110 HR 6958 IH: Hurricane Ike Tax Relief Act of 2008 U.S. House of Representatives 2008-09-18 text/xml EN Pursuant to Title 17 Section 105 of the United States Code, this file is not subject to copyright protection and is in the public domain.

I 110th CONGRESS 2d Session H. R. 6958 IN THE HOUSE OF REPRESENTATIVES September 18, 2008 Mr. Brady of Texas (for himself, Mr. Paul, Mr. McCaul of Texas, Ms. Granger, Mr. Gohmert, Mr. Culberson, Mr. Poe, Mr. Sam Johnson of Texas, Mr. Smith of Texas, Mr. Al Green of Texas, Mr. Ortiz, Mr. Thornberry, Mr. Gonzalez, and Mr. Carter) introduced the following bill; which was referred to the Committee on Ways and Means A BILL To provide tax relief for the victims of Hurricane Ike, and for other purposes.

1.

Short title

This Act may be cited as the Hurricane Ike Tax Relief Act of 2008.

2.

Temporary tax relief for areas damaged by Hurricane Ike

(a)

In general

Subject to the modifications described in this section, the following provisions of or relating to the Internal Revenue Code of 1986 shall apply to the Hurricane Ike recovery area in addition to the areas to which such provisions otherwise apply: (1)

Go Zone benefits

(A)Section 1400N (relating to tax benefits) other than subsections (b), (c), (i), (j), (m), and (o) thereof. (B)Section 1400P (relating to housing tax benefits). (C)Section 1400Q (relating to special rules for use of retirement funds). (D)Section 1400R(a) (relating to employee retention credit for employers). (E)Section 1400S (relating to additional tax relief) other than subsection (d) thereof. (F)Section 1400T (relating to special rules for mortgage revenue bonds). (2)

Other benefits included in Katrina Emergency Tax Relief Act of 2005

Sections 302, 304, 401, and 405 of the Katrina Emergency Tax Relief Act of 2005. (b)

Use of amended income tax returns To take into account receipt of certain casualty loss grants by disallowing previously taken casualty loss deductions

(1)

In general

Notwithstanding any other provision of the Internal Revenue Code of 1986, if a taxpayer claims a deduction for any taxable year with respect to a casualty loss to a principal residence (within the meaning of section 121 of such Code) resulting from Hurricane Ike and in a subsequent taxable year receives a grant under any Federal or State program as reimbursement for such loss, such taxpayer may elect to file an amended income tax return for the taxable year in which such deduction was allowed (and for any taxable year to which such deduction is carried) and reduce (but not below zero) the amount of such deduction by the amount of such reimbursement. (2)

Time of filing amended return

Paragraph (1) shall apply with respect to any grant only if any amended income tax returns with respect to such grant are filed not later than the later of— (A)the due date for filing the tax return for the taxable year in which the taxpayer receives such grant, or (B)the date which is 1 year after the date of the enactment of this Act. (3)

Waiver of penalties and interest

Any underpayment of tax resulting from the reduction under paragraph (1) of the amount otherwise allowable as a deduction shall not be subject to any penalty or interest under such Code if such tax is paid not later than 1 year after the filing of the amended return to which such reduction relates. (c)

Hurricane Ike recovery area

(1)

In general

For purposes of this section and for applying the substitutions described in subsections (e) and (f), the term Hurricane Ike recovery area means an area— (A)with respect to which a major disaster has been declared by the President under section 401 of the Robert T. Stafford Disaster Relief and Emergency Assistance Act by reason of Hurricane Ike, and (B)determined by the President to warrant individual or individual and public assistance from the Federal Government under such Act by reason of Hurricane Ike. (2)

Certain benefits available to areas eligible only for public assistance

For purposes of applying this section to benefits under the following provisions, paragraph (1) shall be applied without regard to subparagraph (B): (A)Sections 1400Q, 1400S(b), and 1400S(d) of the Internal Revenue Code of 1986. (B)Sections 302, 401, and 405 of the Katrina Emergency Tax Relief Act of 2005. (d)

References

(1)

