MENTS.—In the case of a group health plan maintained pursu-
ant to one or more collective bargaining agreements between 
employee representatives and one or more employers ratified 
before the date of the enactment of this Act, the amendments 
made by this section shall not apply to plan years beginning 
before the later of— 
42 USC 300gg–5 
note. 
Deadline. 
42 USC 300gg–5 
note. 
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122 STAT. 3892 
PUBLIC LAW 110–343—OCT. 3, 2008 
(A) the date on which the last of the collective bar-
gaining agreements relating to the plan terminates (deter-
mined without regard to any extension thereof agreed to 
after the date of the enactment of this Act), or 
(B) January 1, 2009. 
For purposes of subparagraph (A), any plan amendment made 
pursuant to a collective bargaining agreement relating to the 
plan which amends the plan solely to conform to any require-
ment added by this section shall not be treated as a termination 
of such collective bargaining agreement. 
(f) ASSURING COORDINATION.—The Secretary of Health and 
Human Services, the Secretary of Labor, and the Secretary of 
the Treasury may ensure, through the execution or revision of 
an interagency memorandum of understanding among such Secre-
taries, that— 
(1) regulations, rulings, and interpretations issued by such 
Secretaries relating to the same matter over which two or 
more such Secretaries have responsibility under this section 
(and the amendments made by this section) are administered 
so as to have the same effect at all times; and 
(2) coordination of policies relating to enforcing the same 
requirements through such Secretaries in order to have a 
coordinated enforcement strategy that avoids duplication of 
enforcement efforts and assigns priorities in enforcement. 
(g) CONFORMING CLERICAL AMENDMENTS.— 
(1) ERISA HEADING.— 
(A) IN GENERAL.—The heading of section 712 of the 
Employee Retirement Income Security Act of 1974 is 
amended to read as follows: 
‘‘SEC. 712. PARITY IN MENTAL HEALTH AND SUBSTANCE USE DIS-
ORDER BENEFITS.’’. 
(B) CLERICAL AMENDMENT.—The table of contents in 
section 1 of such Act is amended by striking the item 
relating to section 712 and inserting the following new 
item: 
‘‘Sec. 712. Parity in mental health and substance use disorder benefits.’’. 
(2) PHSA HEADING.—The heading of section 2705 of the 
Public Health Service Act is amended to read as follows: 
‘‘SEC. 2705. PARITY IN MENTAL HEALTH AND SUBSTANCE USE DIS-
ORDER BENEFITS.’’. 
(3) IRC HEADING.— 
(A) IN GENERAL.—The heading of section 9812 of the 
Internal Revenue Code of 1986 is amended to read as 
follows: 
‘‘SEC. 9812. PARITY IN MENTAL HEALTH AND SUBSTANCE USE DIS-
ORDER BENEFITS.’’. 
(B) CLERICAL AMENDMENT.—The table of sections for 
subchapter B of chapter 100 of such Code is amended 
by striking the item relating to section 9812 and inserting 
the following new item: 
‘‘Sec. 9812. Parity in mental health and substance use disorder benefits.’’. 
(h) GAO STUDY
ON COVERAGE
AND EXCLUSION
OF MENTAL 
HEALTH AND SUBSTANCE USE DISORDER DIAGNOSES.— 
26 USC 9812. 
42 USC 300gg–5. 
29 USC 1185a. 
42 USC 300gg–5 
note. 
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122 STAT. 3893 
PUBLIC LAW 110–343—OCT. 3, 2008 
(1) IN GENERAL.—The Comptroller General of the United 
States shall conduct a study that analyzes the specific rates, 
patterns, and trends in coverage and exclusion of specific 
mental health and substance use disorder diagnoses by health 
plans and health insurance. The study shall include an analysis 
of— 
(A) specific coverage rates for all mental health condi-
tions and substance use disorders; 
(B) which diagnoses are most commonly covered or 
excluded; 
(C) whether implementation of this Act has affected 
trends in coverage or exclusion of such diagnoses; and 
(D) the impact of covering or excluding specific 
diagnoses on participants’ and enrollees’ health, their 
health care coverage, and the costs of delivering health 
care. 
(2) REPORTS.—Not later than 3 years after the date of 
the enactment of this Act, and 2 years after the date of submis-
sion the first report under this paragraph, the Comptroller 
General shall submit to Congress a report on the results of 
the study conducted under paragraph (1). 
TITLE VI—OTHER PROVISIONS 
SEC. 601. SECURE RURAL SCHOOLS AND COMMUNITY SELF-DETER-
MINATION PROGRAM. 
(a) REAUTHORIZATION
OF
THE SECURE RURAL SCHOOLS
AND 
COMMUNITY SELF-DETERMINATION ACT OF 2000.—The Secure Rural 
Schools and Community Self-Determination Act of 2000 (16 U.S.C. 
500 note; Public Law 106–393) is amended by striking sections 
1 through 403 and inserting the following: 
‘‘SEC. 1. SHORT TITLE. 
‘‘This Act may be cited as the ‘Secure Rural Schools and 
Community Self-Determination Act of 2000’. 
‘‘SEC. 2. PURPOSES. 
‘‘The purposes of this Act are— 
‘‘(1) to stabilize and transition payments to counties to 
provide funding for schools and roads that supplements other 
available funds; 
‘‘(2) to make additional investments in, and create addi-
tional employment opportunities through, projects that— 
‘‘(A)(i) improve the maintenance of existing infrastruc-
ture; 
‘‘(ii) implement stewardship objectives that enhance 
forest ecosystems; and 
‘‘(iii) restore and improve land health and water 
quality; 
‘‘(B) enjoy broad-based support; and 
‘‘(C) have objectives that may include— 
‘‘(i) road, trail, and infrastructure maintenance or 
obliteration; 
‘‘(ii) soil productivity improvement; 
‘‘(iii) improvements in forest ecosystem health; 
‘‘(iv) watershed restoration and maintenance; 
16 USC 7101. 
16 USC 7101 
note. 
16 USC 500 
notes. 
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122 STAT. 3894 
PUBLIC LAW 110–343—OCT. 3, 2008 
‘‘(v) the restoration, maintenance, and improve-
ment of wildlife and fish habitat; 
‘‘(vi) the control of noxious and exotic weeds; and 
‘‘(vii) the reestablishment of native species; and 
‘‘(3) to improve cooperative relationships among— 
‘‘(A) the people that use and care for Federal land; 
and 
‘‘(B) the agencies that manage the Federal land. 
‘‘SEC. 3. DEFINITIONS. 
‘‘In this Act: 
‘‘(1) ADJUSTED SHARE.—The term ‘adjusted share’ means 
the number equal to the quotient obtained by dividing— 
‘‘(A) the number equal to the quotient obtained by 
dividing— 
‘‘(i) the base share for the eligible county; by 
‘‘(ii) the income adjustment for the eligible county; 
by 
‘‘(B) the number equal to the sum of the quotients 
obtained under subparagraph (A) and paragraph (8)(A) for 
all eligible counties. 
‘‘(2) BASE SHARE.—The term ‘base share’ means the number 
equal to the average of— 
‘‘(A) the quotient obtained by dividing— 
‘‘(i) the number of acres of Federal land described 
in paragraph (7)(A) in each eligible county; by 
‘‘(ii) the total number acres of Federal land in 
all eligible counties in all eligible States; and 
‘‘(B) the quotient obtained by dividing— 
‘‘(i) the amount equal to the average of the 3 
highest 25-percent payments and safety net payments 
made to each eligible State for each eligible county 
during the eligibility period; by 
‘‘(ii) the amount equal to the sum of the amounts 
calculated under clause (i) and paragraph (9)(B)(i) for 
all eligible counties in all eligible States during the 
eligibility period. 
‘‘(3) COUNTY PAYMENT.—The term ‘county payment’ means 
the payment for an eligible county calculated under section 
101(b). 
‘‘(4) ELIGIBLE COUNTY.—The term ‘eligible county’ means 
any county that— 
‘‘(A) contains Federal land (as defined in paragraph 
(7)); and 
‘‘(B) elects to receive a share of the State payment 
or the county payment under section 102(b). 
‘‘(5) ELIGIBILITY
PERIOD.—The term ‘eligibility period’ 
means fiscal year 1986 through fiscal year 1999. 
‘‘(6) ELIGIBLE STATE.—The term ‘eligible State’ means a 
State or territory of the United States that received a 25- 
percent payment for 1 or more fiscal years of the eligibility 
period. 
‘‘(7) FEDERAL LAND.—The term ‘Federal land’ means— 
‘‘(A) land within the National Forest System, as defined 
in section 11(a) of the Forest and Rangeland Renewable 
Resources Planning Act of 1974 (16 U.S.C. 1609(a)) exclu-
sive of the National Grasslands and land utilization 
16 USC 7102. 
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122 STAT. 3895 
PUBLIC LAW 110–343—OCT. 3, 2008 
projects designated as National Grasslands administered 
pursuant to the Act of July 22, 1937 (7 U.S.C. 1010– 
1012); and 
‘‘(B) such portions of the revested Oregon and Cali-
fornia Railroad and reconveyed Coos Bay Wagon Road 
grant land as are or may hereafter come under the jurisdic-
tion of the Department of the Interior, which have here-
tofore or may hereafter be classified as timberlands, and 
power-site land valuable for timber, that shall be managed, 
except as provided in the former section 3 of the Act of 
August 28, 1937 (50 Stat. 875; 43 U.S.C. 1181c), for perma-
nent forest production. 
‘‘(8) 50-PERCENT ADJUSTED SHARE.—The term ‘50-percent 
adjusted share’ means the number equal to the quotient 
obtained by dividing— 
‘‘(A) the number equal to the quotient obtained by 
dividing— 
‘‘(i) the 50-percent base share for the eligible 
county; by 
‘‘(ii) the income adjustment for the eligible county; 
by 
‘‘(B) the number equal to the sum of the quotients 
obtained under subparagraph (A) and paragraph (1)(A) for 
all eligible counties. 
‘‘(9) 50-PERCENT BASE SHARE.—The term ‘50-percent base 
share’ means the number equal to the average of— 
‘‘(A) the quotient obtained by dividing— 
‘‘(i) the number of acres of Federal land described 
in paragraph (7)(B) in each eligible county; by 
‘‘(ii) the total number acres of Federal land in 
all eligible counties in all eligible States; and 
‘‘(B) the quotient obtained by dividing— 
‘‘(i) the amount equal to the average of the 3 
highest 50-percent payments made to each eligible 
county during the eligibility period; by 
‘‘(ii) the amount equal to the sum of the amounts 
calculated under clause (i) and paragraph (2)(B)(i) for 
all eligible counties in all eligible States during the 
eligibility period. 
‘‘(10) 50-PERCENT
PAYMENT.—The term ‘50-percent pay-
ment’ means the payment that is the sum of the 50-percent 
share otherwise paid to a county pursuant to title II of the 
Act of August 28, 1937 (chapter 876; 50 Stat. 875; 43 U.S.C. 
1181f), and the payment made to a county pursuant to the 
Act of May 24, 1939 (chapter 144; 53 Stat. 753; 43 U.S.C. 
1181f–1 et seq.). 
‘‘(11) FULL
FUNDING
AMOUNT.—The term ‘full funding 
amount’ means— 
‘‘(A) $500,000,000 for fiscal year 2008; and 
‘‘(B) for fiscal year 2009 and each fiscal year thereafter, 
the amount that is equal to 90 percent of the full funding 
amount for the preceding fiscal year. 
‘‘(12) INCOME ADJUSTMENT.—The term ‘income adjustment’ 
means the square of the quotient obtained by dividing— 
‘‘(A) the per capita personal income for each eligible 
county; by 
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122 STAT. 3896 
PUBLIC LAW 110–343—OCT. 3, 2008 
‘‘(B) the median per capita personal income of all 
eligible counties. 
‘‘(13) PER CAPITA PERSONAL INCOME.—The term ‘per capita 
personal income’ means the most recent per capita personal 
income data, as determined by the Bureau of Economic Anal-
ysis. 
‘‘(14) SAFETY NET PAYMENTS.—The term ‘safety net pay-
ments’ means the special payment amounts paid to States 
and counties required by section 13982 or 13983 of the Omnibus 
Budget Reconciliation Act of 1993 (Public Law 103–66; 16 
U.S.C. 500 note; 43 U.S.C. 1181f note). 
‘‘(15) SECRETARY
CONCERNED.—The term ‘Secretary con-
cerned’ means— 
‘‘(A) the Secretary of Agriculture or the designee of 
the Secretary of Agriculture with respect to the Federal 
land described in paragraph (7)(A); and 
‘‘(B) the Secretary of the Interior or the designee of 
the Secretary of the Interior with respect to the Federal 
land described in paragraph (7)(B). 
‘‘(16) STATE PAYMENT.—The term ‘State payment’ means 
the payment for an eligible State calculated under section 
101(a). 
‘‘(17) 25-PERCENT
PAYMENT.—The term ‘25-percent pay-
ment’ means the payment to States required by the sixth para-
graph under the heading of ‘FOREST SERVICE’ in the Act 
of May 23, 1908 (35 Stat. 260; 16 U.S.C. 500), and section 
13 of the Act of March 1, 1911 (36 Stat. 963; 16 U.S.C. 500). 
‘‘TITLE 
I—SECURE 
PAYMENTS 
FOR 
STATES AND COUNTIES CONTAINING 
FEDERAL LAND 
‘‘SEC. 101. SECURE PAYMENTS FOR STATES CONTAINING FEDERAL 
LAND. 
‘‘(a) STATE PAYMENT.—For each of fiscal years 2008 through 
2011, the Secretary of Agriculture shall calculate for each eligible 
State an amount equal to the sum of the products obtained by 
multiplying— 
‘‘(1) the adjusted share for each eligible county within the 
eligible State; by 
‘‘(2) the full funding amount for the fiscal year. 
