113 S278 IS: Job Preservation and Sequester Replacement Act of 2013
U.S. Senate
2013-02-11
text/xml
EN
Pursuant to Title 17 Section 105 of the United States Code, this file is not subject to copyright protection and is in the public domain.
1.Short
title; table of contents
(a)This Act may be cited
as the Job Preservation and Sequester
Replacement Act of 2013
.
(b)The table of
contents of this Act is as follows:
Sec. 1. Short title; table of
contents.
TITLE I—Elimination of sequestration for fiscal year
2013
Sec. 101. No sequestration for 2013.
TITLE II—Elimination of Tax Loopholes for High-Income
Taxpayers
Sec. 201. Minimum tax for high-income earners.
Sec. 202. Requiring high-income professionals to pay their
payroll taxes.
Sec. 203. Elimination of private jet giveaway.
TITLE III—Elimination of tax loopholes for offshoring
manufacturers
Sec. 301. Ending tax breaks for offshoring
manufacturers.
TITLE IV—Elimination of tax loopholes for oil and gas
companies
Sec. 401. Modifications of foreign tax credit rules applicable
to major integrated oil companies which are dual capacity
taxpayers.
Sec. 402. Limitation on section 199 deduction attributable to
oil, natural gas, or primary products thereof.
Sec. 403. Limitation on deduction for intangible drilling and
development costs.
Sec. 404. Limitation on percentage depletion allowance for oil
and gas wells.
Sec. 405. Limitation on deduction for tertiary
injectants.
Sec. 406. Repeal of outer Continental Shelf deep water and deep
gas royalty relief.
<enum>I</enum><header>Elimination of
sequestration for fiscal year 2013</header>
<section id="idFFFA50A99E5A46CBB41D7D0CF9B362D8"><enum>101.</enum><header>No
sequestration for 2013</header>
<subsection id="id3E13F3058737496AB74D579C26705596"><enum>(a)</enum><header>In
general</header><text display-inline="yes-display-inline">Section 251A(3)(E) of
the Balanced Budget and Emergency Deficit Control Act of 1985 (2 U.S.C.
901a(3)(E)) is amended by striking <quote>$24,000,000,000</quote> and inserting
<quote>$109,300,000,000</quote>.</text>
</subsection><subsection id="idcf4e728a61e649f3b889c0807be10b51"><enum>(b)</enum><header>Repeal of
Budget Control Act sequester for fiscal year 2013</header>
<paragraph id="ide03e0dd066f24775bfa95e0a55f69a23"><enum>(1)</enum><header>Repeal</header><text>Section
901(e) of the American Taxpayer Relief Act of 2012 (<external-xref legal-doc="public-law" parsable-cite="pl/112/240">Public Law 112–240</external-xref>) is
repealed.</text>
</paragraph><paragraph id="id00f9bd5d51b84dbf9b464ae347918547"><enum>(2)</enum><header>BBEDCA</header><text>Section
251A of the Balanced Budget and Emergency Deficit Control Act (<external-xref legal-doc="usc" parsable-cite="usc/2/901a">2 U.S.C. 901a</external-xref>)
is amended—</text>
<subparagraph id="id44b4ca7ebb074c36b83605ff88d09bf9"><enum>(A)</enum><text>in paragraph (4),
by striking <quote>On March 1, 2013, for fiscal year 2013, and in</quote> and
inserting <quote>In</quote>;</text>
</subparagraph><subparagraph id="id7367037cd9004ca88b6e6e1cecd783cd"><enum>(B)</enum><text>in paragraph (5),
by striking <quote>2013</quote> and inserting <quote>2014</quote>;</text>
</subparagraph><subparagraph id="ida6025fed8b414ecfbd9e88133168877f"><enum>(C)</enum><text>in paragraph (6),
by striking <quote>2013</quote> and inserting <quote>2014</quote>; and</text>
</subparagraph><subparagraph id="idc3bf6aa8be894a82b4203f5a03173c88"><enum>(D)</enum><text>in paragraph
(7)—</text>
<clause id="idE9787BB613F948F7B82BB4CEAB18A6C5"><enum>(i)</enum><text>by
striking <quote><header-in-text level="paragraph" style="OLC">reductions</header-in-text>.—</quote> and all that follows through
<quote>On the date of the submission</quote> and inserting
<quote><header-in-text level="paragraph" style="OLC">reductions</header-in-text>.—On the date of the submission</quote>;
and</text>
</clause><clause id="id6E504E13FC1448DDB4BA2DDB8C9E4AC0"><enum>(ii)</enum><text>by
redesignating clauses (i) and (ii) as subparagraphs (A) and (B),
respectively.</text>
</clause></subparagraph></paragraph></subsection></section><enum>II</enum><header>Elimination of
Tax Loopholes for High-Income Taxpayers</header>
<section id="idB3198222122447ABBA12613638D23236"><enum>201.</enum><header>Minimum tax
for high-income earners</header>
<subsection id="ID471f4f9c7ce444c6bdafa3f70c8957e3"><enum>(a)</enum><header>In
general</header><text>Subchapter A of chapter 1 is amended by adding at the end
the following new part:</text>
<quoted-block display-inline="no-display-inline" id="id28F15319176D4FB1AB1024B0667191D1" style="OLC">
<part id="id52F739CDD1254829A7C4FDBA34D0A9E1"><enum>VIII</enum><header>Fair share tax
on high-income taxpayers</header>
<toc>
<toc-entry idref="id769FF3336EE94D5CB6DC7DB75DBBD233" level="section">Sec. 59B. Fair share tax.</toc-entry>
</toc>
<section id="id769FF3336EE94D5CB6DC7DB75DBBD233"><enum>59B.<?LEXA-Enum 59B.?></enum><header>Fair share tax</header>
<subsection id="id61BAD049439C44B4AD36D7515F056795"><enum>(a)</enum><header>General
rule</header>
<paragraph id="idFF5D2371F8E344378DA1C36A849945A0"><enum>(1)</enum><header>Phase-in of
tax</header><text>In the case of any high-income taxpayer, there is hereby
imposed for a taxable year (in addition to any other tax imposed by this
subtitle) a tax equal to the product of—</text>
<subparagraph id="idFDCE8D7D745242E388B7392B4D56E924"><enum>(A)</enum><text>the amount
determined under paragraph (2), and</text>
</subparagraph><subparagraph id="id9E02CFF4C6C241B1BA4409E3EE558006"><enum>(B)</enum><text>a fraction (not
to exceed 1)—</text>
<clause id="id1794986A9F2746968116CD93D1E84DC2"><enum>(i)</enum><text>the numerator of
which is the excess of—</text>
<subclause id="id28D87A9013DD4722A1C1EF144578FBB3"><enum>(I)</enum><text>the taxpayer's
adjusted gross income, over</text>
</subclause><subclause id="id6D5B155F69D04E4FA82D8521E316C84F"><enum>(II)</enum><text>the dollar
amount in effect under subsection (c)(1), and</text>
</subclause></clause><clause id="idAB0ADE8EF6304AD9958A2DEF99533296"><enum>(ii)</enum><text>the denominator
of which is the dollar amount in effect under subsection (c)(1).</text>
</clause></subparagraph></paragraph><paragraph id="id2BE6F98D92A94AA68E2FCC064DD5E88A"><enum>(2)</enum><header>Amount of
tax</header><text>The amount of tax determined under this paragraph is an
amount equal to the excess (if any) of—</text>
<subparagraph id="id332A6913BADF48F6BE4D5959EE7392BC"><enum>(A)</enum><text>the tentative
