Grow a Renewable Energy Economy Now--Jumpstart Other Biofuels Act of 2010 - Amends the Internal Revenue Code to: (1) allow a 30% energy tax credit for investments in qualified cellulosic and algae-based biofuel facilities; (2) extend through 2016 the special depreciation allowance for qualified cellulosic biofuel plant property; (3) include algae-based biofuel within the definition of cellulosic biofuel for purposes of the cellulosic biofuel producer tax credit; (4) exclude from the definition of cellulosic biofuel any processed fuel with an acid number greater than 25; (5) extend through 2016 the cellulosic biofuel producer tax credit; and (6) allow a direct payment of 30% of the basis of cellulosic and algae-based biofuel facility property.
[Congressional Bills 111th Congress]
[From the U.S. Government Publishing Office]
[H.R. 5142 Introduced in House (IH)]
111th CONGRESS
2d Session
H. R. 5142
To amend the Internal Revenue Code of 1986 to provide for an investment
tax credit for biofuel facilities, and for other purposes.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
April 26, 2010
Ms. Schwartz (for herself, Mr. Schauer, and Mr. Bilbray) 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 provide for an investment
tax credit for biofuel facilities, 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 ``Grow a Renewable Energy Economy
Now--Jumpstart Other Biofuels Act of 2010''.
SEC. 2. ALLOWANCE OF INVESTMENT TAX CREDIT FOR CERTAIN CELLULOSIC AND
ALGAE-BASED BIOFUEL FACILITIES.
(a) In General.--Subsection (a) of section 48 of the Internal
Revenue Code of 1986 is amended by adding at the end the following new
paragraph:
``(6) Election to treat qualified cellulosic and algae-
based biofuel facility as energy property.--
``(A) In general.--In the case of any qualified
property which is part of a qualified cellulosic and
algae-based biofuel facility--
``(i) such property shall be treated as
energy property for purposes of this section,
and
``(ii) the energy percentage with respect
to such property shall be 30 percent.
``(B) Denial of production credit.--No credit shall
be allowed under section 40 for any taxable year with
respect to any qualified investment credit cellulosic
and algae-based biofuel facility.
``(C) Qualified investment credit cellulosic and
algae-based biofuel facility.--For purposes of this
paragraph, the term `qualified cellulosic and algae-
based biofuel facility' means a facility constructed
with the primary purpose of the production of
transportation-grade qualified cellulosic biofuel
production (as defined in subparagraph (C) of section
40(b)(6)) or qualified algae-based biofuel production
(as defined in section (F) of such section) if no
credit has been allowed under section 40 with respect
to such facility and the taxpayer makes an irrevocable
election to have this paragraph apply to such facility.
``(D) Termination.--No election may be made under
subparagraph (C) after December 31, 2016.''.
(b) Special Allowance for Cellulosic Biofuel Plant Property.--
(1) Extension of.--Paragraphs (2)(D) and (5)(B) of section
168(l) of such Code are each amended by striking ``January 1,
2013'' and inserting ``January 1, 2017''.
(2) Coordination with credit.--Section 168(l)(8) of such
Code is amended by inserting ``or under section 48(a)(6)(C)
(relating to election to treat qualified cellulosic and algae-
based biofuel facility as energy property)'' before the period
at the end.
(c) Conforming Amendment.--Section 48(a)(3) of such Code is amended
by striking ``section 45'' and inserting ``section 40 or 45''.
(d) Effective Date.--The amendments made by this section shall
apply to property placed in service after the date of the enactment of
this Act.
SEC. 3. INCLUSION OF ALGAE-BASED BIOFUEL IN DEFINITION OF CELLULOSIC
BIOFUEL.
(a) Cellulosic Biofuel Producer Credit.--
(1) General rule.--Paragraph (4) of section 40(a) of the
Internal Revenue Code of 1986 is amended by inserting ``and
algae-based'' after ``cellulosic''.
