H.R. 4753 — Introduced in House

I 113th CONGRESS 2d Session H. R. 4753 IN THE HOUSE OF REPRESENTATIVES May 28, 2014 Mr. McDermott (for himself, Mr. Waxman, Mr. Larson of Connecticut, Mr. Blumenauer, and Mr. Pascrell) introduced the following bill; which was referred to the Committee on Ways and Means A BILL To amend the Internal Revenue Code of 1986 to provide incentives for clean energy and to repeal fossil fuel subsidies for big oil companies. 1. Short title; table of contents (a) Short title This Act may be cited as the Investing to Modernize the Production of American Clean Energy and Technology Act of 2014 or as the IMPACT Act of 2014. (b) Table of contents The table of contents of this Act is as follows: Sec. 1. Short title; table of contents. Title I—Clean energy incentives Subtitle A—Renewable energy Sec. 101. Extension of renewable energy credits. Sec. 102. Extension of election of investment tax credit in lieu of production credit. Sec. 103. Extension of qualifying advanced energy project credit. Sec. 104. Extension of credit for energy-efficient new homes. Sec. 105. Extension of credit for energy-efficient appliances. Subtitle B—Electric, natural gas, and hydrogen vehicles Sec. 111. Increase and expansion of credit for qualified plug-in electric drive motor vehicles. Sec. 112. Extension of new qualified alternative fuel motor vehicle credit for heavy natural gas vehicles. Sec. 113. Modification of credit for alternative fuel vehicle refueling property for vehicles powered by electricity, natural gas, or hydrogen. Sec. 114. Electric, natural gas, and hydrogen vehicle refueling property tax credit bonds. Title II—Repeal of fossil fuel subsidies for big oil companies Sec. 201. Prohibition on using last-in, first-out accounting for major integrated oil companies. Sec. 202. Modifications of foreign tax credit rules applicable to major integrated oil companies which are dual capacity taxpayers. Sec. 203. Limitation on section 199 deduction attributable to oil, natural gas, or primary products thereof. Sec. 204. Limitation on deduction for intangible drilling and development costs. Sec. 205. Limitation on percentage depletion allowance for oil and gas wells. Sec. 206. Limitation on deduction for tertiary injectants. I Clean energy incentives A Renewable energy 101. Extension of renewable energy credits (a) Wind, biomass, geothermal, small irrigation, landfill gas, hydropower, marine, and hydrokinetic Each of the following provisions of section 45(d) of such Code is amended by striking January 1, 2014 each place it appears and inserting January 1, 2024: (1) Paragraph (1). (2) Clauses (i) and (ii) of paragraph (2)(A). (3) Clauses (i)(I) and (ii) of paragraph (3)(A). (4) Paragraph (4). (5) Paragraph (6). (6) Subparagraphs (A) and (C) of paragraph (9). (7) Subparagraph (B) of paragraph (11). (b) Early termination in event of Federal renewable electricity requirement Subsection (d) of section 45 of the Internal Revenue Code of 1986 is amended by adding at the end the following new paragraph: (12) Termination in event of Federal renewable electricity requirement Notwithstanding any other provision of this section, the term qualified facility shall not include any property which is placed in service after the date which is 1 year after the date on which the Secretary of Energy makes a public declaration that a Federal law is in effect which requires retail electric suppliers in the United States to supply minimum and significant amounts of electric energy which is generated from renewable sources to customers for purposes other than resale. . 102. Extension of election of investment tax credit in lieu of production credit (a) In general Clause (ii) of section 48(a)(5)(C) of the Internal Revenue Code of 1986 is amended by striking January 1, 2014 and inserting January 1, 2024. (b) Limitation Paragraph (5) of section 48(a) of such Code is amended by adding at the end the following new subparagraphs: (E) Limitation In the case of a qualifying offshore wind facility to which this paragraph applies and the total megawatt nameplate capacity of which exceeds 3,000 megawatts, the basis which would (but for this subparagraph) be taken into account under subsection (a) with respect to such facility shall not exceed the amount which bears the same ratio to such basis as— (i) 3000 megawatts, bears to (ii) the total megawatt nameplate capacity of such facility. (F) Qualifying offshore wind facility For purposes of this paragraph— (i) In general The term qualifying offshore wind facility means an offshore facility using wind to produce electricity. (ii) Offshore facility The term offshore facility means any facility located in the inland navigable waters of the United States, including the Great Lakes, or in the coastal waters of the United States, including the territorial seas of the United States, the exclusive economic zone of the United States, and the Outer Continental Shelf of the United States. For purposes of the preceding sentence, the term United States has the meaning given in section 638(1). . (c) Effective date The amendments made by this section shall apply to facilities placed in service after December 31, 2013. 