fair share tax for the taxable year, over</text>
</subparagraph><subparagraph id="id46536D3AF7D1429E94DDA13646557E79"><enum>(B)</enum><text>the excess
of—</text>
<clause id="id29BDE53EB97A4D24BDBCB9513C0FC6A6"><enum>(i)</enum><text>the sum
of—</text>
<subclause id="id42879461F5CE4CE1B6825C2C97A2AF66"><enum>(I)</enum><text>the regular tax
liability (as defined in section 26(b)) for the taxable year, determined
without regard to any tax liability determined under this section,</text>
</subclause><subclause id="idA603AE8697FB4868930030B7DD24084A"><enum>(II)</enum><text>the tax imposed
by section 55 for the taxable year, plus</text>
</subclause><subclause id="idD7F9BF72579A45D9A24DAAAA00D1057C"><enum>(III)</enum><text>the payroll tax
for the taxable year, over</text>
</subclause></clause><clause id="id08CBA04DC3A548E6BDBE94C81E05163D"><enum>(ii)</enum><text>the credits
allowable under part IV of subchapter A (other than sections 27(a), 31, and
34).</text>
</clause></subparagraph></paragraph></subsection><subsection id="idE57E46EC06E14CEDA08E62CF1B490F39"><enum>(b)</enum><header>Tentative fair
share tax</header><text>For purposes of this section—</text>
<paragraph id="idF516F4D1420D46C69187FAA5FC9370E1"><enum>(1)</enum><header>In
general</header><text>The tentative fair share tax for the taxable year is 30
percent of the excess of—</text>
<subparagraph id="idA1820FD499B241E7B68EECC0B9C48AAA"><enum>(A)</enum><text>the adjusted
gross income of the taxpayer, over</text>
</subparagraph><subparagraph id="id96EF7417666E4763B86E7BF0F72578BD"><enum>(B)</enum><text>the modified
charitable contribution deduction for the taxable year.</text>
</subparagraph></paragraph><paragraph id="id72B669B1E81A4D7BB454311EBFE35640"><enum>(2)</enum><header>Modified
charitable contribution deduction</header><text>For purposes of paragraph
(1)—</text>
<subparagraph id="idA7E0623A2F6248E6955C9039D2490FD0"><enum>(A)</enum><header>In
general</header><text>The modified charitable contribution deduction for any
taxable year is an amount equal to the amount which bears the same ratio to the
deduction allowable under section 170 (section 642(c) in the case of a trust or
estate) for such taxable year as—</text>
<clause id="id09C282E720854724AB6AD18036C85E58"><enum>(i)</enum><text>the amount of
itemized deductions allowable under the regular tax (as defined in section 55)
for such taxable year, determined after the application of section 68, bears
to</text>
</clause><clause id="idEFD53F3D7DD7455DA3FFBC22F720C204"><enum>(ii)</enum><text>such amount,
determined before the application of section 68.</text>
</clause></subparagraph><subparagraph id="id32A6B7194658493AA0F5DBA8151D968B"><enum>(B)</enum><header>Taxpayer must
itemize</header><text>In the case of any individual who does not elect to
itemize deductions for the taxable year, the modified charitable contribution
deduction shall be zero.</text>
</subparagraph></paragraph></subsection><subsection id="idF6366F4AAA144AE3B9B36065FFA4DDFA"><enum>(c)</enum><header>High-Income
taxpayer</header><text>For purposes of this section—</text>
<paragraph id="idA865BD7E47DC49038DD83CC0227D6289"><enum>(1)</enum><header>In
general</header><text>The term <term>high-income taxpayer</term> means, with
respect to any taxable year, any taxpayer (other than a corporation) with an
adjusted gross income for such taxable year in excess of $1,000,000 (50 percent
of such amount in the case of a married individual who files a separate
return).</text>
</paragraph><paragraph id="id4E74A13C415446869B152F87D6158F22"><enum>(2)</enum><header>Inflation
adjustment</header>
<subparagraph id="ID9f20a6d599d747f79c06ab5437f64b42"><enum>(A)</enum><header>In
general</header><text>In the case of a taxable year beginning after 2013, the
$1,000,000 amount under paragraph (1) shall be increased by an amount equal
to—</text>
<clause id="ID9f2d4a37624c40fab5b1ec09249a800c"><enum>(i)</enum><text>such dollar
amount, multiplied by</text>
</clause><clause id="ID5f1194ed00474951baade0befa5a6a92"><enum>(ii)</enum><text>the
cost-of-living adjustment determined under section 1(f)(3) for the calendar
year in which the taxable year begins, determined by substituting
<quote>calendar year 2012</quote> for <quote>calendar year 1992</quote> in
subparagraph (B) thereof.</text>
</clause></subparagraph><subparagraph id="ID84a4d142d70845b281289e53b3894b52"><enum>(B)</enum><header>Rounding</header><text>If
any amount as adjusted under subparagraph (A) is not a multiple of $10,000,
such amount shall be rounded to the next lowest multiple of $10,000.</text>
</subparagraph></paragraph></subsection><subsection id="id583E38523AC1430C93E97150A2C3F7BF"><enum>(d)</enum><header>Payroll
tax</header><text>For purposes of this section, the payroll tax for any taxable
year is an amount equal to the excess of—</text>
<paragraph id="idF6A3FDE92418419EA2151EE1461A9847"><enum>(1)</enum><text>the taxes imposed
on the taxpayer under sections 1401, 1411, 3101, 3201, and 3211(a) (to the
extent such tax is attributable to the rate of tax in effect under section
3101) with respect to such taxable year or wages or compensation received
during such taxable year, over</text>
</paragraph><paragraph id="id2FB04995F68B462B9BD9CB355CB60E63"><enum>(2)</enum><text>the deduction
allowable under section 164(f) for such taxable year.</text>
</paragraph></subsection><subsection id="id857955860220407A810BBE146622B997"><enum>(e)</enum><header>Special rule
for estates and trusts</header><text>For purposes of this section, in the case
of an estate or trust, adjusted gross income shall be computed in the manner
described in section 67(e).</text>
</subsection><subsection commented="no" id="IDc88d296dce014c7e83446cd26faeb1d1"><enum>(f)</enum><header>Not treated as
tax imposed by this chapter for certain purposes</header><text>The tax imposed
under this section shall not be treated as tax imposed by this chapter for
purposes of determining the amount of any credit under this chapter (other than
the credit allowed under section 27(a)) or for purposes of section
55.</text>
</subsection></section></part><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="idA8E4A587BBA045998A4468D5E2E9A61E"><enum>(b)</enum><header>Clerical
amendment</header><text>The table of parts for subchapter A of chapter 1 is
amended by adding at the end the following new item:</text>
