Text: H.R.4040 — 114th Congress (2015-2016)All Information (Except Text)

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Introduced in House (11/17/2015)


114th CONGRESS
1st Session
H. R. 4040


To amend the Internal Revenue Code of 1986 to modify and extend certain tax incentives relating to energy.


IN THE HOUSE OF REPRESENTATIVES

November 17, 2015

Mr. Blumenauer (for himself, Ms. Edwards, Mr. McDermott, Mr. Pascrell, Mr. Honda, Mr. Van Hollen, Ms. McCollum, Mr. Lowenthal, Mr. Ted Lieu of California, Mr. Higgins, Mr. Neal, Ms. Linda T. Sánchez of California, Ms. Lee, Mr. Quigley, Mr. Cartwright, Ms. Norton, Mr. Rangel, Mr. Huffman, and Mr. Grijalva) 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 modify and extend certain tax incentives relating to energy.

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

SECTION 1. Short title, etc.

(a) Short title.—This Act may be cited as the “Bridge to a Clean Energy Future Act of 2015”.

(b) Amendment of 1986 Code.—Except as otherwise expressly provided, whenever in this Act 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 Act is as follows:


Sec. 1. Short title, etc.

Sec. 101. Extension and modification of credit for nonbusiness energy property.

Sec. 102. Extension of credit for new qualified fuel cell motor vehicles.

Sec. 103. Extension of credit for alternative fuel vehicle refueling property.

Sec. 104. Extension of second generation biofuel producer credit.

Sec. 105. Extension and reform of biodiesel tax incentives.

Sec. 106. Extension of credits with respect to facilities producing energy from certain renewable resources.

Sec. 107. Extension of credit for energy-efficient new homes.

Sec. 108. Extension of special allowance for second generation biofuel plant property.

Sec. 109. Extension and modification of energy efficient commercial buildings deduction.

Sec. 110. Extension of special rule for sales or dispositions to implement FERC or State electric restructuring policy for qualified electric utilities.

Sec. 111. Extension of excise tax credits relating to alternative fuels.

Sec. 201. Extension of energy credit for certain property under construction.

Sec. 202. Modifications in credit for combined heat and power system property.

Sec. 203. Energy credit for waste heat to power property.

Sec. 204. Investment tax credit for community wind projects having generation capacity of not more than 20 megawatts.

Sec. 205. Extension of publicly traded partnership ownership structure to energy power generation projects, transportation fuels, and related energy activities.

Sec. 206. Additional advanced energy manufacturing credit allocations.

Sec. 301. Amortization of geological and geophysical expenditures.

Sec. 302. Producing oil and gas from marginal wells.

Sec. 303. Enhanced oil recovery credit.

Sec. 304. Intangible drilling and development costs in the case of oil and gas wells.

Sec. 305. Repeal of percentage depletion for oil and gas wells.

Sec. 306. Repeal of deduction for tertiary injectants.

Sec. 307. Repeal of exception to passive loss limitations for working interests in oil and gas properties.

Sec. 308. Deduction for income attributable to domestic production activities not allowed with respect to oil and gas activities.

Sec. 309. Prohibition on using last-in, first-out accounting for oil and gas companies.

Sec. 310. Modifications of foreign tax credit rules applicable to dual capacity taxpayers.

SEC. 101. Extension and modification of credit for nonbusiness energy property.

(a) In general.—Paragraph (2) of section 25C(g) is amended by striking “December 31, 2014” and inserting “December 31, 2016”.

(b) Updated Energy Star requirements for windows, doors, skylights, and roofing.—

(1) IN GENERAL.—Paragraph (1) of section 25C(c) is amended by striking “which meets” and all that follows through “requirements)”.

(2) ENERGY EFFICIENT BUILDING ENVELOPE COMPONENT.—Subsection (c) of section 25C is amended by redesignating paragraphs (2) and (3) as paragraphs (3) and (4), respectively, and by inserting after paragraph (1) the following new paragraph:

“(2) ENERGY EFFICIENT BUILDING ENVELOPE COMPONENT.—The term ‘energy efficient building envelope component’ means a building envelope component which meets—

“(A) applicable Energy Star program requirements, in the case of a roof or roof products,

“(B) version 6.0 Energy Star program requirements, in the case of an exterior window, a skylight, or an exterior door, and

“(C) the prescriptive criteria for such component established by the 2009 International Energy Conservation Code, as such Code (including supplements) is in effect on the date of the enactment of the American Recovery and Reinvestment Tax Act of 2009, in the case of any other component.”.

(3) CONFORMING AMENDMENT.—Subparagraph (D) of section 25C(c)(3), as so redesignated, is amended to read as follows:

“(D) any roof or roof products which are installed on a dwelling unit and are specifically and primarily designed to reduce the heat gain of such dwelling unit.”.

(c) Separate standards for tankless and storage water heaters.—

(1) IN GENERAL.—Subparagraph (D) of section 25C(d)(3) is amended by striking “which has either” and all that follows and inserting “which has either—

“(i) in the case of a storage water heater, an energy factor of at least 0.80 or a thermal efficiency of at least 90 percent, and

“(ii) in the case of any other water heater, an energy factor of at least 0.90 or a thermal efficiency of at least 90 percent, and”.

(2) STORAGE WATER HEATERS.—Paragraph (3) of section 25C(d) is amended by adding at the end the following flush sentence:

“For purposes of subparagraph (D)(i), the term ‘storage water heater’ means a water heater that has a water storage capacity of more than 20 gallons but not more than 55 gallons.”.

(d) Modification of testing standards for biomass stoves.—Subparagraph (E) of section 25C(d)(3) is amended by inserting before the period the following: “, when tested using the higher heating value of the fuel and in accordance with the Canadian Standards Administration B415.1 test protocol”.

