[Congressional Bills 110th Congress]
[From the U.S. Government Publishing Office]
[H.R. 6152 Introduced in House (IH)]







110th CONGRESS
  2d Session
                                H. R. 6152

  To stimulate the economy of the United States and provide financial 
          relief to low-income families in the United States.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                              May 22, 2008

 Mr. English of Pennsylvania (for himself and Mr. Gerlach) introduced 
  the following bill; which was referred to the Committee on Ways and 
 Means, and in addition to the Committee on Financial Services, for a 
 period to be subsequently determined by the Speaker, in each case for 
consideration of such provisions as fall within the jurisdiction of the 
                          committee concerned

_______________________________________________________________________

                                 A BILL


 
  To stimulate the economy of the United States and provide financial 
          relief to low-income families in the United States.

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

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Family Relief and 
Economic Stimulus Act''.
    (b) Table of Contents.--The table of contents for this Act is as 
follows:

Sec. 1. Short title; table of contents.
              TITLE I--EMERGENCY UNEMPLOYMENT COMPENSATION

Sec. 101. Federal-State agreements.
Sec. 102. Emergency unemployment compensation account.
Sec. 103. Payments to States having agreements for the payment of 
                            emergency unemployment compensation.
Sec. 104. Financing provisions.
Sec. 105. Fraud and overpayments.
Sec. 106. Definitions.
Sec. 107. Applicability.
                        TITLE II--TAX PROVISIONS

               Subtitle A--Penalty-Free IRA Distributions

Sec. 201. Penalty-free distributions from IRAs to avoid foreclosure on 
                            principal residence.
Sec. 202. Penalty-free distributions from IRAs for expenses during 
                            extended unemployment.
                    Subtitle B--Homeland Investment

Sec. 211. Allowance of deduction for dividends received from controlled 
                            foreign corporations for additional year.
 Subtitle C--Suspension of Highway Fuels Taxes When Summer Blending in 
                                 Effect

Sec. 221. Suspension of highway fuels taxes when summer blending in 
                            effect.
                 Subtitle D--Indexing for Capital Gains

Sec. 231. Indexing of certain assets for purposes of determining gain 
                            or loss.
  TITLE III--EMERGENCY ASSISTANCE FOR REDEVELOPMENT OF ABANDONED AND 
FORECLOSED HOMES AND FOR WEATHERIZATION OF HOMES OF LOW-INCOME FAMILIES

Sec. 301. Direct appropriations.
Sec. 302. Allocation of appropriated amounts.
Sec. 303. Use of funds.
Sec. 304. Limitations.
Sec. 305. Rules of construction.
Sec. 306. Authority to specify alternative requirements.
Sec. 307. Periodic audits.

              TITLE I--EMERGENCY UNEMPLOYMENT COMPENSATION

SEC. 101. FEDERAL-STATE AGREEMENTS.

    (a) In General.--Any State which desires to do so may enter into 
and participate in an agreement under this title with the Secretary of 
Labor (in this title referred to as the ``Secretary''). Any State which 
is a party to an agreement under this title may, upon providing 30 
days' written notice to the Secretary, terminate such agreement.
    (b) Provisions of Agreement.--Any agreement under subsection (a) 
shall provide that the State agency of the State will make payments of 
emergency unemployment compensation to individuals who--
            (1) have exhausted all rights to regular compensation under 
        the State law or under Federal law with respect to a benefit 
        year (excluding any benefit year that ended before May 1, 
        2007);
            (2) have no rights to regular compensation or extended 
        compensation with respect to a week under such law or any other 
        State unemployment compensation law or to compensation under 
        any other Federal law (except as provided under subsection 
        (e)); and
            (3) are not receiving compensation with respect to such 
        week under the unemployment compensation law of Canada.
    (c) Exhaustion of Benefits.--For purposes of subsection (b)(1), an 
individual shall be deemed to have exhausted such individual's rights 
to regular compensation under a State law when--
            (1) no payments of regular compensation can be made under 
        such law because such individual has received all regular 
        compensation available to such individual based on employment 
        or wages during such individual's base period; or
            (2) such individual's rights to such compensation have been 
        terminated by reason of the expiration of the benefit year with 
        respect to which such rights existed.
    (d) Weekly Benefit Amount, etc.--For purposes of any agreement 
under this title--
            (1) the amount of emergency unemployment compensation which 
        shall be payable to any individual for any week of total 
        unemployment shall be equal to the amount of the regular 
        compensation (including dependents' allowances) payable to such 
        individual during such individual's benefit year under the 
        State law for a week of total unemployment;
            (2) the terms and conditions of the State law which apply 
        to claims for regular compensation and to the payment thereof 
        shall apply to claims for emergency unemployment compensation 
        and the payment thereof, except where otherwise inconsistent 
        with the provisions of this title or with the regulations or 
        operating instructions of the Secretary promulgated to carry 
        out this title; and
            (3) the maximum amount of emergency unemployment 
        compensation payable to any individual for whom an emergency 
        unemployment compensation account is established under section 
        102 shall not exceed the amount established in such account for 
        such individual.
    (e) Election by States.--Notwithstanding any other provision of 
Federal law (and if State law permits), the Governor of a State that is 
in an extended benefit period may provide for the payment of emergency 
unemployment compensation prior to extended compensation to individuals 
who otherwise meet the requirements of this section.

SEC. 102. EMERGENCY UNEMPLOYMENT COMPENSATION ACCOUNT.