Area

Any reference in such provisions to the Hurricane Katrina disaster area or the Gulf Opportunity Zone shall be treated as a reference to the Hurricane Ike recovery area and any reference to the Hurricane Katrina disaster area or the Gulf Opportunity Zone within a State shall be treated as a reference to the portion of the Hurricane Ike recovery area within the State. (2)

Items attributable to disaster

Any reference in such provisions to any loss, damage, or other item attributable to Hurricane Katrina shall be treated as a reference to any loss, damage, or other item attributable to Hurricane Ike. (e)

Modifications to 1986 Code

In the case of the Hurricane Ike recovery area, the following provisions of the Internal Revenue Code of 1986 shall be applied with the following modifications: (1)

Tax-exempt bond financing

Section 1400N(a)— (A)by substituting qualified Hurricane Ike recovery area bond for qualified Gulf Opportunity Zone Bond each place it appears, except that in determining whether a bond is a qualified Hurricane Ike recovery area bond— (i)paragraph (2)(A)(i) shall be applied by only treating costs as qualified project costs if— (I)in the case of a project involving a private business use (as defined in section 141(b)(6)), either the person using the property suffered a loss in a trade or business attributable to Hurricane Ike or is a person designated for purposes of this section by the Governor of the State in which the project is located as a person carrying on a trade or business replacing a trade or business with respect to which another person suffered such a loss, and (II)in the case of a project relating to public utility property, the project involves repair or reconstruction of public utility property damaged by Hurricane Ike, and (ii)paragraph (2)(A)(ii) shall be applied by treating an issue as a qualified mortgage issue only if 95 percent or more of the net proceeds (as defined in section 150(a)(3)) of the issue are to be used to provide financing for mortgagors who suffered damages to their principal residences attributable to Hurricane Ike, (B)by substituting any State any portion of which is in the Hurricane Ike recovery area for the State of Alabama, Louisiana, or Mississippi in paragraph (2)(B), (C)by substituting designated for purposes of this section (on the basis of providing assistance to areas in the order in which such assistance is most needed) for designated for purposes of this section in paragraph (2)(C), (D)by substituting January 1, 2013 for January 1, 2011 in paragraph (2)(D), (E)in paragraph (3)(A)— (i)by substituting $1,000 for $2,500, and (ii)by substituting before September 12, 2008 for before August 28, 2005, (F)by substituting qualified Hurricane Ike recovery area repair or construction for qualified GO Zone repair or construction each place it appears, and (G)by substituting after the date of the enactment of the Hurricane Ike Tax Relief Act of 2008 and before January 1, 2013 for after the date of the enactment of this paragraph and before January 1, 2011 in paragraph (7)(C). (2)

Special allowance for certain property acquired on or after the applicable disaster date

Section 1400N(d)— (A)by substituting qualified Hurricane Ike recovery area property for qualified Gulf Opportunity Zone property each place it appears, except that a taxpayer shall be allowed additional bonus depreciation and expensing under such subsection or section 1400N(e) with respect to such property only if— (i)the taxpayer suffered an economic loss attributable to Hurricane Ike, and (ii)such property— (I)rehabilitates property damaged, or replaces property destroyed or condemned, as a result of Hurricane Ike, except that, for purposes of this clause, property shall be treated as replacing property destroyed or condemned if, as part of an integrated plan, such property replaces property which is included in a continuous area which includes real property destroyed or condemned, and (II)is similar in nature to, and located in the same county as, the property being rehabilitated or replaced, (B)by substituting September 12, 2008 for August 28, 2005 each place it appears, (C)by substituting December 31, 2011 for December 31, 2007 in paragraph (2)(A)(v), (D)by substituting December 31, 2012 for December 31, 2008 in paragraph (2)(A)(v), (E)by substituting September 11, 2008 for August 27, 2005 in paragraph (3)(A), (F)determined without regard to paragraph (6) thereof, and (G)by not including as qualified Hurricane Ike recovery area property any property to which section 168(k) applies. (3)

Increase in expensing under section 179

Section 1400N(e), by substituting qualified section 179 Hurricane Ike recovery area property for qualified section 179 Gulf Opportunity Zone property each place it appears. (4)

