109 HR 4440 EH: Gulf Opportunity Zone Act of 2005
U.S. House of Representatives
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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.
(a)This Act may be cited as the Gulf Opportunity Zone Act of 2005
.
(b)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)The table of contents of this Act is as follows:
Sec. 1. Short title; etc
Title I—Establishment of Gulf Opportunity Zone
Sec. 101. Tax benefits for Gulf Opportunity Zone
Sec. 102. Federal guarantee of certain State bonds
Title II—Tax benefits related to Hurricanes Rita and Wilma
Sec. 201. Extension of certain emergency tax relief for Hurricane Katrina to Hurricanes Rita and Wilma
Title III—Other provisions
Sec. 301. Secretarial authority to extend period during which traveling expenses are treated as incurred away from home in case of major disaster
Sec. 302. Gulf Coast Recovery Bonds
<enum>I</enum><header>Establishment of Gulf Opportunity Zone</header>
<section id="HCA1F536D5D9B41389944A8EDFBC71BD1" section-type="subsequent-section" display-inline="no-display-inline"><enum>101.</enum><header>Tax benefits for Gulf Opportunity Zone</header>
<subsection id="HA1640394CC834DBC85520508372BD0B2"><enum>(a)</enum><header>In general</header><text>Subchapter Y of <external-xref legal-doc="usc-chapter" parsable-cite="usc-chapter/26/1">chapter 1</external-xref> is amended by adding at the end the following new part:</text>
<quoted-block style="OLC" id="H84B4B166248B43068C2945D35120CBCB" display-inline="no-display-inline">
<part id="HBD154B0458BA47C1A183C747BAE3282"><enum>II</enum><header>Tax benefits for Gulf Opportunity Zone</header>
<toc container-level="part-container" quoted-block="no-quoted-block" lowest-level="section" idref="HBD154B0458BA47C1A183C747BAE3282" regeneration="yes-regeneration" lowest-bolded-level="division-lowest-bolded">
<toc-entry idref="H9EDD796C3AB248ADBD6689CA60006DD0" level="section">Sec. 1400M. Definitions</toc-entry>
<toc-entry idref="HF64224DCBC1645BE93E6ECD263BAA1A7" level="section">Sec. 1400N. Tax benefits for Gulf Opportunity Zone</toc-entry></toc>
<section id="H9EDD796C3AB248ADBD6689CA60006DD0"><enum>1400M.</enum><header>Definitions</header><text display-inline="no-display-inline">For purposes of this part—</text>
<paragraph id="HA0D6E915B4D74CA49961E0F060613D34"><enum>(1)</enum><header>Gulf Opportunity Zone</header><text display-inline="yes-display-inline">The terms <term>Gulf Opportunity Zone</term> and <term>GO Zone</term> mean 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.</text></paragraph>
<paragraph id="H524DDD793C5144688F8771917657EEF"><enum>(2)</enum><header>Hurricane Katrina disaster area</header><text>The term <term>Hurricane Katrina disaster area</term> 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.</text></paragraph>
<paragraph id="H0D2F72AF468649BCAC35AD001D00654E" commented="no"><enum>(3)</enum><header>Rita GO Zone</header><text>The term <term>Rita GO Zone</term> means that portion of the Hurricane Rita disaster area determined by the President to warrant individual or individual and public assistance from the Federal Government under such Act by reason of Hurricane Rita.</text></paragraph>
<paragraph id="H3C5F97A4EB954F2286AAC65ECAD2200" commented="no"><enum>(4)</enum><header>Hurricane Rita disaster area</header><text>The term <term>Hurricane Rita disaster area</term> means an area with respect to which a major disaster has been declared by the President, before October 6, 2005, under section 401 of such Act by reason of Hurricane Rita.</text></paragraph>
<paragraph id="HAA49BA43758F40CE906541DF81A16DD1" commented="no"><enum>(5)</enum><header>Wilma GO Zone</header><text>The term <term>Wilma GO Zone</term> means that portion of the Hurricane Wilma disaster area determined by the President to warrant individual or individual and public assistance from the Federal Government under such Act by reason of Hurricane Wilma.</text></paragraph>
<paragraph id="HA08EFB5AA8FA4BEF80FC1BBDE752D1B" commented="no"><enum>(6)</enum><header>Hurricane Wilma disaster area</header><text>The term <term>Hurricane Wilma disaster area</term> means an area with respect to which a major disaster has been declared by the President, before November 14, 2005, under section 401 of such Act by reason of Hurricane Wilma.</text></paragraph></section>
<section id="HF64224DCBC1645BE93E6ECD263BAA1A7"><enum>1400N.</enum><header>Tax benefits for Gulf Opportunity Zone</header>
<subsection id="H56EB0BC0342D4A3B948EB68967B2CDC3" display-inline="no-display-inline"><enum>(a)</enum><header>Tax-exempt bond financing</header>
<paragraph id="HC85D2CB268D04AF89B774CCD9E5F2FEC"><enum>(1)</enum><header>In general</header><text>For purposes of this title—</text>
<subparagraph id="H678BD78702B441CFAAF1AF6E619DD889"><enum>(A)</enum><text display-inline="yes-display-inline">any qualified Gulf Opportunity Zone Bond described in paragraph (2)(A)(i) shall be treated as an exempt facility bond, and</text></subparagraph>
<subparagraph id="H198A4B24F5A8421EA146F789255040D0"><enum>(B)</enum><text display-inline="yes-display-inline">any qualified Gulf Opportunity Zone Bond described in paragraph (2)(A)(ii) shall be treated as a qualified mortgage bond.</text></subparagraph></paragraph>
<paragraph id="H20737D078E3544499D39F66992388C57"><enum>(2)</enum><header>Qualified Gulf Opportunity Zone Bond</header><text>For purposes of this subsection, the term <term>qualified Gulf Opportunity Zone Bond</term> means any bond issued as part of an issue if—</text>
<subparagraph id="H776E429608B14401BDC21844A5BCF7D6"><enum>(A)</enum>
<clause id="HD1CAFE20749941B1A9298962CF52A900" display-inline="yes-display-inline"><enum>(i)</enum><text>95 percent or more of the net proceeds (as defined in section 150(a)(3)) of such issue are to be used for qualified project costs, or</text></clause>
<clause id="HB7C0E7D7E2A14F20BA9DD45FC9DF9E6C" indent="up1"><enum>(ii)</enum><text display-inline="yes-display-inline">such issue meets the requirements of a qualified mortgage issue, except as otherwise provided in this subsection, </text></clause></subparagraph>
<subparagraph id="H6E9AF4580B3848A593B9440015B17AE"><enum>(B)</enum><text>such bond is issued by the State of Alabama, Louisiana, or Mississippi, or any political subdivision thereof,</text></subparagraph>
<subparagraph id="HDE80EA4C940644CFAF6BEC173F1E18C0"><enum>(C)</enum><text>such bond is designated for purposes of this section by—</text>
<clause id="HA1A40F77507743EB8BD3DB2D8E000044"><enum>(i)</enum><text>in the case of a bond which is required under State law to be approved by the bond commission of such State, such bond commission, and</text></clause>
<clause id="H92405D4F71C4492C8ECC45A98CB1F1C1"><enum>(ii)</enum><text>in the case of any other bond, the Governor of such State, and</text></clause></subparagraph>
<subparagraph id="H6328C6197991498797948D5B32154400"><enum>(D)</enum><text>such bond is issued after the date of the enactment of this section and before January 1, 2011.</text></subparagraph></paragraph>
<paragraph id="HC56AAC10698C4C45A5465ED3E01E4BD8"><enum>(3)</enum><header>Limitations on bonds</header>
<subparagraph id="HFD80F4859B79411D8C84339DB1CBC5F0"><enum>(A)</enum><header>Aggregate amount designated</header><text display-inline="yes-display-inline">The maximum aggregate face amount of bonds which may be designated under this subsection with respect to any State shall not exceed the product of $2,500 multiplied by the portion of the State population which is in the Gulf Opportunity Zone (as determined on the basis of the most recent census estimate of resident population released by the Bureau of Census before August 28, 2005).</text></subparagraph>
<subparagraph id="H66A6D43DDD914B8FAAB147906163596"><enum>(B)</enum><header>Movable property</header><text>No bonds shall be issued which are to be used for movable fixtures and equipment.</text></subparagraph></paragraph>
<paragraph id="HCB999F9803A8451DB08B00C43344B4B7"><enum>(4)</enum><header>Qualified project costs</header><text>For purposes of this subsection, the term <term>qualified project costs</term> means the cost of acquisition, construction, reconstruction, and renovation of—</text>
<subparagraph id="H7E0FA8303CC64D16A95681BE6307FF89"><enum>(A)</enum><text>nonresidential real property and qualified residential rental property (as defined in section 142(d)) located in the Gulf Opportunity Zone, and</text></subparagraph>
<subparagraph id="H7920C9A580DF44B4B06D6D5871635647"><enum>(B)</enum><text>public utility property (as defined in section 168(i)(10)) located in the Gulf Opportunity Zone.</text></subparagraph></paragraph>
<paragraph id="H1F302BF2FA93439AAACDBBF390D62E69"><enum>(5)</enum><header>Special rules</header><text>In applying this title to any qualified Gulf Opportunity Zone Bond, the following modifications shall apply:</text>
<subparagraph id="HD0638BF4BC484ECD8715B1C6006645A3"><enum>(A)</enum><text display-inline="yes-display-inline">Section 142(d)(1) (defining qualified residential rental project) shall be applied—</text>
<clause id="H1BDA036EEEEA44D8B9FF002DB59642BE"><enum>(i)</enum><text display-inline="yes-display-inline"> by substituting <quote>60 percent</quote> for <quote>50 percent</quote> in subparagraph (A) thereof, and</text></clause>
<clause id="HA523795A32684606922C46DACE28C2E7"><enum>(ii)</enum><text display-inline="yes-display-inline"> by substituting <quote>70 percent</quote> for <quote>60 percent</quote> in subparagraph (B) thereof. </text></clause></subparagraph>
<subparagraph id="H489D8BE481D046B5B5035B9B35C64C32"><enum>(B)</enum><text display-inline="yes-display-inline">Section 143 (relating to mortgage revenue bonds: qualified mortgage bond and qualified veterans’ mortgage bond) shall be applied—</text>
<clause id="H6601BFC468BB460895768B2324587886"><enum>(i)</enum><text display-inline="yes-display-inline">by treating only residences in the Gulf Opportunity Zone as owner-occupied residences,</text></clause>
<clause id="H13E91060CA2947D98DFD04F255D8D7B9"><enum>(ii)</enum><text>by treating any residence in the Gulf Opportunity Zone as a targeted area residence, and</text></clause>
<clause id="HD447AD7192454671AF56C926E36BC928"><enum>(iii)</enum><text>by substituting <quote>$150,000</quote> for <quote>$15,000</quote> in subsection (k)(4) thereof.</text></clause></subparagraph>
<subparagraph id="H3B22F455658F4F6D8D2916A9F6D0C9CE"><enum>(C)</enum><text display-inline="yes-display-inline">Except as provided in section 143, repayments of principal on financing provided by the issue of which such bond is a part may not be used to provide financing.</text></subparagraph>
<subparagraph id="H97D1C11169E046129E24FB400649D4C5"><enum>(D)</enum><text>Section 146 (relating to volume cap) shall not apply.</text></subparagraph>
<subparagraph id="H7E0D10BBE65046298CA6EC6DC12C4856"><enum>(E)</enum><text>Section 147(d)(2) (relating to acquisition of existing property not permitted) shall be applied by substituting <quote>50 percent</quote> for <quote>15 percent</quote> each place it appears.</text></subparagraph>
<subparagraph id="H3F51BD3D4D1A4639ACCEB87DC9C8E728" commented="no"><enum>(F)</enum><text display-inline="yes-display-inline">Section 148(f)(4)(C) (relating to exception from rebate for certain proceeds to be used to finance construction expenditures) shall apply to the available construction proceeds of bonds which are part of an issue described in paragraph (2)(A)(i).</text></subparagraph>
<subparagraph id="HEF50C6FC567B4DF1A55490B775F7F5A0"><enum>(G)</enum><text>Section 57(a)(5) (relating to tax-exempt interest) shall not apply.</text></subparagraph></paragraph>
<paragraph id="HBE142D751426446BA806C131EEECFDF"><enum>(6)</enum><header>Separate issue treatment of portions of an issue</header><text>This subsection shall not apply to the portion of an issue which (if issued as a separate issue) would be treated as a qualified bond or as a bond that is not a private activity bond (determined without regard to paragraph (1)), if the issuer elects to so treat such portion.</text></paragraph></subsection>
<subsection id="H863846EF1D7449F781E63300AF7C020" display-inline="no-display-inline"><enum>(b)</enum><header>Advance refundings of certain tax-exempt bonds</header>
<paragraph id="HF7CE446F309E46579CA1B2FB226EE1CC"><enum>(1)</enum><header>In general</header><text>With respect to a bond described in paragraph (3) which is not a qualified 501(c)(3) bond, one additional advance refunding after the date of the enactment of this section and before January 1, 2011, shall be allowed under the applicable rules of section 149(d) if—</text>
<subparagraph id="H6ED8DFA5FCB347B8AC9856C0E079E43"><enum>(A)</enum><text>the Governor of the State designates the advance refunding bond for purposes of this subsection, and</text></subparagraph>
<subparagraph id="HBDCA5E5AA26E412786FDD3C8E847F8C3"><enum>(B)</enum><text>the requirements of paragraph (5) are met.</text></subparagraph></paragraph>
<paragraph id="H31FD5D671CB040649307F69D5F9CE6A9"><enum>(2)</enum><header>Certain private activity bonds</header><text>With respect to a bond described in paragraph (3) which is an exempt facility bond described in paragraph (1) or (2) of section 142(a), one advance refunding after the date of the enactment of this section and before January 1, 2011, shall be allowed under the applicable rules of section 149(d) (notwithstanding paragraph (2) thereof) if the requirements of subparagraphs (A) and (B) of paragraph (1) are met.</text></paragraph>
<paragraph id="H27F5FA8851EC4B9B83BDEA5EF0F1EBBB"><enum>(3)</enum><header>Bonds described</header><text>A bond is described in this paragraph if such bond was outstanding on August 28, 2005, and is issued by the State of Alabama, Louisiana, or Mississippi, or a political subdivision thereof.</text></paragraph>
<paragraph id="H24A620C77A364276008939D2B96DD682" commented="no"><enum>(4)</enum><header>Aggregate limit</header><text>The maximum aggregate face amount of bonds which may be designated under this subsection by the Governor of a State shall not exceed—</text>
<subparagraph id="H7DEC3FD2B8B4479A92C635AC6780317" commented="no"><enum>(A)</enum><text>$4,500,000,000 in the case of the State of Louisiana, </text></subparagraph>
<subparagraph id="HFB409B08781D40FD8B423585E0364C96" commented="no"><enum>(B)</enum><text>$2,250,000,000 in the case of the State of Mississippi, and</text></subparagraph>
<subparagraph id="HA8D461D9D3184988BD8218E5D2FD455" commented="no"><enum>(C)</enum><text>$1,125,000,000 in the case of the State of Alabama.</text></subparagraph></paragraph>
<paragraph id="HE39BC406B3074E33B9FEBE5F04F89CB0"><enum>(5)</enum><header>Additional requirements</header><text>The requirements of this paragraph are met with respect to any advance refunding of a bond described in paragraph (3) if—</text>
<subparagraph id="H9376BE1D6492457CA9AC9247706F2179"><enum>(A)</enum><text display-inline="yes-display-inline">no advance refundings of such bond would be allowed under this title on or after August 28, 2005,</text></subparagraph>
