I 111th CONGRESS 1st Session H. R. 3004 IN THE HOUSE OF REPRESENTATIVES June 23, 2009 Mr. Gingrey of Georgia (for himself, Mr. Broun of Georgia, Mr. King of Iowa, Mr. Brady of Texas, Mr. Paulsen, Ms. Fallin, Mr. Bartlett, Mr. Pitts, Mrs. Blackburn, Mr. Culberson, Mr. Lamborn, Mr. Bonner, Mr. Franks of Arizona, Mr. Bilbray, Mr. Jones, Mr. Westmoreland, Mr. Wamp, Mr. Sessions, Mr. Nunes, and Mr. Smith of Nebraska) introduced the following bill; which was referred to the Committee on Ways and Means A BILL To amend the Internal Revenue Code of 1986 to exclude from gross income gain from the conversion of property by reason of eminent domain.

1.

Short title

This Act may be cited as the Eminent Domain Tax Relief Act of 2009.

2.

Exclusion from gross income for gain from disposition of property by reason of eminent domain

(a)

In general

Part III of subchapter B of chapter 1 of the Internal Revenue Code of 1986 (relating to items specifically excluded from gross income) is amended by inserting after section 139C the following new section:

139D.

Gain from disposition of property by reason of eminent domain

(a)

In general

Gross income shall not include gain from the conversion (or threat or imminence thereof) of property in the United States by reason of the exercise of eminent domain by a governmental unit having the power to exercise eminent domain. (b)

Coordination with other nonrecognition provisions

(1)

Gain

Gain excluded under subsection (a) shall not be treated as gain recognized or an amount realized for purposes of sections 467, 637(d), 1033, 1245, 1250, 1252, 1254, 1255, and 1402. (2)

Section 1231

Section 1231 shall be applied without regard to this section. (3)

Holding period

Section 1223(1) shall not apply. (c)

Election not To claim credit

This section shall not apply to a taxpayer for any taxable year if such taxpayer elects to have this section not apply for such taxable year.

. (b)

Clerical amendment

The table of sections for such part is amended by inserting after the item relating to section 139C the following new item: Sec. 139D. Gain from disposition of property by reason of eminent domain. . (c)

Effective date

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