(e) Separate standard for oil hot water boilers.—Paragraph (4) of section 25C(d) is amended by striking “95” and inserting “95 (90 in the case of an oil hot water boiler)”.

(f) Installation costs for qualified energy efficiency improvements.—Paragraph (1) of subsection (c) of section 25C is amended by adding at the end the following flush sentence:

“Such term includes expenditures for labor costs properly allocable to the onsite preparation, assembly, or original installation of the component.”.

(g) Effective date.—The amendments made by this section shall apply to property placed in service after December 31, 2014.

SEC. 102. Extension of credit for new qualified fuel cell motor vehicles.

(a) In general.—Paragraph (1) of section 30B(k) is amended by striking “December 31, 2014” and inserting “December 31, 2016”.

(b) Effective date.—The amendment made by this section shall apply to property purchased after December 31, 2014.

SEC. 103. Extension of credit for alternative fuel vehicle refueling property.

(a) In general.—Subsection (g) of section 30C is amended by striking “December 31, 2014” and inserting “December 31, 2016”.

(b) Effective date.—The amendment made by this section shall apply to property placed in service after December 31, 2014.

SEC. 104. Extension of second generation biofuel producer credit.

(a) In general.—Clause (i) of section 40(b)(6)(J) is amended by striking “January 1, 2015” and inserting “January 1, 2017”.

(b) Effective date.—The amendment made by this subsection shall apply to qualified second generation biofuel production after December 31, 2014.

SEC. 105. Extension and reform of biodiesel tax incentives.

(a) Income tax credit.—

(1) EXTENSION.—

(A) CREDITS FOR BIODIESEL AND RENEWABLE DIESEL USED AS FUEL.—Subsection (g) of section 40A is amended by striking “December 31, 2014” and inserting “December 31, 2016”.

(B) EFFECTIVE DATE.—The amendment made by this paragraph shall apply to fuel sold or used after December 31, 2014.

(2) REFORM OF INCOME TAX CREDIT.—

(A) IN GENERAL.—So much of section 40A as precedes subsection (c) is amended to read as follows:

“SEC. 40A. Biodiesel fuels credit.

“(a) In general.—For purposes of section 38, in the case of an eligible taxpayer, the biodiesel fuels credit determined under this section for the taxable year is $1.00 for each gallon of biodiesel produced by the taxpayer which during the taxable year—

“(1) is sold by the producer of such biodiesel to another person—

“(A) for use by such other person’s trade or business as a fuel or in the production of a biodiesel mixture (other than casual off-farm production), or

“(B) who sells such biodiesel at retail to another person and places such biodiesel in the fuel tank of such other person, or

“(2) is used by such producer for any purpose described in paragraph (1).

“(b) Increased credit for small producers.—

“(1) IN GENERAL.—In the case of any eligible small biodiesel producer, subsection (a) shall be applied by increasing the dollar amount contained therein by 10 cents.

“(2) LIMITATION.—Paragraph (1) shall only apply with respect to the first 15,000,000 gallons of biodiesel produced by any eligible small biodiesel producer during any taxable year.”.

(B) DEFINITIONS AND SPECIAL RULES.—Section 40A(d) is amended by striking all that follows paragraph (1) and inserting the following:

“(2) ELIGIBLE TAXPAYER.—

“(A) IN GENERAL.—The term ‘eligible taxpayer’ means, with respect to any gallon of biodiesel, the producer of such gallon if such producer has paid the tax imposed by section 4081 on such biodiesel.

“(B) SPECIAL RULE FOR ELIGIBLE DISCRETIONARY BLENDERS.—For purposes of this section (other than subsection (b)), an eligible discretionary blender shall be treated as the producer of any gallon of biodiesel which is used to make a qualified biodiesel mixture if—

“(i) the producer of such biodiesel (determined without regard to this subparagraph)—

“(I) did not pay the tax imposed under section 4081 with respect to such gallon, and

“(II) assigns the credit allowed under this section to the eligible discretionary blender in such form and manner as provided by the Secretary, and

“(ii) such eligible discretionary blender pays the tax imposed under section 4081 with respect to such gallon.

For purposes of the preceding sentence, an eligible discretionary blender shall be treated as producing a gallon of biodiesel in the taxable year in which the sale or use of the qualified biodiesel mixture occurs.

“(C) ELIGIBLE DISCRETIONARY BLENDER.—For purposes of subparagraph (B), the term ‘eligible discretionary blender’ means any person who—

“(i) is registered under section 4101 as a blender of qualified biodiesel mixtures, and

“(ii) has used 10,000,000 or more gallons of biodiesel in the production of qualified biodiesel mixtures in the preceding taxable year.

“(3) BIODIESEL MIXTURE; QUALIFIED BIODIESEL MIXTURE.—

“(A) BIODIESEL MIXTURE.—The term ‘biodiesel mixture’ means a mixture which consists of biodiesel and diesel fuel (as defined in section 4083(a)(3)), determined without regard to any use of kerosene.

“(B) QUALIFIED BIODIESEL MIXTURE.—

“(i) IN GENERAL.—The term ‘qualified biodiesel mixture’ means a biodiesel mixture which is produced by an eligible discretionary blender and—

“(I) sold by such eligible discretionary blender to any person for use as a fuel, or

“(II) used by such eligible discretionary blender as a fuel.

“(ii) SALE OR USE MUST BE IN TRADE OR BUSINESS, ETC.—A biodiesel mixture shall not be treated as a qualified biodiesel mixture unless the sale or use described in clause (i) is in a trade or business of the eligible discretionary blender.

“(4) BIODIESEL NOT USED FOR A QUALIFIED PURPOSE.—If—

“(A) any credit was determined with respect to any biodiesel under this section, and

“(B) any person uses such biodiesel for a purpose not described in subsection (a),

then there is hereby imposed on such person a tax equal to the product of the rate applicable under subsection (a) and the number of gallons of such biodiesel.

