I 111th CONGRESS 1st Session H. R. 3622 IN THE HOUSE OF REPRESENTATIVES September 22, 2009 Mr. Bright 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 allow a credit for the construction of pond establishments for the purposes of non-commercial recreational fishing and conservation of water-based wildlife habitats.

1.

Short title

This Act may be cited as the Ponds and Water-Based Conservation Act of 2009.

2.

Pond construction credit

(a)

Pond construction credit

Subpart A 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:

25E.

Pond construction credit

(a)

Allowance of credit

In the case of an individual, there shall be allowed as a credit against the tax imposed by this chapter for the taxable year an amount equal to 50 percent of qualified pond construction expenditures. (b)

Limitations

The amount allowed as a credit under subsection (a) for a taxable year shall not exceed $50,000. (c)

Qualified pond construction expenditures

For purposes of this section— (1)

In general

The term qualified pond construction expenditures means amounts paid or incurred to construct a body of water larger than one-half acre and smaller than 10 acres that serves to promote stormwater management and conservation or foster expansion of water-based habitat for wildlife or fish. (2)

Labor costs

For purposes of paragraph (1), expenditures for labor costs properly allocable to the onsite construction of such body of water shall be taken into account. (3)

Exception for commercial uses

Such term does not include any amount paid or incurred with respect to commercial fishing. (d)

Recapture of credit

(1)

In general

The Secretary shall provide for the recapture of the credit allowed under this section in any case in which, before the close of the recapture period, the land with respect to which the qualified pond construction expenditures were paid or incurred is disposed of or otherwise ceases to sustain water-based wildlife or fish. (2)

Exceptions

(A)

Death of taxpayer

Paragraph (1) shall not apply to any taxable year ending after the date of the taxpayer’s death. (B)

Involuntary conversion

Paragraph (1) shall not apply in the case of a property which is compulsorily or involuntarily converted (within the meaning of section 1033(a)). (C)

Transfers between spouses or incident to divorce

In the case of a transfer of a property to which section 1041(a) applies— (i)paragraph (1) shall not apply to such transfer, and (ii)in the case of taxable years ending after such transfer, paragraph (1) shall apply to the transferee in the same manner as if such transferee were the transferor (and shall not apply to the transferor). (3)

Recapture period

For purposes of paragraph (1), the recapture period is the 10-taxable year period beginning with the taxable year after the taxable year for which a credit is allowed under subsection (a). (e)

Certification

(1)

Year of construction

No amount shall be treated as a qualified pond construction expenditure unless the taxpayer certifies that the body of water constructed pursuant to such expenditures meets the requirements of subsection (c)(1). (2)

Recapture

Recapture shall be required under subsection (d) for any year in the recapture period unless the taxpayer certifies that the taxpayer is in compliance with subsection (d). (3)

Certification requirements

A certification under this subsection shall be in such form and meet such requirements as the Secretary may require.

. (b)

Conforming 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 item: Sec. 25E. Pond construction credit. . (c)

Effective Date

The amendments made by this section shall apply to taxable years beginning after December 31, 2009.