<quoted-block id="ida5a95c9a-9bc6-4fee-8389-a66fdd660686" style="OLC">
<toc>
<toc-entry idref="id52F739CDD1254829A7C4FDBA34D0A9E1" level="part">Part VIII—Fair share tax on high-Income
taxpayers</toc-entry>
</toc>
<after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection commented="no" display-inline="no-display-inline" id="id1A85806DDA7A466BA8007BB2EED1E8A0"><enum>(c)</enum><header>Effective
date</header><text>The amendments made by this section shall apply to taxable
years beginning after December 31, 2012.</text>
</subsection></section><section id="id3D70129967D140BEB5F375C88C8E854C"><enum>202.</enum><header>Requiring
high-income professionals to pay their payroll taxes</header>
<subsection id="id1C3CBE39E0B242DBB2FA86C774F34769"><enum>(a)</enum><header>In
general</header><text display-inline="yes-display-inline">Section 1402 of the
Internal Revenue Code of 1986 is amended by adding at the end the following new
subsection:</text>
<quoted-block display-inline="no-display-inline" id="id556FF05001654CDCA30E86E74015D1A6" style="OLC">
<subsection id="id3955DCC7BDA748329B87EE84B5816286"><enum>(m)</enum><header>Special rules
for professional service businesses</header>
<paragraph id="id592D0FFA30F5448F8A26A34B1E11161B"><enum>(1)</enum><header>Shareholders
providing services to specified S corporations</header>
<subparagraph id="id0464c092c3314c748843dd5a4323799a"><enum>(A)</enum><header>In
general</header><text>In the case of an applicable shareholder who provides
substantial services with respect to a professional service business referred
to in subparagraph (C) of a specified S corporation—</text>
<clause id="id596EADE34D6F4536A779972D48C37B3B"><enum>(i)</enum><text>such shareholder
shall be treated as engaged in the trade or business of such professional
service business with respect to items of income or loss described in section
1366 which are attributable to such business, and</text>
</clause><clause id="id5AD1EA8801844F1FAA9651638F176EB9"><enum>(ii)</enum><text>such
shareholder's net earnings from self-employment shall include such
shareholder’s pro rata share of such items of income or loss, except that in
computing such pro rata share of such items the exceptions provided in
subsection (a) shall apply.</text>
</clause></subparagraph><subparagraph id="idF15276E3CFD547A39FE54B98BDC4212A"><enum>(B)</enum><header>Treatment of
family members</header><text display-inline="yes-display-inline">Except as
otherwise provided by the Secretary, the applicable shareholder’s pro rata
share of items referred to in subparagraph (A) shall be increased by the pro
rata share of such items of each member of such applicable shareholder’s family
(within the meaning of section 318(a)(1)) who does not provide substantial
services with respect to such professional service business.</text>
</subparagraph><subparagraph id="idBC5E9F6E23B1431E991F91F51CBB08F6"><enum>(C)</enum><header>Specified S
corporation</header><text>For purposes of this subsection, the term
<term>specified S corporation</term> means—</text>
<clause id="id9DD8B114BED245D592175731D6C1D5A2"><enum>(i)</enum><text>any S corporation
which is a partner in a partnership which is engaged in a professional service
business if substantially all of the activities of such S corporation are
performed in connection with such partnership, and</text>
</clause><clause id="id434C3863AA014063837A8270A86391B9"><enum>(ii)</enum><text>any other S
corporation which is engaged in a professional service business if 75 percent
or more of the gross income of such business is attributable to service of 3 or
fewer shareholders of such corporation.</text>
</clause></subparagraph><subparagraph id="id752C23DE609E49CB8D5E88AAAB90281F"><enum>(D)</enum><header>Applicable
shareholder</header><text>For purposes of this paragraph, the term
<term>applicable shareholder</term> means any shareholder whose modified
adjusted gross income for the taxable year exceeds—</text>
<clause id="idBB70AB732F09436DA6430F2FAEA73BCE"><enum>(i)</enum><text>in the case of a
shareholder making a joint return under section 6013 or a surviving spouse (as
defined in section 2(a)), $250,000,</text>
</clause><clause id="idC5EA667FBD284D90BCD51FC186249B7E"><enum>(ii)</enum><text>in the case of a
married shareholder (as defined in section 7703) filing a separate return, half
of the dollar amount determined under clause (i), and</text>
</clause><clause id="id0CA81DB59B504842A025A497276413B6"><enum>(iii)</enum><text>in any other
case, $200,000.</text>
</clause></subparagraph></paragraph><paragraph id="idB3C3719FC22A42A4B4A4084D7A6A5310"><enum>(2)</enum><header>Partners</header>
<subparagraph id="id509D6C0ED33C4309B9B1C697B3F90FED"><enum>(A)</enum><header>In
general</header><text>In the case of any partnership which is engaged in a
professional service business, subsection (a)(13) shall not apply to any
applicable partner who provides substantial services with respect to such
professional service business.</text>
</subparagraph><subparagraph id="id6060B360112E4349A9752A1131E3EE63"><enum>(B)</enum><header>Applicable
partner</header><text>For purposes of this paragraph, the term <term>applicable
partner</term> means any partner whose modified adjusted gross income for the
taxable year exceeds—</text>
<clause id="idEBB2114E7F4D4430933165FB9630C392"><enum>(i)</enum><text>in the case of a
partner making a joint return under section 6013 or a surviving spouse (as
defined in section 2(a)), $250,000,</text>
</clause><clause id="idDCFD568E82954EC68F74ADD5C1E9A76F"><enum>(ii)</enum><text>in the case of a
married partner (as defined in section 7703) filing a separate return, half of
the dollar amount determined under clause (i), and</text>
</clause><clause id="idDEC10280702240189B484CCA12827066"><enum>(iii)</enum><text>in any other
case, $200,000.</text>
</clause></subparagraph></paragraph><paragraph id="id859BF0B97C69404E962F49FB479A84A6"><enum>(3)</enum><header>Professional
service business</header><text>For purposes of this subsection, the term
<quote>professional service business</quote> means any trade or business (or
portion thereof) providing services in the fields of health, law, lobbying,
engineering, architecture, accounting, actuarial science, performing arts,
consulting, athletics, investment advice or management, or brokerage
services.</text>
</paragraph><paragraph id="id258281DB50204915A21C35FE4B276113"><enum>(4)</enum><header>Modified