“(5) PASS-THRU IN THE CASE OF ESTATES AND TRUSTS.—Under regulations prescribed by the Secretary, rules similar to the rules of subsection (d) of section 52 shall apply.

“(6) LIMITATION TO BIODIESEL WITH CONNECTION TO THE UNITED STATES.—No credit shall be determined under subsection (a) with respect to biodiesel unless such biodiesel is produced in the United States. For purposes of this paragraph, the term ‘United States’ includes any possession of the United States.”.

(C) RULES FOR SMALL BIODIESEL PRODUCERS.—

(i) IN GENERAL.—Section 40A(e) is amended—

(I) by striking “agri-biodiesel” each place it appears in paragraphs (1) and (5)(A) and inserting “biodiesel”,

(II) by striking “subsection (b)(4)(C)” each place it appears in paragraphs (2) and (3) and inserting “subsection (b)(2)”, and

(III) by striking “subsection (a)(3)” each place it appears in paragraphs (5)(A), (6)(A)(i), and (6)(B)(i) and inserting “subsection (b)”.

(ii) The heading for subsection (e) of section 40A is amended by striking “agri-biodiesel” and inserting “biodiesel”.

(iii) The headings for paragraphs (1) and (6) of section 40A(e) are each amended by striking “agri-biodiesel” and inserting “biodiesel”.

(D) CONFORMING AMENDMENTS RELATED TO RENEWABLE DIESEL.—Section 40A(f) is amended—

(i) by striking “Subsection (b)(4)” and inserting “Subsection (b)”, and

(ii) by striking paragraph (4) and inserting the following:

“(4) CERTAIN AVIATION FUEL.—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 for Testing and Materials specification for aviation turbine fuel.”.

(E) REGISTRATION OF ELIGIBLE DISCRETIONARY BLENDERS.—Section 4101(a)(1) is amended—

(i) by striking “and” before “every person producing second generation biofuel”, and

(ii) by inserting “, and every person producing qualified biodiesel mixtures (as defined in section 40A(d)(3)) 10,000,000 or more gallons per year” after “section 40(b)(6)(E))”.

(F) CLERICAL AMENDMENT.—The table of sections for subpart D of part IV of subchapter A of chapter 1 is amended by striking the item relating to section 40A and inserting the following new item:


“Sec. 40A. Biodiesel fuels credit.”.

(G) EFFECTIVE DATE.—The amendments made by this paragraph shall apply to fuel sold or used after December 31, 2015.

(b) Excise tax incentives.—

(1) EXTENSION.—

(A) IN GENERAL.—Paragraph (6) of section 6426(c) is amended by striking “December 31, 2014” and inserting “December 31, 2016”.

(B) PAYMENTS.—Subparagraph (B) of section 6427(e)(6) is amended by striking “December 31, 2014” and inserting “December 31, 2016”.

(C) EFFECTIVE DATE.—The amendments made by this paragraph shall apply to fuel sold or used after December 31, 2014.

(D) SPECIAL RULE FOR CERTAIN PERIODS DURING 2015.—Notwithstanding any other provision of law, in the case of any biodiesel mixture credit properly determined under section 6426(c) of the Internal Revenue Code of 1986 for periods after December 31, 2014, and on or before the last day of the first calendar quarter ending after the date of the enactment of this Act, such credit shall be allowed, and any refund or payment attributable to such credit (including any payment under section 6427(e) of such Code) shall be made, only in such manner as the Secretary of the Treasury (or the Secretary’s delegate) shall provide. Such Secretary shall issue guidance within 30 days after the date of the enactment of this Act providing for a one-time submission of claims covering periods described in the preceding sentence. Such guidance shall provide for a 180-day period for the submission of such claims (in such manner as prescribed by such Secretary) to begin not later than 30 days after such guidance is issued. Such claims shall be paid by such Secretary not later than 60 days after receipt. If such Secretary has not paid pursuant to a claim filed under this subsection within 60 days after the date of the filing of such claim, the claim shall be paid with interest from such date determined by using the overpayment rate and method under section 6621 of such Code.

(2) REFORM OF EXCISE TAX CREDIT.—

(A) IN GENERAL.—Subsection (c) of section 6426 is amended—

(i) by striking all that precedes paragraph (6) and inserting the following:

“(c) Biodiesel production credit.—

“(1) IN GENERAL.—For purposes of this section, in the case of an eligible taxpayer, the biodiesel production credit is $1.00 for each gallon of biodiesel produced by the taxpayer and which—

“(A) is sold by such producer to another person—

“(i) for use by such other person’s trade or business as a fuel or in the production of a biodiesel mixture (other than casual off-farm production), or

“(ii) who sells such biodiesel at retail to another person and places such biodiesel in the fuel tank of such other person, or

“(B) is used by such producer for any purpose described in subparagraph (A).

“(2) SPECIAL RULE FOR ELIGIBLE DISCRETIONARY BLENDERS.—For purposes of this subsection and section 6427(e)(3), an eligible discretionary blender shall be treated as the producer of any gallon of biodiesel which is used to make a qualified biodiesel mixture if—

“(A) the producer of such biodiesel (determined without regard to this subparagraph)—

“(i) did not pay the tax imposed under section 4081 with respect to such gallon, and

“(ii) assigns the credit allowed under this section to the eligible discretionary blender in such form and manner as provided by the Secretary, and

“(B) such eligible discretionary blender pays the tax imposed under section 4081 with respect to such gallon.

For purposes of the preceding sentence, an eligible discretionary blender shall not be treated as producing a gallon of biodiesel before the date on which the sale or use of the qualified biodiesel mixture occurs.

“(3) DEFINITIONS.—Any term used in this subsection which is also used in section 40A shall have the meaning given such term by section 40A.”, and

(ii) by redesignating paragraph (6), as amended by paragraph (1)(A), as paragraph (4).