Expensing for certain demolition and clean-up costs

Section 1400N(f)— (A)by substituting qualified Hurricane Ike recovery area clean-up cost for qualified Gulf Opportunity Zone clean-up cost each place it appears, (B)by substituting beginning on September 12, 2008, and ending on December 31, 2010 for beginning on August 28, 2005, and ending on December 31, 2007 in paragraph (2), and (C)by treating costs as qualified Hurricane Ike recovery clean-up costs only if the removal of debris or demolition of any structure was necessary due to damage attributable to Hurricane Ike. (5)

Extension of expensing for environmental remediation costs

Section 1400N(g)— (A)by substituting September 12, 2008 for August 28, 2005 each place it appears, (B)by substituting January 1, 2011 for January 1, 2008 in paragraph (1), (C)by substituting December 31, 2010 for December 31, 2007 in paragraph (1), and (D)by treating a site as a qualified contaminated site only if the release (or threat of release) or disposal of a hazardous substance at the site was attributable to Hurricane Ike. (6)

Increase in rehabilitation credit

Section 1400N(h)— (A)by substituting September 12, 2008 for August 28, 2005, (B)by substituting January 1, 2011 for January 1, 2008 in paragraph (1), and (C)by only applying such subsection to qualified rehabilitation expenditures with respect to any building or structure which was damaged or destroyed as a result of Hurricane Ike. (7)

Treatment of net operating losses attributable to disaster losses

Section 1400N(k)— (A)by substituting qualified Hurricane Ike recovery area loss for qualified Gulf Opportunity Zone loss each place it appears, (B)by substituting after September 11, 2008, and before January 1, 2011 for after August 27, 2005, and before January 1, 2008 each place it appears, (C)by substituting September 12, 2008 for August 28, 2005 in paragraph (2)(B)(ii)(I), (D)by substituting qualified Hurricane Ike recovery area property for qualified Gulf Opportunity Zone property in paragraph (2)(B)(iv), and (E)by substituting qualified Hurricane Ike recovery area casualty loss for qualified Gulf Opportunity Zone casualty loss each place it appears. (8)

Credit to holders of tax credit bonds

Section 1400N(l)— (A)by substituting Hurricane Ike tax credit bond for Gulf tax credit bond each place it appears, (B)by substituting any State any portion of which is in the Hurricane Ike recovery area for the State of Alabama, Louisiana, or Mississippi in paragraph (4)(A)(i), (C)by substituting after December 31, 2008 and before January 1, 2010 for after December 31, 2005, and before January 1, 2007, (D)by substituting shall not exceed $100,000,000 for any State with an aggregate population located in the portion of the State which is in the Hurricane Ike recovery area of at least 2,000,000, $50,000,000 for any State with an aggregate population located in such portion of at least 1,000,000 but less than 2,000,000, and zero for any other State. The population of a State within any area shall be determined on the basis of the most recent census estimate of resident population released by the Bureau of Census before September 12, 2008. for shall not exceed and all that follows in paragraph (4)(C), and (E)by substituting September 12, 2008 for August 28, 2005 in paragraph (5)(A). (9)

Housing tax benefits

Section 1400P, by substituting September 12, 2008 for August 28, 2005 in subsection (c)(1). (10)