(2) Definitions.--Paragraph (6) of section 40(b) of such
Code is amended--
(A) by inserting ``and algae-based'' after
``Cellulosic'' in the heading,
(B) by striking subparagraph (A) and inserting the
following:
``(A) In general.--The cellulosic and algae-based
biofuel producer credit of any taxpayer is an amount
equal to the applicable amount for each gallon of--
``(i) qualified cellulosic biofuel
production, and
``(ii) qualified algae-based biofuel
production.'',
(C) by redesignating subparagraphs (F), (G), and
(H) as subparagraphs (I), (J), and (K), respectively,
(D) by inserting ``and algae-based'' after
``cellulosic'' in the heading of subparagraph (I), as
so redesignated,
(E) by inserting ``or algae-based biofuel,
whichever is appropriate,'' after ``cellulosic
biofuel'' in subparagraph (J), as so redesignated,
(F) by inserting ``and qualified algae-based
biofuel production'' after ``qualified cellulosic
biofuel production'' in subparagraph (K), as so
redesignated, and
(G) by inserting after subparagraph (E) the
following new subparagraphs:
``(F) Qualified algae-based biofuel production.--
For purposes of this section, the term `qualified
algae-based biofuel production' means any algae-based
biofuel which is produced by the taxpayer, and which
during the taxable year--
``(i) is sold by the taxpayer to another
person--
``(I) for use by such other person
in the production of a qualified algae-
based biofuel mixture in such other
person's trade or business (other than
casual off-farm production),
``(II) for use by such other person
as a fuel in a trade or business, or
``(III) who sells such algae-based
biofuel at retail to another person and
places such algae-based biofuel in the
fuel tank of such other person, or
``(ii) is used or sold by the taxpayer for
any purpose described in clause (i).
The qualified algae-based biofuel production of any
taxpayer for any taxable year shall not include any
alcohol which is purchased by the taxpayer and with
respect to which such producer increases the proof of
the alcohol by additional distillation.
``(G) Qualified algae-based biofuel mixture.--For
purposes of this paragraph, the term `qualified algae-
based biofuel mixture' means a mixture of algae-based
biofuel and gasoline or of algae-based biofuel and a
special fuel which--
``(i) is sold by the person producing such
mixture to any person for use as a fuel, or
``(ii) is used as a fuel by the person
producing such mixture.
``(H) Algae-based biofuel.--For purposes of this
paragraph--
``(i) In general.--The term `algae-based
biofuel' means any liquid fuel, including
gasoline, diesel, aviation fuel, and ethanol,
which--
``(I) is produced from the biomass
of algal organisms, and
``(II) meets the registration
requirements for fuels and fuel
additives established by the
Environmental Protection Agency under
section 211 of the Clean Air Act (42
U.S.C. 7545).
``(ii) Algal organism.--The term `algal
organism' means a single- or multi-cellular
organism which is primarily aquatic and
classified as a non-vascular plant, including
microalgae, blue-green algae (cyanobacteria),
and macroalgae (seaweeds).
``(iii) Exclusion of low-proof alcohol.--
Such term shall not include any alcohol with a
proof of less than 150. The determination of
the proof of any alcohol shall be made without
regard to any added denaturants.''.
(3) Conforming amendments.--
(A) Subparagraph (D) of section 40(d)(3) of such
Code is amended--
(i) by inserting ``and algae-based'' after
``cellulosic'' in the heading,
(ii) by inserting ``or (b)(6)(F)'' after
``(b)(6)(C)'' in clause (ii), and
(iii) by inserting ``or algae-based'' after
``such cellulosic''.
(B) Paragraph (6) of section 40(d) of such Code is
amended--
(i) by inserting ``and algae-based'' after
``cellulosic'' in the heading, and
(ii) by striking the first sentence and
inserting ``No cellulosic and algae-based
biofuel producer credit shall be determined
under subsection (a) with respect to any
cellulosic or algae-based biofuel unless such
cellulosic or algae-based biofuel is produced
in the United States and used as a fuel in the
United States.''.
(C) Paragraph (3) of section 40(e) of such Code is
amended by inserting ``and algae-based'' after
``cellulosic'' in the heading.
(D) Paragraph (1) of section 4101(a) of such Code
is amended--
(i) by inserting ``or algae-based'' after
``cellulosic'', and
(ii) by inserting ``and 40(b)(6)(H),
respectively'' after ``section 40(b)(6)(E)''.
(b) Special Allowance for Cellulosic Biofuel Plant Property.--
Subsection (l) of section 168 of such Code is amended--
(1) by inserting ``and Algae-based'' after ``Cellulosic''
in the heading,
(2) by inserting ``and any qualified algae-based biofuel
plant property'' after ``qualified cellulosic biofuel plant
property'' in paragraph (1),
(3) by redesignating paragraphs (4) through (8) as
paragraphs (6) through (10), respectively,
(4) by inserting ``or qualified algae-based biofuel plant
property'' after ``cellulosic biofuel plant property'' in
paragraph (7)(C), as so redesignated,
(5) by striking ``with respect to'' and all that follows in
paragraph (9), as so redesignated, and inserting ``with respect
to any qualified cellulosic biofuel plant property and any
qualified algae-based biofuel plant property which ceases to be
such qualified property.'',
(6) by inserting ``or qualified algae-based biofuel plant
property'' after ``cellulosic biofuel plant property'' in
paragraph (10), as so redesignated, and
(7) by inserting after paragraph (3) the following new
paragraphs:
``(4) Qualified algae-based biofuel plant property.--The
term `qualified algae-based biofuel plant property' means
property of a character subject to the allowance for
depreciation--
``(A) which is used in the United States solely to
produce algae-based biofuel,
``(B) the original use of which commences with the
taxpayer after the date of the enactment of this
paragraph,
``(C) which is acquired by the taxpayer by purchase
(as defined in section 179(d)) after the date of the
enactment of this paragraph, but only if no written
binding contract for the acquisition was in effect on
or before such date, and
``(D) which is placed in service by the taxpayer
before January 1, 2017.
