HR 6 EAS1S/PP
‘‘SEC. 40B. BIODIESEL USED AS FUEL.
1
‘‘(a) G
ENERAL
R
ULE
.—For purposes of section 38, the
2
biodiesel fuels credit determined under this section for the
3
taxable year is an amount equal to the biodiesel mixture
4
credit.
5
‘‘(b) D
EFINITION OF
B
IODIESEL
M
IXTURE
C
REDIT
.—
6
For purposes of this section—
7
‘‘(1) B
IODIESEL MIXTURE CREDIT
.—
8
‘‘(A) I
N GENERAL
.—The biodiesel mixture
9
credit of any taxpayer for any taxable year is
10
the sum of the products of the biodiesel mixture
11
rate for each qualified biodiesel mixture and the
12
number of gallons of such mixture of the tax-
13
payer for the taxable year.
14
‘‘(B) B
IODIESEL MIXTURE RATE
.—For pur-
15
poses of subparagraph (A), the biodiesel mixture
16
rate for each qualified biodiesel mixture shall
17
be—
18
‘‘(i) in the case of a mixture with only
19
biodiesel V, 1 cent for each whole percentage
20
point (not exceeding 20 percentage points)
21
of biodiesel V in such mixture, and
22
‘‘(ii) in the case of a mixture with bio-
23
diesel NV, or a combination of biodiesel V
24
and biodiesel NV, 0.5 cent for each whole
25
percentage point (not exceeding 20 percent-
26
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age points) of such biodiesel in such mix-
1
ture.
2
‘‘(2) Q
UALIFIED BIODIESEL MIXTURE
.—
3
‘‘(A) I
N GENERAL
.—The term ‘qualified bio-
4
diesel mixture’ means a mixture of diesel and
5
biodiesel V or biodiesel NV which—
6
‘‘(i) is sold by the taxpayer producing
7
such mixture to any person for use as a
8
fuel, or
9
‘‘(ii) is used as a fuel by the taxpayer
10
producing such mixture.
11
‘‘(B) S
ALE OR USE MUST BE IN TRADE OR
12
BUSINESS
,
ETC
.—
13
‘‘(i) I
N GENERAL
.—Biodiesel V or bio-
14
diesel NV used in the production of a quali-
15
fied biodiesel mixture shall be taken into
16
account—
17
‘‘(I) only if the sale or use de-
18
scribed in subparagraph (A) is in a
19
trade or business of the taxpayer, and
20
‘‘(II) for the taxable year in which
21
such sale or use occurs.
22
‘‘(ii) C
ERTIFICATION
FOR
BIODIESEL
23
V
.—Biodiesel V used in the production of a
24
qualified biodiesel mixture shall be taken
25
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into account only if the taxpayer described
1
in subparagraph (A) obtains a certification
2
from the producer of the biodiesel V which
3
identifies the product produced.
4
‘‘(C) C
ASUAL OFF
-
FARM PRODUCTION NOT
5
ELIGIBLE
.—No credit shall be allowed under this
6
section with respect to any casual off-farm pro-
7
duction of a qualified biodiesel mixture.
8
‘‘(c) C
OORDINATION
W
ITH
E
XEMPTION
F
ROM
E
XCISE
9
T
AX
.—The amount of the credit determined under this sec-
10
tion with respect to any biodiesel V shall, under regulations
11
prescribed by the Secretary, be properly reduced to take into
12
account any benefit provided with respect to such biodiesel
13
V solely by reason of the application of section 4041(n) or
14
section 4081(f).
15
‘‘(d) D
EFINITIONS AND
S
PECIAL
R
ULES
.—For pur-
16
poses of this section—
17
‘‘(1) B
IODIESEL V DEFINED
.—The term ‘biodiesel
18
V’ means the monoalkyl esters of long chain fatty
19
acids derived solely from virgin vegetable oils for use
20
in compressional-ignition (diesel) engines. Such term
21
shall include esters derived from vegetable oils from
22
corn, soybeans, sunflower seeds, cottonseeds, canola,
23
crambe, rapeseeds, safflowers, flaxseeds, rice bran, and
24
mustard seeds.
25
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‘‘(2) B
IODIESEL NV DEFINED
.—The term ‘bio-
1
diesel nv’ means the monoalkyl esters of long chain
2
fatty acids derived from nonvirgin vegetable oils or
3
animal fats for use in compressional-ignition (diesel)
4
engines.
5
‘‘(3) R
EGISTRATION REQUIREMENTS
.—The terms
6
‘biodiesel V’ and ‘biodiesel NV’ shall only include a
7
biodiesel which meets—
8
‘‘(i) the registration requirements for
9
fuels and fuel additives established by the
10
Environmental Protection Agency under
11
section 211 of the Clean Air Act (42 U.S.C.
12
7545), and
13
‘‘(ii) the requirements of the American
14
Society of Testing and Materials D6751.