‘‘(b) COUNTY PAYMENT.—For each of fiscal years 2008 through 
2011, the Secretary of the Interior shall calculate for each eligible 
county that received a 50-percent payment during the eligibility 
period an amount equal to the product obtained by multiplying— 
‘‘(1) the 50-percent adjusted share for the eligible county; 
by 
‘‘(2) the full funding amount for the fiscal year. 
‘‘SEC. 102. PAYMENTS TO STATES AND COUNTIES. 
‘‘(a) PAYMENT AMOUNTS.—Except as provided in section 103, 
the Secretary of the Treasury shall pay to— 
‘‘(1) a State or territory of the United States an amount 
equal to the sum of the amounts elected under subsection 
(b) by each county within the State or territory for— 
16 USC 7112. 
16 USC 7111. 
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122 STAT. 3897 
PUBLIC LAW 110–343—OCT. 3, 2008 
‘‘(A) if the county is eligible for the 25-percent payment, 
the share of the 25-percent payment; or 
‘‘(B) the share of the State payment of the eligible 
county; and 
‘‘(2) a county an amount equal to the amount elected under 
subsection (b) by each county for— 
‘‘(A) if the county is eligible for the 50-percent payment, 
the 50-percent payment; or 
‘‘(B) the county payment for the eligible county. 
‘‘(b) ELECTION TO RECEIVE PAYMENT AMOUNT.— 
‘‘(1) ELECTION; SUBMISSION OF RESULTS.— 
‘‘(A) IN GENERAL.—The election to receive a share of 
the State payment, the county payment, a share of the 
State payment and the county payment, a share of the 
25-percent payment, the 50-percent payment, or a share 
of the 25-percent payment and the 50-percent payment, 
as applicable, shall be made at the discretion of each 
affected county by August 1, 2008 (or as soon thereafter 
as the Secretary concerned determines is practicable), and 
August 1 of each second fiscal year thereafter, in accordance 
with paragraph (2), and transmitted to the Secretary con-
cerned by the Governor of each eligible State. 
‘‘(B) FAILURE
TO
TRANSMIT.—If an election for an 
affected county is not transmitted to the Secretary con-
cerned by the date specified under subparagraph (A), the 
affected county shall be considered to have elected to 
receive a share of the State payment, the county payment, 
or a share of the State payment and the county payment, 
as applicable. 
‘‘(2) DURATION OF ELECTION.— 
‘‘(A) IN GENERAL.—A county election to receive a share 
of the 25-percent payment or 50-percent payment, as 
applicable, shall be effective for 2 fiscal years. 
‘‘(B) FULL
FUNDING
AMOUNT.—If a county elects to 
receive a share of the State payment or the county pay-
ment, the election shall be effective for all subsequent 
fiscal years through fiscal year 2011. 
‘‘(3) SOURCE OF PAYMENT AMOUNTS.—The payment to an 
eligible State or eligible county under this section for a fiscal 
year shall be derived from— 
‘‘(A) any amounts that are appropriated to carry out 
this Act; 
‘‘(B) any revenues, fees, penalties, or miscellaneous 
receipts, exclusive of deposits to any relevant trust fund, 
special account, or permanent operating funds, received 
by the Federal Government from activities by the Bureau 
of Land Management or the Forest Service on the 
applicable Federal land; and 
‘‘(C) to the extent of any shortfall, out of any amounts 
in the Treasury of the United States not otherwise appro-
priated. 
‘‘(c) DISTRIBUTION AND EXPENDITURE OF PAYMENTS.— 
‘‘(1) DISTRIBUTION METHOD.—A State that receives a pay-
ment under subsection (a) for Federal land described in section 
3(7)(A) shall distribute the appropriate payment amount among 
the appropriate counties in the State in accordance with— 
‘‘(A) the Act of May 23, 1908 (16 U.S.C. 500); and 
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122 STAT. 3898 
PUBLIC LAW 110–343—OCT. 3, 2008 
‘‘(B) section 13 of the Act of March 1, 1911 (36 Stat. 
963; 16 U.S.C. 500). 
‘‘(2) EXPENDITURE
PURPOSES.—Subject to subsection (d), 
payments received by a State under subsection (a) and distrib-
uted to counties in accordance with paragraph (1) shall be 
expended as required by the laws referred to in paragraph 
(1). 
‘‘(d) EXPENDITURE RULES FOR ELIGIBLE COUNTIES.— 
‘‘(1) ALLOCATIONS.— 
‘‘(A) USE OF PORTION IN SAME MANNER AS 25-PERCENT 
PAYMENT OR 50-PERCENT PAYMENT, AS APPLICABLE.—Except 
as provided in paragraph (3)(B), if an eligible county elects 
to receive its share of the State payment or the county 
payment, not less than 80 percent, but not more than 
85 percent, of the funds shall be expended in the same 
manner in which the 25-percent payments or 50-percent 
payment, as applicable, are required to be expended. 
‘‘(B) ELECTION AS TO USE OF BALANCE.—Except as pro-
vided in subparagraph (C), an eligible county shall elect 
to do 1 or more of the following with the balance of any 
funds not expended pursuant to subparagraph (A): 
‘‘(i) Reserve any portion of the balance for projects 
in accordance with title II. 
‘‘(ii) Reserve not more than 7 percent of the total 
share for the eligible county of the State payment 
or the county payment for projects in accordance with 
title III. 
‘‘(iii) Return the portion of the balance not reserved 
under clauses (i) and (ii) to the Treasury of the United 
States. 
‘‘(C) COUNTIES WITH MODEST DISTRIBUTIONS.—In the 
case of each eligible county to which more than $100,000, 
but less than $350,000, is distributed for any fiscal year 
pursuant to either or both of paragraphs (1)(B) and (2)(B) 
of subsection (a), the eligible county, with respect to the 
balance of any funds not expended pursuant to subpara-
graph (A) for that fiscal year, shall— 
‘‘(i) reserve any portion of the balance for— 
‘‘(I) carrying out projects under title II; 
‘‘(II) carrying out projects under title III; or 
‘‘(III) a combination of the purposes described 
in subclauses (I) and (II); or 
‘‘(ii) return the portion of the balance not reserved 
under clause (i) to the Treasury of the United States. 
‘‘(2) DISTRIBUTION OF FUNDS.— 
‘‘(A) IN GENERAL.—Funds reserved by an eligible county 
under subparagraph (B)(i) or (C)(i) of paragraph (1) for 
carrying out projects under title II shall be deposited in 
a special account in the Treasury of the United States. 
‘‘(B) AVAILABILITY.—Amounts deposited under subpara-
graph (A) shall— 
‘‘(i) be available for expenditure by the Secretary 
concerned, without further appropriation; and 
‘‘(ii) remain available until expended in accordance 
with title II. 
‘‘(3) ELECTION.— 
‘‘(A) NOTIFICATION.— 
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122 STAT. 3899 
PUBLIC LAW 110–343—OCT. 3, 2008 
‘‘(i) IN GENERAL.—An eligible county shall notify 
the Secretary concerned of an election by the eligible 
county under this subsection not later than September 
30, 2008 (or as soon thereafter as the Secretary con-
cerned determines is practicable), and each September 
30 thereafter for each succeeding fiscal year. 
‘‘(ii) FAILURE
TO
ELECT.—Except as provided in 
subparagraph (B), if the eligible county fails to make 
an election by the date specified in clause (i), the 
eligible county shall— 
‘‘(I) be considered to have elected to expend 
85 percent of the funds in accordance with para-
graph (1)(A); and 
‘‘(II) return the balance to the Treasury of 
the United States. 
‘‘(B) COUNTIES WITH MINOR DISTRIBUTIONS.—In the case 
of each eligible county to which less than $100,000 is 
distributed for any fiscal year pursuant to either or both 
of paragraphs (1)(B) and (2)(B) of subsection (a), the eligible 
county may elect to expend all the funds in the same 
manner in which the 25-percent payments or 50-percent 
payments, as applicable, are required to be expended. 
‘‘(e) TIME FOR PAYMENT.—The payments required under this 
section for a fiscal year shall be made as soon as practicable 
after the end of that fiscal year. 
‘‘SEC. 103. TRANSITION PAYMENTS TO STATES. 
‘‘(a) DEFINITIONS.—In this section: 
‘‘(1) ADJUSTED
AMOUNT.—The term ‘adjusted amount’ 
means, with respect to a covered State— 
‘‘(A) for fiscal year 2008, 90 percent of— 
‘‘(i) the sum of the amounts paid for fiscal year 
2006 under section 102(a)(2) (as in effect on September 
29, 2006) for the eligible counties in the covered State 
that have elected under section 102(b) to receive a 
share of the State payment for fiscal year 2008; and 
‘‘(ii) the sum of the amounts paid for fiscal year 
2006 under section 103(a)(2) (as in effect on September 
29, 2006) for the eligible counties in the State of Oregon 
that have elected under section 102(b) to receive the 
county payment for fiscal year 2008; 
‘‘(B) for fiscal year 2009, 81 percent of— 
‘‘(i) the sum of the amounts paid for fiscal year 
2006 under section 102(a)(2) (as in effect on September 
29, 2006) for the eligible counties in the covered State 
that have elected under section 102(b) to receive a 
share of the State payment for fiscal year 2009; and 
‘‘(ii) the sum of the amounts paid for fiscal year 
2006 under section 103(a)(2) (as in effect on September 
29, 2006) for the eligible counties in the State of Oregon 
that have elected under section 102(b) to receive the 
county payment for fiscal year 2009; and 
‘‘(C) for fiscal year 2010, 73 percent of— 
‘‘(i) the sum of the amounts paid for fiscal year 
2006 under section 102(a)(2) (as in effect on September 
29, 2006) for the eligible counties in the covered State 
16 USC 7113. 
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122 STAT. 3900 
PUBLIC LAW 110–343—OCT. 3, 2008 
that have elected under section 102(b) to receive a 
share of the State payment for fiscal year 2010; and 
‘‘(ii) the sum of the amounts paid for fiscal year 
2006 under section 103(a)(2) (as in effect on September 
29, 2006) for the eligible counties in the State of Oregon 
that have elected under section 102(b) to receive the 
county payment for fiscal year 2010. 
‘‘(2) COVERED STATE.—The term ‘covered State’ means each 
of the States of California, Louisiana, Oregon, Pennsylvania, 
South Carolina, South Dakota, Texas, and Washington. 
‘‘(b) TRANSITION PAYMENTS.—For each of fiscal years 2008 
through 2010, in lieu of the payment amounts that otherwise would 
have been made under paragraphs (1)(B) and (2)(B) of section 
102(a), the Secretary of the Treasury shall pay the adjusted amount 
to each covered State and the eligible counties within the covered 
State, as applicable. 
‘‘(c) DISTRIBUTION OF ADJUSTED AMOUNT.—Except as provided 
in subsection (d), it is the intent of Congress that the method 
of distributing the payments under subsection (b) among the coun-
ties in the covered States for each of fiscal years 2008 through 
2010 be in the same proportion that the payments were distributed 
to the eligible counties in fiscal year 2006. 
‘‘(d) DISTRIBUTION OF PAYMENTS IN CALIFORNIA.—The following 
payments shall be distributed among the eligible counties in the 
State of California in the same proportion that payments under 
section 102(a)(2) (as in effect on September 29, 2006) were distrib-
uted to the eligible counties for fiscal year 2006: 
‘‘(1) Payments to the State of California under subsection 
(b). 
‘‘(2) The shares of the eligible counties of the State payment 
for California under section 102 for fiscal year 2011. 
‘‘(e) TREATMENT OF PAYMENTS.—For purposes of this Act, any 
payment made under subsection (b) shall be considered to be a 
payment made under section 102(a). 
‘‘TITLE II—SPECIAL PROJECTS ON 
FEDERAL LAND 
‘‘SEC. 201. DEFINITIONS. 
‘‘In this title: 
‘‘(1) PARTICIPATING
COUNTY.—The term ‘participating 
county’ means an eligible county that elects under section 
102(d) to expend a portion of the Federal funds received under 
section 102 in accordance with this title. 
‘‘(2) PROJECT FUNDS.—The term ‘project funds’ means all 
funds an eligible county elects under section 102(d) to reserve 
for expenditure in accordance with this title. 
‘‘(3) RESOURCE ADVISORY COMMITTEE.—The term ‘resource 
advisory committee’ means— 
‘‘(A) an advisory committee established by the Sec-
retary concerned under section 205; or 
‘‘(B) an advisory committee determined by the Sec-
retary concerned to meet the requirements of section 205. 
‘‘(4) RESOURCE
MANAGEMENT
PLAN.—The term ‘resource 
management plan’ means— 
16 USC 7121. 
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122 STAT. 3901 
PUBLIC LAW 110–343—OCT. 3, 2008 
‘‘(A) a land use plan prepared by the Bureau of Land 
Management for units of the Federal land described in 
section 3(7)(B) pursuant to section 202 of the Federal Land 
Policy and Management Act of 1976 (43 U.S.C. 1712); or 
‘‘(B) a land and resource management plan prepared 
by the Forest Service for units of the National Forest 
System pursuant to section 6 of the Forest and Rangeland 
Renewable Resources Planning Act of 1974 (16 U.S.C. 
1604). 
‘‘SEC. 202. GENERAL LIMITATION ON USE OF PROJECT FUNDS. 
‘‘(a) LIMITATION.—Project funds shall be expended solely on 
projects that meet the requirements of this title. 
‘‘(b) AUTHORIZED USES.—Project funds may be used by the 
Secretary concerned for the purpose of entering into and imple-
menting cooperative agreements with willing Federal agencies, 
State and local governments, private and nonprofit entities, and 
landowners for protection, restoration, and enhancement of fish 
and wildlife habitat, and other resource objectives consistent with 
the purposes of this Act on Federal land and on non-Federal land 
where projects would benefit the resources on Federal land. 
‘‘SEC. 203. SUBMISSION OF PROJECT PROPOSALS. 
