American-made automobile credit

(a)

In general

Subpart A of part IV of subchapter A of chapter 1 of the Internal Revenue Code of 1986 (relating to nonrefundable personal credits) is amended by inserting after section 25D the following new section:

25E.

American-made automobile credit

(a)

Allowance of credit

In the case of an individual who places in service a qualified vehicle during the taxable year, there shall be allowed as a credit against the tax imposed by this subtitle for the taxable year an amount equal to $1,500. (b)

Limitation based on modified adjusted gross income

(1)

In general

The credit which would (but for this paragraph) be allowed under subsection (a) for the taxable year shall be reduced (but not below zero) by the amount determined under paragraph (2). (2)

Amount of reduction

The amount determined under this paragraph is the amount which bears the same ratio to the amount which would be allowed as— (A)the excess of— (i)the taxpayer’s modified adjusted gross income for such taxable year, over (ii)$125,000 ($250,000 in the case of a joint return), bears to (B)$10,000. (3)

Modified adjusted gross income

The term modified adjusted gross income means the adjusted gross income of the taxpayer for the taxable year increased by any amount excluded from gross income under section 911, 931, or 933. (c)

Qualified vehicle

For purposes of this section, the term qualified vehicle means any motor vehicle (as defined in section 30(c)(2))— (1)substantially all of the manufacturing of which occurred in the United States, (2)which is acquired for use by the taxpayer and not for resale, (3)the original use of which commences with the taxpayer, and (4)which has a vehicle gross weight rating of not more than 14,000 pounds. (d)

Special rules

For purposes of this section— (1)

One-time only

If a credit is allowed under subsection (a) with respect to an individual who places in service a qualified vehicle, no credit shall be allowed with respect to any other vehicle placed in service by such individual. (2)

Basis reduction

The basis of any property for which a credit is allowed under subsection (a) shall be reduced by the amount of such credit. (3)

Election not to take credit

No credit shall be allowed under subsection (a) for any vehicle if the taxpayer elects to not have this section apply to such vehicles. (4)

No double benefit

The amount of any deduction or other credit allowable under this chapter with respect to a vehicle shall be reduced by the amount of credit allowed under subsection (a) for such vehicle for the taxable year. (5)

Property used outside United States, etc., not qualified

No credit shall be allowed under subsection (a) with respect to any property referred to in section 50(b) or with respect to the portion of the cost of any property taken into account under section 179. (e)

Termination

This section shall not apply to any vehicle purchased more than 180 days after the date of the enactment of this Act.

(b)

Clerical amendment

The table of sections for subpart A of part IV of subchapter A of chapter 1 of such Code is amended by inserting after the item relating to section 25D the following new items:

Sec. 25E. American-made automobile credit.

(c)

Effective date

The amendments made by this section shall apply to property purchased after the date of the enactment of this Act for taxable years beginning after such date.