<subparagraph id="HFD04558A4691410DB095B900E31CFCD1"><enum>(B)</enum><text>the advance refunding bond is the only other outstanding bond with respect to the refunded bond, and</text></subparagraph>
<subparagraph id="H7162C376625340ADAC25ED7F9BA984FD"><enum>(C)</enum><text>the requirements of section 148 are met with respect to all bonds issued under this subsection.</text></subparagraph></paragraph></subsection>
<subsection id="HC6622FD8AA5D4A848D7E00592970D4BF" display-inline="no-display-inline" commented="no"><enum>(c)</enum><header>Low-income housing credit</header>
<paragraph id="H9E190F7DE6DA4B138EB6C15552C7558D" commented="no"><enum>(1)</enum><header>Additional housing credit dollar amount</header>
<subparagraph id="H711899EA51A74BC29B27357F148CDC82" commented="no"><enum>(A)</enum><header>In general</header><text display-inline="yes-display-inline">For purposes of section 42, in the case of calendar years 2006, 2007, and 2008, the State housing credit ceiling of each State, any portion of which is located in the Gulf Opportunity Zone, shall be increased by the lesser of—</text>
<clause id="H1CACCCEB480D4428AFAC9F0013E500EE" commented="no"><enum>(i)</enum><text>the aggregate housing credit dollar amount allocated by the State housing credit agency of such State to buildings located in the Gulf Opportunity Zone for such calendar year, or</text></clause>
<clause id="H5B2BCB15F3F44BF09BC510019E1001E" commented="no"><enum>(ii)</enum><text>the Gulf Opportunity housing amount for such State for such calendar year.</text></clause></subparagraph>
<subparagraph id="H17130D5806E24199A4D900A0009723E0" commented="no"><enum>(B)</enum><header>Gulf Opportunity housing amount</header><text display-inline="yes-display-inline">For purposes of subparagraph (A), the term <term>Gulf Opportunity housing amount</term> means, for any calendar year, the amount equal to the product of $18.00 multiplied by the portion of the State population which is in the Gulf Opportunity Zone (as determined on the basis of the most recent census estimate of resident population released by the Bureau of Census before August 28, 2005).</text></subparagraph>
<subparagraph id="H949969C525B14B98A7DD6CBB078FC1F8" commented="no"><enum>(C)</enum><header>Allocations treated as made first from additional allocation amount for purposes of determining carryover</header><text>For purposes of determining the unused State housing credit ceiling under section 42(h)(3)(C) for any calendar year, any increase in the State housing credit ceiling under subparagraph (A) shall be treated as an amount described in clause (ii) of such section.</text></subparagraph></paragraph>
<paragraph id="HCB608C14EE5B403EABAAB272E12FCDED" commented="no"><enum>(2)</enum><header>Difficult development area</header>
<subparagraph id="H190ED2DBF73B4D08A3BE7E8BDA96E427"><enum>(A)</enum><header>In general</header><text>For purposes of section 42, in the case of property placed in service during 2006, 2007, or 2008, the Gulf Opportunity Zone—</text>
<clause id="H1B6C14919BA04430969877EAEB8081B" commented="no"><enum>(i)</enum><text>shall be treated as a difficult development area designated under subclause (I) of section 42(d)(5)(C)(iii), and</text></clause>
<clause id="H1F92A1B659A24C9F8CABE5EEF2B1F1E" commented="no"><enum>(ii)</enum><text>shall not be taken into account for purposes of applying the limitation under subclause (II) of such section.</text></clause></subparagraph>
<subparagraph id="H9FD76E5F8C1A4F8BB973E2487DF19EE2" commented="no"><enum>(B)</enum><header>Application</header><text>Subparagraph (A) shall apply only to—</text>
<clause id="HD728BAE60DE44EFBAADC4C2BB3B8A7C" commented="no"><enum>(i)</enum><text>housing credit dollar amounts allocated during the period beginning on January 1, 2006, and ending on December 31, 2008, and</text></clause>
<clause id="H11881FA373F74E81A68893BC90A5A84D" commented="no"><enum>(ii)</enum><text>buildings placed in service during such period to the extent that paragraph (1) of section 42(h) does not apply to any building by reason of paragraph (4) thereof, but only with respect to bonds issued after December 31, 2005.</text></clause></subparagraph></paragraph>
<paragraph id="HF3F9E52D01E84FD19C91E63C4273DEDD" commented="no"><enum>(3)</enum><header>Special rule for applying income tests</header><text>In the case of property placed in service—</text>
<subparagraph id="HF33C02F7EE974543A79244FC1C5E339F" commented="no"><enum>(A)</enum><text>during 2006, 2007, or 2008,</text></subparagraph>
<subparagraph id="H5A541D4E093B48CBAE8B6229CCEB27AE" commented="no"><enum>(B)</enum><text>in the Gulf Opportunity Zone, and</text></subparagraph>
<subparagraph id="H6A317643C0614280B0A2015171FAF166" commented="no"><enum>(C)</enum><text>in a nonmetropolitan area (as defined in section 42(d)(5)(C)(iv)(IV)), </text></subparagraph><continuation-text continuation-text-level="paragraph">section 42 shall be applied by substituting <quote>national nonmetropolitan median gross income (determined under rules similar to the rules of section 142(d)(2)(B))</quote> for <quote>area median gross income</quote> in subparagraphs (A) and (B) of section 42(g)(1).</continuation-text></paragraph>
<paragraph id="H00CEC5089C2A47B4A95EB6086FAD50AA" commented="no"><enum>(4)</enum><header>Definitions</header><text>Any term used in this subsection which is also used in section 42 shall have the same meaning as when used in such section.</text></paragraph></subsection>
<subsection id="H2ADEAFB91EAA4569AA675E95F9B12B79" display-inline="no-display-inline"><enum>(d)</enum><header>Special allowance for certain property acquired on or after August 28, 2005</header>
<paragraph id="H70055D314B2140989479269FC467BD50"><enum>(1)</enum><header>Additional allowance</header><text display-inline="yes-display-inline">In the case of any qualified Gulf Opportunity Zone property—</text>
<subparagraph id="H978FA5692D754E43AB9D2654F664FB60"><enum>(A)</enum><text>the depreciation deduction provided by section 167(a) for the taxable year in which such property is placed in service shall include an allowance equal to 50 percent of the adjusted basis of such property, and </text></subparagraph>
<subparagraph id="HA5C2F6016610441D8DFCCFF8006EE531"><enum>(B)</enum><text>the adjusted basis of the qualified Gulf Opportunity Zone property shall be reduced by the amount of such deduction before computing the amount otherwise allowable as a depreciation deduction under this chapter for such taxable year and any subsequent taxable year.</text></subparagraph></paragraph>
<paragraph id="H64B1B89AD4DA47ADA92E9494E9D79980"><enum>(2)</enum><header>Qualified Gulf Opportunity Zone property</header><text display-inline="yes-display-inline"> For purposes of this subsection—</text>
<subparagraph id="H79AADD17F3DD4EF987F1C5D3966590B7"><enum>(A)</enum><header>In general</header><text>The term <term>qualified Gulf Opportunity Zone property</term> means property—</text>
<clause id="H052CF48516014B47BF6BDA8189E92778"><enum>(i)</enum>
<subclause id="H99C9C480690D46088454041000AEB6F9" display-inline="yes-display-inline"><enum>(I)</enum><text>which is described in section 168(k)(2)(A)(i), or </text></subclause>
<subclause id="HE99F8AF399F9470F98DA3C73E6984720" indent="up1"><enum>(II)</enum><text>which is nonresidential real property or residential rental property, </text></subclause></clause>
<clause id="HF4E0F76FD12A40F5B7FF8007CD9DC3B"><enum>(ii)</enum><text>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, </text></clause>
<clause id="HFDCB556F461D417DAE219DE5B5000037"><enum>(iii)</enum><text>the original use of which in the Gulf Opportunity Zone commences with the taxpayer on or after August 28, 2005, </text></clause>
<clause id="HD233A7AAC00E4655B465DF1C2FF3DE77"><enum>(iv)</enum><text>which is acquired by the taxpayer by purchase (as defined in section 179(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</text></clause>
<clause id="HA32CE5F27245434EBEFBADA30976791"><enum>(v)</enum><text>which is placed in service by the taxpayer on or before December 31, 2007 (December 31, 2008, in the case of nonresidential real property and residential rental property).</text></clause></subparagraph>
<subparagraph id="H05D1E4F457D14976A8D56F30E1B519B2"><enum>(B)</enum><header>Exceptions</header>
<clause id="HF7560DBBBB004AD4AB3859C15D5DF9E"><enum>(i)</enum><header>Alternative depreciation property</header><text display-inline="yes-display-inline">Such term shall not include any property described in section 168(k)(2)(D)(i).</text></clause>
<clause id="HD664DF5F5A284EA4ABCBA3D3D3BF41E2"><enum>(ii)</enum><header>Tax-exempt bond-financed property</header><text display-inline="yes-display-inline">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.</text></clause>
<clause id="H6EFDCD1306BA4D7BBA278C42E91B6571" commented="no" display-inline="no-display-inline"><enum>(iii)</enum><header>Qualified revitalization buildings</header><text>Such term shall not include any qualified revitalization building with respect to which the taxpayer has elected the application of paragraph (1) or (2) of section 1400I(a).</text></clause>
<clause id="H8801B40B67FB441396679C84825F40F4"><enum>(iv)</enum><header>Election out</header><text>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.</text></clause></subparagraph></paragraph>
<paragraph id="H371F3BC7D38E441EBCFEE43955A03E29"><enum>(3)</enum><header>Special rules</header><text>For purposes of this subsection, rules similar to the rules of subparagraph (E) of section 168(k)(2) shall apply, except that such subparagraph shall be applied—</text>
<subparagraph id="HF6B1A0EE60454CED81ABFB56BB152FC3"><enum>(A)</enum><text>by substituting <quote>August 27, 2005</quote> for <quote>September 10, 2001</quote> each place it appears therein,</text></subparagraph>
<subparagraph id="HC1D4C216C4984A06AC8C13326878D752"><enum>(B)</enum><text>by substituting <quote>January 1, 2008</quote> for <quote>January 1, 2005</quote> in clause (i) thereof, and</text></subparagraph>
<subparagraph id="HD722E002F44E49DCB64052BF00C2C74"><enum>(C)</enum><text>by substituting <quote>qualified Gulf Opportunity Zone property</quote> for <quote>qualified property</quote> in clause (iv) thereof.</text></subparagraph></paragraph>
<paragraph id="HB2CAC362D9634D9B9F00ECF27BAAD442"><enum>(4)</enum><header>Allowance against alternative minimum tax</header><text>For purposes of this subsection, rules similar to the rules of section 168(k)(2)(G) shall apply.</text></paragraph>
<paragraph id="HFE6CB2B0592641488B02482DD4C401B5" commented="no"><enum>(5)</enum><header>Recapture</header><text display-inline="yes-display-inline">For purposes of this subsection, rules similar to the rules under section 179(d)(10) shall apply with respect to any qualified Gulf Opportunity Zone property which ceases to be qualified Gulf Opportunity Zone property.</text></paragraph></subsection>
<subsection id="H265273A41A6A4E329C9615BB009F477E" display-inline="no-display-inline"><enum>(e)</enum><header>Increase in expensing under section 179</header>
<paragraph id="HF4D351A06AFB4AF4B1E4C9C056648AD"><enum>(1)</enum><header>In general</header><text>For purposes of section 179—</text>
<subparagraph id="H7EF1B81490084951A1EE7CB66F311960"><enum>(A)</enum><text>the dollar amount in effect under section 179(b)(1) for the taxable year shall be increased by the lesser of—</text>
<clause id="H46F6119B076744E2B04DC5B5384B8F34"><enum>(i)</enum><text>$100,000, or </text></clause>
<clause id="H927D73F5416745DA9BBCD6FFE207825D"><enum>(ii)</enum><text>the cost of qualified section 179 Gulf Opportunity Zone property placed in service during the taxable year, and </text></clause></subparagraph>
<subparagraph id="HCFE0D34A957146078C26E12143B552D"><enum>(B)</enum><text>the dollar amount in effect under section 179(b)(2) for the taxable year shall be increased by the lesser of—</text>
<clause id="H74867EDB1EBC4C8494E8FEA5BE30C200"><enum>(i)</enum><text>$600,000, or</text></clause>
<clause id="H8CD5BBE900F549A4B772E14F26488B31"><enum>(ii)</enum><text display-inline="yes-display-inline">the cost of qualified section 179 Gulf Opportunity Zone property placed in service during the taxable year.</text></clause></subparagraph></paragraph>
<paragraph id="H12F6C995A9FB4B8C955D2405B6EFDD50"><enum>(2)</enum><header>Qualified section 179 Gulf Opportunity Zone property</header><text>For purposes of this subsection, the term <term>qualified section 179 Gulf Opportunity Zone property</term> means section 179 property (as defined in section 179(d)) which is qualified Gulf Opportunity Zone property (as defined in subsection (d)(2)).</text></paragraph>
<paragraph id="H6B5920469AA341FCA8EB10EC84360043"><enum>(3)</enum><header>Coordination with empowerment zones and renewal communities</header><text>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.</text></paragraph>
<paragraph id="HACA545B85ED14D418DAADD59D8D0063" commented="no"><enum>(4)</enum><header>Recapture</header><text display-inline="yes-display-inline">For purposes of this subsection, rules similar to the rules under section 179(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.</text></paragraph></subsection>
<subsection id="H2496CED21A6C45EB842FEEA465CC8529" display-inline="no-display-inline"><enum>(f)</enum><header>Expensing for certain demolition and clean-up costs</header><text></text>
<paragraph id="H916FAFF6B2E64872004FD519E9008B1F"><enum>(1)</enum><header>In general</header><text>A taxpayer may elect to treat 50 percent of any qualified Gulf Opportunity Zone clean-up cost as an expense which is not chargeable to capital account. Any cost so treated shall be allowed as a deduction for the taxable year in which such cost is paid or incurred.</text></paragraph>
<paragraph id="H4CC5103A24A94AF6B7BDF5D940E7FEFC"><enum>(2)</enum><header>Qualified Gulf Opportunity Zone clean-up cost</header><text display-inline="yes-display-inline">For purposes of this subsection, the term <term>qualified Gulf Opportunity Zone clean-up cost</term> means any amount paid or incurred during the period beginning on August 28, 2005, and ending on December 31, 2007, for the removal of debris from, or the demolition of structures on, real property which is located in the Gulf Opportunity Zone and which is—</text>
<subparagraph id="H1C8C17FF9A4F49D1A3AADB935CB204F1"><enum>(A)</enum><text>held by the taxpayer for use in a trade or business or for the production of income, or</text></subparagraph>
<subparagraph id="H1EB19104988C44E1970210F994C906E7"><enum>(B)</enum><text>property described in section 1221(a)(1) in the hands of the taxpayer. </text></subparagraph><continuation-text continuation-text-level="paragraph">For purposes of the preceding sentence, amounts paid or incurred shall be taken into account only to the extent that such amount would (but for paragraph (1)) be chargeable to capital account.</continuation-text></paragraph></subsection>
<subsection id="HAF9856A586EA4140ACEF435FF310D529"><enum>(g)</enum><header>Extension of expensing for environmental remediation costs</header><text display-inline="yes-display-inline">With respect to any qualified environmental remediation expenditure (as defined in section 198(b)) paid or incurred on or after August 28, 2005, in connection with a qualified contaminated site located in the Gulf Opportunity Zone, section 198 (relating to expensing of environmental remediation costs) shall be applied—</text>