(B) PRODUCER REGISTRATION REQUIREMENT.—Subsection (a) of section 6426 is amended by striking “subsections (d) and (e)” in the flush sentence at the end and inserting “subsections (c), (d), and (e)”.

(C) RECAPTURE.—

(i) IN GENERAL.—Subsection (f) of section 6426 is amended—

(I) by striking “or biodiesel” each place it appears in subparagraphs (A) and (B)(i) of paragraph (1),

(II) by striking “or biodiesel mixture” in paragraph (1)(A), and

(III) by redesignating paragraph (2) as paragraph (3) and by inserting after paragraph (1) the following new paragraph:

“(2) BIODIESEL.—If any credit was determined under this section or paid pursuant to section 6427(e) with respect to the production of any biodiesel and any person uses such biodiesel for a purpose not described in subsection (c)(1), then there is hereby imposed on such person a tax equal to $1 for each gallon of such biodiesel.”.

(ii) CONFORMING AMENDMENTS.—

(I) Paragraph (3) of section 6426(f), as redesignated by clause (i)(III), is amended by inserting “or (2)” after “paragraph (1)”.

(II) The heading for paragraph (1) of section 6426(f) is amended by striking “Imposition of tax” and inserting “In general”.

(D) LIMITATION.—Section 6426(i) is amended—

(i) in paragraph (2)—

(I) by striking “biodiesel or”, and

(II) by striking “Biodiesel and” in the heading, and

(ii) by inserting after paragraph (2) the following new paragraph:

“(3) BIODIESEL.—No credit shall be determined under this section with respect to biodiesel unless such biodiesel is produced in the United States.”.

(E) CLERICAL AMENDMENTS.—

(i) The heading of section 6426 is amended by striking “alcohol fuel, biodiesel, and alternative fuel mixtures” and inserting “alcohol fuel mixtures, biodiesel production, and alternative fuel mixtures”.

(ii) The item relating to section 6426 in the table of sections for subchapter B of chapter 65 is amended by striking “alcohol fuel, biodiesel, and alternative fuel mixtures” and inserting “alcohol fuel mixtures, biodiesel production, and alternative fuel mixtures”.

(F) EFFECTIVE DATE.—The amendments made by this paragraph shall apply to fuel sold or used after December 31, 2015.

(3) REFORM OF EXCISE PAYMENTS OF CREDIT.—

(A) IN GENERAL.—Subsection (e) of section 6427, as amended by paragraph (1)(B), is amended—

(i) by striking “or the biodiesel mixture credit” in paragraph (1),

(ii) by redesignating paragraphs (3) through (6) as paragraphs (4) through (7), respectively, and by inserting after paragraph (2) the following new paragraph:

“(3) BIODIESEL PRODUCTION CREDIT.—If any person produces biodiesel and sells or uses such biodiesel as provided in section 6426(c)(1), the Secretary shall pay (without interest) to such person an amount equal to the biodiesel production credit with respect to such biodiesel.”,

(iii) by striking “paragraph (1) or (2)” each place it appears in paragraphs (4) and (6), as redesignated by paragraph (2), and inserting “paragraph (1), (2), or (3)”,

(iv) by striking “alternative fuel” each place it appears in paragraphs (4) and (6), as redesignated by paragraph (2), and inserting “fuel”, and

(v) by striking “biodiesel mixture (as defined in section 6426(c)(3))” in paragraph (7)(B), as so redesignated, and inserting “biodiesel (within the meaning of section 40A)”.

(B) EFFECTIVE DATE.—The amendments made by this paragraph shall apply to fuel sold or used after December 31, 2015.

(c) Treatment of biodiesel as a taxable fuel.—

(1) IN GENERAL.—

(A) TAXABLE FUEL INCLUDES BIODIESEL.—Paragraph (1) of section 4083(a) 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) biodiesel.”.

(B) BIODIESEL DEFINED.—Subsection (a) of section 4083 is amended by adding at the end the following new paragraph:

“(4) BIODIESEL.—The term ‘biodiesel’ has the meaning given such term under section 40A(d)(1), determined without regard to the last sentence thereof.”.

(2) BIODIESEL PRODUCTION FACILITIES TREATED AS REFINERIES.—

(A) IN GENERAL.—Subsection (a) of section 4081 is amended by adding at the end the following new paragraph:

“(5) BIODIESEL PRODUCTION FACILITIES AND BLENDING FACILITIES TREATED AS REFINERIES.—For purposes of this part—

“(A) any facility which is used to produce biodiesel, and

“(B) any biodiesel blending facility,

shall be treated as a refinery with respect to biodiesel.”.

(B) BIODIESEL BLENDING FACILITY DEFINED.—Section 4083 is amended by adding at the end the following new subsection:

“(e) Biodiesel blending facility.—For purposes of this subpart, the term ‘biodiesel blending facility’ means any facility that is operated by an eligible discretionary blender (as defined in section 40A(d)(2)(C)).”.

(C) BULK TRANSFERS.—Subparagraph (B) of section 4081(a)(1) is amended by adding at the end the following new clause:

“(iii) SPECIAL RULES FOR BIODIESEL.—The tax imposed by this paragraph shall not apply to the removal or entry of biodiesel to any refinery or terminal if the person removing or entering the biodiesel and the operator of the refinery or terminal are registered under section 4101.”.

(3) RATE OF TAX.—Subparagraph (A)(iii) of section 4081(a)(2) is amended by striking “diesel fuel or kerosene” and inserting “diesel fuel, kerosene, or biodiesel”.

(4) EXEMPTIONS.—

(A) IN GENERAL.—Section 4082 is amended by striking “diesel fuel and kerosene” each place it appears in subsections (a), (c), and (g) and inserting “diesel fuel, kerosene, and biodiesel”.