adjusted gross income</header><text>For purposes of this subsection, the term
<term>modified adjusted gross income</term> means adjusted gross income—</text>
<subparagraph id="id313822C3C3EB4F22A29C0B1FA8D35232"><enum>(A)</enum><text>determined
without regard to any deduction allowed under section 164(f), and</text>
</subparagraph><subparagraph id="id7BE85D1FB7354EE4887A08B029557B05"><enum>(B)</enum><text>increased by the
amount excluded from gross income under section 911(a)(1).</text>
</subparagraph></paragraph><paragraph id="id78681EB9B3F04DC1A2D7F4B29BEA0382"><enum>(5)</enum><header>Regulations</header><text>The
Secretary shall prescribe such regulations as may be necessary or appropriate
to carry out the purposes of this subsection, including regulations which
prevent the avoidance of the purposes of this subsection through tiered
entities or otherwise.</text>
</paragraph><paragraph display-inline="no-display-inline" id="id7B6CEB2F26824CAD9232647945DE7E2D"><enum>(6)</enum><header>Cross
reference</header><text display-inline="yes-display-inline">For employment tax
treatment of wages paid to shareholders of S corporations, see subtitle
C.</text>
</paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="id35CCECDBB75543D3AACF112429A72E02"><enum>(b)</enum><header>Conforming
amendment</header><text display-inline="yes-display-inline">Section 211 of the
Social Security Act is amended by adding at the end the following new
subsection:</text>
<quoted-block display-inline="no-display-inline" id="idF776BDF1A0AF4F74AB40CC670DA15677" style="OLC">
<subsection display-inline="no-display-inline" id="idB05D166DC9AD4BEBA9B7CD11B6E47943"><enum>(l)</enum><header>Special rules
for professional service businesses</header>
<paragraph id="id1F8F695A647D4190963BC119C74C17AD"><enum>(1)</enum><header>Shareholders
providing services to specified S corporations</header>
<subparagraph id="idED862F68310E4739952BCD6495C2E40D"><enum>(A)</enum><header>In
general</header><text>In the case of an applicable shareholder who provides
substantial services with respect to a professional service business referred
to in subparagraph (C) of a specified S corporation—</text>
<clause id="id16254BD2BB44408CABE8C59E864D8509"><enum>(i)</enum><text>such shareholder
shall be treated as engaged in the trade or business of such professional
service business with respect to items of income or loss described in section
1366 of the Internal Revenue Code of 1986 which are attributable to such
business, and</text>
</clause><clause id="id6C794508EA30482CA5AA7F2E1B484687"><enum>(ii)</enum><text>such
shareholder's net earnings from self-employment shall include such
shareholder’s pro rata share of such items of income or loss, except that in
computing such pro rata share of such items the exceptions provided in
subsection (a) shall apply.</text>
</clause></subparagraph><subparagraph display-inline="no-display-inline" id="idB3D978888E2C436CBB700429C688D6DC"><enum>(B)</enum><header>Treatment of
family members</header><text display-inline="yes-display-inline">Except as
otherwise provided by the Secretary of the Treasury, the applicable
shareholder’s pro rata share of items referred to in subparagraph (A) shall be
increased by the pro rata share of such items of each member of such applicable
shareholder’s family (within the meaning of section 318(a)(1) of the Internal
Revenue Code of 1986) who does not provide substantial services with respect to
such professional service business.</text>
</subparagraph><subparagraph id="idCCC04FFEED9E48969C19425367FD504A"><enum>(C)</enum><header>Specified S
corporation</header><text>For purposes of this subsection, the term
<quote>specified S corporation</quote> means—</text>
<clause id="id9BAC51E78025463C814D576C090055E0"><enum>(i)</enum><text>any S corporation
(as defined in <external-xref legal-doc="usc" parsable-cite="usc/26/1361">section 1361(a)</external-xref> of the Internal Revenue Code of 1986) which is a
partner in a partnership which is engaged in a professional service business if
substantially all of the activities of such S corporation are performed in
connection with such partnership, and</text>
</clause><clause id="idA8010DC54E2D4A69AB2DC8B61C8CABC5"><enum>(ii)</enum><text>any other S
corporation (as so defined) which is engaged in a professional service business
if 75 percent or more of the gross income of such business is attributable to
service of 3 or fewer shareholders of such corporation.</text>
</clause></subparagraph><subparagraph id="idD2FBD8E0EDAB429B9E8B35AAB7C69AE0"><enum>(D)</enum><header>Applicable
shareholder</header><text>For purposes of this paragraph, the term
<term>applicable shareholder</term> means any shareholder whose modified
adjusted gross income for the taxable year exceeds—</text>
<clause id="id5248BAEFBB5B4B159EE40FEDD742EB46"><enum>(i)</enum><text>in the case of a
shareholder making a joint return under section 6013 of the Internal Revenue
Code of 1986 or a surviving spouse (as defined in section 2(a) of such Code),
$250,000,</text>
</clause><clause id="id049A6AF5378B4FFBB7CD3C431D1F4472"><enum>(ii)</enum><text>in the case of a
married shareholder (as defined in section 7703 of such Code) filing a separate
return, half of the dollar amount determined under clause (i), and</text>
</clause><clause id="id75E0BD7B79CA4AA68361273130A7B64B"><enum>(iii)</enum><text>in any other
case, $200,000.</text>
</clause></subparagraph></paragraph><paragraph id="id8B71FCA65F13469ABC91796C1A12B17A"><enum>(2)</enum><header>Partners</header>
<subparagraph id="id72C3954E4711476B8BD21C1692128D89"><enum>(A)</enum><header>In
general</header><text>In the case of any partnership which is engaged in a
professional service business, subsection (a)(12) shall not apply to any
applicable partner who provides substantial services with respect to such
professional service business.</text>
</subparagraph><subparagraph id="id2C42D14874A046F39843C1C482C1BF3B"><enum>(B)</enum><header>Applicable
partner</header><text>For purposes of this paragraph, the term <term>applicable
partner</term> means any partner whose modified adjusted gross income for the
taxable year exceeds—</text>
<clause id="id35DA738513D9429F90B37D12545E2D1B"><enum>(i)</enum><text>in the case of a
partner making a joint return under section 6013 of the Internal Revenue Code
of 1986 or a surviving spouse (as defined in section 2(a) of such Code),
$250,000,</text>
</clause><clause id="id61CEC6A22BAF4EE5BB991E55F996B047"><enum>(ii)</enum><text>in the case of a
