Fuel Efficiency Encouragement Act of 2007

Fuel Efficiency Encouragement Act of 2007 - Amends the Internal Revenue Code to: (1) repeal the limitation on the number of new qualified hybrid and advanced lean-burn technology vehicles eligible for the alternative motor vehicle tax credit; and (2) provide a tax credit for manufacturing new qualified hybrid motor vehicles.

[Congressional Bills 110th Congress]
[From the U.S. Government Publishing Office]
[H.R. 2481 Introduced in House (IH)]







110th CONGRESS
  1st Session
                                H. R. 2481

To amend the Internal Revenue Code of 1986 to repeal the limitation on 
 the number of new qualified hybrid and advanced lean-burn technology 
   vehicles eligible for the alternative motor vehicle credit and to 
        provide for a credit for manufacturing hybrid vehicles.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                              May 24, 2007

   Mr. Hill 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 repeal the limitation on 
 the number of new qualified hybrid and advanced lean-burn technology 
   vehicles eligible for the alternative motor vehicle credit and to 
        provide for a credit for manufacturing hybrid vehicles.

    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 ``Fuel Efficiency Encouragement Act of 
2007''.

SEC. 2. REPEAL OF VOLUME LIMITATION ON VEHICLES ELIGIBLE FOR 
              ALTERNATIVE MOTOR VEHICLE CREDIT.

    (a) In General.--Section 30B of the Internal Revenue Code of 1986 
(relating to alternative motor vehicle credit) is amended by striking 
subsection (f).
    (b) Effective Date.--The amendment made by subsection (a) shall 
apply to cars manufactured after December 31, 2006.

SEC. 3. CREDIT FOR MANUFACTURING NEW QUALIFIED HYBRID MOTOR VEHICLES.

    (a) In General.--Subpart D of part IV of subchapter 1 of the 
Internal Revenue Code of 1986 is amended by inserting after section 45N 
the following new section:

``SEC. 45O. CREDIT FOR MANUFACTURING NEW QUALIFIED HYBRID MOTOR 
              VEHICLES.

    ``(a) In General.--For purposes of section 38, the new qualified 
hybrid motor vehicle manufacturing credit determined under this section 
for any taxable year is $1,000 for each new qualified hybrid motor 
vehicle manufactured by the taxpayer during the taxable year.
    ``(b) New Qualified Hybrid Motor Vehicle.--For purposes of this 
section, the term `new qualified hybrid motor vehicle' means a motor 
vehicle described in section 30B(d)(3) which--
            ``(1) is made in the United States by a manufacturer,
            ``(2) is manufactured after the date of the enactment of 
        this section, and
            ``(3) meets or exceeds the minimum fuel economy standards 
        and conservation standards described in section 30B(d)(2)(A) 
        for the vehicle model and weight class of such motor vehicle.
    ``(c) Definitions and Special Rules.--
            ``(1) Motor vehicle.--The term `motor vehicle' has the 
        meaning given such term by section 30(c)(2).
            ``(2) Basis reduction.--The basis of any property for which 
        a credit is determined under subsection (a) shall be reduced by 
        the amount of the credit so determined.
            ``(3) Election not to take credit.--No credit shall be 
        determined under subsection (a) for any vehicle if the taxpayer 
        elects not to have this section apply to such vehicle.''.
    (b) Denial of Double Benefit.--Section 280C of such Code is amended 
by adding at the end the following new subsection:
    ``(f) Credit for Manufacturing New Qualified Hybrid Motor 
Vehicles.--No deduction shall be allowed for that portion of the 
expenses otherwise allowable as a deduction for the taxable year which 
is equal to the amount of the credit determined for the taxable year 
under section 45O(a).''.
    (c) Conforming Amendments.--
            (1) Section 38(b) of such Code is amended by striking 
        ``plus'' at the end of paragraph (30), by striking the period 
        at the end of paragraph (31) and inserting ``, plus'', and by 
        adding at the end the following:
            ``(32) the new qualified hybrid motor vehicle manufacturing 
        credit determined under section 45O(a).''.
            (2) Section 1016(a) of such Code is amended by striking 
        ``and'' at the end of paragraph (37), by striking the period at 
        the end of paragraph (38) and inserting ``, and'', and by 
        adding at the end the following new paragraph:
            ``(38) to the extent provided in section 30D(c)(2).''.
            (3) Section 6501(m) of such Code is amended by inserting 
        ``30D(c)(3),'' after ``30C(e)(5),''.
            (4) The table of sections for subpart D of part IV of 
        subchapter A of chapter 1 of such Code is amended by inserting 
        after the item relating to section 45N the following new item:

``Sec. 45O. Credit for manufacturing new qualified hybrid motor 
                            vehicles.''.
    (d) Effective Date.--The amendments made by this section shall 
apply to taxable years ending after the date of the enactment of this 
Act.
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