[Congressional Bills 111th Congress]
[From the U.S. Government Publishing Office]
[S. 2876 Introduced in Senate (IS)]

111th CONGRESS
  1st Session
                                S. 2876

To amend the Internal Revenue Code of 1986 to clarify the capital gain 
or loss treatment of the sale or exchange of mitigation credits earned 
             by restoring wetlands, and for other purposes.


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                   IN THE SENATE OF THE UNITED STATES

                           December 11, 2009

 Ms. Landrieu introduced the following bill; which was read twice and 
                  referred to the Committee on Finance

_______________________________________________________________________

                                 A BILL


 
To amend the Internal Revenue Code of 1986 to clarify the capital gain 
or loss treatment of the sale or exchange of mitigation credits earned 
             by restoring wetlands, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Wetlands Conservation Investment Act 
of 2009''.

SEC. 2. CLARIFICATION OF TREATMENT OF SALES OR EXCHANGES OF WETLAND 
              MITIGATION CREDITS AS LONG-TERM CAPITAL GAIN OR LOSS.

    (a) In General.--Part IV of subchapter P of chapter 1 of the 
Internal Revenue Code of 1986 is amended by inserting after section 
1257 the following new section:

``SEC. 1257A. GAINS OR LOSSES FROM SALES OR EXCHANGES OF WETLANDS 
              MITIGATION CREDITS.

    ``(a) General Rule.--Gain or loss attributable to the sale or 
exchange of a mitigation bank credit by the sponsor of the mitigation 
bank who earned such credit shall be considered the sale or exchange of 
a capital asset held for more than 1 year.
    ``(b) Definitions.--For purposes of this section, the terms 
`mitigation bank' and `mitigation bank credit' have the respective 
meanings given such terms by part 332 of title 33 of the Code of 
Federal Regulations.''.
    (b) Clerical Amendment.--The table of sections for part IV of 
subchapter P of chapter 1 of such Code is amended by inserting after 
the item relating to section 1257 the following new item:

``Sec. 1257A. Gains or losses from sales or exchanges of wetlands 
                            mitigation credits.''.
    (c) Effective Date.--The amendments made by this section shall 
apply with respect to sales or exchanges of mitigation bank credits 
occurring before, on, or after the date of enactment of this Act.

SEC. 3. EXEMPTION OF WETLAND MITIGATION CREDIT SALES FROM FIRPTA.

    (a) In General.--Section 897(c)(6) of the Internal Revenue Code of 
1986 is amended by adding at the end the following new subparagraph:
                    ``(D) Exemption of wetland mitigation credit 
                sales.--The term `United States real property interest' 
                does not include any mitigation bank credit (as defined 
                in part 332 of title 33 of the Code of Federal 
                Regulations.''.
    (b) Conforming Amendment.--Section 897(c)(1)(A) of such Code is 
amended by inserting ``and paragraph (6)(C)'' after ``subparagraph 
(B)''.
    (c) Effective Date.--The amendments made by this section shall 
apply with respect to sales or exchanges of mitigation bank credits 
occurring before, on, or after the date of enactment of this Act.
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