married partner (as defined in section 7703 of such Code) filing a separate
return, half of the dollar amount determined under clause (i), and</text>
</clause><clause id="id6419947D85EA4A9CBC314D1D0BAD2778"><enum>(iii)</enum><text>in any other
case, $200,000.</text>
</clause></subparagraph></paragraph><paragraph id="id599531BAE932432BA6BC7075C0A48FD7"><enum>(3)</enum><header>Professional
service business</header><text>For purposes of this subsection, the term
<quote>professional service business</quote> means any trade or business (or
portion thereof) providing services in the fields of health, law, lobbying,
engineering, architecture, accounting, actuarial science, performing arts,
consulting, athletics, investment advice or management, or brokerage
services.</text>
</paragraph><paragraph id="id52ACCC4B9B444E71AA5EEE715C7C2D92"><enum>(4)</enum><header>Modified
adjusted gross income</header><text>For purposes of this subsection, the term
<term>modified adjusted gross income</term> means adjusted gross income as
determined under <external-xref legal-doc="usc" parsable-cite="usc/26/62">section 62</external-xref> of the Internal Revenue Code of 1986—</text>
<subparagraph id="id74769487178B4FDEA93F76EC42C8585E"><enum>(A)</enum><text>determined
without regard to any deduction allowed under section 164(f) of such Code,
and</text>
</subparagraph><subparagraph id="idEDAC64557E0A4A1EB27B31198DE84048"><enum>(B)</enum><text>increased by the
amount excluded from gross income under section 911(a)(1) of such
Code.</text>
</subparagraph></paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection commented="no" display-inline="no-display-inline" id="idBE8DFE80FC004F658688FC5C1D2473DE"><enum>(c)</enum><header>Effective
date</header><text>The amendments made by this section shall apply to taxable
years beginning after December 31, 2012.</text>
</subsection></section><section id="id5CFD53BA77394CF1BB2919DA12B7CBF3"><enum>203.</enum><header>Elimination of
private jet giveaway</header>
<subsection id="H74151880DC5448E7933E318A4B359823"><enum>(a)</enum><header>In
general</header><text>Subparagraph (C) of section 168(e)(3) of the Internal
Revenue Code of 1986 is amended by striking <quote>and</quote> at the end of
clause (iv), by redesignating clause (v) as clause (vi), and by inserting after
clause (iv) the following new clause:</text>
<quoted-block id="H3B3D2C2AD9B24042B31C61B5BD4BE999" style="OLC">
<subsection id="H83A6286315FC4FC5B834C109B5C08F09" indent="down3"><enum>(v)</enum><text>any general aviation aircraft,
and</text>
</subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="HAF1534F735C64CE6B15CAC4C07171556"><enum>(b)</enum><header>Class
Life</header><text>Paragraph (3) of section 168(g) of the Internal Revenue Code
of 1986 is amended by inserting after subparagraph (E) the following new
subparagraph:</text>
<quoted-block id="H8D9299BAB690478AA4829B9629489CB3" style="OLC">
<subparagraph id="HC8932B84726047A5B0FD78E984EB3A5E"><enum>(F)</enum><header>General aviation
aircraft</header><text>In the case of any general aviation aircraft, the
recovery period used for purposes of paragraph (2) shall be 12
years.</text>
</subparagraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="HDB6A664DDB3D4A32978FBBC512DBFA88"><enum>(c)</enum><header>General aviation
aircraft</header><text>Subsection (i) of section 168 of the Internal Revenue
Code of 1986 is amended by inserting after paragraph (19) the following new
paragraph:</text>
<quoted-block id="H5A4BEE18EFC7441A9CFFF22A9BCCD5F4" style="OLC">
<paragraph id="HCF8C5DA0B50F41B7B18BCAF9AC72BFC5"><enum>(20)</enum><header>General
aviation aircraft</header><text>The term <quote>general aviation
aircraft</quote> means any airplane or helicopter (including airframes and
engines) not used in commercial or contract carrying of passengers or freight,
but which primarily engages in the carrying of
passengers.</text>
</paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="HC7C1B3A702BC45BE916673EC8E46E449"><enum>(d)</enum><header>Effective
date</header><text>This section shall be effective for property placed in
service after December 31, 2012.</text>
</subsection></section><enum>III</enum><header>Elimination of
tax loopholes for offshoring manufacturers</header>
<section id="id2E60BBAFA3A64806AA0915E63C25A35C"><enum>301.</enum><header>Ending tax
breaks for offshoring manufacturers</header>
<subsection id="ID1CB82BB9E232404C860338A93DB4D1CE"><enum>(a)</enum><header>General
Rule</header><text>Subsection (a) of section 954 of the Internal Revenue Code
of 1986 is amended by striking the period at the end of paragraph (5) and
inserting <quote>, and</quote>, by redesignating paragraph (5) as paragraph
(4), and by adding at the end the following new paragraph:</text>
<quoted-block id="ID5BDAC310149246F183AA06327F385B18" style="OLC">
<paragraph id="ID102D28439F6C4B668A2FA9F90CB91F00"><enum>(5)</enum><text>imported property
income for the taxable year (determined under subsection (j) and reduced as
provided in subsection
(b)(5)).</text>
</paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="ID6D1D93DC7C654257B0512E11D41A3148"><enum>(b)</enum><header>Definition of
Imported Property Income</header><text>Section 954 of the Internal Revenue Code
of 1986 is amended by adding at the end the following new subsection:</text>
<quoted-block id="IDC82ED20BC007428CBF4831408CB6E6B1" style="OLC">
<subsection id="ID5ABFA047007849DCAB0D82A7FEA9E504"><enum>(j)</enum><header>Imported
Property Income</header>
<paragraph id="ID68FE72D3F7744BD1B878130DF02CFA77"><enum>(1)</enum><header>In
general</header><text>For purposes of subsection (a)(5), the term
<term>imported property income</term> means income (whether in the form of
profits, commissions, fees, or otherwise) derived in connection with—</text>
<subparagraph id="IDF027510C6ADB4194A2DE4D829714A368"><enum>(A)</enum><text>manufacturing,
producing, growing, or extracting imported property;</text>
</subparagraph><subparagraph id="ID2EA2B95B13724FAF87C8DC6AC8162E62"><enum>(B)</enum><text>the sale,
exchange, or other disposition of imported property; or</text>
</subparagraph><subparagraph id="ID90F2D5C306674400AE6DAEF041E5B5F0"><enum>(C)</enum><text>the lease,
rental, or licensing of imported property.</text>
</subparagraph><continuation-text continuation-text-level="paragraph">Such term
shall not include any foreign oil and gas extraction income (within the meaning
