1.Credit for production of
cellulosic biofuel
(a)Subpart B of part IV
of subchapter A of chapter 1 of the Internal Revenue Code of 1986 is amended by
adding at the end the following new section:
30D.Cellulosic
biofuel production
(a)There shall be allowed as a credit against the tax imposed
by this chapter for the taxable year an amount equal to $1.28 for each gallon
of qualified cellulosic biofuel production.
(b)Qualified
cellulosic biofuel productionFor purposes of this section, the
term qualified cellulosic biofuel production means any cellulosic
biofuel which is produced in the United States by the taxpayer and which during
the taxable year—
(1)is sold by the
taxpayer to another person—
(A)for use by such
other person in the production of a qualified cellulosic biofuel mixture in
such other person's trade or business (other than casual off-farm
production),
(B)for use by such
other person as a fuel in a trade or business, or
(C)who sells such
cellulosic biofuel at retail to another person and places such cellulosic
biofuel in the fuel tank of such other person, or
(2)is used or sold
by the taxpayer for any purpose described in paragraph (1).
(c)Definitions and
special rulesFor purposes of this section—
(1)The term cellulosic biofuel means any liquid
transportation fuel derived from any lignocellulosic or hemicellulosic mater
(other than food starch) that is available on a renewable or recurring
basis.
(2)Qualified
cellulosic biofuel mixtureThe term qualified cellulosic
biofuel mixture means a mixture of cellulosic biofuel and gasoline
which—
(A)is sold by the
person producing such mixture to any person for use as a fuel, or
(B)is used as a fuel
by the person producing such mixture.
(3)Cellulosic
biofuel not used as a fuelIf any credit is allowed under
subsection (a) and any person does not use such cellulosic biofuel for a
purpose described in subsection (b), then there is hereby imposed on such
person a tax equal to $1.28 for each gallon of such cellulosic biofuel.
(4)Pass-thru in
the case of estates and trustsUnder regulations prescribed by
the Secretary, rules similar to the rules of subsection (d) of section 52 shall
apply.
(5)No credit shall be allowed under this section to
any taxpayer with respect to any cellulosic biofuel if a credit or payment is
allowed with respect to such fuel to such taxpayer under section 40, 40A, 6426,
or 6427(e).
(d)Limitation
based on amount of taxThe credit allowed under subsection (a)
for any taxable year shall not exceed the excess of—
(1)the sum of the
regular tax liability (as defined in section 26(b)) plus the tax imposed by
section 55, over
(2)the sum of the
credits allowable under subpart A and sections 27, 30, 30B, and 30C.
(e)Carryforward
and carryback of unused credit
(1)If the credit allowable under subsection (a) exceeds the
limitation imposed by subsection (d) for such taxable year (hereinafter in this
section referred to as the unused credit year
) reduced by the
sum of the credits allowable under subpart A, such excess shall be—
(A)carried back to
the taxable year preceding the unused credit year, and
(B)carried forward
to each of the 20 taxable years following the unused credit year.
(2)The credit under subsection (a) may not be carried to a
taxable year beginning before the date of the enactment of this section.
(f)This section shall apply with respect to qualified
cellulosic biofuel production—
(1)after the date of
the enactment of this section, and
(2)before the date
on which the Secretary of Energy certifies that 1,000,000,000 gallons of
cellulosic biofuels have been produced in the United States after such
date.
.
(b)Deduction
allowed for unused creditSection 196(c) of such Code is amended
by adding at the end the following new subsection:
(d)Deduction
allowed for cellulosic biofuel production credit
(1)If any portion of the credit allowed under section 30D
for any taxable year has not, after the application of section 30D(d), been
allowed to the taxpayer as a credit under such section for any taxable year, an
amount equal to such credit not so allowed shall be allowed to the taxpayer as
a deduction for the first taxable year following the last taxable year for
which such credit could, under section 30D(e), have been allowed as a
credit.
(2)Taxpayer's
dying or ceasing to existIf a taxpayer dies or ceases to exist
before the first taxable year following the last taxable year for which the
credit could, under section 30D(e), have been allowed as a credit, the amount
described in paragraph (1) (or the proper portion thereof) shall, under
regulations prescribed by the Secretary, be allowed to the taxpayer as a
deduction for the taxable year in which such death or cessation
occurs.
.
(c)
(1)(A)Section 87 of the
Internal Revenue Code of 1986 is amended by striking and
at the
end of paragraph (1), by striking the period at the end of paragraph (2) and
inserting , and
, and by adding at the end the following new
paragraph:
(3)the cellulosic
biofuel production credit determined with respect to the taxpayer under section
30D(a).
.
(B)The heading of section 87 of such Code
is amended by striking and
biodiesel fuels credits
and inserting
, biodiesel fuels, and
cellulosic biofuels credits
.
(C)The item relating to section 87 is the
table of sections for part II of subchapter B of chapter 1 of such Code is
amended by striking and biodiesel fuels credits
and inserting
, biodiesel fuels, and cellulosic biofuels credits
.
(2)The table of
sections for subpart B of part IV of subchapter A of chapter 1 of such Code is
amended by inserting after the item relating to section 40A the following new
item:
Sec. 30D. Cellulosic biofuel
production.
.
(d)The amendments made by this section shall apply to fuel
produced after the date of the enactment of this Act.