(B) CONFORMING AMENDMENT.—Subparagraph (A) of section 4082(d)(1) is amended by inserting “biodiesel,” after “diesel fuel,”.

(5) OTHER CONFORMING AMENDMENTS.—

(A) The heading for paragraph (1) of section 4041(a) is amended by striking “diesel fuel and kerosene” and inserting “diesel fuel, kerosene, and biodiesel”.

(B) Paragraph (2) of section 6416(b) is amended by striking “diesel fuel or kerosene” and inserting “diesel fuel, kerosene, or biodiesel”.

(C) Section 6427(l) is amended—

(i) by striking “diesel fuel or kerosene” each place it appears in paragraphs (1) and (5)(A) and inserting “diesel fuel, kerosene, or biodiesel”,

(ii) by striking “diesel fuel and kerosene” in the heading and inserting “diesel fuel, kerosene, and biodiesel”, and

(iii) by striking “diesel fuel or kerosene” in the heading of paragraph (5) and inserting “diesel fuel, kerosene, or biodiesel”.

(D) Section 6715(c)(1) is amended by striking “diesel fuel or kerosene” and inserting “diesel fuel, kerosene, or biodiesel”.

(6) EFFECTIVE DATE.—The amendments made by this subsection shall apply to biodiesel sold or used after December 31, 2015.

SEC. 106. Extension of credits with respect to facilities producing energy from certain renewable resources.

(a) In general.—The following provisions of section 45(d) are each amended by striking “January 1, 2015” each place it appears and inserting “January 1, 2017”:

(1) Paragraph (1).

(2) Paragraph (2)(A).

(3) Paragraph (3)(A).

(4) Paragraph (4)(B).

(5) Paragraph (6).

(6) Paragraph (7).

(7) Paragraph (9).

(8) Paragraph (11)(B).

(b) Extension of election To treat qualified facilities as energy property.—Clause (ii) of section 48(a)(5)(C) is amended by striking “January 1, 2015” and inserting “January 1, 2017”.

(c) Effective dates.—The amendments made by this section shall take effect on January 1, 2015.

SEC. 107. Extension of credit for energy-efficient new homes.

(a) In general.—Subsection (g) of section 45L is amended by striking “December 31, 2014” and inserting “December 31, 2016”.

(b) Effective date.—The amendment made by this section shall apply to homes acquired after December 31, 2014.

SEC. 108. Extension of special allowance for second generation biofuel plant property.

(a) In general.—Subparagraph (D) of section 168(l)(2) is amended by striking “January 1, 2015” and inserting “January 1, 2017”.

(b) Effective date.—The amendment made by this section shall apply to property placed in service after December 31, 2014.

SEC. 109. Extension and modification of energy efficient commercial buildings deduction.

(a) In general.—Subsection (h) of section 179D is amended by striking “December 31, 2014” and inserting “December 31, 2016”.

(b) Allocations to Indian tribal governments.—Paragraph (4) of section 179D(d) is amended by striking “or local” and inserting “local, or Indian tribal”.

(c) Allocations to certain nonprofit organizations.—

(1) IN GENERAL.—Paragraph (4) of section 179D(d), as amended by subsection (b), is amended by inserting “or by an organization that is described in section 501(c)(3) and exempt from tax under section 501(a),” after “political subdivision thereof,”.

(2) CLERICAL AMENDMENT.—The heading of paragraph (4) of section 179D(d) is amended by inserting “and property held by certain non-profits” after “public property”.

(d) Updated ASHRAE standards for 2016.—

(1) IN GENERAL.—Paragraph (1) of section 179D(c) is amended by striking “Standard 90.1-2001” each place it appears and inserting “Standard 90.1-2007”.

(2) CONFORMING AMENDMENTS.—

(A) Paragraph (2) of section 179D(c) is amended to read as follows:

“(2) STANDARD 90.1-2007.—The term ‘Standard 90.1-2007’ means Standard 90.1-2007 of the American Society of Heating, Refrigerating, and Air Conditioning Engineers and the Illuminating Engineering Society of North America (as in effect on the day before the date of the adoption of Standard 90.1-2010 of such Societies).”.

(B) Subsection (f) of section 179D is amended by striking “Standard 90.1-2001” each place it appears in paragraphs (1) and (2)(C)(i) and inserting “Standard 90.1-2007”.

(C) Paragraph (1) of section 179D(f) is amended—

(i) by striking “Table 9.3.1.1” and inserting “Table 9.5.1”, and

(ii) by striking “Table 9.3.1.2” and inserting “Table 9.6.1”.

(3) EFFECTIVE DATE.—The amendments made by this subsection shall apply to property placed in service after December 31, 2015.

(e) Effective date.—Except as provided in subsection (d)(3), the amendments made by this section shall apply to property placed in service after December 31, 2014.

SEC. 110. Extension of special rule for sales or dispositions to implement FERC or State electric restructuring policy for qualified electric utilities.

(a) In general.—Paragraph (3) of section 451(i) is amended by striking “January 1, 2015” and inserting “January 1, 2017”.

(b) Effective date.—The amendment made by this section shall apply to dispositions after December 31, 2014.

SEC. 111. Extension of excise tax credits relating to alternative fuels.

(a) Extension of alternative fuels excise tax credits.—

(1) IN GENERAL.—Sections 6426(d)(5) and 6426(e)(3) are each amended by striking “December 31, 2014” and inserting “December 31, 2016”.

(2) OUTLAY PAYMENTS FOR ALTERNATIVE FUELS.—Subparagraph (C) of section 6427(e)(7), as redesignated by section 6(b)(3)(A)(ii), is amended by striking “December 31, 2014” and inserting “December 31, 2016”.

(b) Effective date.—The amendments made by this section shall apply to fuel sold or used after December 31, 2014.