``(5) Algae-based biofuel.--
``(A) In general.--The term `algae-based biofuel'
means any liquid fuel which is produced from the
biomass of algal organisms.
``(B) Algal organism.--The term `algal organism'
means a single- or multi-cellular organism which is
primarily aquatic and classified as a non-vascular
plant, including microalgae, blue-green algae
(cyanobacteria), and macroalgae (seaweeds).''.
(c) Effective Dates.--
(1) Cellulosic biofuel producer credit.--The amendments
made by subsection (a) shall apply to fuel produced after the
date of the enactment of this Act.
(2) Special allowance for cellulosic biofuel plant
property.--The amendments made by subsection (b) shall apply to
property purchased and placed in service after the date of the
enactment of this Act.
SEC. 4. CRUDE TALL OIL INELIGIBLE FOR CELLULOSIC AND ALGAE-BASED
BIOFUEL PRODUCER CREDIT.
(a) In General.--Paragraph (6) of section 40(b) of the Internal
Revenue Code of 1986 is amended by redesignating subparagraphs (I),
(J), and (K), as designated by section 3(a)(2)(C) of this Act, as
subparagraphs (J), (K), and (L), respectively, and by inserting after
subparagraph (H) the following new subparagraph:
``(I) Exclusion of certain processed fuels with a
high acid content.--The terms `cellulosic biofuel' and
`algae-based biofuel' shall not include any processed
fuel with an acid number greater than 25. For purposes
of the preceding sentence, the term `processed fuel'
means any fuel other than a fuel--
``(i) more than 4 percent of which
(determined by weight) is any combination of
water and sediment, or
``(ii) the ash content of which is more
than 1 percent (determined by weight).''.
(b) Effective Date.--The amendment made by this section shall apply
to fuels sold or used on or after the date of the enactment of this
Act.
SEC. 5. EXTENSION OF CELLULOSIC AND ALGAE-BASED BIOFUEL PRODUCER
CREDIT.
Subparagraph (L) of section 40(b)(6) of the Internal Revenue Code
of 1986, as amended by sections 3 and 4 of this Act, is amended by
striking ``January 1, 2013'' and inserting ``January 1, 2017''.
SEC. 6. ELECTIVE PAYMENT FOR CELLULOSIC AND ALGAE-BASED BIOFUEL
FACILITY PROPERTY.
(a) In General.--Chapter 65 of the Internal Revenue Code of 1986
(relating to abatements, credits, and refunds) is amended by adding at
the end the following new subchapter:
``Subchapter C--Direct Payment Provisions
``Sec. 6451. Elective payment for cellulosic and algae-based biofuel
facility property.
``SEC. 6451. ELECTIVE PAYMENT FOR CELLULOSIC AND ALGAE-BASED BIOFUEL
FACILITY PROPERTY.
``(a) In General.--Any person making an election under this section
with respect to any specified cellulosic and algae-based biofuel
facility property originally placed in service by such person during
the taxable year shall be treated as making a payment, against the tax
imposed by subtitle A for the taxable year equal to 30 percent of the
basis of such property. Such payment shall be treated as made on the
later of the due date of the return of such tax or the date on which
such return is filed.
``(b) Specified Cellulosic and Algae-Based Biofuel Facility
Property.--For purposes of this section, the term `specified cellulosic
and algae-based biofuel facility property' means a qualified cellulosic
and algae-based biofuel facility (as defined by section 48(a)(6)(C)
which--
``(1) is property of a character subject to an allowance
for depreciation, and
``(2) is originally placed in service before January 1,
2017.
``(c) Special Rules for Certain Non-Taxpayers.--
``(1) Denial of payment.--Subsection (a) shall not apply
with respect to any property originally placed in service by--
``(A) any governmental entity,
``(B) any organization described in section 501(c)
or 401(a) and exempt from tax under section 501(a), or
``(C) any entity referred to in paragraph (4) of
section 54(j), or
``(D) any partnership or other pass-thru entity any
partner (or other holder of an equity or profits
interest) of which is described in paragraph (1), (2),
or (3).
``(2) Exception for property used in unrelated trade or
business.--Paragraph (1) shall not apply with respect to any
property originally placed in service by an entity described in
section 511(a)(2) if substantially all of the income derived
from such property by such entity is unrelated business taxable
income (as defined in section 512).