of section 907(c)) or any foreign oil related income (within the meaning of
section 907(c)).</continuation-text></paragraph><paragraph id="IDE7BD18DB53AA49D6BD67E72BD5E3FD34"><enum>(2)</enum><header>Imported
property</header><text>For purposes of this subsection—</text>
<subparagraph id="ID0961E19468874DE69F348433FA9AEC0C"><enum>(A)</enum><header>In
general</header><text>Except as otherwise provided in this paragraph, the term
<term>imported property</term> means property which is imported into the United
States by the controlled foreign corporation or a related person.</text>
</subparagraph><subparagraph id="ID0C77D59EEBFC47F9B55AC318F260B237"><enum>(B)</enum><header>Imported
property includes certain property imported by unrelated
persons</header><text>The term <term>imported property</term> includes any
property imported into the United States by an unrelated person if, when such
property was sold to the unrelated person by the controlled foreign corporation
(or a related person), it was reasonable to expect that—</text>
<clause id="ID9CD588352746492E9787F9E9F8650B52"><enum>(i)</enum><text>such property
would be imported into the United States; or</text>
</clause><clause id="IDAC5E75EA54A14A6193AF29834F2FAA2B"><enum>(ii)</enum><text>such property
would be used as a component in other property which would be imported into the
United States.</text>
</clause></subparagraph><subparagraph id="ID4857227D80264023B537A082A6B06DB2"><enum>(C)</enum><header>Exception for
property subsequently exported</header><text>The term <term>imported
property</term> does not include any property which is imported into the United
States and which—</text>
<clause id="IDDD55F7D29E234688A7249A87E524D106"><enum>(i)</enum><text>before
substantial use in the United States, is sold, leased, or rented by the
controlled foreign corporation or a related person for direct use, consumption,
or disposition outside the United States; or</text>
</clause><clause id="ID5B519C0CA1884A96B767FF3BC29DC78D"><enum>(ii)</enum><text>is used by the
controlled foreign corporation or a related person as a component in other
property which is so sold, leased, or rented.</text>
</clause></subparagraph><subparagraph id="idEEC634691CCE41E1ACCC3800C192CADE"><enum>(D)</enum><header>Exception for
certain agricultural commodities</header><text>The term <term>imported
property</term> does not include any agricultural commodity which is not grown
in the United States in commercially marketable quantities.</text>
</subparagraph></paragraph><paragraph id="ID0CDAB1DE8FEA42B08C6273870AD41889"><enum>(3)</enum><header>Definitions and
special rules</header>
<subparagraph id="ID9408F98654E84BC2A9520E2AD6FB3410"><enum>(A)</enum><header>Import</header><text>For
purposes of this subsection, the term <term>import</term> means entering, or
withdrawal from warehouse, for consumption or use. Such term includes any grant
of the right to use intangible property (as defined in section 936(h)(3)(B)) in
the United States.</text>
</subparagraph><subparagraph id="ID5A6848EFD4474709A50D1827BC629781"><enum>(B)</enum><header>United
states</header><text>For purposes of this subsection, the term <term>United
States</term> includes the Commonwealth of Puerto Rico, the Virgin Islands of
the United States, Guam, American Samoa, and the Commonwealth of the Northern
Mariana Islands.</text>
</subparagraph><subparagraph id="ID95B783D9BA6040629C809825094F90B0"><enum>(C)</enum><header>Unrelated
person</header><text>For purposes of this subsection, the term <term>unrelated
person</term> means any person who is not a related person with respect to the
controlled foreign corporation.</text>
</subparagraph><subparagraph id="ID8811ABC96FE94B89B469CDA9C84D2C7B"><enum>(D)</enum><header>Coordination
with foreign base company sales income</header><text>For purposes of this
section, the term <term>foreign base company sales income</term> shall not
include any imported property
income.</text>
</subparagraph></paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="ID0785B6D4B4E0457FA13A15F6E3F600FA"><enum>(c)</enum><header>Separate
Application of Limitations on Foreign Tax Credit for Imported Property
Income</header>
<paragraph id="ID08DB284A81A44E7AAB43C92E19773731"><enum>(1)</enum><header>In
general</header><text>Paragraph (1) of section 904(d) of the Internal Revenue
Code of 1986 is amended by striking <quote>and</quote> at the end of
subparagraph (A), by redesignating subparagraph (B) as subparagraph (C), and by
inserting after subparagraph (A) the following new subparagraph:</text>
<quoted-block id="ID71CC174F5C8646B4B93FE1FBC2B138E5" style="OLC">
<subparagraph id="IDDB059A6AB54B447B9DF7C323734BF616"><enum>(B)</enum><text>imported property
income,
and</text>
</subparagraph><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph><paragraph id="IDB25F06C59C6E4B2990EB4A7825D6BC42"><enum>(2)</enum><header>Imported
property income defined</header><text>Paragraph (2) of section 904(d) of such
Code is amended by redesignating subparagraphs (I), (J), and (K) as
subparagraphs (J), (K), and (L), respectively, and by inserting after
subparagraph (H) the following new subparagraph:</text>
<quoted-block id="IDB1DBFA39475E4685A3CBBE52C939BFD8" style="OLC">
<subparagraph id="ID9D6C93D98F774D919E6D67DCCD9C929E"><enum>(I)</enum><header>Imported
property income</header><text>The term <term>imported property income</term>
means any income received or accrued by any person which is of a kind which
would be imported property income (as defined in section
954(j)).</text>
</subparagraph><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph><paragraph id="ID7C99769D99C04320A7BA7A18A68D346F"><enum>(3)</enum><header>Conforming
amendment</header><text>Clause (ii) of section 904(d)(2)(A) of such Code is
amended by inserting <quote>or imported property income</quote> after
<quote>passive category income</quote>.</text>
</paragraph></subsection><subsection id="IDD5859A2B3F624997A206E14EE450EE0E"><enum>(d)</enum><header>Technical
Amendments</header>
<paragraph id="IDB3507E3E38DE4E7DADF1643514DB15CC"><enum>(1)</enum><text>Clause (iii) of
<external-xref legal-doc="usc" parsable-cite="usc/26/952">section 952(c)(1)(B)</external-xref> of the Internal Revenue Code of 1986 is amended—</text>
<subparagraph id="IDB15975E4ED54465A968093E63E17D775"><enum>(A)</enum><text>by redesignating
subclauses (II), (III), (IV), and (V) as subclauses (III), (IV), (V), and (VI),