    (a) In General.--Any agreement under this title shall provide that 
the State will establish, for each eligible individual who files an 
application for emergency unemployment compensation, an emergency 
unemployment compensation account with respect to such individual's 
benefit year.
    (b) Amount in Account.--
            (1) In general.--The amount established in an account under 
        subsection (a) shall be equal to the lesser of--
                    (A) 50 percent of the total amount of regular 
                compensation (including dependents' allowances) payable 
                to the individual during the individual's benefit year 
                under such law, or
                    (B) 13 times the individual's average weekly 
                benefit amount for the benefit year.
            (2) Weekly benefit amount.--For purposes of this 
        subsection, an individual's weekly benefit amount for any week 
        is the amount of regular compensation (including dependents' 
        allowances) under the State law payable to such individual for 
        such week for total unemployment.
    (c) Special Rule.--
            (1) In general.--Notwithstanding any other provision of 
        this section, if, at the time that the individual's account is 
        exhausted or at any time thereafter, such individual's State is 
        in an extended benefit period (as determined under paragraph 
        (2)), then, such account shall be augmented by an amount equal 
        to the amount originally established in such account (as 
        determined under subsection (b)(1)).
            (2) Extended benefit period.--For purposes of paragraph 
        (1), a State shall be considered to be in an extended benefit 
        period, as of any given time, if--
                    (A) such a period is then in effect for such State 
                under the Federal-State Extended Unemployment 
                Compensation Act of 1970;
                    (B) such a period would then be in effect for such 
                State under such Act if section 203(d) of such Act--
                            (i) were applied by substituting ``4'' for 
                        ``5'' each place it appears; and
                            (ii) did not include the requirement under 
                        paragraph (1)(A); or
                    (C) such a period would then be in effect for such 
                State under such Act if--
                            (i) section 203(f) of such Act were applied 
                        to such State (regardless of whether the State 
                        by law had provided for such application); and
                            (ii) such section 203(f)--
                                    (I) were applied by substituting 
                                ``6.0'' for ``6.5'' in paragraph 
                                (1)(A)(i); and
                                    (II) did not include the 
                                requirement under paragraph (1)(A)(ii).

SEC. 103. PAYMENTS TO STATES HAVING AGREEMENTS FOR THE PAYMENT OF 
              EMERGENCY UNEMPLOYMENT COMPENSATION.

    (a) General Rule.--There shall be paid to each State that has 
entered into an agreement under this title an amount equal to 100 
percent of the emergency unemployment compensation paid to individuals 
by the State pursuant to such agreement.
    (b) Treatment of Reimbursable Compensation.--No payment shall be 
made to any State under this section in respect of any compensation to 
the extent the State is entitled to reimbursement in respect of such 
compensation under the provisions of any Federal law other than this 
title or chapter 85 of title 5, United States Code. A State shall not 
be entitled to any reimbursement under such chapter 85 in respect of 
any compensation to the extent the State is entitled to reimbursement 
under this title in respect of such compensation.
    (c) Determination of Amount.--Sums payable to any State by reason 
of such State having an agreement under this title shall be payable, 
either in advance or by way of reimbursement (as may be determined by 
the Secretary), in such amounts as the Secretary estimates the State 
will be entitled to receive under this title for each calendar month, 
reduced or increased, as the case may be, by any amount by which the 
Secretary finds that the Secretary's estimates for any prior calendar 
month were greater or less than the amounts which should have been paid 
to the State. Such estimates may be made on the basis of such 
statistical, sampling, or other method as may be agreed upon by the 
Secretary and the State agency of the State involved.

SEC. 104. FINANCING PROVISIONS.

    (a) In General.--Funds in the extended unemployment compensation 
account (as established by section 905(a) of the Social Security Act 
(42 U.S.C. 1105(a)) of the Unemployment Trust Fund (as established by 
section 904(a) of such Act (42 U.S.C. 1104(a)) shall be used for the 
making of payments to States having agreements entered into under this 
title.
    (b) Certification.--The Secretary shall from time to time certify 
to the Secretary of the Treasury for payment to each State the sums 
payable to such State under this title. The Secretary of the Treasury, 
prior to audit or settlement by the Government Accountability Office, 
shall make payments to the State in accordance with such certification, 
by transfers from the extended unemployment compensation account (as so 
established) to the account of such State in the Unemployment Trust 
Fund (as so established).
    (c) Assistance to States.--There are appropriated out of the 
employment security administration account (as established by section 
901(a) of the Social Security Act (42 U.S.C. 1101(a)) of the 
Unemployment Trust Fund, without fiscal year limitation, such funds as 
may be necessary for purposes of assisting States (as provided in title 
III of the Social Security Act (42 U.S.C. 501 et seq.)) in meeting the 
costs of administration of agreements under this title.
    (d) Appropriations for Certain Payments.--There are appropriated 
from the general fund of the Treasury, without fiscal year limitation, 
to the extended unemployment compensation account (as so established) 
of the Unemployment Trust Fund (as so established) such sums as the 
Secretary estimates to be necessary to make the payments under this 
section in respect of--
            (1) compensation payable under chapter 85 of title 5, 
        United States Code; and
            (2) compensation payable on the basis of services to which 
        section 3309(a)(1) of the Internal Revenue Code of 1986 
        applies.
Amounts appropriated pursuant to the preceding sentence shall not be 
required to be repaid.

SEC. 105. FRAUD AND OVERPAYMENTS.

    (a) In General.--If an individual knowingly has made, or caused to 
be made by another, a false statement or representation of a material 
fact, or knowingly has failed, or caused another to fail, to disclose a 
material fact, and as a result of such false statement or 
representation or of such nondisclosure such individual has received an 
amount of emergency unemployment compensation under this title to which 
he was not entitled, such individual--
            (1) shall be ineligible for further emergency unemployment 
        compensation under this title in accordance with the provisions 
        of the applicable State unemployment compensation law relating 
        to fraud in connection with a claim for unemployment 
        compensation; and
            (2) shall be subject to prosecution under section 1001 of 
        title 18, United States Code.
    (b) Repayment.--In the case of individuals who have received 
amounts of emergency unemployment compensation under this title to 
which they were not entitled, the State shall require such individuals 
to repay the amounts of such emergency unemployment compensation to the 
State agency, except that the State agency may waive such repayment if 
it determines that--
            (1) the payment of such emergency unemployment compensation 
        was without fault on the part of any such individual; and
            (2) such repayment would be contrary to equity and good 
        conscience.
    (c) Recovery by State Agency.--
            (1) In general.--The State agency may recover the amount to 
        be repaid, or any part thereof, by deductions from any 
        emergency unemployment compensation payable to such individual 
        under this title or from any unemployment compensation payable 
        to such individual under any State or Federal unemployment 
        compensation law administered by the State agency or under any 
        other Federal law administered by the State agency which 
        provides for the payment of any assistance or allowance with 
        respect to any week of unemployment, during the 3-year period 
        after the date such individuals received the payment of the 
        emergency unemployment compensation to which they were not 
        entitled, except that no single deduction may exceed 50 percent 
        of the weekly benefit amount from which such deduction is made.
            (2) Opportunity for hearing.--No repayment shall be 
        required, and no deduction shall be made, until a determination 
        has been made, notice thereof and an opportunity for a fair 
        hearing has been given to the individual, and the determination 
        has become final.
    (d) Review.--Any determination by a State agency under this section 
shall be subject to review in the same manner and to the same extent as 
determinations under the State unemployment compensation law, and only 
in that manner and to that extent.