‘‘(a) SUBMISSION OF PROJECT PROPOSALS TO SECRETARY CON-
CERNED.— 
‘‘(1) PROJECTS FUNDED USING PROJECT FUNDS.—Not later 
than September 30 for fiscal year 2008 (or as soon thereafter 
as the Secretary concerned determines is practicable), and each 
September 30 thereafter for each succeeding fiscal year through 
fiscal year 2011, each resource advisory committee shall submit 
to the Secretary concerned a description of any projects that 
the resource advisory committee proposes the Secretary under-
take using any project funds reserved by eligible counties in 
the area in which the resource advisory committee has 
geographic jurisdiction. 
‘‘(2) PROJECTS FUNDED USING OTHER FUNDS.—A resource 
advisory committee may submit to the Secretary concerned 
a description of any projects that the committee proposes the 
Secretary undertake using funds from State or local govern-
ments, or from the private sector, other than project funds 
and funds appropriated and otherwise available to do similar 
work. 
‘‘(3) JOINT PROJECTS.—Participating counties or other per-
sons may propose to pool project funds or other funds, described 
in paragraph (2), and jointly propose a project or group of 
projects to a resource advisory committee established under 
section 205. 
‘‘(b) REQUIRED DESCRIPTION OF PROJECTS.—In submitting pro-
posed projects to the Secretary concerned under subsection (a), 
a resource advisory committee shall include in the description of 
each proposed project the following information: 
‘‘(1) The purpose of the project and a description of how 
the project will meet the purposes of this title. 
‘‘(2) The anticipated duration of the project. 
‘‘(3) The anticipated cost of the project. 
‘‘(4) The proposed source of funding for the project, whether 
project funds or other funds. 
Deadlines. 
16 USC 7123. 
16 USC 7122. 
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122 STAT. 3902 
PUBLIC LAW 110–343—OCT. 3, 2008 
‘‘(5)(A) Expected outcomes, including how the project will 
meet or exceed desired ecological conditions, maintenance objec-
tives, or stewardship objectives. 
‘‘(B) An estimate of the amount of any timber, forage, 
and other commodities and other economic activity, including 
jobs generated, if any, anticipated as part of the project. 
‘‘(6) A detailed monitoring plan, including funding needs 
and sources, that— 
‘‘(A) tracks and identifies the positive or negative 
impacts of the project, implementation, and provides for 
validation monitoring; and 
‘‘(B) includes an assessment of the following: 
‘‘(i) Whether or not the project met or exceeded 
desired ecological conditions; created local employment 
or training opportunities, including summer youth jobs 
programs such as the Youth Conservation Corps where 
appropriate. 
‘‘(ii) Whether the project improved the use of, or 
added value to, any products removed from land con-
sistent with the purposes of this title. 
‘‘(7) An assessment that the project is to be in the public 
interest. 
‘‘(c) AUTHORIZED
PROJECTS.—Projects proposed under sub-
section (a) shall be consistent with section 2. 
‘‘SEC. 204. EVALUATION AND APPROVAL OF PROJECTS BY SECRETARY 
CONCERNED. 
‘‘(a) CONDITIONS FOR APPROVAL OF PROPOSED PROJECT.—The 
Secretary concerned may make a decision to approve a project 
submitted by a resource advisory committee under section 203 
only if the proposed project satisfies each of the following conditions: 
‘‘(1) The project complies with all applicable Federal laws 
(including regulations). 
‘‘(2) The project is consistent with the applicable resource 
management plan and with any watershed or subsequent plan 
developed pursuant to the resource management plan and 
approved by the Secretary concerned. 
‘‘(3) The project has been approved by the resource advisory 
committee in accordance with section 205, including the proce-
dures issued under subsection (e) of that section. 
‘‘(4) A project description has been submitted by the 
resource advisory committee to the Secretary concerned in 
accordance with section 203. 
‘‘(5) The project will improve the maintenance of existing 
infrastructure, implement stewardship objectives that enhance 
forest ecosystems, and restore and improve land health and 
water quality. 
‘‘(b) ENVIRONMENTAL REVIEWS.— 
‘‘(1) REQUEST
FOR
PAYMENT
BY
COUNTY.—The Secretary 
concerned may request the resource advisory committee submit-
ting a proposed project to agree to the use of project funds 
to pay for any environmental review, consultation, or compli-
ance with applicable environmental laws required in connection 
with the project. 
‘‘(2) CONDUCT OF ENVIRONMENTAL REVIEW.—If a payment 
is requested under paragraph (1) and the resource advisory 
committee agrees to the expenditure of funds for this purpose, 
16 USC 7124. 
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122 STAT. 3903 
PUBLIC LAW 110–343—OCT. 3, 2008 
the Secretary concerned shall conduct environmental review, 
consultation, or other compliance responsibilities in accordance 
with Federal laws (including regulations). 
‘‘(3) EFFECT OF REFUSAL TO PAY.— 
‘‘(A) IN GENERAL.—If a resource advisory committee 
does not agree to the expenditure of funds under paragraph 
(1), the project shall be deemed withdrawn from further 
consideration by the Secretary concerned pursuant to this 
title. 
‘‘(B) EFFECT
OF
WITHDRAWAL.—A withdrawal under 
subparagraph (A) shall be deemed to be a rejection of 
the project for purposes of section 207(c). 
‘‘(c) DECISIONS OF SECRETARY CONCERNED.— 
‘‘(1) REJECTION OF PROJECTS.— 
‘‘(A) IN GENERAL.—A decision by the Secretary con-
cerned to reject a proposed project shall be at the sole 
discretion of the Secretary concerned. 
‘‘(B) NO ADMINISTRATIVE APPEAL OR JUDICIAL REVIEW.— 
Notwithstanding any other provision of law, a decision 
by the Secretary concerned to reject a proposed project 
shall not be subject to administrative appeal or judicial 
review. 
‘‘(C) NOTICE OF REJECTION.—Not later than 30 days 
after the date on which the Secretary concerned makes 
the rejection decision, the Secretary concerned shall notify 
in writing the resource advisory committee that submitted 
the proposed project of the rejection and the reasons for 
rejection. 
‘‘(2) NOTICE
OF
PROJECT
APPROVAL.—The Secretary con-
cerned shall publish in the Federal Register notice of each 
project approved under subsection (a) if the notice would be 
required had the project originated with the Secretary. 
‘‘(d) SOURCE AND CONDUCT OF PROJECT.—Once the Secretary 
concerned accepts a project for review under section 203, the accept-
ance shall be deemed a Federal action for all purposes. 
‘‘(e) IMPLEMENTATION OF APPROVED PROJECTS.— 
‘‘(1) COOPERATION.—Notwithstanding chapter 63 of title 31, 
United States Code, using project funds the Secretary concerned 
may enter into contracts, grants, and cooperative agreements 
with States and local governments, private and nonprofit enti-
ties, and landowners and other persons to assist the Secretary 
in carrying out an approved project. 
‘‘(2) BEST VALUE CONTRACTING.— 
‘‘(A) IN GENERAL.—For any project involving a contract 
authorized by paragraph (1) the Secretary concerned may 
elect a source for performance of the contract on a best 
value basis. 
‘‘(B) FACTORS.—The Secretary concerned shall deter-
mine best value based on such factors as— 
‘‘(i) the technical demands and complexity of the 
work to be done; 
‘‘(ii)(I) the ecological objectives of the project; and 
‘‘(II) the sensitivity of the resources being treated; 
‘‘(iii) the past experience by the contractor with 
the type of work being done, using the type of equip-
ment proposed for the project, and meeting or 
exceeding desired ecological conditions; and 
Federal Register, 
publication. 
Deadline. 
Notification. 
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122 STAT. 3904 
PUBLIC LAW 110–343—OCT. 3, 2008 
‘‘(iv) the commitment of the contractor to hiring 
highly qualified workers and local residents. 
‘‘(3) MERCHANTABLE
TIMBER
CONTRACTING
PILOT
PRO-
GRAM.— 
‘‘(A) ESTABLISHMENT.—The Secretary concerned shall 
establish a pilot program to implement a certain percentage 
of approved projects involving the sale of merchantable 
timber using separate contracts for— 
‘‘(i) the harvesting or collection of merchantable 
timber; and 
‘‘(ii) the sale of the timber. 
‘‘(B) ANNUAL PERCENTAGES.—Under the pilot program, 
the Secretary concerned shall ensure that, on a nationwide 
basis, not less than the following percentage of all approved 
projects involving the sale of merchantable timber are 
implemented using separate contracts: 
‘‘(i) For fiscal year 2008, 35 percent. 
‘‘(ii) For fiscal year 2009, 45 percent. 
‘‘(iii) For each of fiscal years 2010 and 2011, 50 
percent. 
‘‘(C) INCLUSION
IN
PILOT
PROGRAM.—The decision 
whether to use separate contracts to implement a project 
involving the sale of merchantable timber shall be made 
by the Secretary concerned after the approval of the project 
under this title. 
‘‘(D) ASSISTANCE.— 
‘‘(i) IN GENERAL.—The Secretary concerned may 
use funds from any appropriated account available to 
the Secretary for the Federal land to assist in the 
administration of projects conducted under the pilot 
program. 
‘‘(ii) MAXIMUM AMOUNT OF ASSISTANCE.—The total 
amount obligated under this subparagraph may not 
exceed $1,000,000 for any fiscal year during which 
the pilot program is in effect. 
‘‘(E) REVIEW AND REPORT.— 
‘‘(i) INITIAL
REPORT.—Not later than September 
30, 2010, the Comptroller General shall submit to the 
Committees on Agriculture, Nutrition, and Forestry 
and Energy and Natural Resources of the Senate and 
the Committees on Agriculture and Natural Resources 
of the House of Representatives a report assessing 
the pilot program. 
‘‘(ii) ANNUAL
REPORT.—The Secretary concerned 
shall submit to the Committees on Agriculture, Nutri-
tion, and Forestry and Energy and Natural Resources 
of the Senate and the Committees on Agriculture and 
Natural Resources of the House of Representatives 
an annual report describing the results of the pilot 
program. 
‘‘(f) REQUIREMENTS FOR PROJECT FUNDS.—The Secretary shall 
ensure that at least 50 percent of all project funds be used for 
projects that are primarily dedicated— 
‘‘(1) to road maintenance, decommissioning, or obliteration; 
or 
‘‘(2) to restoration of streams and watersheds. 
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122 STAT. 3905 
PUBLIC LAW 110–343—OCT. 3, 2008 
‘‘SEC. 205. RESOURCE ADVISORY COMMITTEES. 
‘‘(a) ESTABLISHMENT
AND PURPOSE
OF RESOURCE ADVISORY 
COMMITTEES.— 
‘‘(1) ESTABLISHMENT.—The Secretary concerned shall estab-
lish and maintain resource advisory committees to perform 
the duties in subsection (b), except as provided in paragraph 
(4). 
‘‘(2) PURPOSE.—The purpose of a resource advisory com-
mittee shall be— 
‘‘(A) to improve collaborative relationships; and 
‘‘(B) to provide advice and recommendations to the 
land management agencies consistent with the purposes 
of this title. 
‘‘(3) ACCESS
TO
RESOURCE
ADVISORY
COMMITTEES.—To 
ensure that each unit of Federal land has access to a resource 
advisory committee, and that there is sufficient interest in 
participation on a committee to ensure that membership can 
be balanced in terms of the points of view represented and 
the functions to be performed, the Secretary concerned may, 
establish resource advisory committees for part of, or 1 or 
more, units of Federal land. 
‘‘(4) EXISTING ADVISORY COMMITTEES.— 
‘‘(A) IN GENERAL.—An advisory committee that meets 
the requirements of this section, a resource advisory com-
mittee established before September 29, 2006, or an 
advisory committee determined by the Secretary concerned 
before September 29, 2006, to meet the requirements of 
this section may be deemed by the Secretary concerned 
to be a resource advisory committee for the purposes of 
this title. 
‘‘(B) CHARTER.—A charter for a committee described 
in subparagraph (A) that was filed on or before September 
29, 2006, shall be considered to be filed for purposes of 
this Act. 
‘‘(C) BUREAU OF LAND MANAGEMENT ADVISORY COMMIT-
TEES.—The Secretary of the Interior may deem a resource 
advisory committee meeting the requirements of subpart 
1784 of part 1780 of title 43, Code of Federal Regulations, 
as a resource advisory committee for the purposes of this 
title. 
‘‘(b) DUTIES.—A resource advisory committee shall— 
‘‘(1) review projects proposed under this title by partici-
pating counties and other persons; 
‘‘(2) propose projects and funding to the Secretary concerned 
under section 203; 
‘‘(3) provide early and continuous coordination with appro-
priate land management agency officials in recommending 
projects consistent with purposes of this Act under this title; 
‘‘(4) provide frequent opportunities for citizens, organiza-
tions, tribes, land management agencies, and other interested 
parties to participate openly and meaningfully, beginning at 
the early stages of the project development process under this 
title; 
‘‘(5)(A) monitor projects that have been approved under 
section 204; and 
‘‘(B) advise the designated Federal official on the progress 
of the monitoring efforts under subparagraph (A); and 
16 USC 7125. 
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122 STAT. 3906 
PUBLIC LAW 110–343—OCT. 3, 2008 
‘‘(6) make recommendations to the Secretary concerned for 
any appropriate changes or adjustments to the projects being 
monitored by the resource advisory committee. 
‘‘(c) APPOINTMENT BY THE SECRETARY.— 
‘‘(1) APPOINTMENT AND TERM.— 
‘‘(A) IN
GENERAL.—The Secretary concerned, shall 
appoint the members of resource advisory committees for 
a term of 4 years beginning on the date of appointment. 
‘‘(B) REAPPOINTMENT.—The Secretary concerned may 
reappoint members to subsequent 4-year terms. 
‘‘(2) BASIC REQUIREMENTS.—The Secretary concerned shall 
ensure that each resource advisory committee established meets 
the requirements of subsection (d). 
‘‘(3) INITIAL APPOINTMENT.—Not later than 180 days after 
the date of the enactment of this Act, the Secretary concerned 
shall make initial appointments to the resource advisory 
committees. 