(c) Special rule for certain periods during 2015.—Notwithstanding any other provision of law, in the case of any alternative fuel credit properly determined under section 6426(d) of such Code for such periods, such credit shall be allowed, and any refund or payment attributable to such credit (including any payment under section 6427(e) of such Code) shall be made, only in such manner as the Secretary of the Treasury (or the Secretary’s delegate) shall provide. Such Secretary shall issue guidance within 30 days after the date of the enactment of this Act providing for a one-time submission of claims covering periods described in the preceding sentence. Such guidance shall provide for a 180-day period for the submission of such claims (in such manner as prescribed by such Secretary) to begin not later than 30 days after such guidance is issued. Such claims shall be paid by such Secretary not later than 60 days after receipt. If such Secretary has not paid pursuant to a claim filed under this subsection within 60 days after the date of the filing of such claim, the claim shall be paid with interest from such date determined by using the overpayment rate and method under section 6621 of such Code.

SEC. 201. Extension of energy credit for certain property under construction.

(a) Solar energy property.—Paragraphs (2)(A)(i)(II) and (3)(A)(ii) of section 48(a) are each amended by striking “periods ending” and inserting “property the construction of which begins”.

(b) Qualified fuel cell property.—Section 48(c)(1)(D) is amended by striking “for any period after December 31, 2016” and inserting “the construction of which does not begin before January 1, 2017”.

(c) Qualified microturbine property.—Section 48(c)(2)(D) is amended by striking “for any period after December 31, 2016” and inserting “the construction of which does not begin before January 1, 2017”.

(d) Combined heat and power system property.—Section 48(c)(3)(A)(iv) is amended by striking “which is placed in service” and inserting “construction of which begins”.

(e) Qualified small wind energy property.—Section 48(c)(4)(C) is amended by striking “for any period after December 31, 2016” and inserting “the construction of which does not begin before January 1, 2017”.

(f) Thermal energy property.—Section 48(a)(3)(A)(vii) is amended by striking “periods ending” and inserting “property the construction of which begins”.

(g) Effective date.—The amendments made by this section shall take effect on the date of the enactment of this Act.

SEC. 202. Modifications in credit for combined heat and power system property.

(a) Increased energy percentage.—Section 48(a)(2)(A)(i) is amended by striking “and” at the end of subclause (III), by redesignating subclause (IV) as subclause (V), and by inserting after subclause (III) the following new subclause:

“(IV) energy property described in paragraph (3)(A)(v), and”.

(b) Modification of certain capacity limitations.—Section 48(c)(3)(B) is amended—

(1) by striking “15 megawatts” in clause (ii) and inserting “25 megawatts”,

(2) by striking “20,000 horsepower” in clause (ii) and inserting “34,000 horsepower”, and

(3) by striking clause (iii).

(c) Effective date.—The amendments made by this section shall apply to periods after the date of the enactment of this Act, 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. 203. Energy credit for waste heat to power property.

(a) In general.—Section 48(a)(3)(A) is amended by striking “or” at the end of clause (vi), by inserting “or” at the end of clause (vii), and by adding at the end the following new clause:

“(viii) waste heat to power property,”.

(b) Waste heat To power property.—Section 48(c) is amended by adding at the end the following new paragraph:

“(5) WASTE HEAT TO POWER PROPERTY.—

“(A) WASTE HEAT TO POWER PROPERTY.—The term ‘waste heat to power property’ means property comprising a system which generates electricity through the recovery of a qualified waste heat resource.

“(B) QUALIFIED WASTE HEAT RESOURCE DEFINED.—The term ‘qualified waste heat resource’ means—

“(i) exhaust heat or flared gas from any industrial process,

“(ii) waste gas or industrial tail gas that would otherwise be flared, incinerated, or vented,

“(iii) a pressure drop in any gas for an industrial or commercial process, or

“(iv) such other forms of waste heat resources as the Secretary may determine.

“(C) EXCEPTION.—The term ‘qualified waste heat resource’ does not include any heat resource from a process whose primary purpose is the generation of electricity utilizing a fossil fuel or nuclear energy.

“(D) TERMINATION.—The term ‘waste heat to power property’ shall not include any property placed in service after December 31, 2016.”.

(c) Increased energy percentage.—Section 48(a)(2)(A)(i), as amended by section 201, is amended by striking “and” at the end of subclause (IV) and by inserting after subclause (V) the following new subclause:

“(VI) energy property described in paragraph (3)(A)(viii), and”.

(d) Effective date.—The amendments made by this section shall apply to periods after the date of the enactment of this Act, 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. 204. Investment tax credit for community wind projects having generation capacity of not more than 20 megawatts.

(a) In general.—Paragraph (4) of section 48(c) is amended—

(1) by striking subparagraph (A) and inserting the following new subparagraph:

“(A) IN GENERAL.—The term ‘qualified small wind energy property’ means—

“(i) property which uses a qualifying small wind turbine to generate electricity, or

“(ii) property which uses 1 or more wind turbines with an aggregate nameplate capacity of more than 100 kilowatts but not more than 20 megawatts.”, and

(2) by redesignating subparagraph (C) as subparagraph (D) and by inserting after subparagraph (B) the following new subparagraph:

“(C) REGULATIONS.—The Secretary shall prescribe such regulations as may be appropriate to prevent improper division of property to attempt to meet the limitation under subparagraph (A)(ii).”.

(b) 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. 205. Extension of publicly traded partnership ownership structure to energy power generation projects, transportation fuels, and related energy activities.