<paragraph id="H2829E9A01EAF4A32AAE2533CA823DFEB"><enum>(1)</enum><text>in the case of expenditures paid or incurred on or after August 28, 2005, and before January 1, 2008, by substituting <quote>December 31, 2007</quote> for the date contained in section 198(h), and</text></paragraph>
<paragraph id="H7E882940CC9747688F171F00EF4CA2EA"><enum>(2)</enum><text>except as provided in section 198(d)(2), by treating petroleum products (as defined in section 4612(a)(3)) as a hazardous substance.</text> </paragraph></subsection>
<subsection id="H1A2FBC888E454316B1F1E514B899102E"><enum>(h)</enum><header>Increase in rehabilitation credit</header><text display-inline="yes-display-inline">In the case of qualified rehabilitation expenditures (as defined in section 47(c)) paid or incurred during the period beginning on August 28, 2005, and ending on December 31, 2008, with respect to any qualified rehabilitated building or certified historic structure (as defined in section 47(c)) located in the Gulf Opportunity Zone, subsection (a) of section 47 (relating to rehabilitation credit) shall be applied—</text>
<paragraph id="HC8962356701E4CB6AE2CCDD5F6714DA8"><enum>(1)</enum><text>by substituting <quote>13 percent</quote> for <quote>10 percent</quote> in paragraph (1) thereof, and</text></paragraph>
<paragraph id="H38254F714ABF4FE8908B91FEC1315DD6"><enum>(2)</enum><text>by substituting <quote>26 percent</quote> for <quote>20 percent</quote> in paragraph (2) thereof.</text></paragraph></subsection>
<subsection id="HD78168752865476B91383692E62D32DA" display-inline="no-display-inline"><enum>(i)</enum><header>Special rules for small timber producers</header>
<paragraph id="H49719A8D69FD4940AB00C57DB0D951C8"><enum>(1)</enum><header>Increased expensing for qualified timber property</header><text>In the case of qualified timber property any portion of which is located in the Gulf Opportunity Zone or in that portion of the Rita GO Zone which is not part of the Gulf Opportunity Zone, the limitation under subparagraph (B) of section 194(b)(1) shall be increased by the lesser of—</text>
<subparagraph id="H4FB670C185FA4A418DB5BA6EA0F1AE86"><enum>(A)</enum><text>the limitation which would (but for this subsection) apply under such subparagraph, or</text></subparagraph>
<subparagraph id="HAB59CD3EAFC44E25B813625181D808DF"><enum>(B)</enum><text>the amount of reforestation expenditures (as defined in section 194(c)(3)) paid or incurred by the taxpayer with respect to such qualified timber property during the specified portion of the taxable year.</text></subparagraph></paragraph>
<paragraph id="H7B5BA2AB5AB7401698A0569C7F35C3C"><enum>(2)</enum><header>5 year NOL carryback of certain timber losses</header><text>For purposes of determining farming loss under section 172(i), income and deductions which are allocable to the specified portion of the taxable year and which are attributable to qualified timber property any portion of which is located in the Gulf Opportunity Zone or in that portion of the Rita GO Zone which is not part of the Gulf Opportunity Zone shall be treated as attributable to farming businesses.</text></paragraph>
<paragraph id="HDF87C7BE1D4D4C129DF5D9F6728E842C"><enum>(3)</enum><header>Rules not applicable to large timber producers</header>
<subparagraph id="H89E65DCA841846DAA7CE78566C808600"><enum>(A)</enum><header>Expensing</header><text>Paragraph (1) shall not apply to any taxpayer if such taxpayer holds more than 500 acres of qualified timber property at any time during the taxable year.</text></subparagraph>
<subparagraph id="H13CF93255BFF49A2AAA5DF2703770097" display-inline="no-display-inline"><enum>(B)</enum><header>NOL carryback</header><text>Paragraph (2) shall not apply with respect to any qualified timber property unless—</text>
<clause id="H4A43EE91F1434342BCBADAA95916AF3B"><enum>(i)</enum><text>such property was held by the taxpayer—</text>
<subclause id="HD73C7637D72A4C90B37D959FE6437CF3" display-inline="no-display-inline"><enum>(I)</enum><text display-inline="yes-display-inline">on August 28, 2005, in the case of qualified timber property any portion of which is located in the Gulf Opportunity Zone, or</text></subclause>
<subclause id="H7718CD04FCC6423EB8C18DF5D008E6D"><enum>(II)</enum><text display-inline="yes-display-inline">on September 23, 2005, in the case of qualified timber property (other than property described in subclause (I)) any portion of which is located in that portion of the Rita GO Zone which is not part of the Gulf Opportunity Zone, and</text></subclause></clause>
<clause id="H4FFE143C1FE84547B4859E5179689EAF"><enum>(ii)</enum><text display-inline="yes-display-inline">such taxpayer held not more than 500 acres of qualified timber property on such date.</text></clause></subparagraph>
<subparagraph id="H0058C5981EC744BFAAD3B68F13CE0E2" commented="no"><enum>(C)</enum><header>Aggregation rule</header><text display-inline="yes-display-inline">For purposes of subparagraphs (A) and (B), related persons shall be treated as one taxpayer. For purposes of the preceding sentence, the following shall be treated as related persons—</text>
<clause id="H481042C7A6744745A9E060096CC4F01D" commented="no"><enum>(i)</enum><text>2 or more persons if the relationship between such persons would result in a disallowance of losses under section 267 or 707(b), and</text></clause>
<clause id="H691C018293A84222A1E366BA32C032B" commented="no"><enum>(ii)</enum><text display-inline="yes-display-inline">2 or more persons which are members of the same controlled group (within the meaning of section 194(b)(2)(A)) of corporations.</text></clause><continuation-text continuation-text-level="subparagraph">For purposes of clause (i), section 267 shall be applied without regard to subsection (b)(1) thereof.</continuation-text></subparagraph></paragraph>
<paragraph id="H75DCB88370744C5584072C77A4D9E619"><enum>(4)</enum><header>Definitions</header><text>For purposes of this subsection—</text>
<subparagraph id="H60AC9D2A0F9D4031B637A790ED35D566"><enum>(A)</enum><header>Specified portion</header><text display-inline="yes-display-inline">The term <term>specified portion</term> means—</text>
<clause id="H42AF8455EC7145D19531E4111DF1A374" display-inline="no-display-inline"><enum>(i)</enum><text display-inline="yes-display-inline">in the case of qualified timber property any portion of which is located in the Gulf Opportunity Zone, that portion of the taxable year which is on or after August 28, 2005, and before January 1, 2007, and</text></clause>
<clause id="H2AC55EB0DB43415B94BB53C1B86F3E8"><enum>(ii)</enum><text display-inline="yes-display-inline">in the case of qualified timber property (other than property described in clause (i)) any portion of which is located in the Rita GO Zone, that portion of the taxable year which is on or after September 23, 2005, and before January 1, 2007.</text></clause></subparagraph>
<subparagraph id="H7C67CF513A3845DCB62200D492F36134"><enum>(B)</enum><header>Qualified timber property</header><text>The term <term>qualified timber property</term> has the meaning given such term in section 194(c)(1).</text></subparagraph></paragraph></subsection>
<subsection id="H69427836DF0B45C591DC169CDDCA9369" display-inline="no-display-inline"><enum>(j)</enum><header>Special rule for Gulf Opportunity Zone public utility casualty losses</header>
<paragraph id="HA4973EE87B8C4D4A87BD4094E3AB772C"><enum>(1)</enum><header>In general</header><text display-inline="yes-display-inline">The amount described in section 172(f)(1)(A) for any taxable year shall be increased by the Gulf Opportunity Zone public utility casualty loss for such taxable year.</text></paragraph>
<paragraph id="H61D8D65E3E3C47279662805C88CAF995"><enum>(2)</enum><header>Gulf Opportunity Zone public utility casualty loss</header><text display-inline="yes-display-inline">For purposes of this subsection, the term <term>Gulf Opportunity Zone public utility casualty loss</term> means any casualty loss of public utility property (as defined in section 168(i)(10)) located in the Gulf Opportunity Zone if—</text>
<subparagraph id="HE941A6845105466D80F5FD69BD569601"><enum>(A)</enum><text>such loss is allowed as a deduction under section 165 for the taxable year,</text></subparagraph>
<subparagraph id="H5286FD9C29DD4EE2A5CA1036CD81EB72"><enum>(B)</enum><text>such loss is by reason of Hurricane Katrina, and</text></subparagraph>
<subparagraph id="HC55AF1E311BF4A81AE395D9FDB5C6630"><enum>(C)</enum><text>the taxpayer elects the application of this subsection with respect to such loss.</text></subparagraph></paragraph>
<paragraph id="HE8EFEE11E4EB437787C4BFEAC75F6330"><enum>(3)</enum><header>Reduction for gains from involuntary conversion</header><text>The amount of Gulf Opportunity Zone public utility casualty loss which would (but for this paragraph) be taken into account under paragraph (1) for any taxable year shall be reduced by the amount of any gain recognized by the taxpayer for such year from the involuntary conversion by reason of Hurricane Katrina of public utility property (as so defined) located in the Gulf Opportunity Zone. </text></paragraph>
<paragraph id="HEAC8C9DA56AB461188D4768002C00A2"><enum>(4)</enum><header>Coordination with general disaster loss rules</header><text>Section 165(i) shall not apply to any Gulf Opportunity Zone public utility casualty loss to the extent such loss is taken into account under paragraph (1).</text></paragraph>
<paragraph id="H79B02B6EC65744CBB3FDFB635BF2C145" commented="no"><enum>(5)</enum><header>Election</header><text display-inline="yes-display-inline">Any election under paragraph (2)(C) shall be made in such manner as may be prescribed by the Secretary and shall be made by the due date (including extensions of time) for filing the taxpayer’s return for the taxable year of the loss. Such election, once made for any taxable year, shall be irrevocable for such taxable year. </text></paragraph></subsection>
<subsection id="H3783B038B72F4220B6342DD241E33503" display-inline="no-display-inline" commented="no"><enum>(k)</enum><header>Special NOL carryback of cost recovery deductions for qualified GO Zone property</header>
<paragraph id="H37AD1A28A8BB4F8D9D46AD6D24AB2E" commented="no"><enum>(1)</enum><header>In general</header><text display-inline="yes-display-inline">For purposes of section 172, the GO Zone cost recovery loss for any taxable year ending on or after August 28, 2005, and before January 1, 2009, shall be a net operating loss carryback to each of the 5 taxable years preceding the taxable year of the loss.</text></paragraph>
<paragraph id="H2CF81AC56D174ED28D8E8CB7363E7BCA" commented="no"><enum>(2)</enum><header>GO Zone cost recovery loss</header><text>For purposes of this subsection, the term <term>GO Zone cost recovery loss</term> means, with respect to any taxable year, the lesser of—</text>
<subparagraph id="H1F740C3A589C4D8CA0836354765233B5" commented="no"><enum>(A)</enum><text>the aggregate amount of the deductions allowed under sections 167 and 168 with respect to qualified Gulf Opportunity Zone property (as defined in subsection (d)(2), but without regard to subparagraph (B)(iv) thereof) which is placed in service during such taxable year, or</text></subparagraph>
<subparagraph id="H7C8ED14AFEB3488B9592BA65060317F1" commented="no"><enum>(B)</enum><text>the excess of—</text>
<clause id="HCAD29E1A2A0A42A4A0468E6729C027DA" commented="no"><enum>(i)</enum><text>the net operating loss for such taxable year, over</text></clause>
<clause id="H52408CAABA404A44AB65F6E5187E7E7B" commented="no"><enum>(ii)</enum><text>the specified liability loss for such taxable year to which a 10-year carryback applies under section 172(b)(1)(C).</text></clause></subparagraph></paragraph>
<paragraph id="H6F860B5B03514E17A605C23662B09B24" commented="no"><enum>(3)</enum><header>Coordination with ordering rule</header><text>For purposes of applying section 172(b)(2), a GO Zone cost recovery loss to which paragraph (1) applies shall be treated in a manner similar to the manner in which a specified liability loss is treated.</text></paragraph>
<paragraph id="H841E512AEE924F16AF8C89D8F073FEE" commented="no"><enum>(4)</enum><header>Election out</header><text>A rule similar to the rule of section 172(j) shall apply for purposes of this subsection.</text></paragraph></subsection>
<subsection id="HC0E369265B7842399C4400D6FA7998A4" display-inline="no-display-inline"><enum>(l)</enum><header>Credit to holders of Gulf tax credit bonds</header>
<paragraph id="H418A15A51D2A4EDBB4B1D4144D03392"><enum>(1)</enum><header>Allowance of credit</header><text display-inline="yes-display-inline">If a taxpayer holds a Gulf tax credit bond on one or more credit allowance dates of the bond occurring during any taxable year, there shall be allowed as a credit against the tax imposed by this chapter for the taxable year an amount equal to the sum of the credits determined under paragraph (2) with respect to such dates. </text></paragraph>
<paragraph id="H91C5E251F2E64CB2A0EC4B55F8C38C9"><enum>(2)</enum><header>Amount of credit</header><text></text>
<subparagraph id="H62A7897F1A9748B791C41919E99F11BC"><enum>(A)</enum><header>In general</header><text>The amount of the credit determined under this paragraph with respect to any credit allowance date for a Gulf tax credit bond is 25 percent of the annual credit determined with respect to such bond. </text></subparagraph>
<subparagraph id="HA9EF51169D7041308820848E304E20DA"><enum>(B)</enum><header>Annual credit</header><text>The annual credit determined with respect to any Gulf tax credit bond is the product of—</text>
<clause id="H69BEC4DCDCAC40B582119411666E8492"><enum>(i)</enum><text>the credit rate determined by the Secretary under subparagraph (C) for the day on which such bond was sold, multiplied by </text></clause>
<clause id="H04AC1AE0ED574F6EB135074E1BDE75C2"><enum>(ii)</enum><text>the outstanding face amount of the bond.</text></clause></subparagraph>
<subparagraph id="HFCACD345314142DCA7DC7FE60066FE94"><enum>(C)</enum><header>Determination</header><text display-inline="yes-display-inline">For purposes of subparagraph (B), with respect to any Gulf tax credit bond, the Secretary shall determine daily or cause to be determined daily a credit rate which shall apply to the first day on which there is a binding, written contract for the sale or exchange of the bond. The credit rate for any day is the credit rate which the Secretary or the Secretary’s designee estimates will permit the issuance of Gulf tax credit bonds with a specified maturity or redemption date without discount and without interest cost to the issuer. </text></subparagraph>
<subparagraph id="H612B45D351804B9E9900D2CCA14B3FC3"><enum>(D)</enum><header>Credit allowance date</header><text>For purposes of this subsection, the term <term>credit allowance date</term> means March 15, June 15, September 15, and December 15. Such term also includes the last day on which the bond is outstanding.</text></subparagraph>