‘‘(4) VACANCIES.—The Secretary concerned shall make 
appointments to fill vacancies on any resource advisory com-
mittee as soon as practicable after the vacancy has occurred. 
‘‘(5) COMPENSATION.—Members of the resource advisory 
committees shall not receive any compensation. 
‘‘(d) COMPOSITION OF ADVISORY COMMITTEE.— 
‘‘(1) NUMBER.—Each resource advisory committee shall be 
comprised of 15 members. 
‘‘(2) COMMUNITY
INTERESTS
REPRESENTED.—Committee 
members shall be representative of the interests of the following 
3 categories: 
‘‘(A) 5 persons that— 
‘‘(i) represent organized labor or non-timber forest 
product harvester groups; 
‘‘(ii) represent developed outdoor recreation, off 
highway vehicle users, or commercial recreation activi-
ties; 
‘‘(iii) represent— 
‘‘(I) energy and mineral development interests; 
or 
‘‘(II) 
commercial 
or 
recreational 
fishing 
interests; 
‘‘(iv) represent the commercial timber industry; or 
‘‘(v) hold Federal grazing or other land use permits, 
or represent nonindustrial private forest land owners, 
within the area for which the committee is organized. 
‘‘(B) 5 persons that represent— 
‘‘(i) nationally recognized environmental organiza-
tions; 
‘‘(ii) regionally or locally recognized environmental 
organizations; 
‘‘(iii) dispersed recreational activities; 
‘‘(iv) archaeological and historical interests; or 
‘‘(v) nationally or regionally recognized wild horse 
and burro interest groups, wildlife or hunting organiza-
tions, or watershed associations. 
‘‘(C) 5 persons that— 
‘‘(i) hold State elected office (or a designee); 
‘‘(ii) hold county or local elected office; 
Deadline. 
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122 STAT. 3907 
PUBLIC LAW 110–343—OCT. 3, 2008 
‘‘(iii) represent American Indian tribes within or 
adjacent to the area for which the committee is orga-
nized; 
‘‘(iv) are school officials or teachers; or 
‘‘(v) represent the affected public at large. 
‘‘(3) BALANCED REPRESENTATION.—In appointing committee 
members from the 3 categories in paragraph (2), the Secretary 
concerned shall provide for balanced and broad representation 
from within each category. 
‘‘(4) GEOGRAPHIC
DISTRIBUTION.—The members of a 
resource advisory committee shall reside within the State in 
which the committee has jurisdiction and, to extent practicable, 
the Secretary concerned shall ensure local representation in 
each category in paragraph (2). 
‘‘(5) CHAIRPERSON.—A majority on each resource advisory 
committee shall select the chairperson of the committee. 
‘‘(e) APPROVAL PROCEDURES.— 
‘‘(1) IN GENERAL.—Subject to paragraph (3), each resource 
advisory committee shall establish procedures for proposing 
projects to the Secretary concerned under this title. 
‘‘(2) QUORUM.—A quorum must be present to constitute 
an official meeting of the committee. 
‘‘(3) APPROVAL BY MAJORITY OF MEMBERS.—A project may 
be proposed by a resource advisory committee to the Secretary 
concerned under section 203(a), if the project has been approved 
by a majority of members of the committee from each of the 
3 categories in subsection (d)(2). 
‘‘(f) OTHER COMMITTEE AUTHORITIES AND REQUIREMENTS.— 
‘‘(1) STAFF
ASSISTANCE.—A resource advisory committee 
may submit to the Secretary concerned a request for periodic 
staff assistance from Federal employees under the jurisdiction 
of the Secretary. 
‘‘(2) MEETINGS.—All meetings of a resource advisory com-
mittee shall be announced at least 1 week in advance in a 
local newspaper of record and shall be open to the public. 
‘‘(3) RECORDS.—A resource advisory committee shall main-
tain records of the meetings of the committee and make the 
records available for public inspection. 
‘‘SEC. 206. USE OF PROJECT FUNDS. 
‘‘(a) 
AGREEMENT
REGARDING
SCHEDULE
AND
COST
OF 
PROJECT.— 
‘‘(1) AGREEMENT
BETWEEN
PARTIES.—The Secretary con-
cerned may carry out a project submitted by a resource advisory 
committee under section 203(a) using project funds or other 
funds described in section 203(a)(2), if, as soon as practicable 
after the issuance of a decision document for the project and 
the exhaustion of all administrative appeals and judicial review 
of the project decision, the Secretary concerned and the resource 
advisory committee enter into an agreement addressing, at 
a minimum, the following: 
‘‘(A) The schedule for completing the project. 
‘‘(B) The total cost of the project, including the level 
of agency overhead to be assessed against the project. 
‘‘(C) For a multiyear project, the estimated cost of 
the project for each of the fiscal years in which it will 
be carried out. 
16 USC 7126. 
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122 STAT. 3908 
PUBLIC LAW 110–343—OCT. 3, 2008 
‘‘(D) The remedies for failure of the Secretary concerned 
to comply with the terms of the agreement consistent with 
current Federal law. 
‘‘(2) LIMITED USE OF FEDERAL FUNDS.—The Secretary con-
cerned may decide, at the sole discretion of the Secretary con-
cerned, to cover the costs of a portion of an approved project 
using Federal funds appropriated or otherwise available to 
the Secretary for the same purposes as the project. 
‘‘(b) TRANSFER OF PROJECT FUNDS.— 
‘‘(1) INITIAL TRANSFER REQUIRED.—As soon as practicable 
after the agreement is reached under subsection (a) with regard 
to a project to be funded in whole or in part using project 
funds, or other funds described in section 203(a)(2), the Sec-
retary concerned shall transfer to the applicable unit of 
National Forest System land or Bureau of Land Management 
District an amount of project funds equal to— 
‘‘(A) in the case of a project to be completed in a 
single fiscal year, the total amount specified in the agree-
ment to be paid using project funds, or other funds 
described in section 203(a)(2); or 
‘‘(B) in the case of a multiyear project, the amount 
specified in the agreement to be paid using project funds, 
or other funds described in section 203(a)(2) for the first 
fiscal year. 
‘‘(2) CONDITION ON PROJECT COMMENCEMENT.—The unit of 
National Forest System land or Bureau of Land Management 
District concerned, shall not commence a project until the 
project funds, or other funds described in section 203(a)(2) 
required to be transferred under paragraph (1) for the project, 
have been made available by the Secretary concerned. 
‘‘(3) SUBSEQUENT TRANSFERS FOR MULTIYEAR PROJECTS.— 
‘‘(A) IN GENERAL.—For the second and subsequent fiscal 
years of a multiyear project to be funded in whole or 
in part using project funds, the unit of National Forest 
System land or Bureau of Land Management District con-
cerned shall use the amount of project funds required to 
continue the project in that fiscal year according to the 
agreement entered into under subsection (a). 
‘‘(B) SUSPENSION OF WORK.—The Secretary concerned 
shall suspend work on the project if the project funds 
required by the agreement in the second and subsequent 
fiscal years are not available. 
‘‘SEC. 207. AVAILABILITY OF PROJECT FUNDS. 
‘‘(a) SUBMISSION OF PROPOSED PROJECTS TO OBLIGATE FUNDS.— 
By September 30, 2008 (or as soon thereafter as the Secretary 
concerned determines is practicable), and each September 30 there-
after for each succeeding fiscal year through fiscal year 2011, a 
resource advisory committee shall submit to the Secretary concerned 
pursuant to section 203(a)(1) a sufficient number of project proposals 
that, if approved, would result in the obligation of at least the 
full amount of the project funds reserved by the participating county 
in the preceding fiscal year. 
‘‘(b) USE OR TRANSFER OF UNOBLIGATED FUNDS.—Subject to 
section 208, if a resource advisory committee fails to comply with 
subsection (a) for a fiscal year, any project funds reserved by the 
participating county in the preceding fiscal year and remaining 
16 USC 7127. 
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122 STAT. 3909 
PUBLIC LAW 110–343—OCT. 3, 2008 
unobligated shall be available for use as part of the project submis-
sions in the next fiscal year. 
‘‘(c) EFFECT OF REJECTION OF PROJECTS.—Subject to section 
208, any project funds reserved by a participating county in the 
preceding fiscal year that are unobligated at the end of a fiscal 
year because the Secretary concerned has rejected one or more 
proposed projects shall be available for use as part of the project 
submissions in the next fiscal year. 
‘‘(d) EFFECT OF COURT ORDERS.— 
‘‘(1) IN GENERAL.—If an approved project under this Act 
is enjoined or prohibited by a Federal court, the Secretary 
concerned shall return the unobligated project funds related 
to the project to the participating county or counties that 
reserved the funds. 
‘‘(2) EXPENDITURE OF FUNDS.—The returned funds shall 
be available for the county to expend in the same manner 
as the funds reserved by the county under subparagraph (B) 
or (C)(i) of section 102(d)(1). 
‘‘SEC. 208. TERMINATION OF AUTHORITY. 
‘‘(a) IN GENERAL.—The authority to initiate projects under this 
title shall terminate on September 30, 2011. 
‘‘(b) DEPOSITS IN TREASURY.—Any project funds not obligated 
by September 30, 2012, shall be deposited in the Treasury of the 
United States. 
‘‘TITLE III—COUNTY FUNDS 
‘‘SEC. 301. DEFINITIONS. 
‘‘In this title: 
‘‘(1) COUNTY FUNDS.—The term ‘county funds’ means all 
funds an eligible county elects under section 102(d) to reserve 
for expenditure in accordance with this title. 
‘‘(2) PARTICIPATING
COUNTY.—The term ‘participating 
county’ means an eligible county that elects under section 
102(d) to expend a portion of the Federal funds received under 
section 102 in accordance with this title. 
‘‘SEC. 302. USE. 
‘‘(a) AUTHORIZED USES.—A participating county, including any 
applicable agencies of the participating county, shall use county 
funds, in accordance with this title, only— 
‘‘(1) to carry out activities under the Firewise Communities 
program to provide to homeowners in fire-sensitive ecosystems 
education on, and assistance with implementing, techniques 
in home siting, home construction, and home landscaping that 
can increase the protection of people and property from 
wildfires; 
‘‘(2) to reimburse the participating county for search and 
rescue and other emergency services, including firefighting, 
that are— 
‘‘(A) performed on Federal land after the date on which 
the use was approved under subsection (b); 
‘‘(B) paid for by the participating county; and 
‘‘(3) to develop community wildfire protection plans in 
coordination with the appropriate Secretary concerned. 
16 USC 7142. 
16 USC 7141. 
16 USC 7128. 
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122 STAT. 3910 
PUBLIC LAW 110–343—OCT. 3, 2008 
‘‘(b) PROPOSALS.—A participating county shall use county funds 
for a use described in subsection (a) only after a 45-day public 
comment period, at the beginning of which the participating county 
shall— 
‘‘(1) publish in any publications of local record a proposal 
that describes the proposed use of the county funds; and 
‘‘(2) submit the proposal to any resource advisory committee 
established under section 205 for the participating county. 
‘‘SEC. 303. CERTIFICATION. 
‘‘(a) IN GENERAL.—Not later than February 1 of the year after 
the year in which any county funds were expended by a partici-
pating county, the appropriate official of the participating county 
shall submit to the Secretary concerned a certification that the 
county funds expended in the applicable year have been used for 
the uses authorized under section 302(a), including a description 
of the amounts expended and the uses for which the amounts 
were expended. 
‘‘(b) REVIEW.—The Secretary concerned shall review the certifi-
cations submitted under subsection (a) as the Secretary concerned 
determines to be appropriate. 
‘‘SEC. 304. TERMINATION OF AUTHORITY. 
‘‘(a) IN GENERAL.—The authority to initiate projects under this 
title terminates on September 30, 2011. 
‘‘(b) AVAILABILITY.—Any county funds not obligated by Sep-
tember 30, 2012, shall be returned to the Treasury of the United 
States. 
‘‘TITLE IV—MISCELLANEOUS 
PROVISIONS 
‘‘SEC. 401. REGULATIONS. 
‘‘The Secretary of Agriculture and the Secretary of the Interior 
shall issue regulations to carry out the purposes of this Act. 
‘‘SEC. 402. AUTHORIZATION OF APPROPRIATIONS. 
‘‘There are authorized to be appropriated such sums as are 
necessary to carry out this Act for each of fiscal years 2008 through 
2011. 
‘‘SEC. 403. TREATMENT OF FUNDS AND REVENUES. 
‘‘(a) RELATION TO OTHER APPROPRIATIONS.—Funds made avail-
able under section 402 and funds made available to a Secretary 
concerned under section 206 shall be in addition to any other 
annual appropriations for the Forest Service and the Bureau of 
Land Management. 
‘‘(b) DEPOSIT OF REVENUES AND OTHER FUNDS.—All revenues 
generated from projects pursuant to title II, including any interest 
accrued from the revenues, shall be deposited in the Treasury 
of the United States.’’. 
(b) FOREST RECEIPT PAYMENTS TO ELIGIBLE STATES AND COUN-
TIES.— 
(1) ACT OF MAY 23, 1908.—The sixth paragraph under the 
heading ‘‘FOREST SERVICE’’ in the Act of May 23, 1908 (16 
U.S.C. 500) is amended in the first sentence by striking 
‘‘twenty-five percentum’’ and all that follows through ‘‘shall 
16 USC 7153. 
16 USC 7152. 
16 USC 7151. 
16 USC 7144. 
Deadline. 
16 USC 7143. 
Publication. 
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122 STAT. 3911 
PUBLIC LAW 110–343—OCT. 3, 2008 
be paid’’ and inserting the following: ‘‘an amount equal to 
the annual average of 25 percent of all amounts received for 
the applicable fiscal year and each of the preceding 6 fiscal 
years from each national forest shall be paid’’. 
(2) WEEKS LAW.—Section 13 of the Act of March 1, 1911 
(commonly known as the ‘‘Weeks Law’’) (16 U.S.C. 500) is 
amended in the first sentence by striking ‘‘twenty-five 
percentum’’ and all that follows through ‘‘shall be paid’’ and 
inserting the following: ‘‘an amount equal to the annual average 
of 25 percent of all amounts received for the applicable fiscal 
year and each of the preceding 6 fiscal years from each national 
forest shall be paid’’. 