(a) In general.—Subparagraph (E) of section 7704(d)(1) is amended—

(1) by striking “income and gains derived from the exploration” and inserting “income and gains derived from the following:

“(i) MINERALS, NATURAL RESOURCES, ETC.—The exploration”,

(2) by inserting “or” before “industrial source”,

(3) by inserting a period after “carbon dioxide”, and

(4) by striking “, or the transportation or storage” and all that follows and inserting the following:

“(ii) RENEWABLE ENERGY.—The generation of electric power (including the leasing of tangible personal property used for such generation) exclusively utilizing any resource described in section 45(c)(1) or energy property described in section 48 (determined without regard to any termination date), or in the case of a facility described in paragraph (3) or (7) of section 45(d) (determined without regard to any placed in service date or date by which construction of the facility is required to begin), the accepting or processing of such resource.

“(iii) ELECTRICITY STORAGE DEVICES.—The receipt and sale of electric power that has been stored in a device directly connected to the grid.”.

(b) Effective date.—The amendments made by this section shall take effect on the date of the enactment of this Act, in taxable years ending after such date.

SEC. 206. Additional advanced energy manufacturing credit allocations.

(a) Additional allocation of credits.—Section 48C(d) is amended by adding at the end the following:

“(6) ADDITIONAL ALLOCATION.—

“(A) IN GENERAL.—In addition to credits allocated under paragraph (1), the Secretary, in consultation with the Secretary of Energy, is authorized to conduct an additional program to consider and award certifications for qualified investments eligible for credits under this section to qualifying advanced energy project sponsors pursuant to applications from such sponsors received after December 31, 2015.

“(B) LIMITATION.—The total amount of credits that may be allocated under subparagraph (A) shall not exceed $2,700,000,000.

“(C) MODIFICATIONS TO APPLICABLE RULES.—For purposes of this paragraph—

“(i) APPLICATION PERIOD.—The 2-year period described in paragraph (2) shall begin on January 1, 2016.

“(ii) REALLOCATION.—The 4-year period described in paragraph (4) shall begin the date of the enactment of this paragraph.”.

(b) Effective date.—The amendment made by subsection (a) shall apply to periods beginning after December 31, 2015.

SEC. 301. Amortization of geological and geophysical expenditures.

(a) In general.—Section 167(h) is amended—

(1) by striking “24-month period” in paragraph (1) and inserting “7-year period”, and

(2) by striking paragraph (5).

(b) Effective date.—The amendment made by this section shall apply to amounts paid or incurred in taxable years beginning after December 31, 2015.

SEC. 302. Producing oil and gas from marginal wells.

(a) In general.—Subpart D of part IV of subchapter A of chapter 1 is amended by striking section 45I (and by striking the item relating to such section in the table of sections for such subpart).

(b) Conforming amendment.—Section 38(b) is amended by striking paragraph (19).

(c) Effective date.—The amendment made by subsection (a) shall apply to credits determined for taxable years beginning after December 31, 2015.

SEC. 303. Enhanced oil recovery credit.

(a) In general.—Subpart D of part IV of subchapter A of chapter 1 is amended by striking section 43 (and by striking the item relating to such section in the table of sections for such subpart).

(b) Conforming amendment.—Section 38(b) is amended by striking paragraph (6).

(c) Effective date.—The amendments made by this section shall apply to amounts paid or incurred in taxable years beginning after December 31, 2015.

SEC. 304. Intangible drilling and development costs in the case of oil and gas wells.

(a) In general.—Subsection (c) of section 263 is amended by adding at the end the following new sentence: “This subsection shall not apply to amounts paid or incurred by a taxpayer with respect to an oil or gas well after December 31, 2015.”.

(b) Effective date.—The amendment made by this section shall apply to amounts paid or incurred in taxable years beginning after December 31, 2015.

SEC. 305. Repeal of percentage depletion for oil and gas wells.

(a) In general.—Part I of subchapter I of chapter 1 is amended by striking section 613A (and the table of sections of such part is amended by striking the item relating to such section).

(b) Conforming amendments.—

(1) Subsection (d) of section 45H is amended—

(A) by striking “For purposes this section” and inserting the following:

“(1) IN GENERAL.—For purposes of this section”,

(B) by striking “(within the meaning of section 613A(d)(3))”, and

(C) by adding at the end the following new paragraph:

“(2) RELATED PERSON.—For purposes of this subsection, a person is a related person with respect to the taxpayer if a significant ownership interest in either the taxpayer or such person is held by the other, or if a third person has a significant ownership interest in both the taxpayer and such person. For purposes of the preceding sentence, the term ‘significant ownership interest’ means—

“(A) with respect to any corporation, 5 percent or more in value of the outstanding stock of such corporation,

“(B) with respect to a partnership, 5 percent or more interest in the profits or capital of such partnership, and

“(C) with respect to an estate or trust, 5 percent or more of the beneficial interests in such estate or trust.

For purposes of determining a significant ownership interest, an interest owned by or for a corporation, partnership, trust, or estate shall be considered as owned directly both by itself and proportionately by its shareholders, partners, or beneficiaries, as the case may be.”.

(2) Section 56(g)(4)(F) is amended to read as follows:

“(F) DEPLETION.—The allowance for depletion with respect to any property placed in service in a taxable year beginning after December 31, 1989, shall be cost depletion determined under section 611.”.

(3) Section 57(a)(1) is amended by striking the last sentence.

(4) Section 291(b)(4) is amended by adding at the end the following: “Any reference in the preceding sentence to section 613A shall be treated as a reference to such section as in effect prior to the date of the enactment of the Bridge to a Clean Energy Future Act of 2015.”.

(5) Section 613(d) is amended by striking “Except as provided in section 613A, in the case of” and inserting “In the case of”.

(6) Section 613(e) is amended—

(A) by striking “or section 613A” in paragraph (2), and

(B) by striking “any amount described in section 613A(d)(5)” in paragraph (3) and inserting “any lease bonus, advance royalty, or other amount payable without regard to production from property”.

(7) Section 705(a) is amended—

(A) by inserting “and” at the end of paragraph (1)(C),

(B) by striking “; and” at the end of paragraph (2)(B) and inserting a period, and

(C) by striking paragraph (3).