103. Extension of qualifying advanced energy project credit Paragraph (1) of section 48C(d) of the Internal Revenue Code of 1986 is amended by adding at the end the following new subparagraph: (C) Additional limitation amount (i) In general The total amount of credits that may be allocated under the program shall be increased by $5,000,000,000. (ii) Applications Notwithstanding the deadline for submitting applications specified in paragraph (2)(A), an applicant for certification with respect to credits allocated pursuant to clause (i) may submit an application to the Secretary at such time and in such manner as the Secretary may provide. (iii) Review, redistribution, and reallocation Notwithstanding the deadline for review specified in paragraph (4)(A), the Secretary shall review the credits allocated pursuant to clause (i) at such time as the Secretary determines appropriate. . 104. Extension of credit for energy-efficient new homes (a) In general Subsection (g) of section 45L of the Internal Revenue Code of 1986 is amended by striking December 31, 2013 and inserting December 31, 2016. (b) Effective date The amendment made by this section shall apply to homes acquired after December 31, 2013. 105. Extension of credit for energy-efficient appliances (a) In general Section 45M(b) of the Internal Revenue Code of 1986 is amended by striking or 2013 each place it appears and inserting 2013, 2014, 2015, or 2016. (b) Effective date The amendments made by this section shall apply to appliances produced after December 31, 2013. B Electric, natural gas, and hydrogen vehicles 111. Increase and expansion of credit for qualified plug-in electric drive motor vehicles (a) Increase in dollar limitation Paragraph (2) of section 30D(b) of the Internal Revenue Code of 1986 is amended by striking $2,500 and inserting $5,000. (b) Increase in limitation on number of vehicles eligible for credit Paragraph (2) of section 30D(e) of such Code is amended by striking 200,000 and inserting 400,000. (c) Effective date The amendment made by this section shall apply to vehicles acquired after the date of the enactment of this Act. 112. Extension of new qualified alternative fuel motor vehicle credit for heavy natural gas vehicles (a) In general Paragraph (4) of section 30B(k) of the Internal Revenue Code of 1986 is amended by inserting (December 31, 2018, in the case of a vehicle powered by compressed or liquefied natural gas and weighing more than 8,500 pounds) before the period at the end. (b) Effective date The amendment made by this section shall apply to vehicles purchased after the date of the enactment of this Act. 113. Modification of credit for alternative fuel vehicle refueling property for vehicles powered by electricity, natural gas, or hydrogen (a) Special Rules for Property Placed in Service Before January 1, 2021 Subsection (e) of section 30C of the Internal Revenue Code of 1986 is amended by adding at the end the following new paragraph: (7) Property for recharging vehicles powered by electricity, natural gas, or hydrogen In the case of property placed in service after December 31, 2013, and before January 1, 2021, which relates to electricity, natural gas, or hydrogen— (A) subsection (a) shall be applied by substituting 50 percent for 30 percent, (B) subsection (b)(1) shall be applied by substituting $50,000 for $30,000, and (C) subsection (b)(2) shall be applied by substituting $2,000 for $1,000. . (b) Installation Costs Subsection (e) of section 30C of such Code, as amended by subsection (a), is amended by adding at the end the following: (8) Installation costs The cost of any qualified alternative fuel vehicle refueling property which relates to electricity, natural gas, or hydrogen shall include the cost of the original installation of such property. . (c) Termination of Credit Paragraph (1) of section 30C(g) of such Code is amended to read as follows: (1) in the case of property relating to electricity, natural gas, or hydrogen, after December 31, 2020, and . (d) Effective Date The amendments made by this section shall apply to property placed in service after December 31, 2013. 