(c) PAYMENTS IN LIEU OF TAXES.— 
(1) IN GENERAL.—Section 6906 of title 31, United States 
Code, is amended to read as follows: 
‘‘§ 6906. Funding 
‘‘For each of fiscal years 2008 through 2012— 
‘‘(1) each county or other eligible unit of local government 
shall be entitled to payment under this chapter; and 
‘‘(2) sums shall be made available to the Secretary of the 
Interior for obligation or expenditure in accordance with this 
chapter.’’. 
(2) CONFORMING AMENDMENT.—The table of sections for 
chapter 69 of title 31, United States Code, is amended by 
striking the item relating to section 6906 and inserting the 
following: 
‘‘6906. Funding.’’. 
(3) BUDGET SCOREKEEPING.— 
(A) 
IN
GENERAL.—Notwithstanding 
the 
Budget 
Scorekeeping Guidelines and the accompanying list of pro-
grams and accounts set forth in the joint explanatory state-
ment of the committee of conference accompanying Con-
ference Report 105–217, the section in this title regarding 
Payments in Lieu of Taxes shall be treated in the baseline 
for purposes of section 257 of the Balanced Budget and 
Emergency Deficit Control Act of 1985 (as in effect prior 
to September 30, 2002), and by the Chairmen of the House 
and Senate Budget Committees, as appropriate, for pur-
poses of budget enforcement in the House and Senate, 
and under the Congressional Budget Act of 1974 as if 
Payment in Lieu of Taxes (14–1114–0–1–806) were an 
account designated as Appropriated Entitlements and 
Mandatories for Fiscal Year 1997 in the joint explanatory 
statement of the committee of conference accompanying 
Conference Report 105–217. 
(B) EFFECTIVE DATE.—This paragraph shall remain in 
effect for the fiscal years to which the entitlement in section 
6906 of title 31, United States Code (as amended by para-
graph (1)), applies. 
SEC. 602. TRANSFER TO ABANDONED MINE RECLAMATION FUND. 
Subparagraph (C) of section 402(i)(1) of the Surface Mining 
Control and Reclamation Act of 1977 (30 U.S.C. 1232(i)(1)) is 
amended by striking ‘‘and $9,000,000 on October 1, 2009’’ and 
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122 STAT. 3912 
PUBLIC LAW 110–343—OCT. 3, 2008 
inserting ‘‘$9,000,000 on October 1, 2009, and $9,000,000 on October 
1, 2010’’. 
TITLE VII—DISASTER RELIEF 
Subtitle A—Heartland and Hurricane Ike 
Disaster Relief 
SEC. 701. SHORT TITLE. 
This subtitle may be cited as the ‘‘Heartland Disaster Tax 
Relief Act of 2008’’. 
SEC. 702. TEMPORARY TAX RELIEF FOR AREAS DAMAGED BY 2008 MID-
WESTERN SEVERE STORMS, TORNADOS, AND FLOODING. 
(a) IN GENERAL.—Subject to the modifications described in this 
section, the following provisions of or relating to the Internal Rev-
enue Code of 1986 shall apply to any Midwestern disaster area 
in addition to the areas to which such provisions otherwise apply: 
(1) GO ZONE BENEFITS.— 
(A) Section 1400N (relating to tax benefits) other than 
subsections (b), (d), (e), (i), (j), (m), and (o) thereof. 
(B) Section 1400O (relating to education tax benefits). 
(C) Section 1400P (relating to housing tax benefits). 
(D) Section 1400Q (relating to special rules for use 
of retirement funds). 
(E) Section 1400R(a) (relating to employee retention 
credit for employers). 
(F) Section 1400S (relating to additional tax relief) 
other than subsection (d) thereof. 
(G) Section 1400T (relating to special rules for mort-
gage revenue bonds). 
(2) OTHER BENEFITS INCLUDED IN KATRINA EMERGENCY TAX 
RELIEF
ACT
OF
2005.—Sections 302, 303, 304, 401, and 405 
of the Katrina Emergency Tax Relief Act of 2005. 
(b) MIDWESTERN DISASTER AREA.— 
(1) IN
GENERAL.—For purposes of this section and for 
applying the substitutions described in subsections (d) and 
(e), the term ‘‘Midwestern disaster area’’ means an area— 
(A) with respect to which a major disaster has been 
declared by the President on or after May 20, 2008, and 
before August 1, 2008, under section 401 of the Robert 
T. Stafford Disaster Relief and Emergency Assistance Act 
by reason of severe storms, tornados, or flooding occurring 
in any of the States of Arkansas, Illinois, Indiana, Iowa, 
Kansas, Michigan, Minnesota, Missouri, Nebraska, and 
Wisconsin, and 
(B) determined by the President to warrant individual 
or individual and public assistance from the Federal 
Government under such Act with respect to damages attrib-
utable to such severe storms, tornados, or flooding. 
(2) CERTAIN BENEFITS AVAILABLE TO AREAS ELIGIBLE ONLY 
FOR PUBLIC ASSISTANCE.—For purposes of applying this section 
to benefits under the following provisions, paragraph (1) shall 
be applied without regard to subparagraph (B): 
Applicability. 
Applicability. 
26 USC 1 note. 
Heartland 
Disaster Tax 
Relief Act 
of 2008. 
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122 STAT. 3913 
PUBLIC LAW 110–343—OCT. 3, 2008 
(A) Sections 1400Q, 1400S(b), and 1400S(d) of the 
Internal Revenue Code of 1986. 
(B) Sections 302, 401, and 405 of the Katrina Emer-
gency Tax Relief Act of 2005. 
(c) REFERENCES.— 
(1) AREA.—Any reference in such provisions to the Hurri-
cane Katrina disaster area or the Gulf Opportunity Zone shall 
be treated as a reference to any Midwestern disaster area 
and any reference to the Hurricane Katrina disaster area or 
the Gulf Opportunity Zone within a State shall be treated 
as a reference to all Midwestern disaster areas within the 
State. 
(2) ITEMS ATTRIBUTABLE TO DISASTER.—Any reference in 
such provisions to any loss, damage, or other item attributable 
to Hurricane Katrina shall be treated as a reference to any 
loss, damage, or other item attributable to the severe storms, 
tornados, or flooding giving rise to any Presidential declaration 
described in subsection (b)(1)(A). 
(3) APPLICABLE DISASTER DATE.—For purposes of applying 
the substitutions described in subsections (d) and (e), the term 
‘‘applicable disaster date’’ means, with respect to any Mid-
western disaster area, the date on which the severe storms, 
tornados, or flooding giving rise to the Presidential declaration 
described in subsection (b)(1)(A) occurred. 
(d) MODIFICATIONS TO 1986 CODE.—The following provisions 
of the Internal Revenue Code of 1986 shall be applied with the 
following modifications: 
(1) TAX-EXEMPT BOND FINANCING.—Section 1400N(a)— 
(A) by substituting ‘‘qualified Midwestern disaster area 
bond’’ for ‘‘qualified Gulf Opportunity Zone Bond’’ each 
place it appears, except that in determining whether a 
bond is a qualified Midwestern disaster area bond— 
(i) paragraph (2)(A)(i) shall be applied by only 
treating costs as qualified project costs if— 
(I) in the case of a project involving a private 
business use (as defined in section 141(b)(6)), 
either the person using the property suffered a 
loss in a trade or business attributable to the 
severe storms, tornados, or flooding giving rise 
to any Presidential declaration described in sub-
section (b)(1)(A) or is a person designated for pur-
poses of this section by the Governor of the State 
in which the project is located as a person carrying 
on a trade or business replacing a trade or business 
with respect to which another person suffered such 
a loss, and 
(II) in the case of a project relating to public 
utility property, the project involves repair or 
reconstruction of public utility property damaged 
by such severe storms, tornados, or flooding, and 
(ii) paragraph (2)(A)(ii) shall be applied by treating 
an issue as a qualified mortgage issue only if 95 percent 
or more of the net proceeds (as defined in section 
150(a)(3)) of the issue are to be used to provide 
financing for mortgagors who suffered damages to their 
principal residences attributable to such severe storms, 
tornados, or flooding. 
Applicability. 
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122 STAT. 3914 
PUBLIC LAW 110–343—OCT. 3, 2008 
(B) by substituting ‘‘any State in which a Midwestern 
disaster area is located’’ for ‘‘the State of Alabama, Lou-
isiana, or Mississippi’’ in paragraph (2)(B), 
(C) by substituting ‘‘designated for purposes of this 
section (on the basis of providing assistance to areas in 
the order in which such assistance is most needed)’’ for 
‘‘designated for purposes of this section’’ in paragraph 
(2)(C), 
(D) by substituting ‘‘January 1, 2013’’ for ‘‘January 
1, 2011’’ in paragraph (2)(D), 
(E) in paragraph (3)(A)— 
(i) by substituting ‘‘$1,000’’ for ‘‘$2,500’’, and 
(ii) by substituting ‘‘before the earliest applicable 
disaster date for Midwestern disaster areas within the 
State’’ for ‘‘before August 28, 2005’’, 
(F) by substituting ‘‘qualified Midwestern disaster area 
repair or construction’’ for ‘‘qualified GO Zone repair or 
construction’’ each place it appears, 
(G) by substituting ‘‘after the date of the enactment 
of the Heartland Disaster Tax Relief Act of 2008 and before 
January 1, 2013’’ for ‘‘after the date of the enactment 
of this paragraph and before January 1, 2011’’ in paragraph 
(7)(C), and 
(H) by disregarding paragraph (8) thereof. 
(2) LOW-INCOME HOUSING CREDIT.—Section 1400N(c)— 
(A) only with respect to calendar years 2008, 2009, 
and 2010, 
(B) by substituting ‘‘Disaster Recovery Assistance 
housing amount’’ for ‘‘Gulf Opportunity housing amount’’ 
each place it appears, 
(C) in paragraph (1)(B)— 
(i) by substituting ‘‘$8.00’’ for ‘‘$18.00’’, and 
(ii) by substituting ‘‘before the earliest applicable 
disaster date for Midwestern disaster areas within the 
State’’ for ‘‘before August 28, 2005’’, and 
(D) determined without regard to paragraphs (2), (3), 
(4), (5), and (6) thereof. 
(3) EXPENSING
FOR
CERTAIN
DEMOLITION
AND
CLEAN-UP 
COSTS.—Section 1400N(f)— 
(A) by substituting ‘‘qualified Disaster Recovery Assist-
ance clean-up cost’’ for ‘‘qualified Gulf Opportunity Zone 
clean-up cost’’ each place it appears, 
(B) by substituting ‘‘beginning on the applicable dis-
aster date and ending on December 31, 2010’’ for ‘‘beginning 
on August 28, 2005, and ending on December 31, 2007’’ 
in paragraph (2), and 
(C) by treating costs as qualified Disaster Recovery 
Assistance clean-up costs only if the removal of debris 
or demolition of any structure was necessary due to damage 
attributable to the severe storms, tornados, or flooding 
giving rise to any Presidential declaration described in 
subsection (b)(1)(A). 
(4) EXTENSION OF EXPENSING FOR ENVIRONMENTAL REMEDI-
ATION COSTS.—Section 1400N(g)— 
(A) by substituting ‘‘the applicable disaster date’’ for 
‘‘August 28, 2005’’ each place it appears, 
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122 STAT. 3915 
PUBLIC LAW 110–343—OCT. 3, 2008 
(B) by substituting ‘‘January 1, 2011’’ for ‘‘January 
1, 2008’’ in paragraph (1), 
(C) by substituting ‘‘December 31, 2010’’ for ‘‘December 
31, 2007’’ in paragraph (1), and 
(D) by treating a site as a qualified contaminated site 
only if the release (or threat of release) or disposal of 
a hazardous substance at the site was attributable to the 
severe storms, tornados, or flooding giving rise to any Presi-
dential declaration described in subsection (b)(1)(A). 
(5) 
INCREASE
IN
REHABILITATION
CREDIT.—Section 
1400N(h), as amended by this Act— 
(A) by substituting ‘‘the applicable disaster date’’ for 
‘‘August 28, 2005’’, 
(B) by substituting ‘‘December 31, 2011’’ for ‘‘December 
31, 2009’’ in paragraph (1), and 
(C) by only applying such subsection to qualified 
rehabilitation expenditures with respect to any building 
or structure which was damaged or destroyed as a result 
of the severe storms, tornados, or flooding giving rise to 
any Presidential declaration described in subsection 
(b)(1)(A). 
(6) TREATMENT OF NET OPERATING LOSSES ATTRIBUTABLE 
TO DISASTER LOSSES.—Section 1400N(k)— 
(A) by substituting ‘‘qualified Disaster Recovery Assist-
ance loss’’ for ‘‘qualified Gulf Opportunity Zone loss’’ each 
place it appears, 
(B) by substituting ‘‘after the day before the applicable 
disaster date, and before January 1, 2011’’ for ‘‘after August 
27, 2005, and before January 1, 2008’’ each place it appears, 
(C) by substituting ‘‘the applicable disaster date’’ for 
‘‘August 28, 2005’’ in paragraph (2)(B)(ii)(I), 
(D) by substituting ‘‘qualified Disaster Recovery Assist-
ance property’’ for ‘‘qualified Gulf Opportunity Zone prop-
erty’’ in paragraph (2)(B)(iv), and 
(E) by substituting ‘‘qualified Disaster Recovery Assist-
ance casualty loss’’ for ‘‘qualified Gulf Opportunity Zone 
casualty loss’’ each place it appears. 