``(3) Special rules for partnerships and s corporations.--
In the case of property originally placed in service by a
partnership or an S corporation--
``(A) the election under subsection (a) may be made
only by such partnership or S corporation,
``(B) such partnership or S corporation shall be
treated as making the payment referred to in subsection
(a) only to the extent of the proportionate share of
such partnership or S corporation as is owned by
persons who would be treated as making such payment if
the property were originally placed in service by such
persons, and
``(C) the return required to be made by such
partnership or S corporation under section 6031 or 6037
(as the case may be) shall be treated as a return of
tax for purposes of subsection (a).
For purposes of subparagraph (B), rules similar to the rules of
section 168(h)(6) (other than subparagraph (F) thereof) shall
apply.
``(d) Coordination With Production and Investment Credits.--In the
case of any property with respect to which an election is made under
this section--
``(1) Denial of production and investment credits.--No
credit shall be determined under section 40 or 48 with respect
to such property for the taxable year in which such property is
originally placed in service or any subsequent taxable year.
``(2) Reduction of payment by progress expenditures already
taken into account.--The amount of the payment treated as made
under subsection (a) with respect to such property shall be
reduced by the aggregate amount of credits determined under
section 48 with respect to such property for all taxable years
preceding the taxable year in which such property is originally
placed in service.
``(e) Other Definitions and Special Rules.--For purposes of this
section--
``(1) Other definitions.--Terms used in this section which
are also used in section 48 shall have the same meaning for
purposes of this section as when used in such section.
``(2) Application of recapture rules, etc.--Except as
otherwise provided by the Secretary--
``(A) In general.--Except as otherwise provided in
this paragraph, rules similar to the rules of section
50 shall apply.
``(B) Exception to limitation on real estate
investment trusts, etc.--Paragraph (1) of section 50(d)
shall not apply.
``(3) Provision of information.--A person shall not be
treated as having elected the application of this section
unless the taxpayer provides such information as the Secretary
(in consultation with the Secretary of Energy) may require for
purposes of verifying the proper amount to be treated as a
payment under subsection (a) and evaluating the effectiveness
of this section.
``(4) Exclusion from gross income.--Any credit or refund
allowed or made by reason of this section shall not be
includible in gross income or alternative minimum taxable
income.''.
(b) Conforming Amendments.--
(1) Subparagraph (A) of section 6211(b)(4)(A) of such Code
is amended by inserting ``and subchapter C of chapter 65
(including any payment treated as made under such subchapter)''
after ``6431''.
(2) Subparagraph (B) of section 6425(c)(1) of such Code is
amended--
(A) by striking ``the credits'' and inserting ``the
sum of--
``(i) the credits'',
(B) by striking the period at the end of clause (i)
thereof (as amended by this paragraph) and inserting
``, plus'', and
(C) by adding at the end the following new clause:
``(ii) the payments treated as made under
subchapter C of chapter 65.''.
(3) Paragraph (4) of section 6654(f) of such Code is
amended--
(A) by striking ``the credits'' and inserting ``the
sum of--
``(A) the credits'',
(B) by striking the period at the end of
subparagraph (A) thereof (as amended by this paragraph)
and inserting ``, and'', and
(C) by adding at the end the following new
subparagraph:
``(B) the payments treated as made under subchapter
C of chapter 65.''.
(4) Subparagraph (B) of section 6655(g)(1) of such Code is
amended--
(A) by striking ``the credits'' and inserting ``the
sum of--
``(i) the credits'',
(B) by striking the period at the end of clause (i)
thereof (as amended by this paragraph) and inserting
``, plus'', and
(C) by adding at the end the following new clause:
``(ii) the payments treated as made under
subchapter C of chapter 65.''.
(5) Paragraph (2) of section 1324(b) of title 31, United
States Code, is amended by inserting ``, or from the provisions
of subchapter C of chapter 65 of such Code'' before the period
at the end.
(6) The table of subchapters for chapter 65 of the Internal
Revenue Code of 1986 is amended by adding at the end the
following new item:
``subchapter c. direct payment provisions.''.
(c) Effective Date.--The amendments made by this section shall
apply to property originally placed in service after the date of the
enactment of this Act.
<all>
Introduced in House
Introduced in House
Referred to the House Committee on Ways and Means.
Rules Committee Resolution H. Res. 1781 Reported to House. Rule provides for consideration of H.R. 5116, H.R. 2751 and H.R. 5142. Providing for consideration of the Senate amendment to H.R. 5116, consideration of the Senate amendments to H.R. 2751, and consideration of the Senate amendment H.R. 2142
Rule H. Res. 1781 passed House.
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