109 HR 4305 IH: To amend the Internal Revenue Code of 1986 to provide increased expensing for section 179 property in the Gulf Opportunity Zone. U.S. House of Representatives 2005-11-10 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.

I 109th CONGRESS 1st Session H. R. 4305 IN THE HOUSE OF REPRESENTATIVES November 10, 2005 Mrs. Musgrave (for herself, Mr. Feeney, Mr. Gingrey, Mr. King of Iowa, Mr. Garrett of New Jersey, Mr. Jindal, Mr. Doolittle, Mr. Barrett of South Carolina, Mr. Wilson of South Carolina, Mr. Kline, Mr. Cole of Oklahoma, Mr. Westmoreland, Mr. Issa, Mr. Weldon of Florida, Mr. Fortenberry, and Mr. Hensarling) introduced the following bill; which was referred to the Committee on Ways and Means A BILL To amend the Internal Revenue Code of 1986 to provide increased expensing for section 179 property in the Gulf Opportunity Zone.

1.

Increase in expensing under section 179 for Gulf Opportunity Zone property

(a)

In general

Section 179 of the Internal Revenue Code of 1986 is amended by adding at the end the following new subsection: (e)

Increase in limitation for Gulf Opportunity Zone property

(1)

In general

For purposes of this section— (A)the dollar amount in effect under subsection (b)(1) for the taxable year shall be increased by the lesser of— (i)$100,000, or (ii)the cost of qualified section 179 Gulf Opportunity Zone property placed in service during the taxable year, and (B)the the dollar amount in effect under subsection (b)(2) for the taxable year shall be increased by the lesser of— (i)$600,000, or (ii)the cost of qualified section 179 Gulf Opportunity Zone property placed in service during the taxable year. (2)

Qualified section 179 Gulf Opportunity Zone property

For purposes of this subsection, the term qualified section 179 Gulf Opportunity Zone property means section 179 property which is qualified Gulf Opportunity Zone property. (3)

Qualified Gulf Opportunity Zone property

For purposes of this subsection— (A)

In general

The term qualified Gulf Opportunity Zone property means property— (i)which is described in section 168(k)(2)(A)(i), (ii)substantially all of the use of which is in the Gulf Opportunity Zone and is in the active conduct of a trade or business by the taxpayer in such Zone, (iii)the original use of which in the Gulf Opportunity Zone commences with the taxpayer on or after August 28, 2005, (iv)which is acquired by the taxpayer by purchase (as defined in subsection (d)) on or after August 28, 2005, but only if no written binding contract for the acquisition was in effect before August 28, 2005, and (v)which is placed in service by the taxpayer on or before December 31, 2007. (B)

Exceptions

(i)

Alternative depreciation property

Such term shall not include any property described in section 168(k)(2)(D)(i). (ii)

Tax-exempt bond-financed property

Such term shall not include any property any portion of which is financed with the proceeds of any obligation the interest on which is exempt from tax under section 103. (iii)

Election out

If a taxpayer makes an election under this clause with respect to any class of property for any taxable year, this subsection shall not apply to all property in such class placed in service during such taxable year. (4)

Gulf Opportunity Zone; Hurricane Katrina disaster area

For purposes of this subsection— (A)

Gulf Opportunity Zone

The term Gulf Opportunity Zone means that portion of the Hurricane Katrina disaster area determined by the President to warrant individual or individual and public assistance from the Federal Government under the Robert T. Stafford Disaster Relief and Emergency Assistance Act by reason of Hurricane Katrina. (B)

Hurricane Katrina disaster area

The term Hurricane Katrina disaster area means an area with respect to which a major disaster has been declared by the President before September 14, 2005, under section 401 of such Act by reason of Hurricane Katrina. (5)

Coordination with empowerment zones and renewal communities

For purposes of sections 1397A and 1400J, qualified section 179 Gulf Opportunity Zone property shall not be treated as qualified zone property or qualified renewal property, unless the taxpayer elects not to take such qualified section 179 Gulf Opportunity Zone property into account for purposes of this subsection. (6)

Recapture

For purposes of this subsection, rules similar to the rules under subsection (d)(10) shall apply with respect to any qualified section 179 Gulf Opportunity Zone property which ceases to be qualified section 179 Gulf Opportunity Zone property.. (b)

Effective date

The amendment made by subsection (a) shall apply to property placed in service after August 28, 2005.