114. Electric, natural gas, and hydrogen vehicle refueling property tax credit bonds (a) In General Paragraph (1) of section 54A(d) of the Internal Revenue Code of 1986 is amended by striking or at the end of subparagraph (D), by inserting or at the end of subparagraph (E), and by inserting after subparagraph (E) the following new subparagraph: (F) a qualified electric, natural gas, and hydrogen vehicle refueling property bond, . (b) Qualified Purpose Subparagraph (C) of section 54A(d)(2) of such Code is amended by striking and at the end of clause (iv), by striking the period at the end of clause (v) and inserting , and, and by adding at the end the following new clause: (vi) in the case of a qualified electric, natural gas, and hydrogen vehicle refueling property bond, a purpose specified in section 54G(a)(1). . (c) Bonds Allowed Subpart I of part IV of subchapter A of chapter 1 of such Code is amended by adding at the end the following new section: 54G. Qualified electric, natural gas, and hydrogen vehicle refueling property bonds (a) Qualified Electric, Natural Gas, and Hydrogen Vehicle Refueling Property Bond For purposes of this subpart, the term qualified electric, natural gas, and hydrogen vehicle refueling property 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 a qualified issuer for 1 or more qualified electric, natural gas, and hydrogen vehicle refueling properties, (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 Notwithstanding paragraph (2) of section 54A(b), the annual credit determined with respect to any qualified electric, natural gas, and hydrogen vehicle refueling property bond is 70 percent of the amount which would (but for this subsection) otherwise be determined under such paragraph with respect to such bond. (c) Limitation on Amount of Bonds Designated The maximum aggregate face amount of bonds which may be designated under subsection (a) by any issuer shall not exceed the limitation amount allocated to such issuer under subsection (e). (d) National Limitation on Amount of Bonds Designated There is a national qualified electric, natural gas, and hydrogen vehicle refueling property bond limitation of $750,000,000. (e) Allocations The Secretary shall make allocations of the amount of the national qualified electric, natural gas, and hydrogen vehicle refueling property bond limitation described in subsection (d) among purposes described in subsection (a)(1) in such manner as the Secretary determines appropriate. (f) Definitions For purposes of this section— (1) Qualified electric, natural gas, and hydrogen vehicle refueling property The term qualified electric, natural gas, and hydrogen vehicle refueling property means any qualified alternative fuel vehicle refueling property (within the meaning of section 30C) which relates to electricity, natural gas, or hydrogen. (2) Qualified issuer (A) In general The term qualified issuer means a public power provider, a cooperative electric company, or a governmental body. (B) Governmental body The term governmental body means any State or Indian tribal government, or any political subdivision thereof. (C) Public power provider The term public power provider means a State utility that has a service obligation to end-users or to a distribution utility (within the meaning of section 217 of the Federal Power Act, as in effect on the date of the enactment of this section). (D) Cooperative electric company The term cooperative electric company means a mutual or cooperative electric company described in section 501(c)(12) or an organization described in section 1381(a)(2)(C). . (d) Clerical Amendment The table of sections for subpart I of part IV of subchapter A of chapter 1 of the Internal Revenue Code of 1986 is amended by adding at the end the following new item: Sec. 54G. Qualified electric, natural gas, and hydrogen vehicle refueling property bonds. . (e) Effective Date The amendments made by this section shall apply to obligations issued after the date of the enactment of this Act. II Repeal of fossil fuel subsidies for big oil companies 201. Prohibition on using last-in, first-out accounting for major integrated oil companies (a) In general Section 472 of the Internal Revenue Code of 1986 is amended by adding at the end the following new subsection: (h) Major integrated oil companies Notwithstanding any other provision of this section, a major integrated oil company (as defined in section 167(h)(5)(B)) may not use the method provided in subsection (b) in inventorying of any goods. . (b) Effective date and special rule (1) In general The amendment made by subsection (a) shall apply to taxable years beginning after the date of the enactment of this Act. (2) Change in method of accounting In the case of any taxpayer required by the amendment made by this section to change its method of accounting for its first taxable year beginning after the date of the enactment of this Act— (A) such change shall be treated as initiated by the taxpayer, (B) such change shall be treated as made with the consent of the Secretary of the Treasury, and (C) the net amount of the adjustments required to be taken into account by the taxpayer under section 481 of the Internal Revenue Code of 1986 shall be taken into account ratably over a period (not greater than 8 taxable years) beginning with such first taxable year. 202. Modifications of foreign tax credit rules applicable to major integrated oil companies which are dual capacity taxpayers (a) In general Section 901 of the Internal Revenue Code of 1986 is