[Congressional Bills 103th Congress]
[From the U.S. Government Publishing Office]
[H.R. 3621 Introduced in House (IH)]

103d CONGRESS
  1st Session
                                H. R. 3621

  To amend the Internal Revenue Code of 1986 to allow a deduction for 
            costs incurred to cleanup contaminated property.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                           November 22, 1993

Mr. Bachus of Alabama 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 allow a deduction for 
            costs incurred to cleanup contaminated property.

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

SECTION 1. DEDUCTION FOR COSTS INCURRED TO CLEANUP CONTAMINATED 
              PROPERTY.

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

``SEC. 198. EXPENDITURES TO CLEANUP CONTAMINATED PROPERTY.

    ``(a) Treatment as Expenses.--A taxpayer engaged in a trade or 
business may treat environmental cleanup expenditures which are paid or 
incurred by the taxpayer during the taxable year as expenses which are 
not chargeable to capital account. The expenditures which are so 
treated shall be allowed as a deduction.
    ``(b) Environmental Cleanup Expenditures.--For purposes of this 
section--
            ``(1) In general.--The term `environmental cleanup 
        expenditures' means expenditures to remove, or to take remedial 
        action with respect to, any substance on any property owned by 
        the taxpayer if such removal or remedial action--
                    ``(A) is required under the Comprehensive 
                Environmental Response, Compensation, and Liability Act 
                (42 U.S.C. 9601 et seq.), and
                    ``(B) at least meets the requirements of such Act.
            ``(2) Exceptions.--Such term shall not include any 
        expenditure--
                    ``(A) which is taken into account in determining 
                the basis of any property of a character subject to the 
                allowance for depreciation under section 167, or
                    ``(B) which is allowable as a deduction under any 
                other provision of this chapter.
    ``(c) Generator, Etc. Not Eligible.--This section shall not apply 
to expenditures to remove, or take remedial action with respect to, any 
substance on any property if the taxpayer (or any related party) is 
potentially liable under paragraph (2), (3), or (4) of section 107(a) 
of the Comprehensive Environmental Response, Compensation, and 
Liability Act with respect to such property.
    ``(d) When Method May Be Adopted.--
            ``(1) Without consent.--A taxpayer may, without consent of 
        the Secretary, adopt the method provided in this section for 
        the taxpayer's first taxable year--
                    ``(A) which begins after the date of the enactment 
                of this section, and
                    ``(B) for which environmental cleanup expenditures 
                are paid or incurred.
            ``(2) With consent.--A taxpayer may, with the consent of 
        the Secretary, adopt at any time the method provided in this 
        section.''
    (b) Exception From Required Capitalization.--Subsection (a) of 
section 263 of such Code is amended by striking ``or'' at the end of 
subparagraph (F), by striking the period at the end of subparagraph (G) 
and inserting ``, or'', and by adding at the end thereof the following 
new subparagraph:
                    ``(H) environmental cleanup expenditures deductible 
                under section 198.''
    (c) Clerical Amendment.--The table of sections for part VI of 
subchapter B of chapter 1 of such Code is amended by adding at the end 
thereof the following new item:

                              ``Sec. 198. Expenditures to cleanup 
                                        contaminated property.''
    (d) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after December 31, 1985.

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