SEC. 106. DEFINITIONS.

    In this title, the terms ``compensation'', ``regular 
compensation'', ``extended compensation'', ``additional compensation'', 
``benefit year'', ``base period'', ``State'', ``State agency'', ``State 
law'', and ``week'' have the respective meanings given such terms under 
section 205 of the Federal-State Extended Unemployment Compensation Act 
of 1970 (26 U.S.C. 3304 note).

SEC. 107. APPLICABILITY.

    (a) In General.--Except as provided in subsection (b), an agreement 
entered into under this title shall apply to weeks of unemployment--
            (1) beginning after the date on which such agreement is 
        entered into; and
            (2) ending on or before February 1, 2009.
    (b) Transition for Amount Remaining in Account.--
            (1) In general.--Subject to paragraphs (2) and (3), in the 
        case of an individual who has amounts remaining in an account 
        established under section 102 as of the last day of the last 
        week (as determined in accordance with the applicable State 
        law) ending on or before February 1, 2009, emergency 
        unemployment compensation shall continue to be payable to such 
        individual from such amounts for any week beginning after such 
        last day for which the individual meets the eligibility 
        requirements of this title.
            (2) Limit on augmentation.--If the account of an individual 
        is exhausted after the last day of such last week (as so 
        determined), then section 102(c) shall not apply and such 
        account shall not be augmented under such section, regardless 
        of whether such individual's State is in an extended benefit 
        period (as determined under paragraph (2) of such section).
            (3) Limit on compensation.--No compensation shall be 
        payable by reason of paragraph (1) for any week beginning after 
        April 30, 2009.

                        TITLE II--TAX PROVISIONS

               Subtitle A--Penalty-Free IRA Distributions

SEC. 201. PENALTY-FREE DISTRIBUTIONS FROM IRAS TO AVOID FORECLOSURE ON 
              PRINCIPAL RESIDENCE.

    (a) In General.--Paragraph (2) of section 72(t) of the Internal 
Revenue Code of 1986 (relating to subsection not to apply to certain 
distributions) is amended by adding at the end the following new 
subparagraph:
                    ``(H) Qualified foreclosure distributions.--
                Distributions from an individual retirement plan to an 
                individual which are qualified foreclosure 
                distributions (as defined in paragraph (11)). 
                Distributions shall not be taken into account under the 
                preceding sentence if such distributions are described 
                in subparagraph (A), (C), (D), (E), (F), or (G) or to 
                the extent paragraph (1) does not apply to such 
                distributions by reason of subparagraph (B).''.
    (b) Qualified Foreclosure Distributions.--Subsection (t) of section 
72 of such Code (relating to 10-percent additional tax on early 
distributions from qualified retirement plans) is amended by adding at 
the end the following new paragraph:
            ``(11) Qualified foreclosure distributions.--For purposes 
        of paragraph (2)(H)--
                    ``(A) In general.--The term `qualified foreclosure 
                distribution' means any payment or distribution 
                received by an individual after the individual has 
                received a notice of foreclosure relating to any 
                mortgage on the principal residence (within the meaning 
                of section 121) of the individual.
                    ``(B) Limitation.--The aggregate payments or 
                distributions which may be treated as qualified 
                foreclosure distributions for a taxable year shall not 
                exceed the amount paid on outstanding indebtedness 
                secured by the principal residence of the taxpayer 
                during the taxable year or the preceeding taxable 
                year.''.
    (c) Effective Date.--The amendments made by this section shall 
apply to payments or distributions received after December 31, 2006.

SEC. 202. PENALTY-FREE DISTRIBUTIONS FROM IRAS FOR EXPENSES DURING 
              EXTENDED UNEMPLOYMENT.

    (a) In General.--Subclause (III) of section 72(t)(2) of the 
Internal Revenue Code of 1986 is amended to read as follows:
                                    ``(III) to the extent such 
                                distributions do not exceed the 
                                expenses during the taxable year with 
                                respect to the individual and the 
                                individual's spouse and dependents (as 
                                defined in section 152, determined 
                                without regard to subsections (b)(1), 
                                (b)(2), and (d)(1)(B) thereof).''.
    (b) Repayment.--Subparagraph (D) of section 72(t) of such Code is 
amended by adding at the end the following new clause:
                            ``(iv) Amount distributed may be repaid.--
                                    ``(I) In general.--Any individual 
                                who receives a distribution under this 
                                subparagraph, at any time during the 5-
                                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 individual 
                                retirement plan of which such 
                                individual is a beneficiary.
                                    ``(II) Treatment of repayments for 
                                distributions from iras.--For purposes 
                                of this title, if a contribution is 
                                made pursuant to subclause (I) with 
                                respect to a distribution under clause 
                                (i), then, to the extent of the amount 
                                of the contribution, the distribution 
                                shall be treated as a distribution 
                                described in section 408(d)(3) and as 
                                having been transferred to such plan in 
                                a direct trustee to trustee transfer 
                                within 60 days of the distribution.''.
    (c) Clerical Amendment.--The heading for subparagraph (D) of 
section 72(t)(2) of such Code is amended by striking ``for health 
insurance premiums''.
    (d) Effective Date.--The amendments made by this section shall 
apply to distributions received in taxable years beginning after 
December 31, 2006.

                    Subtitle B--Homeland Investment

SEC. 211. ALLOWANCE OF DEDUCTION FOR DIVIDENDS RECEIVED FROM CONTROLLED 
              FOREIGN CORPORATIONS FOR ADDITIONAL YEAR.