<subparagraph id="HC0593AA1022A40C18CF023F3194BD3CB"><enum>(E)</enum><header>Special rule for issuance and redemption</header><text display-inline="yes-display-inline">In the case of a bond which is issued during the 3-month period ending on a credit allowance date, the amount of the credit determined under this paragraph with respect to such credit allowance date shall be a ratable portion of the credit otherwise determined based on the portion of the 3-month period during which the bond is outstanding. A similar rule shall apply when the bond is redeemed or matures. </text></subparagraph></paragraph>
<paragraph id="H987AF158373E409C971E67004740A420"><enum>(3)</enum><header>Limitation based on amount of tax</header><text>The credit allowed under paragraph (1) for any taxable year shall not exceed the excess of—</text>
<subparagraph id="H1C810537DA694804865C1005EED6793D"><enum>(A)</enum><text>the sum of the regular tax liability (as defined in section 26(b)) plus the tax imposed by section 55, over </text></subparagraph>
<subparagraph id="H3C744641C8154B5AA6A06DC2320437B"><enum>(B)</enum><text>the sum of the credits allowable under part IV of subchapter A (other than subpart C and this subsection).</text></subparagraph></paragraph>
<paragraph id="H4632B68B7B6A414E9C2935DDD4115F8"><enum>(4)</enum><header>Gulf tax credit bond</header><text>For purposes of this subsection—</text>
<subparagraph id="HB5B8C29A866A452FAB9320321FCF9CED"><enum>(A)</enum><header>In general</header><text>The term <term>Gulf tax credit bond</term> means any bond issued as part of an issue if—</text>
<clause id="HF26E758F79E6460B98F94DE71EF2F5C7"><enum>(i)</enum><text>the bond is issued by the State of Alabama, Louisiana, or Mississippi,</text></clause>
<clause id="HDFDE8BFC05D54D36AA0690EE8214A800"><enum>(ii)</enum><text>95 percent or more of the proceeds of such issue are to be used to—</text>
<subclause id="HB7E9A47034DE42E295DCA7C3495EA1B"><enum>(I)</enum><text>pay principal, interest, or premiums on qualified bonds issued by such State or any political subdivision of such State, or</text></subclause>
<subclause id="HF07D2629E98D4DC5804091B0E52D36F0"><enum>(II)</enum><text>make a loan to any political subdivision of such State to pay principal, interest, or premiums on qualified bonds issued by such political subdivision,</text></subclause></clause>
<clause id="H1ED6424487BA49A5BADDFFAFF37E67D2"><enum>(iii)</enum><text>the Governor of such State designates such bond for purposes of this subsection,</text></clause>
<clause id="H4973E3F90D3B4E198BDB958E57797E26"><enum>(iv)</enum><text>the bond is a general obligation of such State and is in registered form (within the meaning of section 149(a)),</text></clause>
<clause id="H2B91218D06504920A752FAA4ED558E48"><enum>(v)</enum><text>the maturity of such bond does not exceed 2 years, and</text></clause>
<clause id="H729599826A804AE4A0935E66E94985BC"><enum>(vi)</enum><text>the bond is issued after December 31, 2005, and before January 1, 2007.</text></clause></subparagraph>
<subparagraph id="H689196CBEEE64708008BD44F08B0C720"><enum>(B)</enum><header>State matching requirement</header><text>A bond shall not be treated as a Gulf tax credit bond unless—</text>
<clause id="HCAF4A119CC81463B9E01EFBEE3D74BE"><enum>(i)</enum><text>the issuer of such bond pledges as of the date of the issuance of the issue an amount equal to the face amount of such bond to be used for payments described in subclause (I) of subparagraph (A)(ii), or loans described in subclause (II) of such subparagraph, as the case may be, with respect to the issue of which such bond is a part, and</text></clause>
<clause id="HEC005DB30D304D11AE850003006CE866"><enum>(ii)</enum><text>any such payment or loan is made in equal amounts from the proceeds of such issue and from the amount pledged under clause (i).</text></clause><continuation-text continuation-text-level="subparagraph">The requirement of clause (ii) shall be treated as met with respect to any such payment or loan made during the 1-year period beginning on the date of the issuance (or any successor 1-year period) if such requirement is met when applied with respect to the aggregate amount of such payments and loans made during such period.</continuation-text></subparagraph>
<subparagraph id="H82282703B7BE42EF9B904F7F3B7BDB43"><enum>(C)</enum><header>Aggregate limit on bond designations</header><text>The maximum aggregate face amount of bonds which may be designated under this subsection by the Governor of a State shall not exceed—</text>
<clause id="HFAFEBF6B4B1F4D5B8E2CD218BF3D45C"><enum>(i)</enum><text>$200,000,000 in the case of the State of Louisiana,</text></clause>
<clause id="HE37DEBCD64324CFB85907695A5B239AD"><enum>(ii)</enum><text>$100,000,000 in the case of the State of Mississippi, and</text></clause>
<clause id="H44E5B6513D164F4A937BD4D199E6B3E2"><enum>(iii)</enum><text>$50,000,000 in the case of the State of Alabama.</text></clause></subparagraph>
<subparagraph id="HDA5D08F25AC64E8EAB932DA858270065"><enum>(D)</enum><header>Special rules relating to arbitrage</header><text display-inline="yes-display-inline">A bond which is part of an issue shall not be treated as a Gulf tax credit bond unless, with respect to the issue of which the bond is a part, the issuer satisfies the arbitrage requirements of section 148 with respect to proceeds of the issue and any loans made with such proceeds. </text></subparagraph></paragraph>
<paragraph id="H69DB6EA1C253401DBFD1A600EF1DD4FB"><enum>(5)</enum><header>Qualified bond</header><text>For purposes of this subsection—</text>
<subparagraph id="H73C74210924C485C987DA414353BFEC"><enum>(A)</enum><header>In general</header><text>The term <term>qualified bond</term> means any obligation of a State or political subdivision thereof which was outstanding on August 28, 2005.</text></subparagraph>
<subparagraph id="H4025FA9ACFA4448C84322BF6CB239D2F"><enum>(B)</enum><header>Exception for private activity bonds</header><text>Such term shall not include any private activity bond.</text></subparagraph>
<subparagraph id="H5937A0D7A2604B60BF15D6B200FB1D22"><enum>(C)</enum><header>Exception for advance refundings</header><text display-inline="yes-display-inline">Such term shall not include any bond with respect to which there is any outstanding refunded or refunding bond during the period in which a Gulf tax credit bond is outstanding with respect to such bond.</text> </subparagraph></paragraph>
<paragraph id="H1E1C5540458E47E3993FA3CDC02DBD39"><enum>(6)</enum><header>Credit included in gross income</header><text display-inline="yes-display-inline">Gross income includes the amount of the credit allowed to the taxpayer under this subsection (determined without regard to paragraph (3)) and the amount so included shall be treated as interest income.</text></paragraph>
<paragraph id="H4164BC99F7DE49E8A4003D00ECD19957"><enum>(7)</enum><header>Other definitions and special rules</header><text display-inline="yes-display-inline">For purposes of this subsection—</text>
<subparagraph id="HC1014DC3604B44D9AD012882A9F0B555"><enum>(A)</enum><header>Bond</header><text>The term <term>bond</term> includes any obligation. </text></subparagraph>
<subparagraph id="HACE8B89893BC4A238486C3DD54AA80D2"><enum>(B)</enum><header> Partnership; S corporation; and other pass-thru entities</header>
<clause id="HBD10EB87FE4242E287241D7BC32CBBB7"><enum>(i)</enum><header>In general</header><text>Under regulations prescribed by the Secretary, in the case of a partnership, trust, S corporation, or other pass-thru entity, rules similar to the rules of section 41(g) shall apply with respect to the credit allowable under paragraph (1). </text></clause>
<clause id="HACFC08C35C02493FA808C5D5CDE530FA"><enum>(ii)</enum><header>No basis adjustment</header><text>In the case of a bond held by a partnership or an S corporation, rules similar to the rules under section 1397E(i) shall apply. </text></clause></subparagraph>
<subparagraph id="H1A09B500F75F45CD88E7901D63B7E067"><enum>(C)</enum><header>Bonds held by regulated investment companies</header><text>If any Gulf tax credit bond is held by a regulated investment company, the credit determined under paragraph (1) shall be allowed to shareholders of such company under procedures prescribed by the Secretary.</text></subparagraph>
<subparagraph id="H680E38E95A58430F96EEC2EAD546EA2"><enum>(D)</enum><header>Reporting</header><text>Issuers of Gulf tax credit bonds shall submit reports similar to the reports required under section 149(e).</text></subparagraph>
<subparagraph id="H85D9EAD63D9D4A83B0DCA55F5BB07FDB"><enum>(E)</enum><header>Credit treated as nonrefundable bondholder credit</header><text>For purposes of this title, the credit allowed by this subsection shall be treated as a credit allowable under subpart H of part IV of subchapter A of this chapter.</text></subparagraph></paragraph></subsection>
<subsection id="H02AB42CADD1641B7AF5D388327B99D64" display-inline="no-display-inline"><enum>(m)</enum><header>Tax benefits not available with respect to facilities for gambling, etc</header>
<paragraph id="H5E9ADCD0F66B43BC9610A1FA077F9C57"><enum>(1)</enum><header>Tax-exempt bond financing</header><text display-inline="yes-display-inline">Subsection (a) shall not apply to any bond issued as part of an issue if any portion of the proceeds of such issue is to be used to provide any property described in section 144(c)(6)(B).</text></paragraph>
<paragraph id="HE090288C083949B8B74FA46B1F5B01E5"><enum>(2)</enum><header>Advance refunding bonds</header><text display-inline="yes-display-inline">Subsection (b) shall not apply to any advance refunding of a bond which is issued as part of an issue if any portion of the proceeds of such issue (or any prior issue) was (or is to be) used to provide any property described in section 144(c)(6)(B).</text></paragraph>
<paragraph id="HABF05D5CBFE24F538832E247AF429946"><enum>(3)</enum><header>Low-income housing credit</header><text>For purposes of subsection (c), property shall not be treated as located or placed in service in the Gulf Opportunity Zone if such property is described in section 144(c)(6)(B).</text></paragraph>
<paragraph id="HE3A8C565C8D14D67988C2FC0C600005C"><enum>(4)</enum><header>Special allowance for certain property; section 179 expensing; carryback of cost recovery deductions</header><text>For purposes of subsections (d), (e), and (k), the term <quote>qualified Gulf Opportunity Zone property</quote> shall not include any property described in section 144(c)(6)(B).</text></paragraph>
<paragraph id="HCDA88D5F13E041948498F8926D4E9739"><enum>(5)</enum><header>Demolition and clean-up costs; remediation; rehabilitation expenses</header><text>Subsections (f), (g), and (h) shall not apply with respect to any amount paid or incurred with respect to any property described in section 144(c)(6)(B).</text></paragraph>
<paragraph id="HA012ACCD7CDE43DB932DFAD865114160"><enum>(6)</enum><header>Timber producers</header><text>For purposes of subsection (i), qualified timber property shall not include any property described in section 144(c)(6)(B).</text></paragraph>
<paragraph id="HC515F20F6DC54FDDBAF401B79FAE43AE"><enum>(7)</enum><header>Public utility casualty losses</header><text>For purposes of subsection (j), public utility property shall not include any property described in section 144(c)(6)(B).</text></paragraph>
<paragraph id="H6ABE813DA7654A25A358C83F08B96BC1"><enum>(8)</enum><header>Gulf tax credit bonds</header><text display-inline="yes-display-inline">Subsection (l) shall not apply to any bond issued as part of an issue if any portion of the proceeds of such issue is to be used to provide any property described in section 144(c)(6)(B).</text></paragraph> </subsection></section></part><after-quoted-block>.</after-quoted-block></quoted-block></subsection>
<subsection id="H7301CCC0F00E4A2D903F6CDF83EFE08F"><enum>(b)</enum><header>Conforming amendments</header>
<paragraph id="H546AB20C55E3466685BF36E7140072FF"><enum>(1)</enum><text>Paragraph (2) of <external-xref legal-doc="usc" parsable-cite="usc/26/54">section 54(c)</external-xref> is amended by inserting <quote>, section 1400N(l),</quote> after <quote>subpart C</quote>. </text></paragraph>
<paragraph id="H7DED1D83320D425AAA3D09213FDBABB1"><enum>(2)</enum><text>Subparagraph (A) of <external-xref legal-doc="usc" parsable-cite="usc/26/6049">section 6049(d)(8)</external-xref> is amended—</text>
<subparagraph id="HB58931F5F91C485D93ADB6594BC674B"><enum>(A)</enum><text>by inserting <quote>or 1400N(l)(6)</quote> after <quote>section 54(g)</quote>, and</text></subparagraph>
<subparagraph id="HC3C7109FFD584B9CA6AE52069D9BCBBB"><enum>(B)</enum><text>by inserting <quote>or 1400N(l)(2)(D), as the case may be</quote> after <quote>section 54(b)(4)</quote>.</text></subparagraph></paragraph>
<paragraph id="H269713EDABF64F0D9DC92F635CF15554"><enum>(3)</enum><text>So much of subchapter Y of chapter 1 as precedes <external-xref legal-doc="usc" parsable-cite="usc/26/1400L">section 1400L</external-xref> is amended to read as follows:</text>
<quoted-block style="OLC" id="H5AA03C9B85D047328019C3694B62FA83" display-inline="no-display-inline">
<subchapter id="H876F0FA8BF914530A09C561F2D2335FE"><enum>Y</enum><header>Short-term regional benefits</header>
<toc container-level="subchapter-container" quoted-block="no-quoted-block" lowest-level="section" idref="H876F0FA8BF914530A09C561F2D2335FE" regeneration="yes-regeneration" lowest-bolded-level="division-lowest-bolded">
<toc-entry idref="H3BE8C27D3C274EACB3A74329079518C0" level="part">Part I—Tax benefits for New York Liberty Zone</toc-entry>
<toc-entry level="part">Part II—Tax benefits for Gulf Opportunity Zone</toc-entry></toc>
<part id="H3BE8C27D3C274EACB3A74329079518C0"><enum>I</enum><header>Tax benefits for New York Liberty Zone</header>
<toc container-level="quoted-block-container" quoted-block="no-quoted-block" lowest-level="section" idref="H84B4B166248B43068C2945D35120CBCB" regeneration="yes-regeneration" lowest-bolded-level="division-lowest-bolded">
<toc-entry idref="HF64224DCBC1645BE93E6ECD263BAA1A7" level="section">Sec. 1400L. Tax benefits for New York Liberty Zone</toc-entry></toc></part></subchapter><after-quoted-block>.</after-quoted-block></quoted-block></paragraph>
<paragraph id="HC42C0A899ECF4737843F78A127A295E2"><enum>(4)</enum><text>The item relating to subchapter Y in the table of subchapters for <external-xref legal-doc="usc-chapter" parsable-cite="usc-chapter/26/1">chapter 1</external-xref> is amended to read as follows:</text>
<quoted-block style="OLC" id="H6641712E4E1947598DDFE05FDA363D1D" display-inline="no-display-inline">
<toc regeneration="no-regeneration">
<toc-entry level="subchapter">Subchapter Y—Short-term regional benefits</toc-entry></toc><after-quoted-block>.</after-quoted-block></quoted-block></paragraph></subsection>
<subsection id="H49170AA435464C90AE69C406849D441" display-inline="no-display-inline" commented="no"><enum>(c)</enum><header>Effective date</header>