15
‘‘(2) B
IODIESEL MIXTURE NOT USED AS A FUEL
,
16
ETC
.—
17
‘‘(A) I
MPOSITION OF TAX
.—If—
18
‘‘(i) any credit was determined under
19
this section with respect to biodiesel V or
20
biodiesel NV used in the production of any
21
qualified biodiesel mixture, and
22
‘‘(ii) any person—
23
‘‘(I) separates such biodiesel from
24
the mixture, or
25
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‘‘(II) without separation, uses the
1
mixture other than as a fuel,
2
then there is hereby imposed on such person
3
a tax equal to the product of the biodiesel
4
mixture rate applicable under subsection
5
(b)(1)(B) and the number of gallons of the
6
mixture.
7
‘‘(B) A
PPLICABLE LAWS
.—All provisions of
8
law, including penalties, shall, insofar as appli-
9
cable and not inconsistent with this section,
10
apply in respect of any tax imposed under sub-
11
paragraph (A) as if such tax were imposed by
12
section 4081 and not by this chapter.
13
‘‘(3) P
ASS
-
THRU IN THE CASE OF ESTATES AND
14
TRUSTS
.—Under regulations prescribed by the Sec-
15
retary, rules similar to the rules of subsection (d) of
16
section 52 shall apply.
17
‘‘(e) E
LECTION
T
O
H
AVE
B
IODIESEL
F
UELS
C
REDIT
18
N
OT
A
PPLY
.—
19
‘‘(1) I
N
GENERAL
.—A taxpayer may elect to
20
have this section not apply for any taxable year.
21
‘‘(2) T
IME FOR MAKING ELECTION
.—An election
22
under paragraph (1) for any taxable year may be
23
made (or revoked) at any time before the expiration
24
of the 3-year period beginning on the last date pre-
25
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scribed by law for filing the return for such taxable
1
year (determined without regard to extensions).
2
‘‘(3) M
ANNER OF MAKING ELECTION
.—An elec-
3
tion under paragraph (1) (or revocation thereof) shall
4
be made in such manner as the Secretary may by reg-
5
ulations prescribe.’’.
6
‘‘(f) T
ERMINATION
.—This section shall not apply to
7
any fuel sold after December 31, 2005.’’.
8
(2) C
REDIT
TREATED
AS
PART
OF
GENERAL
9
BUSINESS CREDIT
.—Section 38(b), as amended by
10
this Act, is amended by striking ‘‘plus’’ at the end of
11
paragraph (15), by striking the period at the end of
12
paragraph (16) and inserting ‘‘, plus’’, and by add-
13
ing at the end the following new paragraph:
14
‘‘(17) the biodiesel fuels credit determined under
15
section 40B(a).’’.
16
(3) C
ONFORMING AMENDMENTS
.—
17
(A) Section 39(d), as amended by this Act,
18
is amended by adding at the end the following
19
new paragraph:
20
‘‘(12) N
O
CARRYBACK
OF
BIODIESEL
FUELS
21
CREDIT BEFORE JANUARY 1
,
2003
.—No portion of the
22
unused business credit for any taxable year which is
23
attributable to the biodiesel fuels credit determined
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under section 40B may be carried back to a taxable
1
year beginning before January 1, 2003.’’.
2
(B) Section 196(c) is amended by striking
3
‘‘and’’ at the end of paragraph (9), by striking
4
the period at the end of paragraph (10), and by
5
adding at the end the following new paragraph:
6
‘‘(11) the biodiesel fuels credit determined under
7
section 40B(a).’’.
8
(C) Section 6501(m), as amended by this
9
Act, is amended by inserting ‘‘40B(e),’’ after
10
‘‘40(f),’’.
11
(D) The table of sections for subpart D of
12
part IV of subchapter A of chapter 1, as amend-
13
ed by this Act, is amended by adding after the
14
item relating to section 40A the following new
15
item:
16
‘‘Sec. 40B. Biodiesel used as fuel.’’.
(4) E
FFECTIVE DATE
.—The amendments made
17
by this subsection shall apply to taxable years begin-
18
ning after December 31, 2002.
19
(b) R
EDUCTION OF
M
OTOR
F
UEL
E
XCISE
T
AXES ON
20
B
IODIESEL
V M
IXTURES
.—
21
(1) I
N
GENERAL
.—Section 4081 (relating to
22
manufacturers tax on petroleum products) is amended
23
by adding at the end the following new subsection:
24
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‘‘(f) B
IODIESEL
V M
IXTURES
.—Under regulations pre-
1
scribed by the Secretary—
2
‘‘(1) I
N GENERAL
.—In the case of the removal or
3
entry of a qualified biodiesel mixture with biodiesel V,
4
the rate of tax under subsection (a) shall be the other-
5
wise applicable rate reduced by the biodiesel mixture
6
rate (if any) applicable to the mixture.
