Amends the Internal Revenue Code to permit the expensing (of up to $500,000) and amortization (of the remaining amount over a 60-month period) of qualified environmental remediation expenses.
[Congressional Bills 105th Congress]
[From the U.S. Government Printing Office]
[H.R. 997 Introduced in House (IH)]
105th CONGRESS
1st Session
H. R. 997
To amend the Internal Revenue Code of 1986 to allow expensing and rapid
amortization of certain environmental remediation expenditures.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
March 6, 1997
Mr. Weller (for himself, Mr. Lipinski, Mr. Crane, Mr. Rush, Mr. Fawell,
Mr. Jackson of Illinois, Mr. Manzullo, Mr. Gutierrez, Mr. English of
Pennsylvania, Mr. Blagojevich, Mr. Shays, Mr. Davis of Illinois, Mr.
Costello, and Mr. Evans) 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 expensing and rapid
amor tization of certain environmental remediation expenditures.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. EXPENSING AND RAPID AMORTIZATION FOR CERTAIN ENVIRONMENTAL
REMEDIATION EXPENDITURES.
(a) In General.--Part VI of subchapter B of chapter 1 of the
Internal Revenue Code of 1986 (relating to itemized deductions for
individuals and corporations) is amended by adding at the end the
following new section:
``SEC. 198. EXPENSING AND RAPID AMORTIZATION FOR CERTAIN ENVIRONMENTAL
REMEDIATION EXPENDITURES.
``(a) Treatment As Expenses.--
``(1) In general.--At the election of the taxpayer,
qualified environmental remediation expenditures which are paid
or incurred by the taxpayer during the taxable year in
connection with a trade or business shall be treated as
expenses which are not chargeable to capital account. The
expenditures so treated shall be allowed as a deduction.
``(2) Limitation.--The amount treated under paragraph (1)
as an expense with respect to any qualified contaminated site
shall not exceed $500,000 for all taxable years.
``(3) Controlled groups.--Rules similar to the rules of
paragraphs (6), (7), and (8) of section 179(d) shall apply for
purposes of this subsection.
``(b) 60-Month Amortization of Remaining Environmental Remediation
Expenditures.--
``(1) In general.--At the election of the taxpayer,
qualified environmental remediation expenditures--
``(A) which are paid or incurred by the taxpayer in
connection with his trade or business, and
``(B) which are not treated as expenses under
subsection (a),
may be treated as deferred expenses.
``(2) Amortization of deferred expenses.--In computing
taxable income, such deferred expenses shall be allowed as a
deduction ratably over such period of not less than 60 months
as may be selected by the taxpayer (beginning with the month in
which the taxpayer pays or incurs such expenditures). Such
deferred expenses shall be treated as expenditures which are
properly chargeable to capital account for purposes of section
1016(a)(1) (relating to adjustments to basis of property).
``(c) Certain Persons Not Eligible.--A taxpayer shall not be
eligible for the treatment under this section with respect to any
qualified contaminated site if--
``(1) at any time on or before the date of the enactment of
this section such taxpayer was the owner or operator of any
business on such site,
``(2) at any time before, on, or after such date of
enactment such taxpayer--
``(A) had (by contract, agreement, or otherwise)
arranged for the disposal or treatment of any hazardous
materials at such site or arranged with a transporter
for transport for disposal or treatment of any
hazardous materials at such site, or
``(B) had accepted any hazardous materials for
transport to such site, or
``(3) the taxpayer is related to any taxpayer referred to
in paragraph (1) or (2).
``(d) Qualified Environmental Remediation Expenditures.--For
purposes of this section, the term `qualified environmental remediation
expenditure' means any amount (otherwise chargeable to capital account)
which is paid or incurred by the taxpayer for environmental remediation
with respect to any qualified contaminated site which is owned by the
taxpayer.
``(e) Other Definitions.--For purposes of this section--
``(1) Qualified contaminated site.--
``(A) In general.--For purposes of this subsection,
the term `qualified contaminated site' means any site
if the appropriate agency certifies that at least 1 of
the following environmental conditions is present on
such site:
``(i) A release or threatened release of
any hazardous, toxic, or dangerous substance.
``(ii) Any storage tanks which contain any
hazardous, toxic, or dangerous substance.
``(iii) Any illegal disposal of solid
waste.
Such term shall not include any site listed on the
National Priorities List under the Comprehensive
Environmental Response, Compensation, and Liability Act
of 1980.
``(B) Appropriate agency.--For purposes of
subparagraph (A), the appropriate agency is--
``(i) the agency of the State in which the
site is located which is designated by the
Administrator of the Environmental Protection
Agency for purposes of this paragraph, or
``(ii) if the agency described in clause
(i) designates an agency of the local
government in which the site is located for
purposes of this paragraph, such local
government agency.
``(2) Hazardous, toxic, or dangerous substance.--Any
substance, waste, or material shall be treated as a hazardous,
toxic, or dangerous substance if it is so treated under--
``(A) the Comprehensive Environmental Response,
Compensation, and Liability Act of 1980 (42 U.S.C. 9601
et seq.),
``(B) the Resource Conservation and Recovery Act
(42 U.S.C. 6901 et seq.), or
``(C) any State or local environmental law or
ordinance.
The following materials shall in any event be treated as such a
substance: petroleum or crude oil or any derivative thereof,
friable asbestos or any asbestos containing material,
polychlorinated biphenyls, or urea formaldehyde foam
insulation.
``(3) Environmental remediation.--The term `environmental
remediation' means--
``(A) removal or remediation activity, including
soil and ground water remediation,
``(B) restoration of natural, historic or cultural
resources at the site, or the mitigation of unavoidable
losses of such resources incurred in connection with
the remediation or response activity,
``(C) health assessments or health effects studies,
``(D) environmental investigations,
``(E) remediation of off-site contamination caused
by activity on the site, and
``(F) any other costs reasonably required by reason
of the environmental conditions of the site, including
demolition of existing contaminated structures, site
security, and permit fees necessary for remediation.
``(4) Related person.--Persons shall be treated as related
to each other if such persons are treated as a single employer
under the regulations prescribed under section 52(b) or such
persons bear a relationship to each other specified in section
267(b) or 707(b).
``(f) Land and Other Property.--This section shall not apply to any
expenditure for--
``(1) the acquisition or improvement of land, or
``(2) the acquisition or improvement of property of a
character which is subject to the allowance under section 167
(relating to allowance for depreciation, etc.) or section 611
(relating to allowance for depletion); except that, for
purposes of this section, allowances under section 167, and
allowances under section 611, shall be treated as
expenditures.''
(b) Conforming Amendments.--
(1) Paragraph (14) of section 1016(a) of such Code is
amended by inserting ``, or under section 198(b) (relating to
qualified environmental remediation expenditures),'' after
``expenditures)''.
(2) Subparagraph (C) of section 1245(a)(2) of such Code is
amended by striking ``or 193'' and inserting ``193, or 198''.
(3) Subparagraph (C) of section 1245(a)(3) of such Code is
amended by striking ``or 194'' and inserting ``194, or 198''.
(4) The table of sections for part VII of subchapter B of
chapter 1 of such Code is amended by adding at the end the
following new item:
``Sec. 198. Expensing and rapid
amortization for certain
environmental remediation
expenditures.''
(c) Effective Date.--The amendments made by this section shall
apply to taxable years beginning after the date of the enactment of
this Act.
<all>
Introduced in House
Introduced in House
Sponsor introductory remarks on measure. (CR E412)
Referred to the House Committee on Ways and Means.
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