and</text>
</subparagraph><subparagraph id="IDA3A313417F934DA0A1FE87070C1A8012"><enum>(B)</enum><text>by inserting
after subclause (I) the following new subclause:</text>
<quoted-block id="IDCBA1006C11EC4F27B296923C585C1625" style="OLC">
<subclause id="ID84020A2EA66A47EF9F8767EACEB4B90A"><enum>(II)</enum><text>imported
property
income,</text>
</subclause><after-quoted-block>.</after-quoted-block></quoted-block>
</subparagraph></paragraph><paragraph id="idEC1D6B4B52DE41A8AA41D51EBC3EB821"><enum>(2)</enum><text>The last sentence
of paragraph (4) of section 954(b) of such Code is amended by striking
<quote>subsection (a)(5)</quote> and inserting <quote>subsection
(a)(4)</quote>.</text>
</paragraph><paragraph id="IDF4824877857040D68BBC29A336CBF342"><enum>(3)</enum><text>Paragraph (5) of
section 954(b) of such Code is amended by striking <quote>and the foreign base
company oil related income</quote> and inserting <quote>the foreign base
company oil related income, and the imported property income</quote>.</text>
</paragraph></subsection><subsection id="ID4F091632A17F4C1E89E10E7E25AA60F7"><enum>(e)</enum><header>Effective
Date</header><text>The amendments made by this section shall apply to taxable
years of foreign corporations beginning after the date of the enactment of this
Act, and to taxable years of United States shareholders within which or with
which such taxable years of such foreign corporations end.</text>
</subsection></section><enum>IV</enum><header>Elimination of
tax loopholes for oil and gas companies</header>
<section commented="no" display-inline="no-display-inline" id="id85C40D5C4E7C454E86A56B984305EA75"><enum>401.</enum><header>Modifications
of foreign tax credit rules applicable to major integrated oil companies which
are dual capacity taxpayers</header>
<subsection commented="no" display-inline="no-display-inline" id="id870C10B6A3A9401B8D2647B1A0E15EC0"><enum>(a)</enum><header>In
general</header><text display-inline="yes-display-inline">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:</text>
<quoted-block display-inline="no-display-inline" id="id59B4564047054D9F8EFB25B05BC5AF1E" style="OLC">
<subsection commented="no" display-inline="no-display-inline" id="id832013D669AB496E9217A5D70E41E716"><enum>(n)</enum><header>Special rules
relating to major integrated oil companies which are dual capacity
taxpayers</header>
<paragraph commented="no" display-inline="no-display-inline" id="idA86BDC3205EF48378545D9D088E03443"><enum>(1)</enum><header>General
rule</header><text display-inline="yes-display-inline">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—</text>
<subparagraph commented="no" display-inline="no-display-inline" id="idCE1206A91A254CEFA030EAF1D94F610A"><enum>(A)</enum><text display-inline="yes-display-inline">if, for such period, the foreign country or
possession does not impose a generally applicable income tax, or</text>
</subparagraph><subparagraph commented="no" display-inline="no-display-inline" id="id1430720C4FEC4AF1BAEDD845D4A2DE7E"><enum>(B)</enum><text display-inline="yes-display-inline">to the extent such amount exceeds the
amount (determined in accordance with regulations) which—</text>
<clause commented="no" display-inline="no-display-inline" id="id3616EAF2E4174061B78DB6C614CBB2C4"><enum>(i)</enum><text display-inline="yes-display-inline">is paid by such dual capacity taxpayer
pursuant to the generally applicable income tax imposed by the country or
possession, or</text>
</clause><clause commented="no" display-inline="no-display-inline" id="idBBD48C80AE584E7AAE22BC2F3F750626"><enum>(ii)</enum><text display-inline="yes-display-inline">would be paid if the generally applicable
income tax imposed by the country or possession were applicable to such dual
capacity taxpayer.</text>
</clause></subparagraph><continuation-text commented="no" continuation-text-level="paragraph">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).</continuation-text></paragraph><paragraph commented="no" display-inline="no-display-inline" id="id2BE54CFB0E9F46AEABB5E04C1E1553D1"><enum>(2)</enum><header>Dual capacity
taxpayer</header><text display-inline="yes-display-inline">For purposes of this
subsection, the term <term>dual capacity taxpayer</term> means, with respect to
any foreign country or possession of the United States, a person who—</text>
<subparagraph commented="no" display-inline="no-display-inline" id="id114FA007ACB04E589C34FD9AE707FF40"><enum>(A)</enum><text display-inline="yes-display-inline">is subject to a levy of such country or
possession, and</text>
</subparagraph><subparagraph commented="no" display-inline="no-display-inline" id="idB48A3E58EACB4262A062681509EBC2D3"><enum>(B)</enum><text display-inline="yes-display-inline">receives (or will receive) directly or
indirectly a specific economic benefit (as determined in accordance with
regulations) from such country or possession.</text>
</subparagraph></paragraph><paragraph commented="no" display-inline="no-display-inline" id="id4221398EC1FE4603A1915AC3F6F4FF31"><enum>(3)</enum><header>Generally
applicable income tax</header><text display-inline="yes-display-inline">For
purposes of this subsection—</text>
<subparagraph commented="no" display-inline="no-display-inline" id="id9A25BF879E264980B24CFC517824B854"><enum>(A)</enum><header>In
general</header><text display-inline="yes-display-inline">The term
<term>generally applicable income tax</term> 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.</text>
</subparagraph><subparagraph commented="no" display-inline="no-display-inline" id="id6008C386B2034848BC16753211264648"><enum>(B)</enum><header>Exceptions</header><text display-inline="yes-display-inline">Such term shall not include a tax unless it
has substantial application, by its terms and in practice, to—</text>
<clause commented="no" display-inline="no-display-inline" id="id8EFBAC16675449C2ABDBF167616DBFA1"><enum>(i)</enum><text display-inline="yes-display-inline">persons who are not dual capacity
taxpayers, and</text>
</clause><clause commented="no" display-inline="no-display-inline" id="idFE15C6C70615499EB6717AE075351274"><enum>(ii)</enum><text display-inline="yes-display-inline">persons who are citizens or residents of
the foreign country or
possession.</text>
</clause></subparagraph></paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection commented="no" display-inline="no-display-inline" id="id2003AD9F498E450E87059BCEDDDD5689"><enum>(b)</enum><header>Effective