    (a) In General.--Section 965 of the Internal Revenue Code of 1986 
(relating to temporary dividends received deduction) is amended by 
adding at the end the following new subsection:
    ``(g) Allowance for Deduction for 2008.--
            ``(1) In general.--In the case of the first taxable year 
        beginning in 2008, subsection (f)(1) shall be applied by 
        substituting `January 1, 2008,' for `the date of the enactment 
        of this section'.
            ``(2) Special rules.--For purposes of paragraph (1)--
                    ``(A) Extraordinary dividends.--Subsection (b)(2) 
                shall be applied by substituting `June 30, 2007' for 
                `June 30, 2003'.
                    ``(B) Determinations relating to related party 
                indebtedness.--Subsection (b)(3)(B) shall be applied by 
                substituting `October 3, 2008' for `October 3, 2004'.
                    ``(C) Applicable financial statement.--Subsection 
                (c)(1) shall be applied by substituting `June 30, 2007' 
                for `June 30, 2003' each place it occurs.
                    ``(D) Determinations relating to base period.--
                Subsection (c)(2) shall be applied by substituting 
                `June 30, 2007' for `June 30, 2003'.''.
    (b) Effective Date.--The amendment made by subsection (a) shall 
apply to taxable years ending on or after January 1, 2008.

 Subtitle C--Suspension of Highway Fuels Taxes When Summer Blending in 
                                 Effect

SEC. 221. SUSPENSION OF HIGHWAY FUELS TAXES WHEN SUMMER BLENDING IN 
              EFFECT.

    (a) Suspension of Highway Fuel Taxes on Gasoline, Diesel Fuel, and 
Kerosene.--
            (1) In general.--Section 4081 of the Internal Revenue Code 
        of 1986 (relating to imposition of tax on gasoline, diesel 
        fuel, and kerosene) is amended by adding at the end the 
        following new subsection:
    ``(f) Suspension of Taxes on Gasoline, Diesel Fuel, and Kerosene.--
            ``(1) In general.--During the suspension period, each rate 
        of tax referred to in paragraph (2) shall be reduced to zero 
        cents per gallon.
            ``(2) Rates of tax.--The rates of tax referred to in this 
        paragraph are the rates of tax otherwise applicable under--
                    ``(A) clauses (i) and (iii) of subsection (a)(2)(A) 
                (relating to gasoline, diesel fuel, and kerosene), 
                determined after application of subsection (a)(2)(B) 
                and without regard to subsection (a)(2)(C), and
                    ``(B) paragraph (1) of section 4041(a) (relating to 
                diesel fuel and kerosene) with respect to fuel sold for 
                use or used in a diesel-powered highway vehicle.
            ``(3) Suspension period.--For purposes of this subsection, 
        the term `suspension period' means the period in 2008 beginning 
        on the date specified under the section 80.27 of title 40, Code 
        of Federal Regulations, in May and ending on the date specified 
        in September under such section.
            ``(4) Maintenance of trust fund deposits.--In determining 
        the amounts to be appropriated to the Highway Trust Fund under 
        section 9503 and to the Leaking Underground Storage Tank Trust 
        Fund under 9508, an amount equal to the reduction in revenues 
        to the Treasury by reason of this subsection shall be treated 
        as taxes received in the Treasury under this section or section 
        4041.''.
            (2) Effective date.--The amendment made by this subsection 
        shall take effect on the date of the enactment of this Act.
    (b) Floor Stock Refunds.--
            (1) In general.--If--
                    (A) before the tax suspension date, tax has been 
                imposed under section 4081 of the Internal Revenue Code 
                of 1986 on any highway motor fuel, and
                    (B) on such date such fuel is held by a dealer and 
                has not been used and is intended for sale,
        there shall be credited or refunded (without interest) to the 
        person who paid such tax (hereafter in this subsection referred 
        to as the ``taxpayer'') an amount equal to the excess of the 
        tax paid by the taxpayer over the tax which would be imposed on 
        such fuel had the taxable event occurred on such date.
            (2) Time for filing claims.--No credit or refund shall be 
        allowed or made under this subsection unless--
                    (A) claim therefor is filed with the Secretary of 
                the Treasury before the date which is 6 months after 
                the tax suspension date based on a request submitted to 
                the taxpayer before the date which is 3 months after 
                the tax suspension date by the dealer who held the 
                highway motor fuel on such date, and
                    (B) the taxpayer has repaid or agreed to repay the 
                amount so claimed to such dealer or has obtained the 
                written consent of such dealer to the allowance of the 
                credit or the making of the refund.
            (3) Exception for fuel held in retail stocks.--No credit or 
        refund shall be allowed under this subsection with respect to 
        any highway motor fuel in retail stocks held at the place where 
        intended to be sold at retail.
            (4) Definitions.--For purposes of this subsection--
                    (A) Tax suspension date.--The term ``tax suspension 
                date'' means the first day of the suspension period in 
                effect under section 4081(f) of the Internal Revenue 
                Code of 1986 (as added by subsection (a) of this 
                section).
                    (B) Highway motor fuel.--The term ``highway motor 
                fuel'' has the meaning given such term for purposes of 
                subsection (c).
                    (C) Other terms.--The terms ``dealer'' and ``held 
                by a dealer'' have the respective meanings given to 
                such terms by section 6412 of such Code.
            (5) Certain rules to apply.--Rules similar to the rules of 
        subsections (b) and (c) of section 6412 of such Code shall 
        apply for purposes of this subsection.
    (c) Floor Stocks Tax.--
            (1) Imposition of tax.--In the case of any highway motor 
        fuel which is held on the tax restoration date by any person, 
        there is hereby imposed a floor stocks tax equal to the excess 
        of the tax which would be imposed on such fuel had the taxable 
        event occurred on such date over the tax (if any) previously 
        paid (and not credited or refunded) on such fuel.
            (2) Liability for tax and method of payment.--
                    (A) Liability for tax.--The person holding highway 
                motor fuel on the tax restoration date to which the tax 
                imposed by paragraph (1) applies shall be liable for 
                such tax.
                    (B) Method of payment.--The tax imposed by 
                paragraph (1) shall be paid in such manner as the 
                Secretary shall prescribe.
                    (C) Time for payment.--The tax imposed by paragraph 
                (1) shall be paid on or before the 45th day after the 
                tax restoration date.
            (3) Definitions.--For purposes of this subsection--
                    (A) Tax restoration date.--The term ``tax 
                restoration date'' means the first day after the 
                suspension period (as defined in section 4081(f) of the 
                Internal Revenue Code of 1986).
                    (B) Highway motor fuel.--The term ``highway motor 
                fuel'' means any liquid on which tax would have been 
                imposed under section 4081 of the Internal Revenue Code 
                of 1986 during the suspension period in effect under 
                section 4081(f) of such Code but for the amendments 
                made by subsection (a).
                    (C) Held by a person.--A highway motor fuel shall 
                be considered as held by a person if title thereto has 
                passed to such person (whether or not delivery to the 
                person has been made).
                    (D) Secretary.--The term ``Secretary'' means the 
                Secretary of the Treasury or the Secretary's delegate.
            (4) Exception for exempt uses.--The tax imposed by 
        paragraph (1) shall not apply to any highway motor fuel held by 
        any person exclusively for any use to the extent a credit or 
        refund of the tax is allowable for such use.
            (5) Exception for certain amounts of fuel.--
                    (A) In general.--No tax shall be imposed by 
                paragraph (1) on any highway motor fuel held on the tax 
                restoration date by any person if the aggregate amount 
                of such highway motor fuel held by such person on such 
                date does not exceed 2,000 gallons. The preceding 
                sentence shall apply only if such person submits to the 
                Secretary (at the time and in the manner required by 
                the Secretary) such information as the Secretary shall 
                require for purposes of this subparagraph.
                    (B) Exempt fuel.--For purposes of subparagraph (A), 
                there shall not be taken into account any highway motor 
                fuel held by any person which is exempt from the tax 
                imposed by paragraph (1) by reason of paragraph (4).
                    (C) Controlled groups.--For purposes of this 
                subsection--
                            (i) Corporations.--
                                    (I) In general.--All persons 
                                treated as a controlled group shall be 
                                treated as 1 person.
                                    (II) Controlled group.--The term 
                                ``controlled group'' has the meaning 
                                given to such term by subsection (a) of 
                                section 1563 of such Code; except that 
                                for such purposes the phrase ``more 
                                than 50 percent'' shall be substituted 
                                for the phrase ``at least 80 percent'' 
                                each place it appears in such 
                                subsection.
                            (ii) Nonincorporated persons under common 
                        control.--Under regulations prescribed by the 
                        Secretary, principles similar to the principles 
                        of subparagraph (A) shall apply to a group of 
                        persons under common control if 1 or more of 
                        such persons is not a corporation.
            (6) Other laws applicable.--All provisions of law, 
        including penalties, applicable with respect to the taxes 
        imposed by section 4081 of such Code shall, insofar as 
        applicable and not inconsistent with the provisions of this 
        subsection, apply with respect to the floor stock taxes imposed 
        by paragraph (1) to the same extent as if such taxes were 
        imposed by such section.