<paragraph id="H091E1902AA534CC890BA9C8E44D088ED"><enum>(1)</enum><header>In general</header><text>Except as provided in paragraph (2), the amendments made by this section shall apply to taxable years ending on or after August 28, 2005.</text></paragraph>
<paragraph id="H4FEEA62923F749F6B79751D89632EE1B"><enum>(2)</enum><header>Carrybacks</header><text>Subsections (i)(2), (j), and (k) of <external-xref legal-doc="usc" parsable-cite="usc/26/1400N">section 1400N</external-xref> of the Internal Revenue Code of 1986 (as added by this section) shall apply to losses arising in such taxable years.</text></paragraph></subsection></section>
<section id="HF8AC72EDDD634817A28C2742C7134CBF" section-type="subsequent-section" display-inline="no-display-inline"><enum>102.</enum><header>Federal guarantee of certain State bonds</header>
<subsection id="HD4DD3F8478534FFE9466A074BF00D31D"><enum>(a)</enum><header>State bonds described</header>
<paragraph id="H2A1E4E833E2B4365B85BEC0992025F1D"><enum>(1)</enum><header>In general</header><text>This section shall apply to a bond issued as part of an issue if—</text>
<subparagraph id="H8CBE041148C840229D93006614BD00D1"><enum>(A)</enum><text>the issue of which such bond is part is an issue of the State of Alabama, Louisiana, or Mississippi,</text></subparagraph>
<subparagraph id="H8476E60436984B1699EA4E5FB2FC7D23"><enum>(B)</enum><text>the bond is a general obligation of the issuing State and is in registered form,</text></subparagraph>
<subparagraph id="H719E5EF0B5F94FF0AC91CBAC7C72867C"><enum>(C)</enum><text>the proceeds of the bond are distributed to one or more political subdivisions of the issuing State,</text></subparagraph>
<subparagraph id="HC4F89F7D6BE84159A98CCABD9007BAF"><enum>(D)</enum><text>the maturity of such bond does not exceed 5 years, </text></subparagraph>
<subparagraph id="H9ABCCF37004241F89F3DD166D992FC27"><enum>(E)</enum><text>the bond is issued after the date of the enactment of this Act and before January 1, 2008, and</text></subparagraph>
<subparagraph id="H7BEBC0D8B1574D58BF16A64C29D26472"><enum>(F)</enum><text>the bond is designated by the Secretary of the Treasury for purposes of this section.</text></subparagraph></paragraph>
<paragraph id="HA8B1A9578976488C842201F94DEBE7E5"><enum>(2)</enum><header>Facilities for gambling, etc</header><text display-inline="yes-display-inline">The Secretary of the Treasury may not designate any bond for purposes of this section if such bond is issued as part of an issue any portion of the proceeds of which is to be used to provide any property described in section 144(c)(6)(B).</text></paragraph></subsection>
<subsection id="H9C9D4DF51EDB498385C247A71885EA74"><enum>(b)</enum><header>Application</header>
<paragraph id="H2DE9FA181E334608ADDA1BC59933C22B"><enum>(1)</enum><header>In general</header><text>The Secretary of the Treasury may only designate a bond for purposes of this section pursuant to an application submitted to the Secretary by the State which demonstrates the need for such designation on the basis of the criteria specified in paragraph (2). </text></paragraph>
<paragraph id="H05BBDB8E3581468CBF7E978611D3F070"><enum>(2)</enum><header>Criteria</header><text>For purposes of paragraph (1), the criteria specified in this paragraph are—</text>
<subparagraph id="HBA20C272D987480B869E1DC41BB378E5"><enum>(A)</enum><text display-inline="yes-display-inline">the loss of revenue base of one or more political subdivisions of the State by reason of Hurricane Katrina,</text></subparagraph>
<subparagraph id="HC3B902B280E847C6AD7D40765FD0E717"><enum>(B)</enum><text>the need for resources to fund infrastructure within, or operating expenses of, any such political subdivision,</text></subparagraph>
<subparagraph id="H866C6BE7E31E4CC7930000E51861A929"><enum>(C)</enum><text display-inline="yes-display-inline">the lack of access of such political subdivision to capital, and</text></subparagraph>
<subparagraph id="H0B76637B4B604C5790A14D31BA50EDEA"><enum>(D)</enum><text>any other criteria as may be determined by the Secretary.</text></subparagraph></paragraph>
<paragraph id="H53C4A10EFE164E0B8577B913BF8A8F6"><enum>(3)</enum><header>Guidance for submission and consideration of applications</header><text>The Secretary of the Treasury shall prescribe regulations or other guidance which provide for the time and manner for the submission and consideration of applications under this subsection.</text></paragraph></subsection>
<subsection id="HAED8B0A7F0A34A8C84487BE9ECF67D4"><enum>(c)</enum><header>Federal guarantee</header><text>A bond described in subsection (a) is guaranteed by the United States in an amount equal to 50 percent of the outstanding principal with respect to such bond.</text></subsection>
<subsection id="H8F427346F2AE466B9931998B7967D469"><enum>(d)</enum><header>Aggregate limit on bond designations</header><text>The maximum aggregate face amount of bonds which may be issued under this section shall not exceed $3,000,000,000.</text></subsection></section>
<enum>II</enum><header>Tax benefits related to Hurricanes Rita and Wilma </header>
<section id="H214DC79599374FA8A3004B23FCFE708B" section-type="subsequent-section" display-inline="no-display-inline"><enum>201.</enum><header>Extension of certain emergency tax relief for Hurricane Katrina to Hurricanes Rita and Wilma</header>
<subsection id="H5660E799821D460D9535986922B4DCD"><enum>(a)</enum><header>In general</header><text>Part II of subchapter Y of chapter 1 (as added by this Act) is amended by adding at the end the following new sections:</text>
<quoted-block style="OLC" id="H0E7BF4E279584B8EA52BCC607435A337" display-inline="no-display-inline">
<section id="H117D4C9DC9F44A57BA0380EC1E5C2634"><enum>1400O.</enum><header>Special rules for use of retirement funds</header>
<subsection id="H634EABCE43F94BC4B54F91004B61CB11" display-inline="no-display-inline"><enum>(a)</enum><header>Tax-favored withdrawals from retirement plans</header><text></text>
<paragraph id="HD4B17474A8C84B5C00D365A32B91FDA2"><enum>(1)</enum><header>In general</header><text>Section 72(t) shall not apply to any qualified hurricane distribution.</text></paragraph>
<paragraph id="H4E69ED4C983C4D1FB5F86D4E7602E34"><enum>(2)</enum><header>Aggregate dollar limitation</header>
<subparagraph id="H11F8342D5C3D4282A927B29D519B4475"><enum>(A)</enum><header>In general</header><text>For purposes of this subsection, the aggregate amount of distributions received by an individual which may be treated as qualified hurricane distributions for any taxable year shall not exceed the excess (if any) of—</text>
<clause id="H53B5C130153B42C6A8859100EDC3ECA"><enum>(i)</enum><text>$100,000, over</text></clause>
<clause id="HB22AEC9BB5244568B543D512D9E58DF"><enum>(ii)</enum><text>the aggregate amounts treated as qualified hurricane distributions received by such individual for all prior taxable years.</text></clause></subparagraph>
<subparagraph id="HF78AE28CE9D042B69CBF5072A2006144"><enum>(B)</enum><header>Treatment of plan distributions</header><text>If a distribution to an individual would (without regard to subparagraph (A)) be a qualified hurricane distribution, a plan shall not be treated as violating any requirement of this title merely because the plan treats such distribution as a qualified hurricane distribution, unless the aggregate amount of such distributions from all plans maintained by the employer (and any member of any controlled group which includes the employer) to such individual exceeds $100,000.</text></subparagraph>
<subparagraph id="H42AA9F7FCF54424CB7D057EA00CE9500"><enum>(C)</enum><header>Controlled group</header><text>For purposes of subparagraph (B), the term <term>controlled group</term> means any group treated as a single employer under subsection (b), (c), (m), or (o) of section 414.</text></subparagraph></paragraph>
<paragraph id="H5F9E036654C745C70057FBB91F1E7188"><enum>(3)</enum><header>Amount distributed may be repaid</header>
<subparagraph id="HAE5CDDA6312347798BA22344FA011DF7"><enum>(A)</enum><header>In general</header><text>Any individual who receives a qualified hurricane distribution may, at any time during the 3-year period beginning on the day after the date on which such distribution was received, make one or more contributions in an aggregate amount not to exceed the amount of such distribution to an eligible retirement plan of which such individual is a beneficiary and to which a rollover contribution of such distribution could be made under section 402(c), 403(a)(4), 403(b)(8), 408(d)(3), or 457(e)(16), as the case may be.</text></subparagraph>
<subparagraph id="H4AF679809543457CB06F8DA5D7E02576"><enum>(B)</enum><header>Treatment of repayments of distributions from eligible retirement plans other than IRAs</header><text>For purposes of this title, if a contribution is made pursuant to subparagraph (A) with respect to a qualified hurricane distribution from an eligible retirement plan other than an individual retirement plan, then the taxpayer shall, to the extent of the amount of the contribution, be treated as having received the qualified hurricane distribution in an eligible rollover distribution (as defined in section 402(c)(4)) and as having transferred the amount to the eligible retirement plan in a direct trustee to trustee transfer within 60 days of the distribution.</text></subparagraph>
<subparagraph id="H2B3ACF26F1234794AC221F9C04D6635F"><enum>(C)</enum><header>Treatment of repayments for distributions from IRAs</header><text>For purposes of this title, if a contribution is made pursuant to subparagraph (A) with respect to a qualified hurricane distribution from an individual retirement plan (as defined by section 7701(a)(37)), then, to the extent of the amount of the contribution, the qualified hurricane distribution shall be treated as a distribution described in section 408(d)(3) and as having been transferred to the eligible retirement plan in a direct trustee to trustee transfer within 60 days of the distribution.</text></subparagraph></paragraph>
<paragraph id="H78F2BFA748DD4C358BBD001E1F9D87D"><enum>(4)</enum><header>Definitions</header><text>For purposes of this subsection—</text>
<subparagraph id="H181142D42F4E4680A6F55E08409540FD"><enum>(A)</enum><header>Qualified hurricane distribution</header><text>Except as provided in paragraph (2), the term <term>qualified hurricane distribution</term> means—</text>
<clause id="HE0B3E938962641FF87943CA3A8F9C185"><enum>(i)</enum><text display-inline="yes-display-inline">any distribution from an eligible retirement plan made on or after August 25, 2005, and before January 1, 2007, to an individual whose principal place of abode on August 28, 2005, is located in the Hurricane Katrina disaster area and who has sustained an economic loss by reason of Hurricane Katrina,</text></clause>
<clause id="H44A7987B8BA9439B8164F8494F95EE40"><enum>(ii)</enum><text display-inline="yes-display-inline">any distribution (which is not described in clause (i)) from an eligible retirement plan made on or after September 23, 2005, and before January 1, 2007, to an individual whose principal place of abode on September 23, 2005, is located in the Hurricane Rita disaster area and who has sustained an economic loss by reason of Hurricane Rita, and</text></clause>
<clause id="HE31026B28CDD42E78565FFF8F4429BDE"><enum>(iii)</enum><text display-inline="yes-display-inline">any distribution (which is not described in clause (i) or (ii)) from an eligible retirement plan made on or after October 23, 2005, and before January 1, 2007, to an individual whose principal place of abode on October 23, 2005, is located in the Hurricane Wilma disaster area and who has sustained an economic loss by reason of Hurricane Wilma.</text></clause></subparagraph>
<subparagraph id="HEB20043966C141ABB637CE23F152FE3"><enum>(B)</enum><header>Eligible retirement plan</header><text>The term <term>eligible retirement plan</term> shall have the meaning given such term by section 402(c)(8)(B).</text></subparagraph></paragraph>
<paragraph id="HCCE9B4C4B5FC49599073A090BBD87021"><enum>(5)</enum><header>Income inclusion spread over 3-year period</header>
<subparagraph id="H79C017855A354A43BCCD4F8F05AC7732"><enum>(A)</enum><header>In general</header><text>In the case of any qualified hurricane distribution, unless the taxpayer elects not to have this paragraph apply for any taxable year, any amount required to be included in gross income for such taxable year shall be so included ratably over the 3-taxable year period beginning with such taxable year.</text></subparagraph>
<subparagraph id="H94BB6A9AC4234DA4BC537736A486E6A1"><enum>(B)</enum><header>Special rule</header><text>For purposes of subparagraph (A), rules similar to the rules of subparagraph (E) of section 408A(d)(3) shall apply.</text></subparagraph></paragraph>
<paragraph id="H55503E5A881147F29C8035B100EEC91D"><enum>(6)</enum><header>Special rules</header>
<subparagraph id="HF8B8DDE473764158009D509B7D31F634"><enum>(A)</enum><header>Exemption of distributions from trustee to trustee transfer and withholding rules</header><text>For purposes of sections 401(a)(31), 402(f), and 3405, qualified hurricane distributions shall not be treated as eligible rollover distributions.</text></subparagraph>
<subparagraph id="H309FA7EC08EF493AB4F1004B17B4FB9"><enum>(B)</enum><header>Qualified hurricane distributions treated as meeting plan distribution requirements</header><text>For purposes this title, a qualified hurricane distribution shall be treated as meeting the requirements of sections 401(k)(2)(B)(i), 403(b)(7)(A)(ii), 403(b)(11), and 457(d)(1)(A).</text></subparagraph></paragraph></subsection>
<subsection id="HF12ABE66A3BD4C1584422B1B77A1CEC9" display-inline="no-display-inline"><enum>(b)</enum><header>Recontributions of withdrawals for home purchases</header>
<paragraph id="HC129A1B1E62449A1B505C15CD2BAE448"><enum>(1)</enum><header>Recontributions</header>
<subparagraph id="HDF9D4895969A43AFB392C66470845800"><enum>(A)</enum><header>In general</header><text>Any individual who received a qualified distribution may, during the applicable period, make one or more contributions in an aggregate amount not to exceed the amount of such qualified distribution to an eligible retirement plan (as defined in section 402(c)(8)(B)) of which such individual is a beneficiary and to which a rollover contribution of such distribution could be made under section 402(c), 403(a)(4), 403(b)(8), or 408(d)(3), as the case may be.</text></subparagraph>
<subparagraph id="H414000E3AC2C40F79035E49FC5D9D8D"><enum>(B)</enum><header>Treatment of repayments</header><text>Rules similar to the rules of subparagraphs (B) and (C) of subsection (a)(3) shall apply for purposes of this subsection.</text></subparagraph></paragraph>
<paragraph id="H6B26699F0FA043F79F4DCF89CFB6E1EE" display-inline="no-display-inline"><enum>(2)</enum><header>Qualified distribution</header><text>For purposes of this subsection—</text>
<subparagraph id="H81AE7E7B3C7B48FC8735AB02CE61A404"><enum>(A)</enum><header>In general</header><text>The term <term>qualified distribution</term> means any qualified Katrina distribution, any qualified Rita distribution, and any qualified Wilma distribution.</text></subparagraph>