Date</header>
<paragraph commented="no" display-inline="no-display-inline" id="id2C2A93FA1BB14247A7D590BFFC676441"><enum>(1)</enum><header>In
general</header><text display-inline="yes-display-inline">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.</text>
</paragraph><paragraph commented="no" display-inline="no-display-inline" id="idF5637FD489954B729A309CFCDB650390"><enum>(2)</enum><header>Contrary treaty
obligations upheld</header><text display-inline="yes-display-inline">The
amendments made by this section shall not apply to the extent contrary to any
treaty obligation of the United States.</text>
</paragraph></subsection></section><section display-inline="no-display-inline" id="idD36DA8177A7144CFBF7A1B681A26FAC2"><enum>402.</enum><header>Limitation on
section 199 deduction attributable to oil, natural gas, or primary products
thereof</header>
<subsection id="id4EDE82BB1896423CAC005CECEA288DF2"><enum>(a)</enum><header>Denial of
deduction</header><text>Paragraph (4) of section 199(c) of the Internal Revenue
Code of 1986 is amended by adding at the end the following new
subparagraph:</text>
<quoted-block display-inline="no-display-inline" id="id2210F32B480A46E2AC61114E84235138" style="OLC">
<subparagraph id="id6407FC188C044D07833FBF6465572FA7"><enum>(E)</enum><header>Special rule
for certain oil and gas income</header><text>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 <term>domestic production gross receipts</term> 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.</text>
</subparagraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection commented="no" display-inline="no-display-inline" id="idDBB26ED5A91244F4861028F78CCB4383"><enum>(b)</enum><header>Effective
date</header><text>The amendment made by this section shall apply to taxable
years beginning after December 31, 2012.</text>
</subsection></section><section commented="no" display-inline="no-display-inline" id="id403D99C1C16848C48F5209F4984C4B56"><enum>403.</enum><header>Limitation on
deduction for intangible drilling and development costs</header>
<subsection commented="no" display-inline="no-display-inline" id="idE1C6CA4AEAFC44B1B4063EF0543F48BC"><enum>(a)</enum><header>In
general</header><text display-inline="yes-display-inline">Section 263(c) of the
Internal Revenue Code of 1986 is amended by adding at the end the following new
sentence: <quote>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)).</quote>.</text>
</subsection><subsection commented="no" display-inline="no-display-inline" id="idED920A4A6A5B4A26BC8B338B4E7B37D5"><enum>(b)</enum><header>Effective
date</header><text display-inline="yes-display-inline">The amendment made by
this section shall apply to amounts paid or incurred in taxable years beginning
after December 31, 2012.</text>
</subsection></section><section commented="no" display-inline="no-display-inline" id="idEBDA974B3B2449F6AD96FC529404DCFC" section-type="subsequent-section"><enum>404.</enum><header display-inline="yes-display-inline">Limitation on percentage depletion
allowance for oil and gas wells</header>
<subsection commented="no" display-inline="no-display-inline" id="idD496B7DFC3B14DF282E5667BF776AB1D"><enum>(a)</enum><header display-inline="yes-display-inline">In general</header><text display-inline="yes-display-inline">Section 613A of the Internal Revenue Code
of 1986 is amended by adding at the end the following new subsection:</text>
<quoted-block display-inline="no-display-inline" id="idD45339352F7447D0AA745594CCCAED20" style="OLC">
<subsection commented="no" display-inline="no-display-inline" id="idF845C6D7007B4C8E842C3BB31F28E006"><enum>(f)</enum><header display-inline="yes-display-inline">Application with respect to major
integrated oil companies</header><text display-inline="yes-display-inline">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.</text>
</subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection commented="no" display-inline="no-display-inline" id="id3C74932924574C798E37E2F28D0C565C"><enum>(b)</enum><header display-inline="yes-display-inline">Effective
date</header><text display-inline="yes-display-inline">The amendment made by
this section shall apply to taxable years beginning after December 31,
2012.</text>
</subsection></section><section commented="no" display-inline="no-display-inline" id="id2F1FB5D5F7E346B98CBBC0EA3C1E3FBC"><enum>405.</enum><header>Limitation on
deduction for tertiary injectants</header>
<subsection commented="no" display-inline="no-display-inline" id="idBF9377D05B604E8480EEB031445D9565"><enum>(a)</enum><header>In
general</header><text><external-xref legal-doc="usc" parsable-cite="usc/26/193">Section 193</external-xref> of the Internal Revenue Code of 1986 is
amended by adding at the end the following new subsection:</text>
<quoted-block display-inline="no-display-inline" id="id57DA761F659040E3A9495A0210B69564" style="OLC">
<subsection commented="no" display-inline="no-display-inline" id="id1C24D288BC784E0594C10F14AA09860C"><enum>(d)</enum><header>Application
with respect to major integrated oil companies</header><text display-inline="yes-display-inline">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)).</text>
</subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection commented="no" display-inline="no-display-inline" id="idD1309F3F5A1E4A838C6DC30FC0B72391"><enum>(b)</enum><header>Effective
date</header><text display-inline="yes-display-inline">The amendment made by
this section shall apply to amounts paid or incurred in taxable years beginning
after December 31, 2012.</text>
</subsection></section><section id="idC1DA2680506941FEB12BA0AB7D5BBF45"><enum>406.</enum><header>Repeal of
outer Continental Shelf deep water and deep gas royalty relief</header>
<subsection id="ID88967378382d4559bfe0b6d77e073454"><enum>(a)</enum><header>In
general</header><text>Sections 344 and 345 of the Energy Policy Act of 2005 (42
U.S.C. 15904, 15905) are repealed.</text>
</subsection><subsection commented="no" display-inline="no-display-inline" id="ID9684bc5301944d2a8a169adf21e1b2b7"><enum>(b)</enum><header>Administration</header><text>The
Secretary of the Interior shall not be required to provide for royalty relief
in the lease sale terms beginning with the first lease sale held on or after
the date of enactment of this Act for which a final notice of sale has not been
published.</text>
</subsection></section>