amended by redesignating subsection (n) as subsection (o) and by inserting after subsection (m) the following new subsection: (n) Special rules relating to major integrated oil companies which are dual capacity taxpayers (1) General rule Notwithstanding any other provision of this chapter, any amount paid or accrued by a dual capacity taxpayer which is a major integrated oil company (as defined in section 167(h)(5)(B)) to a foreign country or possession of the United States for any period shall not be considered a tax— (A) if, for such period, the foreign country or possession does not impose a generally applicable income tax, or (B) to the extent such amount exceeds the amount (determined in accordance with regulations) which— (i) is paid by such dual capacity taxpayer pursuant to the generally applicable income tax imposed by the country or possession, or (ii) would be paid if the generally applicable income tax imposed by the country or possession were applicable to such dual capacity taxpayer. Nothing in this paragraph shall be construed to imply the proper treatment of any such amount not in excess of the amount determined under subparagraph (B). (2) Dual capacity taxpayer For purposes of this subsection, the term dual capacity taxpayer means, with respect to any foreign country or possession of the United States, a person who— (A) is subject to a levy of such country or possession, and (B) receives (or will receive) directly or indirectly a specific economic benefit (as determined in accordance with regulations) from such country or possession. (3) Generally applicable income tax For purposes of this subsection— (A) In general The term generally applicable income tax means an income tax (or a series of income taxes) which is generally imposed under the laws of a foreign country or possession on income derived from the conduct of a trade or business within such country or possession. (B) Exceptions Such term shall not include a tax unless it has substantial application, by its terms and in practice, to— (i) persons who are not dual capacity taxpayers, and (ii) persons who are citizens or residents of the foreign country or possession. . (b) Effective Date (1) In general The amendments made by this section shall apply to taxes paid or accrued in taxable years beginning after the date of the enactment of this Act. (2) Contrary treaty obligations upheld The amendments made by this section shall not apply to the extent contrary to any treaty obligation of the United States. 203. Limitation on section 199 deduction attributable to oil, natural gas, or primary products thereof (a) Denial of deduction Paragraph (4) of section 199(c) of the Internal Revenue Code of 1986 is amended by adding at the end the following new subparagraph: (E) Special rule for certain oil and gas income In the case of any taxpayer who is a major integrated oil company (as defined in section 167(h)(5)(B)) for the taxable year, the term domestic production gross receipts shall not include gross receipts from the production, transportation, or distribution of oil, natural gas, or any primary product (within the meaning of subsection (d)(9)) thereof. . (b) Effective date The amendment made by this section shall apply to taxable years beginning after December 31, 2013. 204. Limitation on deduction for intangible drilling and development costs (a) In general Section 263(c) of the Internal Revenue Code of 1986 is amended by adding at the end the following new sentence: This subsection shall not apply to amounts paid or incurred by a taxpayer in any taxable year in which such taxpayer is a major integrated oil company (as defined in section 167(h)(5)(B)).. (b) Effective date The amendment made by this section shall apply to amounts paid or incurred in taxable years beginning after December 31, 2013. 205. Limitation on percentage depletion allowance for oil and gas wells (a) In general Section 613A of the Internal Revenue Code of 1986 is amended by adding at the end the following new subsection: (f) Application with respect to major integrated oil companies In the case of any taxable year in which the taxpayer is a major integrated oil company (as defined in section 167(h)(5)(B)), the allowance for percentage depletion shall be zero. . (b) Effective date The amendment made by this section shall apply to taxable years beginning after December 31, 2013. 206. Limitation on deduction for tertiary injectants (a) In general Section 193 of the Internal Revenue Code of 1986 is amended by adding at the end the following new subsection: (d) Application with respect to major integrated oil companies This section shall not apply to amounts paid or incurred by a taxpayer in any taxable year in which such taxpayer is a major integrated oil company (as defined in section 167(h)(5)(B)). . (b) Effective date The amendment made by this section shall apply to amounts paid or incurred in taxable years beginning after December 31, 2013.