<subparagraph id="H236CABBA64D34415959B228F1F2E2E29"><enum>(B)</enum><header>Qualified Katrina distribution</header><text>The term <term>qualified Katrina distribution</term> means any distribution—</text>
<clause id="HC18EB44292F84DBB89CC42B7FC54F004" display-inline="no-display-inline"><enum>(i)</enum><text>described in section 401(k)(2)(B)(i)(IV), 403(b)(7)(A)(ii) (but only to the extent such distribution relates to financial hardship), 403(b)(11)(B), or 72(t)(2)(F),</text></clause>
<clause id="HFAFFB6B4AC8644D7A2CBD909730018FC"><enum>(ii)</enum><text>received after February 28, 2005, and before August 29, 2005, and</text></clause>
<clause id="H12EAD8595E92472E94D310343E33ED7B"><enum>(iii)</enum><text>which was to be used to purchase or construct a principal residence in the Hurricane Katrina disaster area, but which was not so purchased or constructed on account of Hurricane Katrina.</text></clause></subparagraph>
<subparagraph id="H968E1F47B6284D9C9EE2D8CC971E73E1"><enum>(C)</enum><header>Qualified Rita distribution</header><text>The term <term>qualified Rita distribution</term> means any distribution (other than a qualified Katrina distribution)—</text>
<clause id="H78AA8B34F8F8486F8EE5C6888201600"><enum>(i)</enum><text>described in section 401(k)(2)(B)(i)(IV), 403(b)(7)(A)(ii) (but only to the extent such distribution relates to financial hardship), 403(b)(11)(B), or 72(t)(2)(F),</text></clause>
<clause id="HCEFAC2A26DBF4CA4B9E459E8D69EF585"><enum>(ii)</enum><text>received after February 28, 2005, and before September 24, 2005, and</text></clause>
<clause id="H877848967FBE41DFADA450694940B871"><enum>(iii)</enum><text>which was to be used to purchase or construct a principal residence in the Hurricane Rita disaster area, but which was not so purchased or constructed on account of Hurricane Rita.</text></clause></subparagraph>
<subparagraph id="H609253D35F0741EB9141CB62012B36B1" display-inline="no-display-inline"><enum>(D)</enum><header>Qualified Wilma distribution</header><text>The term <term>qualified Wilma distribution</term> means any distribution (other than a qualified Katrina distribution or a qualified Rita distribution)—</text>
<clause id="H71C500341CD546D398593F3317D0C246"><enum>(i)</enum><text>described in section 401(k)(2)(B)(i)(IV), 403(b)(7)(A)(ii) (but only to the extent such distribution relates to financial hardship), 403(b)(11)(B), or 72(t)(2)(F),</text></clause>
<clause id="HF1B98CF1BC5E41BF80205F5EEDE2F7D5"><enum>(ii)</enum><text>received after February 28, 2005, and before October 24, 2005, and</text></clause>
<clause id="H11B82D08FD7C4EE4AA00303DD5DAD611"><enum>(iii)</enum><text>which was to be used to purchase or construct a principal residence in the Hurricane Wilma disaster area, but which was not so purchased or constructed on account of Hurricane Wilma.</text></clause></subparagraph></paragraph>
<paragraph id="HBF0E06D862FB401A96B4906F5FA0F8B"><enum>(3)</enum><header>Applicable period</header><text>For purposes of this subsection, the term <term>applicable period</term> means—</text>
<subparagraph id="H6C532BA53E174E41917FFA83F52D4884"><enum>(A)</enum><text>with respect to any qualified Katrina distribution, the period beginning on August 25, 2005, and ending on February 28, 2006, </text></subparagraph>
<subparagraph id="HA2F85AEF81864C799842C7D28C9B63E8"><enum>(B)</enum><text display-inline="yes-display-inline">with respect to any qualified Rita distribution, the period beginning on September 23, 2005, and ending on February 28, 2006, and</text></subparagraph>
<subparagraph id="HCAD1478CB9FD4FFEA0AD2E624551C045"><enum>(C)</enum><text display-inline="yes-display-inline">with respect to any qualified Wilma distribution, the period beginning on October 23, 2005, and ending on February 28, 2006.</text></subparagraph></paragraph></subsection>
<subsection id="H700FB2F7973C4C9E98B9A404A292BDED" display-inline="no-display-inline"><enum>(c)</enum><header>Loans from qualified plans</header>
<paragraph id="H19CA7AEF5586471DAD0451CD7D4F36F"><enum>(1)</enum><header>Increase in limit on loans not treated as distributions</header><text>In the case of any loan from a qualified employer plan (as defined under section 72(p)(4)) to a qualified individual made during the applicable period—</text>
<subparagraph id="H5B0DAC8B544541CEA5F21E609280C437"><enum>(A)</enum><text>clause (i) of section 72(p)(2)(A) shall be applied by substituting <quote>$100,000</quote> for <quote>$50,000</quote>, and</text></subparagraph>
<subparagraph id="H535D9C03DCA945ECAFFDE5BA8585DA64"><enum>(B)</enum><text>clause (ii) of such section shall be applied by substituting <quote>the present value of the nonforfeitable accrued benefit of the employee under the plan</quote> for <quote>one-half of the present value of the nonforfeitable accrued benefit of the employee under the plan</quote>.</text></subparagraph></paragraph>
<paragraph id="HE3BD6B1C35FC4EAFB56C94DF41003E15"><enum>(2)</enum><header>Delay of repayment</header><text>In the case of a qualified individual with an outstanding loan on or after the qualified beginning date from a qualified employer plan (as defined in section 72(p)(4))—</text>
<subparagraph id="H27F3B220F55B40A0BF50E6C294FC7C8"><enum>(A)</enum><text>if the due date pursuant to subparagraph (B) or (C) of section 72(p)(2) for any repayment with respect to such loan occurs during the period beginning on the qualified beginning date and ending on December 31, 2006, such due date shall be delayed for 1 year,</text></subparagraph>
<subparagraph id="HD031CB89235D4238B6577F49B2DC29E8"><enum>(B)</enum><text>any subsequent repayments with respect to any such loan shall be appropriately adjusted to reflect the delay in the due date under paragraph (1) and any interest accruing during such delay, and</text></subparagraph>
<subparagraph id="H94CCD88F2DE44175BB191161F262E34"><enum>(C)</enum><text>in determining the 5-year period and the term of a loan under subparagraph (B) or (C) of section 72(p)(2), the period described in subparagraph (A) shall be disregarded.</text></subparagraph></paragraph>
<paragraph id="H120071B695F24A0D81A9173CBE2EEDD"><enum>(3)</enum><header>Qualified individual</header><text display-inline="yes-display-inline">For purposes of this subsection—</text>
<subparagraph id="H4CD04547E63B48CA9BB5E24C0369F559"><enum>(A)</enum><header>In general</header><text>The term <term>qualified individual</term> means any qualified Hurricane Katrina individual, any qualified Hurricane Rita individual, and any qualified Hurricane Wilma individual.</text></subparagraph>
<subparagraph id="HB653D9974A75441FB462D2D393084CA3"><enum>(B)</enum><header>Qualified Hurricane Katrina individual</header><text>The term <term>qualified Hurricane Katrina individual</term> means an individual whose principal place of abode on August 28, 2005, is located in the Hurricane Katrina disaster area and who has sustained an economic loss by reason of Hurricane Katrina.</text></subparagraph>
<subparagraph id="HAA21D847160F49B5B300DD2FC0BE7F93"><enum>(C)</enum><header>Qualified Hurricane Rita individual</header><text>The term <term>qualified Hurricane Rita individual</term> means an individual (other than a qualified Hurricane Katrina individual) whose principal place of abode on September 23, 2005, is located in the Hurricane Rita disaster area and who has sustained an economic loss by reason of Hurricane Rita.</text></subparagraph>
<subparagraph id="HAC9EFB6AF5FF4E74A96BD28E5E273D33"><enum>(D)</enum><header>Qualified Hurricane Wilma individual</header><text>The term <term>qualified Hurricane Wilma individual</term> means an individual (other than a qualified Hurricane Katrina individual or a qualified Hurricane Rita individual) whose principal place of abode on October 23, 2005, is located in the Hurricane Wilma disaster area and who has sustained an economic loss by reason of Hurricane Wilma.</text></subparagraph></paragraph>
<paragraph id="H7D6605AA79E14FA6A79B664E82DE4BB6"><enum>(4)</enum><header>Applicable period; qualified beginning date</header><text>For purposes of this subsection—</text>
<subparagraph id="H0A453BE912F743CD9564FBF98BABE0DB" display-inline="no-display-inline"><enum>(A)</enum><header>Hurricane Katrina</header><text>In the case of any qualified Hurricane Katrina individual—</text>
<clause id="H8D2E5EE533B644A1B7E269E025007CD5"><enum>(i)</enum><text>the applicable period is the period beginning on September 24, 2005, and ending on December 31, 2006, and</text></clause>
<clause id="HDB60288C29794DE28919026084A326E5"><enum>(ii)</enum><text>the qualified beginning date is August 25, 2005.</text></clause></subparagraph>
<subparagraph id="HF3EDCB56FC994AA3AD005B7500004EF8"><enum>(B)</enum><header>Hurricane Rita</header><text>In the case of any qualified Hurricane Rita individual—</text>
<clause id="H2C9EDBEB1F7542E381C86DFC2ED2029"><enum>(i)</enum><text>the applicable period is the period beginning on the date of the enactment of this subsection and ending on December 31, 2006, and</text></clause>
<clause id="HB14CAA92AC0D4C098872E7CFB17D7FF9"><enum>(ii)</enum><text>the qualified beginning date is September 23, 2005.</text></clause></subparagraph>
<subparagraph id="HAC77E295AB1F461AA9F2E993F6D7E3C1" display-inline="no-display-inline"><enum>(C)</enum><header>Hurricane Wilma</header><text>In the case of any qualified Hurricane Wilma individual—</text>
<clause id="H88D521B537B04634833709DE0A678A7"><enum>(i)</enum><text>the applicable period is the period beginning on the date of the enactment of this subparagraph and ending on December 31, 2006, and</text></clause>
<clause id="HB7D2B21279824F2800AAE9BD91E73B00"><enum>(ii)</enum><text>the qualified beginning date is October 23, 2005.</text></clause></subparagraph></paragraph></subsection>
<subsection id="H7A993880C5F84D0CB93BFFCFE0EEB0B6" display-inline="no-display-inline"><enum>(d)</enum><header>Provisions relating to plan amendments</header><text></text>
<paragraph id="H94E512A90C4A46619D620042BA982004"><enum>(1)</enum><header>In general</header><text>If this subsection applies to any amendment to any plan or annuity contract, such plan or contract shall be treated as being operated in accordance with the terms of the plan during the period described in paragraph (2)(B)(i).</text></paragraph>
<paragraph id="H765F298BF9994B5AA5A2629B9F318E3C"><enum>(2)</enum><header>Amendments to which subsection applies</header>
<subparagraph id="HD138CA30D6A7487E00DC9B6669E40114"><enum>(A)</enum><header>In general</header><text>This subsection shall apply to any amendment to any plan or annuity contract which is made—</text>
<clause id="HEFA25662D75D4B5C8DE0E4FAD124401"><enum>(i)</enum><text>pursuant to any provision of this section, or pursuant to any regulation issued by the Secretary or the Secretary of Labor under any provision of this section, and</text></clause>
<clause id="H3A1528310E6940F5A91C1762522DAC1B"><enum>(ii)</enum><text>on or before the last day of the first plan year beginning on or after January 1, 2007, or such later date as the Secretary may prescribe.</text></clause><continuation-text continuation-text-level="subparagraph">In the case of a governmental plan (as defined in section 414(d)), clause (ii) shall be applied by substituting the date which is 2 years after the date otherwise applied under clause (ii).</continuation-text></subparagraph>
<subparagraph id="H80436B472C9940C89EF96F5570E66838"><enum>(B)</enum><header>Conditions</header><text>This subsection shall not apply to any amendment unless—</text>
<clause id="H010D4CDFAE6048F585A3CE36781637C8"><enum>(i)</enum><text>during the period—</text>
<subclause id="H46751DC51B354B8083202F3800050050"><enum>(I)</enum><text>beginning on the date that this section or the regulation described in subparagraph (A)(i) takes effect (or in the case of a plan or contract amendment not required by this section or such regulation, the effective date specified by the plan), and</text></subclause>
<subclause id="H9FFA639BC4EC4289AD1EEC5C5CEF1100"><enum>(II)</enum><text>ending on the date described in subparagraph (A)(ii) (or, if earlier, the date the plan or contract amendment is adopted),</text></subclause><continuation-text continuation-text-level="clause">the plan or contract is operated as if such plan or contract amendment were in effect; and</continuation-text></clause>
<clause id="H9F2392DC67B74268A926BD704ED778F6"><enum>(ii)</enum><text>such plan or contract amendment applies retroactively for such period.</text></clause></subparagraph></paragraph></subsection></section>
<section id="HEDDA88B41D7441138090D22788FAC430"><enum>1400P.</enum><header>Employment relief</header>
<subsection id="HB8BD9968A5AA48C6A429EDE222A5D0C4" display-inline="no-display-inline"><enum>(a)</enum><header>Employee retention credit for employers affected by Hurricane Katrina</header><text></text>
<paragraph id="H380F42368EE04FC99083C9E3992027FD"><enum>(1)</enum><header>In general</header><text>For purposes of section 38, in the case of an eligible employer, the Hurricane Katrina employee retention credit for any taxable year is an amount equal to 40 percent of the qualified wages with respect to each eligible employee of such employer for such taxable year. For purposes of the preceding sentence, the amount of qualified wages which may be taken into account with respect to any individual shall not exceed $6,000.</text></paragraph>
<paragraph id="H4880F795DB944FB99DB400A9CCAA3F97"><enum>(2)</enum><header>Definitions</header><text>For purposes of this subsection—</text>
<subparagraph id="H4F921DE497F54FFD81007F0001F39308"><enum>(A)</enum><header>Eligible employer</header><text>The term <term>eligible employer</term> means any employer—</text>
<clause id="HC9A2BFE70F4B4BAD98674862AC1B1036"><enum>(i)</enum><text>which conducted an active trade or business on August 28, 2005, in the GO Zone, and</text></clause>
<clause id="H6734F1EE6BB04B3CA26200843F1F5529"><enum>(ii)</enum><text>with respect to whom the trade or business described in clause (i) is inoperable on any day after August 28, 2005, and before January 1, 2006, as a result of damage sustained by reason of Hurricane Katrina.</text></clause></subparagraph>
<subparagraph id="H6DF6A07CA9804B029B2FFC30AF4FE073"><enum>(B)</enum><header>Eligible employee</header><text>The term <term>eligible employee</term> means with respect to an eligible employer an employee whose principal place of employment on August 28, 2005, with such eligible employer was in the GO Zone.</text></subparagraph>
<subparagraph id="H3F7C1EFE55CA4BEABB3C2CE0AD00A049"><enum>(C)</enum><header>Qualified wages</header><text>The term <term>qualified wages</term> means wages (as defined in section 51(c)(1), but without regard to section 3306(b)(2)(B)) paid or incurred by an eligible employer with respect to an eligible employee on any day after August 28, 2005, and before January 1, 2006, which occurs during the period—</text>
<clause id="H799EC53E896A4B1E859522F3642CBCC8"><enum>(i)</enum><text>beginning on the date on which the trade or business described in subparagraph (A) first became inoperable at the principal place of employment of the employee immediately before Hurricane Katrina, and</text></clause>