Special rules for use of retirement funds

Section 1400Q— (A)by substituting qualified Hurricane Ike recovery area distribution for qualified hurricane distribution each place it appears, (B)by substituting on or after September 12, 2008, and before January 1, 2010 for on or after August 25, 2005, and before January 1, 2007 in subsection (a)(4)(A)(i), (C)by substituting September 12, 2008 for August 28, 2005 in subsections (a)(4)(A)(i) and (c)(3)(B), (D)by disregarding clauses (ii) and (iii) of subsection (a)(4)(A) thereof, (E)by substituting qualified Hurricane Ike distribution for qualified Katrina distribution each place it appears, (F)by substituting April 12, 2008, and before September 13, 2008 for after February 28, 2005, and before August 29, 2005 in subsection (b)(2)(B)(ii), (G)by substituting the Hurricane Ike recovery area, but not so purchased or constructed on account of Hurricane Ike for the Hurricane Katrina disaster area, but not so purchased or constructed on account of Hurricane Katrina in subsection (b)(2)(B)(iii), (H)by substituting beginning on September 12, 2008, and ending on the date which is 5 months after the date of the enactment of the Hurricane Ike Tax Relief Act of 2008 for beginning on August 25, 2005, and ending on February 28, 2006 in subsection (b)(3)(A), (I)by substituting qualified Hurricane Ike individual for qualified Hurricane Katrina individual each place it appears, (J)by substituting December 31, 2009 for December 31, 2006 in subsection (c)(2)(A), (K)by substituting beginning on the date of the enactment of the Hurricane Ike Tax Relief Act of 2008 and ending on December 31, 2009 for beginning on September 24, 2005, and ending on December 31, 2006 in subsection (c)(4)(A)(i), (L)by substituting September 12, 2008 for August 25, 2005 in subsection (c)(4)(A)(ii), and (M)by substituting January 1, 2010 for January 1, 2007 in subsection (d)(2)(A)(ii). (11)

Employee retention credit for employers affected by Hurricane Ike

Section 1400R(a)— (A)by substituting September 12, 2008 for August 28, 2005 each place it appears, (B)by substituting January 1, 2009 for January 1, 2006 both places it appears, and (C)only with respect to eligible employers who employed an average of not more than 200 employees on business days during the taxable year before September 12, 2008. (12)

Temporary suspension of limitations on charitable contributions

Section 1400S(a), by substituting the following paragraph for paragraph (4) thereof: (4)

Qualified contributions

(A)

In general

For purposes of this subsection, the term qualified contribution means any charitable contribution (as defined in section 170(c)) if— (i)such contribution— (I)is paid during the period beginning on September 12, 2008, and ending on December 31, 2008, in cash to an organization described in section 170(b)(1)(A), and (II)is made for relief efforts in the Hurricane Ike recovery area, (ii)the taxpayer obtains from such organization contemporaneous written acknowledgment (within the meaning of section 170(f)(8)) that such contribution was used (or is to be used) for relief efforts in the Hurricane Ike recovery area, and (iii)the taxpayer has elected the application of this subsection with respect to such contribution. (B)

Exception

Such term shall not include a contribution by a donor if the contribution is— (i)to an organization described in section 509(a)(3), or (ii)for establishment of a new, or maintenance of an existing, donor advised fund (as defined in section 4966(d)(2)). (C)

Application of election to partnerships and S corporations

In the case of a partnership or S corporation, the election under subparagraph (A)(iii) shall be made separately by each partner or shareholder.. (13)

Suspension of certain limitations on personal casualty losses

Section 1400S(b)(1), by substituting September 12, 2008 for August 25, 2005. (14)

Special rule for determining earned income

Section 1400S(d)— (A)by treating an individual as a qualified individual if such individual's principal place of abode on September 12, 2008, was located in the Hurricane Ike recovery area, (B)by treating September 12, 2008, with respect to any such individual as the applicable date for purposes of such subsection, and (C)by treating an area as described in paragraph (2)(B)(ii) thereof if the area is a Hurricane Ike recovery area only by reason of subsection (b)(2) of this section (relating to areas eligible only for public assistance). (15)

Adjustments regarding taxpayer and dependency status

Section 1400S(e), by substituting 2008 or 2009 for 2005 or 2006. (f)

Modifications to Katrina Emergency Tax Relief Act of 2005

In the case of the Hurricane Ike recovery area, the following provisions of the Katrina Emergency Tax Relief Act of 2005 shall be applied with the following modifications: (1)

Additional exemption for housing displaced individual

Section 302— (A)by substituting 2008 or 2009 for 2005 or 2006 in subsection (a) thereof, (B)by substituting Hurricane Ike displaced individual for Hurricane Katrina displaced individual each place it appears, and (C)by treating an area as a core disaster area for purposes of applying subsection (c) thereof if the area is a Hurricane Ike recovery area without regard to subsection (b)(2) of this section (relating to areas eligible only for public assistance). (2)