(7) CREDIT TO HOLDERS OF TAX CREDIT BONDS.—Section 
1400N(l)— 
(A) by substituting ‘‘Midwestern tax credit bond’’ for 
‘‘Gulf tax credit bond’’ each place it appears, 
(B) by substituting ‘‘any State in which a Midwestern 
disaster area is located or any instrumentality of the State’’ 
for ‘‘the State of Alabama, Louisiana, or Mississippi’’ in 
paragraph (4)(A)(i), 
(C) by substituting ‘‘after December 31, 2008 and before 
January 1, 2010’’ for ‘‘after December 31, 2005, and before 
January 1, 2007’’, 
(D) by substituting ‘‘shall not exceed $100,000,000 for 
any State with an aggregate population located in all Mid-
western disaster areas within the State of at least 
2,000,000, $50,000,000 for any State with an aggregate 
population located in all Midwestern disaster areas within 
the State of at least 1,000,000 but less than 2,000,000, 
and zero for any other State. The population of a State 
within any area shall be determined on the basis of the 
most recent census estimate of resident population released 
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122 STAT. 3916 
PUBLIC LAW 110–343—OCT. 3, 2008 
by the Bureau of Census before the earliest applicable 
disaster date for Midwestern disaster areas within the 
State.’’ for ‘‘shall not exceed’’ and all that follows in para-
graph (4)(C), and 
(E) by substituting ‘‘the earliest applicable disaster 
date for Midwestern disaster areas within the State’’ for 
‘‘August 28, 2005’’ in paragraph (5)(A). 
(8) EDUCATION
TAX
BENEFITS.—Section 1400O, by sub-
stituting ‘‘2008 or 2009’’ for ‘‘2005 or 2006’’. 
(9) HOUSING TAX BENEFITS.—Section 1400P, by substituting 
‘‘the applicable disaster date’’ for ‘‘August 28, 2005’’ in sub-
section (c)(1). 
(10) SPECIAL RULES FOR USE OF RETIREMENT FUNDS.—Sec-
tion 1400Q— 
(A) by substituting ‘‘qualified Disaster Recovery Assist-
ance distribution’’ for ‘‘qualified hurricane distribution’’ 
each place it appears, 
(B) by substituting ‘‘on or after the applicable disaster 
date and before January 1, 2010’’ for ‘‘on or after August 
25, 2005, and before January 1, 2007’’ in subsection 
(a)(4)(A)(i), 
(C) by substituting ‘‘the applicable disaster date’’ for 
‘‘August 28, 2005’’ in subsections (a)(4)(A)(i) and (c)(3)(B), 
(D) by disregarding clauses (ii) and (iii) of subsection 
(a)(4)(A) thereof, 
(E) by substituting ‘‘qualified storm damage distribu-
tion’’ for ‘‘qualified Katrina distribution’’ each place it 
appears, 
(F) by substituting ‘‘after the date which is 6 months 
before the applicable disaster date and before the date 
which is the day after the applicable disaster date’’ for 
‘‘after February 28, 2005, and before August 29, 2005’’ 
in subsection (b)(2)(B)(ii), 
(G) by substituting ‘‘the Midwestern disaster area, but 
not so purchased or constructed on account of severe 
storms, tornados, or flooding giving rise to the designation 
of the area as a disaster area’’ for ‘‘the Hurricane Katrina 
disaster area, but not so purchased or constructed on 
account of Hurricane Katrina’’ in subsection (b)(2)(B)(iii), 
(H) by substituting ‘‘beginning on the applicable dis-
aster date and ending on the date which is 5 months 
after the date of the enactment of the Heartland Disaster 
Tax Relief Act of 2008’’ for ‘‘beginning on August 25, 2005, 
and ending on February 28, 2006’’ in subsection (b)(3)(A), 
(I) by substituting ‘‘qualified storm damage individual’’ 
for ‘‘qualified Hurricane Katrina individual’’ each place it 
appears, 
(J) by substituting ‘‘December 31, 2009’’ for ‘‘December 
31, 2006’’ in subsection (c)(2)(A), 
(K) by disregarding subparagraphs (C) and (D) of sub-
section (c)(3) thereof, 
(L) by substituting ‘‘beginning on the date of the enact-
ment of the Heartland Disaster Tax Relief Act of 2008 
and ending on December 31, 2009’’ for ‘‘beginning on Sep-
tember 24, 2005, and ending on December 31, 2006’’ in 
subsection (c)(4)(A)(i), 
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122 STAT. 3917 
PUBLIC LAW 110–343—OCT. 3, 2008 
(M) by substituting ‘‘the applicable disaster date’’ for 
‘‘August 25, 2005’’ in subsection (c)(4)(A)(ii), and 
(N) by substituting ‘‘January 1, 2010’’ for ‘‘January 
1, 2007’’ in subsection (d)(2)(A)(ii). 
(11) 
EMPLOYEE
RETENTION
CREDIT
FOR
EMPLOYERS 
AFFECTED BY SEVERE STORMS, TORNADOS, AND FLOODING.—Sec-
tion 1400R(a)— 
(A) by substituting ‘‘the applicable disaster date’’ for 
‘‘August 28, 2005’’ each place it appears, 
(B) by substituting ‘‘January 1, 2009’’ for ‘‘January 
1, 2006’’ both places it appears, and 
(C) only with respect to eligible employers who 
employed an average of not more than 200 employees on 
business days during the taxable year before the applicable 
disaster date. 
(12) TEMPORARY
SUSPENSION
OF
LIMITATIONS
ON
CHARI-
TABLE CONTRIBUTIONS.—Section 1400S(a), by substituting the 
following paragraph for paragraph (4) thereof: 
‘‘(4) QUALIFIED CONTRIBUTIONS.— 
‘‘(A) IN GENERAL.—For purposes of this subsection, the 
term ‘qualified contribution’ means any charitable contribu-
tion (as defined in section 170(c)) if— 
‘‘(i) such contribution— 
‘‘(I) is paid during the period beginning on 
the earliest applicable disaster date for all States 
and ending on December 31, 2008, in cash to an 
organization described in section 170(b)(1)(A), and 
‘‘(II) is made for relief efforts in 1 or more 
Midwestern disaster areas, 
‘‘(ii) the taxpayer obtains from such organization 
contemporaneous written acknowledgment (within the 
meaning of section 170(f)(8)) that such contribution 
was used (or is to be used) for relief efforts in 1 
or more Midwestern disaster areas, and 
‘‘(iii) the taxpayer has elected the application of 
this subsection with respect to such contribution. 
‘‘(B) EXCEPTION.—Such term shall not include a con-
tribution by a donor if the contribution is— 
‘‘(i) to an organization described in section 
509(a)(3), or 
‘‘(ii) for establishment of a new, or maintenance 
of an existing, donor advised fund (as defined in section 
4966(d)(2)). 
‘‘(C) APPLICATION OF ELECTION TO PARTNERSHIPS AND 
S CORPORATIONS.—In the case of a partnership or S corpora-
tion, the election under subparagraph (A)(iii) shall be made 
separately by each partner or shareholder.’’. 
(13) SUSPENSION
OF
CERTAIN
LIMITATIONS
ON
PERSONAL 
CASUALTY
LOSSES.—Section 1400S(b)(1), by substituting ‘‘the 
applicable disaster date’’ for ‘‘August 25, 2005’’. 
(14) SPECIAL RULE FOR DETERMINING EARNED INCOME.— 
Section 1400S(d)— 
(A) by treating an individual as a qualified individual 
if such individual’s principal place of abode on the 
applicable disaster date was located in a Midwestern dis-
aster area, 
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122 STAT. 3918 
PUBLIC LAW 110–343—OCT. 3, 2008 
(B) by treating the applicable disaster date with respect 
to any such individual as the applicable date for purposes 
of such subsection, and 
(C) by treating an area as described in paragraph 
(2)(B)(ii) thereof if the area is a Midwestern disaster area 
only by reason of subsection (b)(2) of this section (relating 
to areas eligible only for public assistance). 
(15) ADJUSTMENTS REGARDING TAXPAYER AND DEPENDENCY 
STATUS.—Section 1400S(e), by substituting ‘‘2008 or 2009’’ for 
‘‘2005 or 2006’’. 
(e) MODIFICATIONS TO KATRINA EMERGENCY TAX RELIEF ACT 
OF 2005.—The following provisions of the Katrina Emergency Tax 
Relief Act of 2005 shall be applied with the following modifications: 
(1) ADDITIONAL EXEMPTION FOR HOUSING DISPLACED INDI-
VIDUAL.—Section 302— 
(A) by substituting ‘‘2008 or 2009’’ for ‘‘2005 or 2006’’ 
in subsection (a) thereof, 
(B) by substituting ‘‘Midwestern displaced individual’’ 
for ‘‘Hurricane Katrina displaced individual’’ each place 
it appears, and 
(C) by treating an area as a core disaster area for 
purposes of applying subsection (c) thereof if the area is 
a Midwestern disaster area without regard to subsection 
(b)(2) of this section (relating to areas eligible only for 
public assistance). 
(2) INCREASE IN STANDARD MILEAGE RATE.—Section 303, 
by substituting ‘‘beginning on the applicable disaster date and 
ending on December 31, 2008’’ for ‘‘beginning on August 25, 
2005, and ending on December 31, 2006’’. 
(3) MILEAGE
REIMBURSEMENTS
FOR
CHARITABLE
VOLUN-
TEERS.—Section 304— 
(A) by substituting ‘‘beginning on the applicable dis-
aster date and ending on December 31, 2008’’ for ‘‘beginning 
on August 25, 2005, and ending on December 31, 2006’’ 
in subsection (a), and 
(B) by substituting ‘‘the applicable disaster date’’ for 
‘‘August 25, 2005’’ in subsection (a). 
(4) EXCLUSION OF CERTAIN CANCELLATION OF INDEBTEDNESS 
INCOME.—Section 401— 
(A) by treating an individual whose principal place 
of abode on the applicable disaster date was in a Mid-
western disaster area (determined without regard to sub-
section (b)(2) of this section) as an individual described 
in subsection (b)(1) thereof, and by treating an individual 
whose principal place of abode on the applicable disaster 
date was in a Midwestern disaster area solely by reason 
of subsection (b)(2) of this section as an individual described 
in subsection (b)(2) thereof, 
(B) by substituting ‘‘the applicable disaster date’’ for 
‘‘August 28, 2005’’ both places it appears, and 
(C) by substituting ‘‘January 1, 2010’’ for ‘‘January 
1, 2007’’ in subsection (e). 
(5) EXTENSION OF REPLACEMENT PERIOD FOR NONRECOGNI-
TION OF GAIN.—Section 405, by substituting ‘‘on or after the 
applicable disaster date’’ for ‘‘on or after August 25, 2005’’. 
Applicability. 
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122 STAT. 3919 
PUBLIC LAW 110–343—OCT. 3, 2008 
SEC. 703. REPORTING REQUIREMENTS RELATING TO DISASTER 
RELIEF CONTRIBUTIONS. 
(a) IN GENERAL.—Section 6033(b) (relating to returns of certain 
organizations described in section 501(c)(3)) is amended by striking 
‘‘and’’ at the end of paragraph (13), by redesignating paragraph 
(14) as paragraph (15), and by adding after paragraph (13) the 
following new paragraph: 
‘‘(14) such information as the Secretary may require with 
respect to disaster relief activities, including the amount and 
use of qualified contributions to which section 1400S(a) applies, 
and’’. 
(b) EFFECTIVE DATE.—The amendments made by this section 
shall apply to returns the due date for which (determined without 
regard to any extension) occurs after December 31, 2008. 
SEC. 704. TEMPORARY TAX-EXEMPT BOND FINANCING AND LOW- 
INCOME HOUSING TAX RELIEF FOR AREAS DAMAGED BY 
HURRICANE IKE. 
(a) TAX-EXEMPT BOND FINANCING.—Section 1400N(a) of the 
Internal Revenue Code of 1986 shall apply to any Hurricane Ike 
disaster area in addition to any other area referenced in such 
section, but with the following modifications: 
(1) By substituting ‘‘qualified Hurricane Ike disaster area 
bond’’ for ‘‘qualified Gulf Opportunity Zone Bond’’ each place 
it appears, except that in determining whether a bond is a 
qualified Hurricane Ike disaster area bond— 
(A) paragraph (2)(A)(i) shall be applied by only treating 
costs as qualified project costs if— 
(i) in the case of a project involving a private 
business use (as defined in section 141(b)(6)), either 
the person using the property suffered a loss in a 
trade or business attributable to Hurricane Ike or is 
a person designated for purposes of this section by 
the Governor of the State in which the project is located 
as a person carrying on a trade or business replacing 
a trade or business with respect to which another 
person suffered such a loss, and 
(ii) in the case of a project relating to public utility 
property, the project involves repair or reconstruction 
of public utility property damaged by Hurricane Ike, 
and 
(B) paragraph (2)(A)(ii) shall be applied by treating 
an issue as a qualified mortgage issue only if 95 percent 
or more of the net proceeds (as defined in section 150(a)(3)) 
of the issue are to be used to provide financing for mortga-
gors who suffered damages to their principal residences 
attributable to Hurricane Ike. 
(2) By substituting ‘‘any State in which any Hurricane 
Ike disaster area is located’’ for ‘‘the State of Alabama, Lou-
isiana, or Mississippi’’ in paragraph (2)(B). 
(3) By substituting ‘‘designated for purposes of this section 
(on the basis of providing assistance to areas in the order 
in which such assistance is most needed)’’ for ‘‘designated for 
purposes of this section’’ in paragraph (2)(C). 
(4) By substituting ‘‘January 1, 2013’’ for ‘‘January 1, 2011’’ 
in paragraph (2)(D). 
Applicability. 
26 USC 6033 
note. 
26 USC 6033. 
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122 STAT. 3920 
PUBLIC LAW 110–343—OCT. 3, 2008 
(5) By substituting the following for subparagraph (A) of 
paragraph (3): 
‘‘(A) AGGREGATE AMOUNT DESIGNATED.—The maximum 
aggregate face amount of bonds which may be designated 
under this subsection with respect to any State shall not 
exceed the product of $2,000 multiplied by the portion 
of the State population which is in— 
‘‘(i) in the case of Texas, the counties of Brazoria, 
Chambers, Galveston, Jefferson, and Orange, and 
‘‘(ii) in the case of Louisiana, the parishes of 
Calcasieu and Cameron, 
(as determined on the basis of the most recent census 
estimate of resident population released by the Bureau 
of Census before September 13, 2008).’’. 