                 Subtitle D--Indexing for Capital Gains

SEC. 231. INDEXING OF CERTAIN ASSETS FOR PURPOSES OF DETERMINING GAIN 
              OR LOSS.

    (a) In General.--Part II of subchapter O of chapter 1 of the 
Internal Revenue Code of 1986 (relating to basis rules of general 
application) is amended by redesignating section 1023 as section 1024 
and by inserting after section 1022 the following new section:

``SEC. 1023. INDEXING OF CERTAIN ASSETS FOR PURPOSES OF DETERMINING 
              GAIN OR LOSS.

    ``(a) General Rule.--
            ``(1) Indexed basis substituted for adjusted basis.--Solely 
        for purposes of determining gain or loss on the sale or other 
        disposition by a taxpayer (other than a corporation) of an 
        indexed asset which has been held for more than 3 years, the 
        indexed basis of the asset shall be substituted for its 
        adjusted basis.
            ``(2) Exception for depreciation, etc.--The deductions for 
        depreciation, depletion, and amortization shall be determined 
        without regard to the application of paragraph (1) to the 
        taxpayer or any other person.
            ``(3) Written documentation requirement.--Paragraph (1) 
        shall apply only with respect to indexed assets for which the 
        taxpayer has written documentation of the original purchase 
        price paid or incurred by the taxpayer to acquire such asset.
    ``(b) Indexed Asset.--
            ``(1) In general.--For purposes of this section, the term 
        `indexed asset' means--
                    ``(A) common stock in a C corporation (other than a 
                foreign corporation), or
                    ``(B) tangible property,
        which is a capital asset or property used in the trade or 
        business (as defined in section 1231(b)).
            ``(2) Stock in certain foreign corporations included.--For 
        purposes of this section--
                    ``(A) In general.--The term `indexed asset' 
                includes common stock in a foreign corporation which is 
                regularly traded on an established securities market.
                    ``(B) Exception.--Subparagraph (A) shall not apply 
                to--
                            ``(i) stock of a foreign investment 
                        company,
                            ``(ii) stock in a passive foreign 
                        investment company (as defined in section 
                        1296),
                            ``(iii) stock in a foreign corporation held 
                        by a United States person who meets the 
                        requirements of section 1248(a)(2), and
                            ``(iv) stock in a foreign personal holding 
                        company.
                    ``(C) Treatment of american depository receipts.--
                An American depository receipt for common stock in a 
                foreign corporation shall be treated as common stock in 
                such corporation.
    ``(c) Indexed Basis.--For purposes of this section--
            ``(1) General rule.--The indexed basis for any asset is--
                    ``(A) the adjusted basis of the asset, increased by
                    ``(B) the applicable inflation adjustment.
            ``(2) Applicable inflation adjustment.--The applicable 
        inflation adjustment for any asset is an amount equal to--
                    ``(A) the adjusted basis of the asset, multiplied 
                by
                    ``(B) the percentage (if any) by which--
                            ``(i) the gross domestic product deflator 
                        for the last calendar quarter ending before the 
                        asset is disposed of, exceeds
                            ``(ii) the gross domestic product deflator 
                        for the last calendar quarter ending before the 
                        asset was acquired by the taxpayer.
        The percentage under subparagraph (B) shall be rounded to the 
        nearest \1/10\ of 1 percentage point.
            ``(3) Gross domestic product deflator.--The gross domestic 
        product deflator for any calendar quarter is the implicit price 
        deflator for the gross domestic product for such quarter (as 
        shown in the last revision thereof released by the Secretary of 
        Commerce before the close of the following calendar quarter).
    ``(d) Suspension of Holding Period Where Diminished Risk of Loss; 
Treatment of Short Sales.--
            ``(1) In general.--If the taxpayer (or a related person) 
        enters into any transaction which substantially reduces the 
        risk of loss from holding any asset, such asset shall not be 
        treated as an indexed asset for the period of such reduced 
        risk.
            ``(2) Short sales.--
                    ``(A) In general.--In the case of a short sale of 
                an indexed asset with a short sale period in excess of 
                3 years, for purposes of this title, the amount 
                realized shall be an amount equal to the amount 
                realized (determined without regard to this paragraph) 
                increased by the applicable inflation adjustment. In 
                applying subsection (c)(2) for purposes of the 
                preceding sentence, the date on which the property is 
                sold short shall be treated as the date of acquisition 
                and the closing date for the sale shall be treated as 
                the date of disposition.
                    ``(B) Short sale period.--For purposes of 
                subparagraph (A), the short sale period begins on the 
                day that the property is sold and ends on the closing 
                date for the sale.
    ``(e) Treatment of Regulated Investment Companies and Real Estate 
Investment Trusts.--
            ``(1) Adjustments at entity level.--
                    ``(A) In general.--Except as otherwise provided in 
                this paragraph, the adjustment under subsection (a) 
                shall be allowed to any qualified investment entity 
                (including for purposes of determining the earnings and 
                profits of such entity).
                    ``(B) Exception for corporate shareholders.--Under 
                regulations--
                            ``(i) in the case of a distribution by a 
                        qualified investment entity (directly or 
                        indirectly) to a corporation--
                                    ``(I) the determination of whether 
                                such distribution is a dividend shall 
                                be made without regard to this section, 
                                and
                                    ``(II) the amount treated as gain 
                                by reason of the receipt of any capital 
                                gain dividend shall be increased by the 
                                percentage by which the entity's net 
                                capital gain for the taxable year 
                                (determined without regard to this 
                                section) exceeds the entity's net 
                                capital gain for such year determined 
                                with regard to this section, and
                            ``(ii) there shall be other appropriate 
                        adjustments (including deemed distributions) so 
                        as to ensure that the benefits of this section 
                        are not allowed (directly or indirectly) to 
                        corporate shareholders of qualified investment 
                        entities.
                For purposes of the preceding sentence, any amount 
                includible in gross income under section 852(b)(3)(D) 
                shall be treated as a capital gain dividend and an S 
                corporation shall not be treated as a corporation.
                    ``(C) Exception for qualification purposes.--This 
                section shall not apply for purposes of sections 851(b) 
                and 856(c).
                    ``(D) Exception for certain taxes imposed at entity 
                level.--
                            ``(i) Tax on failure to distribute entire 
                        gain.--If any amount is subject to tax under 
                        section 852(b)(3)(A) for any taxable year, the 
                        amount on which tax is imposed under such 
                        section shall be increased by the percentage 
                        determined under subparagraph (B)(i)(II). A 
                        similar rule shall apply in the case of any 
                        amount subject to tax under paragraph (2) or 
                        (3) of section 857(b) to the extent 
                        attributable to the excess of the net capital 
                        gain over the deduction for dividends paid 
                        determined with reference to capital gain 
                        dividends only. The first sentence of this 
                        clause shall not apply to so much of the amount 
                        subject to tax under section 852(b)(3)(A) as is 
                        designated by the company under section 