Mileage reimbursements for charitable volunteers

Section 304— (A)by substituting beginning on September 12, 2008, and ending on December 31, 2008 for beginning on August 25, 2005, and ending on December 31, 2006 in subsection (a), and (B)by substituting September 12, 2008 for August 25, 2005 in subsection (a). (3)

Exclusion of certain cancellation of indebtedness income

Section 401— (A)by treating an individual whose principal place of abode on September 12, 2008, was in the Hurricane Ike recovery area (determined without regard to subsection (b)(2) of this section) as an individual described in subsection (b)(1) thereof, and by treating an individual whose principal place of abode on September 12, 2008, was in the Hurricane Ike recovery area solely by reason of subsection (b)(2) of this section as an individual described in subsection (b)(2) thereof, (B)by substituting September 12, 2008 for August 28, 2005 both places it appears, and (C)by substituting January 1, 2010 for January 1, 2007 in subsection (e). (4)

Extension of replacement period for nonrecognition of gain

Section 405, by substituting on or after September 12, 2008 for on or after August 25, 2005.

3.

Enhanced charitable deductions for contributions of food inventory

(a)

Increased amount of deduction

(1)

In general

Clause (iv) of section 170(e)(3)(C) (relating to termination) of the Internal Revenue Code of 1986 is amended by striking December 31, 2007 and inserting December 31, 2009. (2)

Effective date

The amendment made by this subsection shall apply to contributions made after December 31, 2007. (b)

Temporary suspension of limitations on charitable contributions

(1)

In general

Section 170(b) of such Code is amended by adding at the end the following new paragraph: (3)

Temporary suspension of limitations on charitable contributions

In the case of a qualified farmer or rancher (as defined in paragraph (1)(E)(v)), any charitable contribution of food— (A)to which subsection (e)(3)(C) applies (without regard to clause (ii) thereof), and (B)which is made during the period beginning on the date of the enactment of this paragraph and before January 1, 2009,shall be treated for purposes of paragraph (1)(E) or (2)(B), whichever is applicable, as if it were a qualified conservation contribution which is made by a qualified farmer or rancher and which otherwise meets the requirements of such paragraph.. (2)

Effective date

The amendment made by this subsection shall apply to taxable years ending after the date of the enactment of this Act.

4.

Extension of enhanced charitable deduction for contributions of book inventory

(a)

Extension

Clause (iv) of section 170(e)(3)(D) of the Internal Revenue Code of 1986 (relating to termination) of the Internal Revenue Code of 1986 is amended by striking December 31, 2007 and inserting December 31, 2009. (b)

Clerical amendment

Clause (iii) of section 170(e)(3)(D) of such Code (relating to certification by donee) is amended by inserting of books after to any contribution. (c)

Effective date

The amendments made by this section shall apply to contributions made after December 31, 2007.

5.

Reporting requirements relating to disaster relief contributions

(a)

In general

Section 6033(b) of the Internal Revenue Code of 1986 (relating to returns of certain organizations described in section 501(c)(3)) is amended by striking and at the end of paragraph (13), by redesignating paragraph (14) as paragraph (15), and by adding after paragraph (13) the following new paragraph: (14)such information as the Secretary may require with respect to disaster relief activities, including the amount and use of qualified contributions to which section 1400S(a) applies, and. (b)

Effective date

The amendments made by this section shall apply to returns the due date for which (determined without regard to any extension) occurs after December 31, 2008.

6.

Increase in passenger automobile mileage rates

(a)

Charitable mileage rate same as medical and moving rate

(1)

In general

Subsection (i) of section 170 of the Internal Revenue Code of 1986 (relating to standard mileage rate for use of passenger automobile) is amended by striking 14 cents per mile and inserting the rate determined for purposes of sections 213 and 217. (2)

Effective date

The amendment made by paragraph (1) shall apply to miles driven on or after the date of the enactment of this Act. (b)

Increase in mileage rates

For any portion of the period beginning on the date of the enactment of this Act and ending on December 31, 2008, the standard mileage rate under each of sections 162, 213, and 217 of the Internal Revenue Code of 1986 for operating a passenger automobile shall be not less than the greater of— (1)133.7 percent of the rate in effect under each such section on January 1, 2008, or (2)the rate prescribed by the Internal Revenue Service for each such section.