(8) Section 776 is amended by striking subsection (a) and by redesignating subsection (b) as subsection (a).

(9) Section 954(g)(2)(D) is amended by inserting “(as in effect before the date of the enactment of the Bridge to a Clean Energy Future Act of 2015)” after “section 613A”.

(10) Section 993(c)(2)(C) is amended by striking “section 613 or 613A” and inserting “section 613 (determined without regard to subsection (d) thereof)”.

(11) Section 1202(e)(3)(D) is amended by striking “section 613 or 613A” and inserting “section 613 (determined without regard to subsection (d) thereof)”.

(12) Section 1367(a)(2) is amended by inserting “and” at the end of subparagraph (C), by striking “, and” at the end of subparagraph (D) and inserting a period, and by striking subparagraph (E).

(13) Section 1446(c) is amended by striking paragraph (2) and by redesignating paragraph (3) as paragraph (2).

(c) Effective date.—The amendments made by this section shall apply to property placed in service after December 31, 2015.

SEC. 306. Repeal of deduction for tertiary injectants.

(a) In general.—Part VI of subchapter B of chapter 1 is amended by striking section 193 (and the table of sections of such subpart is amended by striking the item relating to such section).

(b) Effective date.—The amendments made by this section shall apply to taxable years beginning after December 31, 2015.

SEC. 307. Repeal of exception to passive loss limitations for working interests in oil and gas properties.

(a) In general.—Section 469(c)(3) is amended by adding at the end the following new subparagraph:

“(C) TERMINATION.—Subparagraph (A) shall not apply with respect to any taxable year beginning after the date of the enactment of this Act.”.

(b) Effective date.—The amendment made by this section shall apply to taxable years beginning after December 31, 2015.

SEC. 308. Deduction for income attributable to domestic production activities not allowed with respect to oil and gas activities.

(a) In general.—Section 199(c)(4)(B) 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 inserting after clause (iii) the following new clause:

“(iv) the production, refining, processing, transportation, or distribution of oil, gas, or any primary product thereof.”.

(b) Conforming amendment.—Section 199(d) is amended by striking paragraph (9) and by redesignating paragraph (10) as paragraph (9).

(c) Effective date.—The amendments made by this section shall apply to taxable years beginning after December 31, 2015.

SEC. 309. Prohibition on using last-in, first-out accounting for oil and gas companies.

(a) In general.—Section 472 is amended by adding at the end the following new subsection:

“(h) Oil and gas companies.—

“(1) IN GENERAL.—Notwithstanding any other provision of this section, a major integrated oil company may not use the method provided in subsection (b) in inventorying of any goods.

“(2) MAJOR INTEGRATED OIL COMPANY.—For purposes of this subsection, the term ‘major integrated oil company’ means, with respect to any taxable year, a producer of crude oil—

“(A) which has an average daily worldwide production of crude oil of at least 500,000 barrels for the taxable year,

“(B) which has gross receipts in excess of $1,000,000,000 for the taxable year, and

“(C) the average daily refinery runs of the taxpayer and related persons for the taxable year exceed 75,000 barrels.

“(3) SPECIAL RULES.—

“(A) CRUDE PRODUCTION AND GROSS RECEIPTS.—For purposes of subparagraphs (A) and (B) of paragraph (2)—

“(i) CONTROLLED GROUPS AND COMMON CONTROL.—All persons treated as a single employer under subsections (a) and (b) of section 52 shall be treated as 1 person.

“(ii) SHORT TAXABLE YEARS.—In the case of a short taxable year, the rule under section 448(c)(3)(B) shall apply.

“(B) AVERAGE DAILY REFINERY RUNS.—For purposes of paragraph (2)(C)—

“(i) IN GENERAL.—The average daily refinery runs for any taxable year shall be determined by dividing the aggregate refinery runs for the taxable year by the number of days in the taxable year.

“(ii) RELATED PERSONS.—A person is a related person with respect to the taxpayer if a significant ownership interest in either the taxpayer or such person is held by the other, or if a third person has a significant ownership interest in both the taxpayer and such person.

“(iii) SIGNIFICANT OWNERSHIP INTEREST.—For purposes of clause (ii), the term ‘significant ownership interest’ means—

“(I) with respect to any corporation, 15 percent or more in value of the outstanding stock of such corporation,

“(II) with respect to a partnership, 15 percent or more interest in the profits or capital of such partnership, and

“(III) with respect to an estate or trust, 15 percent or more of the beneficial interests in such estate or trust.

For purposes of determining a significant ownership interest, an interest owned by or for a corporation, partnership, trust, or estate shall be considered as owned directly both by itself and proportionately by its shareholders, partners, or beneficiaries, as the case may be.”.

(b) Effective date and special rule.—

(1) IN GENERAL.—The amendment made by subsection (a) shall apply to taxable years beginning after December 31, 2015.

(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.

SEC. 310. Modifications of foreign tax credit rules applicable to dual capacity taxpayers.

(a) In general.—Section 901 is amended by redesignating subsection (n) as subsection (o) and by inserting after subsection (m) the following new subsection:

“(n) Special rules relating to dual capacity taxpayers.—

“(1) GENERAL RULE.—Notwithstanding any other provision of this chapter, any amount paid or accrued by a dual capacity taxpayer to a foreign country or possession of the United States for any period with respect to combined foreign oil and gas income (as defined in section 907(b)(1)) shall not be considered a tax to the extent such amount exceeds the amount (determined in accordance with regulations) which would have been required to be paid if the taxpayer were not a dual capacity taxpayer.

“(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.”.

(b) Effective date.—

(1) IN GENERAL.—The amendments made by this section shall apply to taxes paid or accrued in taxable years beginning after December 31, 2015.

(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.


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