<clause id="H689DB8A1B4334FF5BEC8DB91BCD88C9"><enum>(ii)</enum><text>ending on the date on which such trade or business has resumed significant operations at such principal place of employment.</text></clause><continuation-text continuation-text-level="subparagraph">Such term shall include wages paid without regard to whether the employee performs no services, performs services at a different place of employment than such principal place of employment, or performs services at such principal place of employment before significant operations have resumed.</continuation-text></subparagraph></paragraph>
<paragraph id="H35E89A4CEC6E4FEFA35CD53700D4A7C7"><enum>(3)</enum><header>Credit not allowed for large businesses</header><text>The term <term>eligible employer</term> shall not include any trade or business for any taxable year if such trade or business employed an average of more than 200 employees on business days during the taxable year.</text></paragraph>
<paragraph id="H7E31DE3AF918470400A241DE1C00A29B"><enum>(4)</enum><header>Certain rules to apply</header><text>For purposes of this subsection, rules similar to the rules of sections 51(i)(1), 52, and 280C(a) shall apply.</text></paragraph>
<paragraph id="HB67F8257A9F84BC89BFB3B923BD27F25"><enum>(5)</enum><header>Employee not taken into account more than once</header><text>An employee shall not be treated as an eligible employee for purposes of this subsection for any period with respect to any employer if such employer is allowed a credit under section 51 with respect to such employee for such period.</text></paragraph></subsection>
<subsection id="H48103863F8F340F19C54918EB2C4AB08" display-inline="no-display-inline"><enum>(b)</enum><header>Employee retention credit for employers affected by Hurricane Rita</header><text></text>
<paragraph id="H9F793F71EDEF43B19CABD72523FB3534"><enum>(1)</enum><header>In general</header><text>For purposes of section 38, in the case of an eligible employer, the Hurricane Rita employee retention credit for any taxable year is an amount equal to 40 percent of the qualified wages with respect to each eligible employee of such employer for such taxable year. For purposes of the preceding sentence, the amount of qualified wages which may be taken into account with respect to any individual shall not exceed $6,000.</text></paragraph>
<paragraph id="H962F33E02A3548AA9B9C30EFA5E9CCCA"><enum>(2)</enum><header>Definitions</header><text>For purposes of this subsection—</text>
<subparagraph id="H75FE354CB3F447E793432C6F20E5AB9F"><enum>(A)</enum><header>Eligible employer</header><text>The term <term>eligible employer</term> means any employer—</text>
<clause id="H283CB05BA49A4227897FB3E467509CD0"><enum>(i)</enum><text>which conducted an active trade or business on September 23, 2005, in the Rita GO Zone, and</text></clause>
<clause id="H116A948D010542A7A729B5514E4100EB"><enum>(ii)</enum><text>with respect to whom the trade or business described in clause (i) is inoperable on any day after September 23, 2005, and before January 1, 2006, as a result of damage sustained by reason of Hurricane Rita.</text></clause></subparagraph>
<subparagraph id="H4706F7F8922F47BE9254FA1D25EBBFC1"><enum>(B)</enum><header>Eligible employee</header><text>The term <term>eligible employee</term> means with respect to an eligible employer an employee whose principal place of employment on September 23, 2005, with such eligible employer was in the Rita GO Zone.</text></subparagraph>
<subparagraph id="H6C3A4E123A194DC10025B76ED4252D9C"><enum>(C)</enum><header>Qualified wages</header><text>The term <term>qualified wages</term> means wages (as defined in section 51(c)(1), but without regard to section 3306(b)(2)(B)) paid or incurred by an eligible employer with respect to an eligible employee on any day after September 23, 2005, and before January 1, 2006, which occurs during the period—</text>
<clause id="HBEE4BC0C8E004EA49C58DF8C62EEA57E"><enum>(i)</enum><text>beginning on the date on which the trade or business described in subparagraph (A) first became inoperable at the principal place of employment of the employee immediately before Hurricane Rita, and</text></clause>
<clause id="HAD3C0385AEEA4A2988C8EED5D1ABFBEB"><enum>(ii)</enum><text>ending on the date on which such trade or business has resumed significant operations at such principal place of employment.</text></clause><continuation-text continuation-text-level="subparagraph">Such term shall include wages paid without regard to whether the employee performs no services, performs services at a different place of employment than such principal place of employment, or performs services at such principal place of employment before significant operations have resumed.</continuation-text></subparagraph></paragraph>
<paragraph id="H4A02958F1DB94B34B4F959AB5454CC48"><enum>(3)</enum><header>Credit not allowed for large businesses</header><text>The term <term>eligible employer</term> shall not include any trade or business for any taxable year if such trade or business employed an average of more than 200 employees on business days during the taxable year.</text></paragraph>
<paragraph id="HC250952AAD07498581C4B2CE18E1A65D"><enum>(4)</enum><header>Certain rules to apply</header><text>For purposes of this subsection, rules similar to the rules of sections 51(i)(1), 52, and 280C(a) shall apply.</text></paragraph>
<paragraph id="HDA66F53DFB214C409BDFA63FA03BE2BE"><enum>(5)</enum><header>Employee not taken into account more than once</header><text>An employee shall not be treated as an eligible employee for purposes of this subsection for any period with respect to any employer if such employer is allowed a credit under subsection (a) or section 51 with respect to such employee for such period.</text></paragraph></subsection>
<subsection id="H447A058FE25E426D9DF5001DC8B233CA" display-inline="no-display-inline"><enum>(c)</enum><header>Employee retention credit for employers affected by Hurricane Wilma</header><text></text>
<paragraph id="HB2EC941BC71A4DD0BC5DC6A41B3C7457"><enum>(1)</enum><header>In general</header><text>For purposes of section 38, in the case of an eligible employer, the Hurricane Wilma employee retention credit for any taxable year is an amount equal to 40 percent of the qualified wages with respect to each eligible employee of such employer for such taxable year. For purposes of the preceding sentence, the amount of qualified wages which may be taken into account with respect to any individual shall not exceed $6,000.</text></paragraph>
<paragraph id="HAA03DB1CF76447CEBAAB80FA78BFF75"><enum>(2)</enum><header>Definitions</header><text>For purposes of this subsection—</text>
<subparagraph id="H3756CE33934E40369269594150908E6E"><enum>(A)</enum><header>Eligible employer</header><text>The term <term>eligible employer</term> means any employer—</text>
<clause id="H31A1158D7EEF47CFB0A3B8206D3259"><enum>(i)</enum><text>which conducted an active trade or business on October 23, 2005, in the Wilma GO Zone, and</text></clause>
<clause id="H82D968CB9B034F859DA6357F6092D662"><enum>(ii)</enum><text>with respect to whom the trade or business described in clause (i) is inoperable on any day after October 23, 2005, and before January 1, 2006, as a result of damage sustained by reason of Hurricane Wilma.</text></clause></subparagraph>
<subparagraph id="HDD421CF7E4D84159BAB7CAD502C013E8"><enum>(B)</enum><header>Eligible employee</header><text>The term <term>eligible employee</term> means with respect to an eligible employer an employee whose principal place of employment on October 23, 2005, with such eligible employer was in the Wilma GO Zone.</text></subparagraph>
<subparagraph id="HB566A419522B487D8D63C46CB808A207"><enum>(C)</enum><header>Qualified wages</header><text>The term <term>qualified wages</term> means wages (as defined in section 51(c)(1), but without regard to section 3306(b)(2)(B)) paid or incurred by an eligible employer with respect to an eligible employee on any day after October 23, 2005, and before January 1, 2006, which occurs during the period—</text>
<clause id="H687378E56B964355B22506CAAD7042C3"><enum>(i)</enum><text>beginning on the date on which the trade or business described in subparagraph (A) first became inoperable at the principal place of employment of the employee immediately before Hurricane Wilma, and</text></clause>
<clause id="H088AAE7808BB47A29FF3E128C595A1FD"><enum>(ii)</enum><text>ending on the date on which such trade or business has resumed significant operations at such principal place of employment.</text></clause><continuation-text continuation-text-level="subparagraph">Such term shall include wages paid without regard to whether the employee performs no services, performs services at a different place of employment than such principal place of employment, or performs services at such principal place of employment before significant operations have resumed.</continuation-text></subparagraph></paragraph>
<paragraph id="H56305210217F47FC82E08590AD8E3EE"><enum>(3)</enum><header>Credit not allowed for large businesses</header><text>The term <term>eligible employer</term> shall not include any trade or business for any taxable year if such trade or business employed an average of more than 200 employees on business days during the taxable year.</text></paragraph>
<paragraph id="HD974E6346B6847E6891B14D6FAAF1C00"><enum>(4)</enum><header>Certain rules to apply</header><text>For purposes of this subsection, rules similar to the rules of sections 51(i)(1), 52, and 280C(a) shall apply.</text></paragraph>
<paragraph id="H830ECBE4F9C04F7CB6ADFA1302471A9"><enum>(5)</enum><header>Employee not taken into account more than once</header><text>An employee shall not be treated as an eligible employee for purposes of this subsection for any period with respect to any employer if such employer is allowed a credit under subsection (a) or (b) or section 51 with respect to such employee for such period.</text></paragraph></subsection></section>
<section id="H12B9B5627A8748F992304B2F76F6F305"><enum>1400Q.</enum><header>Additional tax relief provisions</header>
<subsection id="HBFDD53B674D048439E0000005E860013" display-inline="no-display-inline"><enum>(a)</enum><header>Temporary suspension of limitations on charitable contributions</header><text></text>
<paragraph id="H9244B1C818954D35A83F62E71F00C38E"><enum>(1)</enum><header>In general</header><text>Except as otherwise provided in paragraph (2), section 170(b) shall not apply to qualified contributions and such contributions shall not be taken into account for purposes of applying subsections (b) and (d) of section 170 to other contributions.</text></paragraph>
<paragraph id="H391CA54A69CA42D29BC96DE97D7941EE"><enum>(2)</enum><header>Treatment of excess contributions</header><text>For purposes of section 170—</text>
<subparagraph id="HDE0D989B24BC4385BCDDD2FAC5CACE08"><enum>(A)</enum><header>Individuals</header><text>In the case of an individual—</text>
<clause id="H620151B672524CEEA03BD1A6622F36DA"><enum>(i)</enum><header>Limitation</header><text>Any qualified contribution shall be allowed only to the extent that the aggregate of such contributions does not exceed the excess of the taxpayer’s contribution base (as defined in subparagraph (F) of section 170(b)(1)) over the amount of all other charitable contributions allowed under section 170(b)(1).</text></clause>
<clause id="H6C794B760BCD477F902CBDD99E6F00F2"><enum>(ii)</enum><header>Carryover</header><text>If the aggregate amount of qualified contributions made in the contribution year (within the meaning of section 170(d)(1)) exceeds the limitation of clause (i), such excess shall be added to the excess described in the portion of subparagraph (A) of such section which precedes clause (i) thereof for purposes of applying such section.</text></clause></subparagraph>
<subparagraph id="H5A064754686B4076B5764F64AC88EC7D"><enum>(B)</enum><header>Corporations</header><text>In the case of a corporation—</text>
<clause id="H0E2271F04D664514B0B5D81237144900"><enum>(i)</enum><header>Limitation</header><text>Any qualified contribution shall be allowed only to the extent that the aggregate of such contributions does not exceed the excess of the taxpayer’s taxable income (as determined under paragraph (2) of section 170(b)) over the amount of all other charitable contributions allowed under such paragraph.</text></clause>
<clause id="H7566D0FDB0E6469386F428DC4704B85F"><enum>(ii)</enum><header>Carryover</header><text>Rules similar to the rules of subparagraph (A)(ii) shall apply for purposes of this subparagraph.</text></clause></subparagraph></paragraph>
<paragraph id="H02DB3B2E34F14ED79DA4B72FD3B600AE"><enum>(3)</enum><header>Exception to overall limitation on itemized deductions</header><text>So much of any deduction allowed under section 170 as does not exceed the qualified contributions paid during the taxable year shall not be treated as an itemized deduction for purposes of section 68.</text></paragraph>
<paragraph id="H4FDF5BEA93BC46768C255675D8FEA8E6"><enum>(4)</enum><header>Qualified contributions</header>
<subparagraph id="HCD70F9A52FB44A8BAD6BD22884A9901F"><enum>(A)</enum><header>In general</header><text>For purposes of this subsection, the term <term>qualified contribution</term> means any charitable contribution (as defined in section 170(c)) if—</text>
<clause id="HB412E56909474B838B242E558F66CBB9"><enum>(i)</enum><text>such contribution is paid during the period beginning on August 28, 2005, and ending on December 31, 2005, in cash to an organization described in section 170(b)(1)(A) (other than an organization described in section 509(a)(3)),</text></clause>
<clause id="HE3EBCC0D76B9452ABE00E868F22BDA0"><enum>(ii)</enum><text>in the case of a contribution paid by a corporation, such contribution is for relief efforts related to Hurricane Katrina, Hurricane Rita, or Hurricane Wilma, and</text></clause>
<clause id="H41453DB5F5194ABD8489C24D57D8CF2D"><enum>(iii)</enum><text>the taxpayer has elected the application of this subsection with respect to such contribution.</text></clause></subparagraph>
<subparagraph id="HAFF4684CDD34409BABE1B91B19167400"><enum>(B)</enum><header>Exception</header><text>Such term shall not include a contribution if the contribution is for establishment of a new, or maintenance in an existing, segregated fund or account with respect to which the donor (or any person appointed or designated by such donor) has, or reasonably expects to have, advisory privileges with respect to distributions or investments by reason of the donor’s status as a donor.</text></subparagraph>
<subparagraph id="H8A2D4E8566BD44CAA56D71BE056466C4"><enum>(C)</enum><header>Application of election to partnerships and S corporations</header><text>In the case of a partnership or S corporation, the election under subparagraph (A)(iii) shall be made separately by each partner or shareholder.</text></subparagraph></paragraph></subsection>