7
‘‘(2) T
AX PRIOR TO MIXING
.—
8
‘‘(A) I
N GENERAL
.—In the case of the re-
9
moval or entry of diesel fuel for use in producing
10
at the time of such removal or entry a qualified
11
biodiesel mixture with biodiesel V, the rate of tax
12
under subsection (a) shall be the rate determined
13
under subparagraph (B).
14
‘‘(B) D
ETERMINATION OF RATE
.—For pur-
15
poses of subparagraph (A), the rate determined
16
under this subparagraph is the rate determined
17
under paragraph (1), divided by a percentage
18
equal to 100 percent minus the percentage of bio-
19
diesel V which will be in the mixture.
20
‘‘(3) D
EFINITIONS
.—For purposes of this sub-
21
section, any term used in this subsection which is also
22
used in section 40B shall have the meaning given
23
such term by section 40B.
24
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‘‘(4) C
ERTAIN RULES TO APPLY
.—Rules similar
1
to the rules of paragraphs (6) and (7) of subsection
2
(c) shall apply for purposes of this subsection.’’.
3
(2) C
ONFORMING AMENDMENTS
.—
4
(A) Section 4041 is amended by adding at
5
the end the following new subsection:
6
‘‘(n) B
IODIESEL
V M
IXTURES
.—Under regulations
7
prescribed by the Secretary, in the case of the sale or use
8
of a qualified biodiesel mixture (as defined in section
9
40B(b)(2)) with biodiesel V, the rates under paragraphs (1)
10
and (2) of subsection (a) shall be the otherwise applicable
11
rates, reduced by any applicable biodiesel mixture rate (as
12
defined in section 40B(b)(1)(B)).’’.
13
(B) Section 6427 is amended by redesig-
14
nating subsection (p) as subsection (q) and by
15
inserting after subsection (o) the following new
16
subsection:
17
‘‘(p) B
IODIESEL
V M
IXTURES
.—Except as provided in
18
subsection (k), if any diesel fuel on which tax was imposed
19
by section 4081 at a rate not determined under section
20
4081(f) is used by any person in producing a qualified bio-
21
diesel mixture (as defined in section 40B(b)(2)) with bio-
22
diesel V which is sold or used in such person’s trade or busi-
23
ness, the Secretary shall pay (without interest) to such per-
24
son an amount equal to the per gallon applicable biodiesel
25
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mixture rate (as defined in section 40B(b)(1)(B)) with re-
1
spect to such fuel.’’.
2
(3) E
FFECTIVE DATE
.—The amendments made
3
by this subsection shall apply to any fuel sold after
4
December 31, 2002, and before January 1, 2006.
5
(c) H
IGHWAY
T
RUST
F
UND
H
ELD
H
ARMLESS
.—There
6
are hereby transferred (from time to time) from the funds
7
of the Commodity Credit Corporation amounts determined
8
by the Secretary of the Treasury to be equivalent to the re-
9
ductions that would occur (but for this subsection) in the
10
receipts of the Highway Trust Fund by reason of the
11
amendments made by this section.
12
SEC. 2009. CREDIT FOR TAXPAYERS OWNING COMMERCIAL
13
POWER TAKEOFF VEHICLES.
14
(a) I
N
G
ENERAL
.—Subpart D of part IV of subchapter
15
A of chapter 1 (relating to business-related credits), as
16
amended by this Act, is amended by adding at the end the
17
following new section:
18
‘‘SEC. 45N. COMMERCIAL POWER TAKEOFF VEHICLES CRED-
19
IT.
20
‘‘(a) G
ENERAL
R
ULE
.—For purposes of section 38, the
21
amount of the commercial power takeoff vehicles credit de-
22
termined under this section for the taxable year is $250 for
23
each qualified commercial power takeoff vehicle owned by
24
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the taxpayer as of the close of the calendar year in which
1
or with which the taxable year of the taxpayer ends.
2
‘‘(b) D
EFINITIONS
.—For purposes of this section—
3
‘‘(1) Q
UALIFIED COMMERCIAL POWER TAKEOFF
4
VEHICLE
.—The term ‘qualified commercial power
5
takeoff vehicle’ means any highway vehicle described
6
in paragraph (2) which is propelled by any fuel sub-
7
ject to tax under section 4041 or 4081 if such vehicle
8
is used in a trade or business or for the production
9
of income (and is licensed and insured for such use).
10
‘‘(2) H
IGHWAY VEHICLE DESCRIBED
.—A high-
11
way vehicle is described in this paragraph if such ve-
12
hicle is—
13
‘‘(A) designed to engage in the daily collec-
14
tion of refuse or recyclables from homes or busi-
15
nesses and is equipped with a mechanism under
16
which the vehicle’s propulsion engine provides
17
the power to operate a load compactor, or
18
‘‘(B) designed to deliver ready mixed con-
19
crete on a daily basis and is equipped with a
20
mechanism under which the vehicle’s propulsion
21
engine provides the power to operate a mixer
22
drum to agitate and mix the product en route to
23
the delivery site.
24
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