                        852(b)(3)(D).
                            ``(ii) Other taxes.--This section shall not 
                        apply for purposes of determining the amount of 
                        any tax imposed by paragraph (4), (5), or (6) 
                        of section 857(b).
            ``(2) Adjustments to interests held in entity.--
                    ``(A) Regulated investment companies.--Stock in a 
                regulated investment company (within the meaning of 
                section 851) shall be an indexed asset for any calendar 
                quarter in the same ratio as--
                            ``(i) the average of the fair market values 
                        of the indexed assets held by such company at 
                        the close of each month during such quarter, 
                        bears to
                            ``(ii) the average of the fair market 
                        values of all assets held by such company at 
                        the close of each such month.
                    ``(B) Real estate investment trusts.--Stock in a 
                real estate investment trust (within the meaning of 
                section 856) shall be an indexed asset for any calendar 
                quarter in the same ratio as--
                            ``(i) the fair market value of the indexed 
                        assets held by such trust at the close of such 
                        quarter, bears to
                            ``(ii) the fair market value of all assets 
                        held by such trust at the close of such 
                        quarter.
                    ``(C) Ratio of 80 percent or more.--If the ratio 
                for any calendar quarter determined under subparagraph 
                (A) or (B) would (but for this subparagraph) be 80 
                percent or more, such ratio for such quarter shall be 
                100 percent.
                    ``(D) Ratio of 20 percent or less.--If the ratio 
                for any calendar quarter determined under subparagraph 
                (A) or (B) would (but for this subparagraph) be 20 
                percent or less, such ratio for such quarter shall be 
                zero.
                    ``(E) Look-thru of partnerships.--For purposes of 
                this paragraph, a qualified investment entity which 
                holds a partnership interest shall be treated (in lieu 
                of holding a partnership interest) as holding its 
                proportionate share of the assets held by the 
                partnership.
            ``(3) Treatment of return of capital distributions.--Except 
        as otherwise provided by the Secretary, a distribution with 
        respect to stock in a qualified investment entity which is not 
        a dividend and which results in a reduction in the adjusted 
        basis of such stock shall be treated as allocable to stock 
        acquired by the taxpayer in the order in which such stock was 
        acquired.
            ``(4) Qualified investment entity.--For purposes of this 
        subsection, the term `qualified investment entity' means--
                    ``(A) a regulated investment company (within the 
                meaning of section 851), and
                    ``(B) a real estate investment trust (within the 
                meaning of section 856).
    ``(f) Other Pass-Thru Entities.--
            ``(1) Partnerships.--
                    ``(A) In general.--In the case of a partnership, 
                the adjustment made under subsection (a) at the 
                partnership level shall be passed through to the 
                partners.
                    ``(B) Special rule in the case of section 754 
                elections.--In the case of a transfer of an interest in 
                a partnership with respect to which the election 
                provided in section 754 is in effect--
                            ``(i) the adjustment under section 
                        743(b)(1) shall, with respect to the transferor 
                        partner, be treated as a sale of the 
                        partnership assets for purposes of applying 
                        this section, and
                            ``(ii) with respect to the transferee 
                        partner, the partnership's holding period for 
                        purposes of this section in such assets shall 
                        be treated as beginning on the date of such 
                        adjustment.
            ``(2) S corporations.--In the case of an S corporation, the 
        adjustment made under subsection (a) at the corporate level 
        shall be passed through to the shareholders. This section shall 
        not apply for purposes of determining the amount of any tax 
        imposed by section 1374 or 1375.
            ``(3) Common trust funds.--In the case of a common trust 
        fund, the adjustment made under subsection (a) at the trust 
        level shall be passed through to the participants.
            ``(4) Indexing adjustment disregarded in determining loss 
        on sale of interest in entity.--Notwithstanding the preceding 
        provisions of this subsection, for purposes of determining the 
        amount of any loss on a sale or exchange of an interest in a 
        partnership, S corporation, or common trust fund, the 
        adjustment made under subsection (a) shall not be taken into 
        account in determining the adjusted basis of such interest.
    ``(g) Dispositions Between Related Persons.--
            ``(1) In general.--This section shall not apply to any sale 
        or other disposition of property between related persons except 
        to the extent that the basis of such property in the hands of 
        the transferee is a substituted basis.
            ``(2) Related persons defined.--For purposes of this 
        section, the term `related persons' means--
                    ``(A) persons bearing a relationship set forth in 
                section 267(b), and
                    ``(B) persons treated as single employer under 
                subsection (b) or (c) of section 414.
    ``(h) Transfers To Increase Indexing Adjustment.--If any person 
transfers cash, debt, or any other property to another person and the 
principal purpose of such transfer is to secure or increase an 
adjustment under subsection (a), the Secretary may disallow part or all 
of such adjustment or increase.
    ``(i) Special Rules.--For purposes of this section--
            ``(1) Treatment of improvements, etc.--If there is an 
        addition to the adjusted basis of any tangible property or of 
        any stock in a corporation during the taxable year by reason of 
        an improvement to such property or a contribution to capital of 
        such corporation--
                    ``(A) such addition shall never be taken into 
                account under subsection (c)(1)(A) if the aggregate 
                amount thereof during the taxable year with respect to 
                such property or stock is less than $1,000, and
                    ``(B) such addition shall be treated as a separate 
                asset acquired at the close of such taxable year if the 
                aggregate amount thereof during the taxable year with 
                respect to such property or stock is $1,000 or more.
        A rule similar to the rule of the preceding sentence shall 
        apply to any other portion of an asset to the extent that 
        separate treatment of such portion is appropriate to carry out 
        the purposes of this section.
            ``(2) Assets which are not indexed assets throughout 
        holding period.--The applicable inflation adjustment shall be 
        appropriately reduced for periods during which the asset was 
        not an indexed asset.
            ``(3) Treatment of certain distributions.--A distribution 
        with respect to stock in a corporation which is not a dividend 
        shall be treated as a disposition.
            ``(4) Section cannot increase ordinary loss.--To the extent 
        that (but for this paragraph) this section would create or 
        increase a net ordinary loss to which section 1231(a)(2) 
        applies or an ordinary loss to which any other provision of 
        this title applies, such provision shall not apply. The 
        taxpayer shall be treated as having a long-term capital loss in 
        an amount equal to the amount of the ordinary loss to which the 
        preceding sentence applies.
            ``(5) Acquisition date where there has been prior 
        application of subsection (a)(1) with respect to the 
        taxpayer.--If there has been a prior application of subsection 
        (a)(1) to an asset while such asset was held by the taxpayer, 
        the date of acquisition of such asset by the taxpayer shall be 
        treated as not earlier than the date of the most recent such 
        prior application.
    ``(j) Regulations.--The Secretary shall prescribe such regulations 
as may be necessary or appropriate to carry out the purposes of this 
section.''.
    (b) Clerical Amendment.--The table of sections for part II of 
subchapter O of chapter 1 of such Code is amended by striking the item 
relating to section 1023 and by inserting after the item relating to 
section 1022 the following new item:

``Sec. 1023. Indexing of certain assets for purposes of determining 
                            gain or loss.
``Sec. 1024. Cross references.''.
    (c) Effective Date.--The amendments made by this section shall 
apply to indexed assets acquired by the taxpayer after December 31, 
2007, in taxable years ending after such date.

  TITLE III--EMERGENCY ASSISTANCE FOR REDEVELOPMENT OF ABANDONED AND 
FORECLOSED HOMES AND FOR WEATHERIZATION OF HOMES OF LOW-INCOME FAMILIES

SEC. 301. DIRECT APPROPRIATIONS.

    There are appropriated out of any money in the Treasury not 
otherwise appropriated for the fiscal year 2008, $4,000,000,000, to 
remain available until expended, for assistance to States and units of 
general local government (as such terms are defined in section 102 of 
the Housing and Community Development Act of 1974 (42 U.S.C. 5302)) for 
the redevelopment of abandoned and foreclosed upon homes and 
residential properties and for the weatherization of homes of low-
income families.

SEC. 302. ALLOCATION OF APPROPRIATED AMOUNTS.

    (a) In General.--The amounts appropriated or otherwise made 
available to States and units of general local government under this 
title shall be allocated based on a funding formula established by the 
Secretary of Housing and Urban Development (in this title referred to 
as the ``Secretary'').
    (b) Formula To Be Devised Swiftly.--The funding formula required 
under subsection (a)) shall be established not later than 60 days after 
the date of the enactment of this Act.
    (c) Criteria.--The funding formula required under subsection (a) 
shall ensure that any amounts appropriated or otherwise made available 
under this title are allocated to States and units of general local 
government with the greatest need, as such need is determined in the 
discretion of the Secretary based on--
            (1) the number and percentage of home foreclosures in each 
        State or unit of general local government;
            (2) the number and percentage of homes financed by a 
        subprime mortgage related loan in each State or unit of general 
        local government;
            (3) the number and percentage of homes in default or 
        delinquency in each State or unit of general local government;
            (4) the rate of unemployment in each State or unit of 
        general local government; and
            (5) the amount of assistance used within the State or unit 
        of general local government under the Low-Income Home Energy 
        Assistance Program under title XXVI of the Low-Income Home 
        Energy Assistance Act of 1981 (42 U.S.C. 8621 et seq.).
    (d) Distribution.--Amounts appropriated or otherwise made available 
under this title shall be distributed according to the funding formula 
established by the Secretary under subsection (a) not later than 30 
days after the establishment of such formula.

SEC. 303. USE OF FUNDS.