<subsection id="H1EA5B9E0B5B048B2A28861EF00B0F729" display-inline="no-display-inline"><enum>(b)</enum><header>Suspension of certain limitations on personal casualty losses</header><text>Paragraphs (1) and (2)(A) of section 165(h) shall not apply to losses described in section 165(c)(3)—</text>
<paragraph id="H24F7AA46471E45F900377EE75719C01D"><enum>(1)</enum><text>which arise in the Hurricane Katrina disaster area on or after August 25, 2005, and which are attributable to Hurricane Katrina,</text></paragraph>
<paragraph id="H9108DE8471A94F2192988306DC384993"><enum>(2)</enum><text display-inline="yes-display-inline">which arise in the Hurricane Rita disaster area on or after September 23, 2005, and which are attributable to Hurricane Rita, or</text></paragraph>
<paragraph id="H1C93583B660B4392807179BC47D64484"><enum>(3)</enum><text>which arise in the Hurricane Wilma disaster area on or after October 23, 2005, and which are attributable to Hurricane Wilma. </text></paragraph><continuation-text continuation-text-level="subsection">In the case of any other losses, section 165(h)(2)(A) shall be applied without regard to the losses referred to in the preceding sentence.</continuation-text></subsection>
<subsection id="H1CE1C398017C41BFAACF52AA9BEBE4E0" display-inline="no-display-inline"><enum>(c)</enum><header>Required exercise of authority under section 7508A</header><text>In the case of any taxpayer determined by the Secretary to be affected by the Presidentially declared disaster relating to Hurricane Katrina, Hurricane Rita, or Hurricane Wilma, any relief provided by the Secretary under section 7508A shall be for a period ending not earlier than February 28, 2006.</text></subsection>
<subsection id="H79C659A9632C4513A5D17475458BD2F8" display-inline="no-display-inline"><enum>(d)</enum><header>Special rule for determining earned income</header><text></text>
<paragraph id="H1F241212985641149E2EE63EB7D1DDBE"><enum>(1)</enum><header>In general</header><text>In the case of a qualified individual, if the earned income of the taxpayer for the taxable year which includes the applicable date is less than the earned income of the taxpayer for the preceding taxable year, the credits allowed under sections 24(d) and 32 may, at the election of the taxpayer, be determined by substituting—</text>
<subparagraph id="H74983D136DA3458FB3AFC5477D0743A5"><enum>(A)</enum><text>such earned income for the preceding taxable year, for</text></subparagraph>
<subparagraph id="H061ED984AA674A9D86D2B56758A66847"><enum>(B)</enum><text>such earned income for the taxable year which includes the applicable date.</text></subparagraph></paragraph>
<paragraph id="H0F6AD13BC29048AE9251FDAAD92A7BE"><enum>(2)</enum><header>Qualified individual</header><text>For purposes of this subsection—</text>
<subparagraph id="H4F9DA2ACD3C042F1BB852ED0872CB2B5"><enum>(A)</enum><header>In general</header><text>The term <term>qualified individual</term> means any qualified Hurricane Katrina individual, any qualified Hurricane Rita individual, and any qualified Hurricane Wilma individual.</text></subparagraph>
<subparagraph id="H1BFB262A55B9408CA9698661D5A6D48D"><enum>(B)</enum><header>Qualified Hurricane Katrina individual</header><text>The term <term>qualified Hurricane Katrina individual</term> means any individual whose principal place of abode on August 25, 2005, was located—</text>
<clause id="HDFC0BEB757E047F2A1BCCA4AEC1428D"><enum>(i)</enum><text>in the GO Zone, or</text></clause>
<clause id="H92DAA58AAB6D46CFB8AA963DA2F2D77"><enum>(ii)</enum><text>in the Hurricane Katrina disaster area (but outside the GO Zone) and such individual was displaced from such principal place of abode by reason of Hurricane Katrina.</text></clause></subparagraph>
<subparagraph id="H9D62FAE947B2440FA8AA54C922A63421"><enum>(C)</enum><header>Qualified Hurricane Rita individual</header><text>The term <term>qualified Hurricane Rita individual</term> means any individual (other than a qualified Hurricane Katrina individual) whose principal place of abode on September 23, 2005, was located—</text>
<clause id="HB2DB34AAA18B4803923BA29993835407"><enum>(i)</enum><text>in the Rita GO Zone, or</text></clause>
<clause id="H1B0FDD55D004470488118699FA9CE92E"><enum>(ii)</enum><text>in the Hurricane Rita disaster area (but outside the Rita GO Zone) and such individual was displaced from such principal place of abode by reason of Hurricane Rita.</text></clause></subparagraph>
<subparagraph id="H8D8BE225B16244ECA44C51BFA307EBEF" display-inline="no-display-inline"><enum>(D)</enum><header>Qualified Hurricane Wilma individual</header><text>The term <term>qualified Hurricane Wilma individual</term> means any individual whose principal place of abode on October 23, 2005, was located—</text>
<clause id="H2E0A82B978F44305816600AFB4D27946"><enum>(i)</enum><text>in the Wilma GO Zone, or</text></clause>
<clause id="H878042880ABF4A5397C67189FF8ECCC3"><enum>(ii)</enum><text>in the Hurricane Wilma disaster area (but outside the Wilma GO Zone) and such individual was displaced from such principal place of abode by reason of Hurricane Wilma.</text></clause></subparagraph></paragraph>
<paragraph id="H20785F0A072746A9B6E6F5D55843AE62"><enum>(3)</enum><header>Applicable date</header><text>For purposes of this subsection, the term <term>applicable date</term> means—</text>
<subparagraph id="H55650EAF091640409124B96FC6613420"><enum>(A)</enum><text>in the case of a qualified Hurricane Katrina individual, August 25, 2005,</text></subparagraph>
<subparagraph id="H085CD6CFC0954A10A588F516980000C1"><enum>(B)</enum><text>in the case of a qualified Hurricane Rita individual, September 23, 2005, and</text></subparagraph>
<subparagraph id="H6193819EB47C4A64AB1628C685D6476D"><enum>(C)</enum><text>in the case of a qualified Hurricane Wilma individual, October 23, 2005.</text></subparagraph></paragraph>
<paragraph id="H747DB3E071F447E894C6F5DAA007B51"><enum>(4)</enum><header>Earned income</header><text>For purposes of this subsection, the term <term>earned income</term> has the meaning given such term under section 32(c).</text></paragraph>
<paragraph id="H8E95B78F13904E3C8482D8C2D912759F"><enum>(5)</enum><header>Special rules</header>
<subparagraph id="H057827D4A2B8402B9DB900FAE7864C59"><enum>(A)</enum><header>Application to joint returns</header><text>For purposes of paragraph (1), in the case of a joint return for a taxable year which includes the applicable date—</text>
<clause id="HFF566B391F4342D78CE5F8F094C3BB1"><enum>(i)</enum><text>such paragraph shall apply if either spouse is a qualified individual, and</text></clause>
<clause id="H2A04012A4CA845DBB5134092116F2619"><enum>(ii)</enum><text>the earned income of the taxpayer for the preceding taxable year shall be the sum of the earned income of each spouse for such preceding taxable year.</text></clause></subparagraph>
<subparagraph id="H1162AF6AA6EC4A6AAF4B80B64109B6E1"><enum>(B)</enum><header>Uniform application of election</header><text>Any election made under paragraph (1) shall apply with respect to both section 24(d) and section 32.</text></subparagraph>
<subparagraph id="H0F28979242EB4CEBA0FC1FFB5B4EC158"><enum>(C)</enum><header>Errors treated as mathematical error</header><text>For purposes of section 6213, an incorrect use on a return of earned income pursuant to paragraph (1) shall be treated as a mathematical or clerical error.</text></subparagraph>
<subparagraph id="HD534974FC8D94B0FBE405518B749C353"><enum>(D)</enum><header>No effect on determination of gross income, etc</header><text>Except as otherwise provided in this subsection, this title shall be applied without regard to any substitution under paragraph (1).</text></subparagraph></paragraph></subsection>
<subsection id="HD4EFABA20EB64918812784BFB4646E4F" display-inline="no-display-inline"><enum>(e)</enum><header>Secretarial authority to make adjustments regarding taxpayer and dependency status</header><text>With respect to taxable years beginning in 2005 or 2006, the Secretary may make such adjustments in the application of the internal revenue laws as may be necessary to ensure that taxpayers do not lose any deduction or credit or experience a change of filing status by reason of temporary relocations by reason of Hurricane Katrina, Hurricane Rita, or Hurricane Wilma. Any adjustments made under the preceding sentence shall ensure that an individual is not taken into account by more than one taxpayer with respect to the same tax benefit.</text></subsection></section><after-quoted-block>.</after-quoted-block></quoted-block></subsection>
<subsection id="H5AFDF5161CF74AA4A86BC27E18D1A0CA"><enum>(b)</enum><header>Conforming amendments</header>
<paragraph id="H4957D7B0E2CE4E7F8215209187F46500"><enum>(1)</enum><text>Subsection (b) of <external-xref legal-doc="usc" parsable-cite="usc/26/38">section 38</external-xref> is amended by striking <quote>and</quote> at the end of paragraph (25), by striking the period at the end of paragraph (26) and inserting a comma, and by adding at the end the following new paragraphs:</text>
<quoted-block style="OLC" id="H4E66FB4C02C34E3E9F1D673EDB9F10A8" display-inline="no-display-inline">
<paragraph id="HEFEEBDBDB0B7458FA4F952E344FD690"><enum>(27)</enum><text>the Hurricane Katrina employee retention credit determined under section 1400P(a),</text></paragraph>
<paragraph id="HE70CCB69322941AC9B4736201DAE5789"><enum>(28)</enum><text>the Hurricane Rita employee retention credit determined under section 1400P(b), and</text></paragraph>
<paragraph id="HAFE04CCA0FAB408F911990E16D58A1D1"><enum>(29)</enum><text display-inline="yes-display-inline">the Hurricane Wilma employee retention credit determined under section 1400P(c).</text></paragraph><after-quoted-block>.</after-quoted-block></quoted-block></paragraph>
<paragraph id="HB9BBB4CBA4EC4F8EAAAF4DFD9E920029"><enum>(2)</enum><text>The table of sections for part II of subchapter Y of <external-xref legal-doc="usc-chapter" parsable-cite="usc-chapter/26/1">chapter 1</external-xref> is amended by adding at the end the following new items:</text>
<quoted-block style="OLC" id="H27294C42D0F94F57B3E135635966F712" display-inline="no-display-inline">
<toc container-level="quoted-block-container" quoted-block="no-quoted-block" lowest-level="section" idref="H0E7BF4E279584B8EA52BCC607435A337" regeneration="yes-regeneration" lowest-bolded-level="division-lowest-bolded">
<toc-entry idref="H117D4C9DC9F44A57BA0380EC1E5C2634" level="section">Sec. 1400O. Special rules for use of retirement funds</toc-entry>
<toc-entry idref="HEDDA88B41D7441138090D22788FAC430" level="section">Sec. 1400P. Employment relief</toc-entry>
<toc-entry idref="H12B9B5627A8748F992304B2F76F6F305" level="section">Sec. 1400Q. Additional tax relief provisions</toc-entry></toc><after-quoted-block>.</after-quoted-block></quoted-block></paragraph>
<paragraph id="H18A115DB826E47908369C7BD3DD31516"><enum>(3)</enum><text>The heading for such part is amended by striking <quote><header-in-text level="part" style="OLC">Gulf Opportunity Zone</header-in-text></quote> and inserting <quote><header-in-text level="part" style="OLC">hurricane relief</header-in-text></quote>. </text></paragraph>
<paragraph id="HD2E22817BF6148D3B005F6A276C7EC3"><enum>(4)</enum><text>The following provisions of the Katrina Emergency Tax Relief Act of 2005 are hereby repealed:</text>
<subparagraph id="HBAAF5893D404421F004834ED08759266"><enum>(A)</enum><text>Title I.</text></subparagraph>
<subparagraph id="H63DEEBC3AF86452881C65903F54C6D00"><enum>(B)</enum><text>Sections 202, 301, 402, 403(b), 406, and 407.</text></subparagraph></paragraph></subsection></section>
<enum>III</enum><header>Other provisions</header>
<section id="HB232CD34BE8E427181FC746623243DE0" display-inline="no-display-inline" section-type="subsequent-section"><enum>301.</enum><header>Secretarial authority to extend period during which traveling expenses are treated as incurred away from home in case of major disaster</header>
<subsection id="HE890744B049F4E16B600656B6868A580"><enum>(a)</enum><header>In general</header><text>Section 162 (relating to trade or business expenses) is amended by redesignating subsection (q) as subsection (r) and by inserting after subsection (p) the following new subsection:</text>
<quoted-block style="OLC" id="H7B747E7ABDD54CB7A6C1D8AA93ED78F8" display-inline="no-display-inline">
<subsection id="HF89F45DD5C7D4EAB8B93B762E037A01B"><enum>(q)</enum><header>Limitation on traveling expenses</header>
<paragraph id="HD367509FD9CC4E818E9CF2B49499DB47"><enum>(1)</enum><header>In general</header><text>For purposes of subsection (a)(2), the taxpayer shall not be treated as being temporarily away from home during any period of employment if such period exceeds 1 year.</text></paragraph>
<paragraph id="H2A2221202B9A47DD90007963897CA942"><enum>(2)</enum><header>Authority to extend in case of major disaster</header><text display-inline="yes-display-inline">In the case of a taxpayer who is away from home in pursuit of a trade or business by reason of a disaster which the President has declared to be a major disaster under section 401 of the Robert T. Stafford Disaster Relief and Emergency Assistance Act, the Secretary may extend the 1-year period referred to in paragraph (1) for a period not exceeding 1 additional year.</text></paragraph>
<paragraph id="HC925F4F796354F3DAE2FCD8CEBFCF2AD"><enum>(3)</enum><header>Exception for certain Federal employees designated by the Attorney General</header><text display-inline="yes-display-inline">Paragraph (1) shall not apply to any Federal employee during any period for which such employee is certified by the Attorney General (or the designee thereof) as traveling on behalf of the United States in temporary duty status to investigate or prosecute, or provide support services for the investigation or prosecution of, a Federal crime.</text></paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block></subsection>
<subsection id="H0E2B2A11C7324163B797B163B7FCFAC7"><enum>(b)</enum><header>Conforming amendment</header><text>Subsection (a) of <external-xref legal-doc="usc" parsable-cite="usc/26/162">section 162</external-xref> is amended by striking the last two sentences.</text></subsection>
<subsection id="H47477ABFD07F4DB6B371A004A81914A8"><enum>(c)</enum><header>Effective date</header><text>The amendments made by this section shall apply to amounts paid or incurred after the date of the enactment of this Act.</text></subsection></section>
<section id="HD78A7B2308324E1C8C6FD6F2239B3D7" commented="no" display-inline="no-display-inline" section-type="subsequent-section"><enum>302.</enum><header>Gulf Coast Recovery Bonds</header><text display-inline="no-display-inline">It is the sense of the Congress that the Secretary of the Treasury, or the Secretary’s delegate, should designate one or more series of bonds or certificates (or any portion thereof) issued under <external-xref legal-doc="usc" parsable-cite="usc/31/3105">section 3105</external-xref> of title 31, United States Code, as <quote>Gulf Coast Recovery Bonds</quote> in response to Hurricanes Katrina, Rita, and Wilma.</text></section>
Passed the House of Representatives December 7, 2005.Jeff TrandahlClerk.