(6) By substituting ‘‘qualified Hurricane Ike disaster area 
repair or construction’’ for ‘‘qualified GO Zone repair or 
construction’’ each place it appears. 
(7) By substituting ‘‘after the date of the enactment of 
the Heartland Disaster Tax Relief Act of 2008 and before 
January 1, 2013’’ for ‘‘after the date of the enactment of this 
paragraph and before January 1, 2011’’ in paragraph (7)(C). 
(8) By disregarding paragraph (8) thereof. 
(9) By substituting ‘‘any Hurricane Ike disaster area’’ for 
‘‘the Gulf Opportunity Zone’’ each place it appears. 
(b) LOW-INCOME HOUSING CREDIT.—Section 1400N(c) of the 
Internal Revenue Code of 1986 shall apply to any Hurricane Ike 
disaster area in addition to any other area referenced in such 
section, but with the following modifications: 
(1) Only with respect to calendar years 2008, 2009, and 
2010. 
(2) By substituting ‘‘any Hurricane Ike disaster area’’ for 
‘‘the Gulf Opportunity Zone’’ each place it appears. 
(3) By substituting ‘‘Hurricane Ike Recovery Assistance 
housing amount’’ for ‘‘Gulf Opportunity housing amount’’ each 
place it appears. 
(4) By substituting the following for subparagraph (B) of 
paragraph (1): 
‘‘(B) HURRICANE IKE HOUSING AMOUNT.—For purposes 
of subparagraph (A), the term ‘Hurricane Ike housing 
amount’ means, for any calendar year, the amount equal 
to the product of $16.00 multiplied by the portion of the 
State population which is in— 
‘‘(i) in the case of Texas, the counties of Brazoria, 
Chambers, Galveston, Jefferson, and Orange, and 
‘‘(ii) in the case of Louisiana, the parishes of 
Calcasieu and Cameron, 
(as determined on the basis of the most recent census 
estimate of resident population released by the Bureau 
of Census before September 13, 2008).’’. 
(5) Determined without regard to paragraphs (2), (3), (4), 
(5), and (6) thereof. 
(c) HURRICANE IKE DISASTER AREA.—For purposes of this sec-
tion and for applying the substitutions described in subsections 
(a) and (b), the term ‘‘Hurricane Ike disaster area’’ means an 
area in the State of Texas or Louisiana— 
(1) with respect to which a major disaster has been declared 
by the President on September 13, 2008, under section 401 
Louisiana. 
Texas. 
Applicability. 
Louisiana. 
Texas. 
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122 STAT. 3921 
PUBLIC LAW 110–343—OCT. 3, 2008 
of the Robert T. Stafford Disaster Relief and Emergency Assist-
ance Act by reason of Hurricane Ike, and 
(2) determined by the President to warrant individual or 
individual and public assistance from the Federal Government 
under such Act with respect to damages attributable to Hurri-
cane Ike. 
Subtitle B—National Disaster Relief 
SEC. 706. LOSSES ATTRIBUTABLE TO FEDERALLY DECLARED DISAS-
TERS. 
(a) WAIVER OF ADJUSTED GROSS INCOME LIMITATION.— 
(1) IN GENERAL.—Subsection (h) of section 165 is amended 
by redesignating paragraphs (3) and (4) as paragraphs (4) and 
(5), respectively, and by inserting after paragraph (2) the fol-
lowing 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 subpara-
graph (A), the term ‘net disaster loss’ means the excess 
of— 
‘‘(i) the personal casualty losses— 
‘‘(I) attributable to a federally declared dis-
aster occurring before January 1, 2010, 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 subse-
quently determined by the President of the United 
States to warrant assistance by the Federal Govern-
ment 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 assist-
ance.’’. 
(2) CONFORMING AMENDMENTS.— 
(A) Section 165(h)(4)(B) (as so redesignated) is 
amended by striking ‘‘paragraph (2)’’ and inserting ‘‘para-
graphs (2) and (3)’’. 
(B) Section 165(i)(1) 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)’’. 
26 USC 165. 
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122 STAT. 3922 
PUBLIC LAW 110–343—OCT. 3, 2008 
(C) Section 165(i)(4) is amended by striking ‘‘Presi-
dentially 
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 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) is amended by 
striking ‘‘investment’’ and all that follows through ‘‘dis-
aster’’ 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) 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) 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) is amended 
by striking ‘‘Presidentially declared disasters’’ and inserting 
‘‘federally declared disasters’’. 
(vii) Subsection (a) of section 7508A is amended by 
striking ‘‘Presidentially declared disaster (as defined in 
section 1033(h)(3))’’ and inserting ‘‘federally declared dis-
aster (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), as 
amended by the Housing Assistance Tax Act of 2008, 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, as amended by the Housing Assistance Tax Act of 2008, 
is amended by adding at the end the following new paragraph: 
‘‘(8) DISASTER LOSS DEDUCTION.—For the purposes of para-
graph (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 TAX-
ABLE INCOME.—Subparagraph (E) of section 56(b)(1) is amended 
by adding at the end the following new sentence: ‘‘The preceding 
26 USC 165. 
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122 STAT. 3923 
PUBLIC LAW 110–343—OCT. 3, 2008 
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 CAS-
UALTY.—Paragraph (1) of section 165(h) is amended by striking 
‘‘$100’’ and inserting ‘‘$500 ($100 for taxable years beginning after 
December 31, 2009)’’. 
(d) EFFECTIVE DATES.— 
(1) IN
GENERAL.—Except as provided by paragraph (2), 
the amendments made by this section shall apply to disasters 
declared in taxable years beginning after December 31, 2007. 
(2) INCREASE IN LIMITATION ON INDIVIDUAL LOSS PER CAS-
UALTY.—The amendment made by subsection (c) shall apply 
to taxable years beginning after December 31, 2008. 
SEC. 707. EXPENSING OF QUALIFIED DISASTER EXPENSES. 
(a) IN GENERAL.—Part VI of subchapter B of chapter 1 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 sec-
tion, 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 sub-
stances that were released on account of a federally 
declared disaster occurring before January 1, 2010, 
‘‘(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 occurring before such date, or 
‘‘(C) for the repair of business-related property dam-
aged as a result of a federally declared disaster occurring 
before such date, and 
‘‘(3) which 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 
26 USC 56 note. 
26 USC 165. 
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122 STAT. 3924 
PUBLIC LAW 110–343—OCT. 3, 2008 
‘‘(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 regula-
tions 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 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 
in connection with disaster declared after such date. 
SEC. 708. NET OPERATING LOSSES ATTRIBUTABLE TO FEDERALLY 
DECLARED DISASTERS. 
(a) IN GENERAL.—Paragraph (1) of section 172(b) is amended 
by adding at the end the following new subparagraph: 
‘‘(J) 
CERTAIN
LOSSES
ATTRIBUTABLE
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 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 pur-
poses 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 dis-
aster (as defined in section 165(h)(3)(C)(i)) occur-
ring before January 1, 2010, 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 
26 USC 172. 
26 USC 198A 
note. 
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122 STAT. 3925 
PUBLIC LAW 110–343—OCT. 3, 2008 
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. 
‘‘(4) EXCLUSION.—The term ‘qualified disaster loss’ shall 
not include any loss with respect to any property described 
in section 1400N(p)(3).’’. 
(c) LOSS DEDUCTION ALLOWED
IN COMPUTING ALTERNATIVE 
MINIMUM
TAXABLE
INCOME.—Subsection (d) of section 56 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) 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) 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, in connection with disasters declared after 
such date. 
SEC. 709. WAIVER OF CERTAIN MORTGAGE REVENUE BOND REQUIRE-
MENTS FOLLOWING FEDERALLY DECLARED DISASTERS. 
(a) IN GENERAL.—Subsection (k) of section 143 is amended 
by adding at the end the following new paragraph: 
‘‘(12) SPECIAL RULES FOR RESIDENCES DESTROYED IN FEDER-
ALLY DECLARED DISASTERS.— 
‘‘(A) PRINCIPAL RESIDENCE DESTROYED.—At the election 
of the taxpayer, if the principal residence (within the 
meaning of section 121) of such taxpayer is— 
‘‘(i) rendered unsafe for use as a residence by rea-
son of a federally declared disaster occurring before 
January 1, 2010, 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 
occurring before such date, 
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) PRINCIPAL RESIDENCE DAMAGED.— 
‘‘(i) IN GENERAL.—At the election of the taxpayer, 
if the principal residence (within the meaning of section 
121) of such taxpayer was damaged as the result of 
a federally declared disaster occurring before January 
Applicability. 
26 USC 56 note. 
Applicability. 
26 USC 56. 
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122 STAT. 3926 
PUBLIC LAW 110–343—OCT. 3, 2008 
1, 2010, 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). 
‘‘(D) ELECTION; DENIAL OF DOUBLE BENEFIT.— 
‘‘(i) ELECTION.—An election under this paragraph 
may not be revoked except with the consent of the 
Secretary. 
‘‘(ii) DENIAL OF DOUBLE BENEFIT.—If a taxpayer 
elects the application of this paragraph, paragraph 
(11) shall not apply with respect to the purchase or 
financing of any residence by such taxpayer.’’. 
(b) EFFECTIVE DATE.—The amendment made by subsection (a) 
shall apply to disasters occurring after December 31, 2007. 
SEC. 710. SPECIAL DEPRECIATION ALLOWANCE FOR QUALIFIED DIS-
ASTER PROPERTY. 
(a) IN GENERAL.—Section 168, as amended by this Act, is 
amended by adding at the end the following new subsection: 
‘‘(n) SPECIAL ALLOWANCE FOR QUALIFIED DISASTER ASSISTANCE 
PROPERTY.— 
‘‘(1) IN GENERAL.—In the case of any qualified disaster 
assistance property— 
‘‘(A) the depreciation deduction provided by section 
167(a) for the taxable year in which such property is placed 
in service shall include an allowance equal to 50 percent 
of the adjusted basis of the qualified disaster assistance 
property, and 
‘‘(B) the adjusted basis of the qualified disaster assist-
ance property shall be reduced by the amount of such 
deduction before computing the amount otherwise allow-
able as a depreciation deduction under this chapter for 
such taxable year and any subsequent taxable year. 
‘‘(2) QUALIFIED DISASTER ASSISTANCE PROPERTY.—For pur-
poses of this subsection— 
‘‘(A) IN GENERAL.—The term ‘qualified disaster assist-
ance property’ means any property— 
‘‘(i)(I) which is described in subsection (k)(2)(A)(i), 
or 
‘‘(II) which is nonresidential real property or resi-
dential rental property, 
‘‘(ii) substantially all of the use of which is— 
‘‘(I) in a disaster area with respect to a feder-
ally declared disaster occurring before January 1, 
2010, and 
‘‘(II) in the active conduct of a trade or busi-
ness by the taxpayer in such disaster area, 
‘‘(iii) which— 
26 USC 168. 
26 USC 143 note. 
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122 STAT. 3927 
PUBLIC LAW 110–343—OCT. 3, 2008 
‘‘(I) 
rehabilitates 
property 
damaged, 
or 
replaces property destroyed or condemned, as a 
result of such federally declared disaster, except 
that, for purposes of this clause, property shall 
be treated as replacing property destroyed or con-
demned if, as part of an integrated plan, such 
property replaces property which is included in 
a continuous area which includes real property 
destroyed or condemned, and 
‘‘(II) is similar in nature to, and located in 
the same county as, the property being rehabili-
tated or replaced, 
‘‘(iv) the original use of which in such disaster 
area commences with an eligible taxpayer on or after 
the applicable disaster date, 
‘‘(v) which is acquired by such eligible taxpayer 
by purchase (as defined in section 179(d)) on or after 
the applicable disaster date, but only if no written 
binding contract for the acquisition was in effect before 
such date, and 
‘‘(vi) which is placed in service by such eligible 
taxpayer on or before the date which is the last day 
of the third calendar year following the applicable dis-
aster date (the fourth calendar year in the case of 
nonresidential real property and residential rental 
property). 
‘‘(B) EXCEPTIONS.— 
‘‘(i) OTHER BONUS DEPRECIATION PROPERTY.—The 
term ‘qualified disaster assistance property’ shall not 
include— 
‘‘(I) any property to which subsection (k) 
(determined without regard to paragraph (4)), (l), 
or (m) applies, 
‘‘(II) any property to which section 1400N(d) 
applies, and 
‘‘(III) any property described in section 
1400N(p)(3). 
‘‘(ii) ALTERNATIVE DEPRECIATION PROPERTY.—The 
term ‘qualified disaster assistance property’ shall not 
include any property to which the alternative deprecia-
tion system under subsection (g) applies, determined 
without regard to paragraph (7) of subsection (g) 
(relating to election to have system apply). 
‘‘(iii) TAX-EXEMPT
BOND
FINANCED
PROPERTY.— 
Such term shall not include any property any portion 
of which is financed with the proceeds of any obligation 
the interest on which is exempt from tax under section 
103. 
‘‘(iv) QUALIFIED REVITALIZATION BUILDINGS.—Such 
term shall not include any qualified revitalization 
building with respect to which the taxpayer has elected 
the application of paragraph (1) or (2) of section 
1400I(a). 
‘‘(v) ELECTION OUT.—If a taxpayer makes an elec-
tion under this clause with respect to any class of 
property for any taxable year, this subsection shall 
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122 STAT. 3928 
PUBLIC LAW 110–343—OCT. 3, 2008 
not apply to all property in such class placed in service 
during such taxable year. 
‘‘(C) SPECIAL RULES.—For purposes of this subsection, 
rules similar to the rules of subparagraph (E) of subsection 
(k)(2) shall apply, except that such subparagraph shall 
be applied— 
‘‘(i) by substituting ‘the applicable disaster date’ 
for ‘December 31, 2007’ each place it appears therein, 
‘‘(ii) without regard to ‘and before January 1, 2009’ 
in clause (i) thereof, and 
‘‘(iii) by substituting ‘qualified disaster assistance 
property’ for ‘qualified property’ in clause (iv) thereof. 