    (a) In General.--Any State or unit of general local government that 
receives amounts pursuant to this title shall, not later than 18 months 
after the receipt of such amounts, use such amounts only as provided in 
subsection (c) to purchase and redevelop abandoned and foreclosed homes 
and residential properties or to weatherize homes of low-income 
families.
    (b) Priority.--Any State or unit of general local government that 
receives amounts pursuant to this title shall, in distributing such 
amounts, give priority emphasis and consideration to those metropolitan 
areas, metropolitan cities, urban areas, rural areas, low- and 
moderate-income areas, and other areas with the greatest need, 
including those--
            (1) with the greatest percentage of home foreclosures;
            (2) with the highest percentage of homes financed by a 
        subprime mortgage related loan;
            (3) identified by the State or unit of general local 
        government as likely to face a significant rise in the rate of 
        home foreclosures; and
            (4) having the greatest need for weatherization for homes 
        of low-income families, as demonstrated by the amount of 
        assistance used within the metropolitan area, metropolitan 
        city, urban area, rural area, low- or moderate-income area, and 
        other area under the Low-Income Home Energy Assistance Program 
        under title XXVI of the Low-Income Home Energy Assistance Act 
        of 1981.
    (c) Eligible Uses.--Amounts made available under this title may be 
used to--
            (1) establish financing mechanisms for purchase and 
        redevelopment of foreclosed upon homes and residential 
        properties, including such mechanisms as soft-seconds, loan 
        loss reserves, and shared-equity loans for low- and moderate-
        income homebuyers;
            (2) purchase and rehabilitate homes and residential 
        properties that have been abandoned or foreclosed upon, in 
        order to sell, rent, or redevelop such homes and properties;
            (3) establish land banks for homes that have been 
        foreclosed upon;
            (4) demolish blighted structures; and
            (5) conduct activities to rehabilitate and make 
        improvements to homes of low-income families that--
                    (A) make such homes secure against cold, heat, 
                wind, precipitation, or other inclement weather; and
                    (B) would be eligible for funding provided under 
                the HOME Investment Partnerships Act (42 U.S.C. 12721 
                et seq.);
        except that such activities may only be conducted with respect 
        to homes of families who, at any time during the 36-month 
        period ending upon the date of the enactment of this Act, have 
        received assistance under the Low-Income Home Energy Assistance 
        Program under title XXVI of the Low-Income Home Energy 
        Assistance Act of 1981.

SEC. 304. LIMITATIONS.

    (a) On Purchases.--Any purchase of a foreclosed upon home or 
residential property under this title shall be at a discount from the 
current market appraised value of the home or property, taking into 
account its current condition, and such discount shall ensure that 
purchasers are paying below-market value for the home or property.
    (b) Sale of Homes.--If an abandoned or foreclosed upon home or 
residential property is purchased, redeveloped, or otherwise sold to an 
individual as a primary residence, then such sale shall be in an amount 
equal to or less than the cost to acquire and redevelop or rehabilitate 
such home or property up to a decent, safe, and habitable condition.
    (c) Reinvestment of Profits.--
            (1) Revenues generated from sales.--Any revenue generated 
        from the sale, rental, redevelopment, rehabilitation, or any 
        other eligible use that is in excess of the cost to acquire and 
        redevelop (including reasonable development fees) or 
        rehabilitate an abandoned or foreclosed upon home or 
        residential property shall be provided to and used by the State 
        or unit of general local government in accordance with, and in 
        furtherance of, the intent and provisions of this title.
            (2) Other revenues.--Any revenue generated under paragraphs 
        (1), (3) or (4) of section 303(c) shall be provided to and used 
        by the State or unit of general local government in accordance 
        with, and in furtherance of, the intent and provisions of this 
        title.

SEC. 305. RULES OF CONSTRUCTION.

    (a) In General.--Except as otherwise provided by this title, 
amounts appropriated, revenues generated, or amounts otherwise made 
available to States and units of general local government under this 
title shall be treated as though such funds were community development 
block grant funds under title I of the Housing and Community 
Development Act of 1974 (42 U.S.C. 5301 et seq.).
    (b) No Match.--No matching funds shall be required in order for a 
State or unit of general local government to receive any amounts under 
this title.

SEC. 306. AUTHORITY TO SPECIFY ALTERNATIVE REQUIREMENTS.

    (a) In General.--In administering any amounts appropriated or 
otherwise made available under this title, the Secretary may specify 
alternative requirements to any provision under title I of the Housing 
and Community Development Act of 1974 (except for those related to fair 
housing, nondiscrimination, labor standards, and the environment) in 
accordance with the terms of this title and for the sole purpose of 
expediting the use of such funds.
    (b) Notice.--The Secretary shall provide written notice of the 
Secretary's intent to exercise the authority to specify alternative 
requirements under subsection (a) to the Committee on Banking, Housing, 
and Urban Affairs of the Senate and the Committee on Financial Services 
of the House of Representatives not later than 10 business days before 
such exercise of authority is to occur.
    (c) Low- and Moderate-Income Requirement.--
            (1) In general.--Notwithstanding the authority of the 
        Secretary under paragraph (1)--
                    (A) all of the funds appropriated or otherwise made 
                available under this title shall be used with respect 
                to individuals and families whose income does not 
                exceed 120 percent of area median income; and
                    (B) not less than 25 percent of the funds 
                appropriated or otherwise made available under this 
                title shall be used for--
                            (i) the purchase and redevelopment of 
                        abandoned or foreclosed upon homes or 
                        residential properties that will be used to 
                        house individuals or families whose incomes do 
                        not exceed 50 percent of area median income; or
                            (ii) weatherization activities for homes of 
                        individuals or families whose incomes do not 
                        exceed 50 percent of area median income.
            (2) Recurrent requirement.--The Secretary shall, by rule or 
        order, ensure, to the maximum extent practicable and for the 
        longest feasible term, that the sale, rental, or redevelopment 
        of abandoned and foreclosed upon homes and residential 
        properties under this title remain affordable to individuals or 
        families described in paragraph (1).

SEC. 307. PERIODIC AUDITS.

    In consultation with the Secretary of Housing and Urban 
Development, the Comptroller General of the United States shall conduct 
periodic audits to ensure that funds appropriated, made available, or 
otherwise distributed under this title are being used in a manner 
consistent with the criteria provided in this title.
                                 <all>