‘‘(D) ALLOWANCE
AGAINST
ALTERNATIVE
MINIMUM 
TAX.—For purposes of this subsection, rules similar to the 
rules of subsection (k)(2)(G) shall apply. 
‘‘(3) OTHER DEFINITIONS.—For purposes of this subsection— 
‘‘(A) APPLICABLE DISASTER DATE.—The term ‘applicable 
disaster date’ means, with respect to any federally declared 
disaster, the date on which such federally declared disaster 
occurs. 
‘‘(B) FEDERALLY DECLARED DISASTER.—The term ‘feder-
ally declared disaster’ has the meaning given such term 
under section 165(h)(3)(C)(i). 
‘‘(C) DISASTER AREA.—The term ‘disaster area’ has the 
meaning given such term under section 165(h)(3)(C)(ii). 
‘‘(D) ELIGIBLE TAXPAYER.—The term ‘eligible taxpayer’ 
means a taxpayer who has suffered an economic loss attrib-
utable to a federally declared disaster. 
‘‘(4) RECAPTURE.—For purposes of this subsection, rules 
similar to the rules under section 179(d)(10) shall apply with 
respect to any qualified disaster assistance property which 
ceases to be qualified disaster assistance property.’’. 
(b) EFFECTIVE DATE.—The amendment made by this section 
shall apply to property placed in service after December 31, 2007, 
with respect disasters declared after such date. 
SEC. 711. INCREASED EXPENSING FOR QUALIFIED DISASTER ASSIST-
ANCE PROPERTY. 
(a) IN GENERAL.—Section 179 is amended by adding at the 
end the following new subsection: 
‘‘(e) SPECIAL RULES FOR QUALIFIED DISASTER ASSISTANCE PROP-
ERTY.— 
‘‘(1) IN GENERAL.—For purposes of this section— 
‘‘(A) the dollar amount in effect under subsection (b)(1) 
for the taxable year shall be increased by the lesser of— 
‘‘(i) $100,000, or 
‘‘(ii) the cost of qualified section 179 disaster assist-
ance property placed in service during the taxable year, 
and 
‘‘(B) the dollar amount in effect under subsection (b)(2) 
for the taxable year shall be increased by the lesser of— 
‘‘(i) $600,000, or 
‘‘(ii) the cost of qualified section 179 disaster assist-
ance property placed in service during the taxable year. 
26 USC 179. 
26 USC 168 note. 
Applicability. 
Applicability. 
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122 STAT. 3929 
PUBLIC LAW 110–343—OCT. 3, 2008 
‘‘(2) QUALIFIED
SECTION
179
DISASTER
ASSISTANCE
PROP-
ERTY.—For purposes of this subsection, the term ‘qualified sec-
tion 179 disaster assistance property’ means section 179 prop-
erty (as defined in subsection (d)) which is qualified disaster 
assistance property (as defined in section 168(n)(2)). 
‘‘(3) COORDINATION
WITH
EMPOWERMENT
ZONES
AND 
RENEWAL COMMUNITIES.—For purposes of sections 1397A and 
1400J, qualified section 179 disaster assistance property shall 
not be treated as qualified zone property or qualified renewal 
property, unless the taxpayer elects not to take such qualified 
section 179 disaster assistance property into account for pur-
poses of this subsection. 
‘‘(4) RECAPTURE.—For purposes of this subsection, rules 
similar to the rules under subsection (d)(10) shall apply with 
respect to any qualified section 179 disaster assistance property 
which ceases to be qualified section 179 disaster assistance 
property.’’. 
(b) EFFECTIVE DATE.—The amendment made by this section 
shall apply to property placed in service after December 31, 2007, 
with respect disasters declared after such date. 
SEC. 712. COORDINATION WITH HEARTLAND DISASTER RELIEF. 
The amendments made by this subtitle, other than the amend-
ments made by sections 706(a)(2), 710, and 711, shall not apply 
to any disaster described in section 702(c)(1)(A), or to any expendi-
ture or loss resulting from such disaster. 
TITLE 
VIII—SPENDING 
REDUCTIONS 
AND APPROPRIATE REVENUE RAIS-
ERS FOR NEW TAX RELIEF POLICY 
SEC. 801. NONQUALIFIED DEFERRED COMPENSATION FROM CERTAIN 
TAX INDIFFERENT PARTIES. 
(a) IN GENERAL.—Subpart B of part II of subchapter E of 
chapter 1 is amended by inserting after section 457 the following 
new section: 
‘‘SEC. 457A. NONQUALIFIED DEFERRED COMPENSATION FROM CER-
TAIN TAX INDIFFERENT PARTIES. 
‘‘(a) IN GENERAL.—Any compensation which is deferred under 
a nonqualified deferred compensation plan of a nonqualified entity 
shall be includible in gross income when there is no substantial 
risk of forfeiture of the rights to such compensation. 
‘‘(b) NONQUALIFIED ENTITY.—For purposes of this section, the 
term ‘nonqualified entity’ means— 
‘‘(1) any foreign corporation unless substantially all of its 
income is— 
‘‘(A) effectively connected with the conduct of a trade 
or business in the United States, or 
‘‘(B) subject to a comprehensive foreign income tax, 
and 
‘‘(2) any partnership unless substantially all of its income 
is allocated to persons other than— 
‘‘(A) foreign persons with respect to whom such income 
is not subject to a comprehensive foreign income tax, and 
26 USC 56 note. 
26 USC 179 note. 
Applicability. 
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122 STAT. 3930 
PUBLIC LAW 110–343—OCT. 3, 2008 
‘‘(B) organizations which are exempt from tax under 
this title. 
‘‘(c) DETERMINABILITY OF AMOUNTS OF COMPENSATION.— 
‘‘(1) IN GENERAL.—If the amount of any compensation is 
not determinable at the time that such compensation is other-
wise includible in gross income under subsection (a)— 
‘‘(A) such amount shall be so includible in gross income 
when determinable, and 
‘‘(B) the tax imposed under this chapter for the taxable 
year in which such compensation is includible in gross 
income shall be increased by the sum of— 
‘‘(i) the amount of interest determined under para-
graph (2), and 
‘‘(ii) an amount equal to 20 percent of the amount 
of such compensation. 
‘‘(2) INTEREST.—For purposes of paragraph (1)(B)(i), the 
interest determined under this paragraph for any taxable year 
is the amount of interest at the underpayment rate under 
section 6621 plus 1 percentage point on the underpayments 
that would have occurred had the deferred compensation been 
includible in gross income for the taxable year in which first 
deferred or, if later, the first taxable year in which such 
deferred compensation is not subject to a substantial risk of 
forfeiture. 
‘‘(d) OTHER DEFINITIONS AND SPECIAL RULES.—For purposes 
of this section— 
‘‘(1) SUBSTANTIAL RISK OF FORFEITURE.— 
‘‘(A) IN GENERAL.—The rights of a person to compensa-
tion shall be treated as subject to a substantial risk of 
forfeiture only if such person’s rights to such compensation 
are conditioned upon the future performance of substantial 
services by any individual. 
‘‘(B) EXCEPTION
FOR
COMPENSATION
BASED
ON
GAIN 
RECOGNIZED ON AN INVESTMENT ASSET.— 
‘‘(i) IN GENERAL.—To the extent provided in regula-
tions prescribed by the Secretary, if compensation is 
determined solely by reference to the amount of gain 
recognized on the disposition of an investment asset, 
such compensation shall be treated as subject to a 
substantial risk of forfeiture until the date of such 
disposition. 
‘‘(ii) INVESTMENT ASSET.—For purposes of clause 
(i), the term ‘investment asset’ means any single asset 
(other than an investment fund or similar entity)— 
‘‘(I) acquired directly by an investment fund 
or similar entity, 
‘‘(II) with respect to which such entity does 
not (nor does any person related to such entity) 
participate in the active management of such asset 
(or if such asset is an interest in an entity, in 
the active management of the activities of such 
entity), and 
‘‘(III) substantially all of any gain on the dis-
position of which (other than such deferred com-
pensation) is allocated to investors in such entity. 
Regulations. 
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122 STAT. 3931 
PUBLIC LAW 110–343—OCT. 3, 2008 
‘‘(iii) COORDINATION
WITH
SPECIAL
RULE.—Para-
graph (3)(B) shall not apply to any compensation to 
which clause (i) applies. 
‘‘(2) COMPREHENSIVE FOREIGN INCOME TAX.—The term ‘com-
prehensive foreign income tax’ means, with respect to any 
foreign person, the income tax of a foreign country if— 
‘‘(A) such person is eligible for the benefits of a com-
prehensive income tax treaty between such foreign country 
and the United States, or 
‘‘(B) such person demonstrates to the satisfaction of 
the Secretary that such foreign country has a comprehen-
sive income tax. 
‘‘(3) NONQUALIFIED DEFERRED COMPENSATION PLAN.— 
‘‘(A) IN
GENERAL.—The term ‘nonqualified deferred 
compensation plan’ has the meaning given such term under 
section 409A(d), except that such term shall include any 
plan that provides a right to compensation based on the 
appreciation in value of a specified number of equity units 
of the service recipient. 
‘‘(B) EXCEPTION.—Compensation shall not be treated 
as deferred for purposes of this section if the service pro-
vider receives payment of such compensation not later than 
12 months after the end of the taxable year of the service 
recipient during which the right to the payment of such 
compensation is no longer subject to a substantial risk 
of forfeiture. 
‘‘(4) EXCEPTION FOR CERTAIN COMPENSATION WITH RESPECT 
TO EFFECTIVELY CONNECTED INCOME.—In the case a foreign 
corporation with income which is taxable under section 882, 
this section shall not apply to compensation which, had such 
compensation had been paid in cash on the date that such 
compensation ceased to be subject to a substantial risk of 
forfeiture, would have been deductible by such foreign corpora-
tion against such income. 
‘‘(5) APPLICATION OF RULES.—Rules similar to the rules 
of paragraphs (5) and (6) of section 409A(d) shall apply. 
‘‘(e) REGULATIONS.—The Secretary shall prescribe such regula-
tions as may be necessary or appropriate to carry out the purposes 
of this section, including regulations disregarding a substantial 
risk of forfeiture in cases where necessary to carry out the purposes 
of this section.’’. 
(b) CONFORMING AMENDMENT.—Section 26(b)(2), as amended 
by the Housing Assistance Tax Act of 2008, is amended by striking 
‘‘and’’ at the end of subparagraph (V), by striking the period at 
the end of subparagraph (W) and inserting ‘‘, and’’, and by adding 
at the end the following new subparagraph: 
‘‘(X) section 457A(c)(1)(B) (relating to determinability 
of amounts of compensation).’’. 
(c) CLERICAL AMENDMENT.—The table of sections of subpart 
B of part II of subchapter E of chapter 1 is amended by inserting 
after the item relating to section 457 the following new item: 
‘‘Sec. 457A. Nonqualified deferred compensation from certain tax indifferent par-
ties.’’. 
(d) EFFECTIVE DATE.— 
(1) IN GENERAL.—Except as otherwise provided in this sub-
section, the amendments made by this section shall apply to 
26 USC 457A 
note. 
26 USC 26. 
Deadline. 
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122 STAT. 3932 
PUBLIC LAW 110–343—OCT. 3, 2008 
amounts deferred which are attributable to services performed 
after December 31, 2008. 
(2) APPLICATION TO EXISTING DEFERRALS.—In the case of 
any amount deferred to which the amendments made by this 
section do not apply solely by reason of the fact that the 
amount is attributable to services performed before January 
1, 2009, to the extent such amount is not includible in gross 
income in a taxable year beginning before 2018, such amounts 
shall be includible in gross income in the later of— 
(A) the last taxable year beginning before 2018, or 
(B) the taxable year in which there is no substantial 
risk of forfeiture of the rights to such compensation (deter-
mined in the same manner as determined for purposes 
of section 457A of the Internal Revenue Code of 1986, 
as added by this section). 
(3) ACCELERATED PAYMENTS.—No later than 120 days after 
the date of the enactment of this Act, the Secretary shall 
issue guidance providing a limited period of time during which 
a nonqualified deferred compensation arrangement attributable 
to services performed on or before December 31, 2008, may, 
without violating the requirements of section 409A(a) of the 
Internal Revenue Code of 1986, be amended to conform the 
date of distribution to the date the amounts are required to 
be included in income. 
(4) CERTAIN
BACK-TO-BACK
ARRANGEMENTS.—If the tax-
payer is also a service recipient and maintains one or more 
nonqualified deferred compensation arrangements for its 
service providers under which any amount is attributable to 
services performed on or before December 31, 2008, the guid-
ance issued under paragraph (4) shall permit such arrange-
ments to be amended to conform the dates of distribution 
under such arrangement to the date amounts are required 
to be included in the income of such taxpayer under this sub-
section. 
(5) ACCELERATED PAYMENT NOT TREATED AS MATERIAL MODI-
FICATION.—Any amendment to a nonqualified deferred com-
pensation arrangement made pursuant to paragraph (4) or 
(5) shall not be treated as a material modification of the 
Deadline. 
Guidance. 
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122 STAT. 3933 
PUBLIC LAW 110–343—OCT. 3, 2008 
LEGISLATIVE HISTORY—H.R. 1424: 
HOUSE REPORTS: No. 110–374, Pt. 1 (Comm. on Education and Labor), Pt. 2 
(Comm. on Ways and Means), and Pt. 3 (Comm. on Energy 
and Commerce). 
CONGRESSIONAL RECORD, Vol. 154 (2008): 
Mar. 5, considered and passed House. 
Oct. 1, considered and passed Senate, amended. 
Oct. 3, House concurred in Senate amendments. 
arrangement for purposes of section 409A of the Internal Rev-
enue Code of 1986. 
Approved October 3, 2008. 
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