AMENDMENTS RELATED TO ENERGY POLICY ACT OF 2005.

SEC. 402. AMENDMENTS RELATED TO ENERGY POLICY ACT OF 2005.(a) Amendments Related to Section 1263.—(1) Part VI of subchapter O of chapter 1 is repealed.(2) Section 1223 is amended by striking paragraph (3) and by redesignating paragraphs (4) through (16) as paragraphs (3) through (15), respectively.(3) Section 121(g) is amended by striking “1223(7)” and inserting “1223(6)”.(4) Section 246(c)(3)(B) is amended by striking “paragraph (4) of section 1223” and inserting “paragraph (3) of section 1223”.(5) Section 247(b)(2)(D) is amended by inserting “as in effect before its repeal” after “part VI of subchapter O”.(6)(A) Section 1245(b) is amended by striking paragraph (5) and redesignating paragraphs (6) through (9) as paragraphs (5) through (8), respectively.(B) Section 1245(b)(3) is amended by striking “paragraph (7)” and inserting “paragraph (6)”.(7)(A) Section 1250(d) is amended by striking paragraph (5) and redesignating paragraphs (6) through (8) as paragraphs (5) through (7), respectively.(B) Section 1250(e)(2) is amended by striking “(3), or (5)” and inserting “or (3)”.(b) Amendment Related to Section 1301.—Clause (ii) of section 45(c)(3)(A) is amended by striking “nonhazardous lignin waste material” and inserting “lignin material”.(c) Amendments Related to Section 1303.—(1) Subsection (l) of section 54 is amended by striking paragraph (5), and by redesignating paragraphs (6) and (7) as paragraphs (5) and (6), respectively.(2) Subsection (e) of section 1303 of the Energy Policy Act of 2005 is amended to read as follows:“(e) Effective Dates.—“(1) In general.—Except as provided in paragraph (2), the amendments made by this section shall apply to bonds issued after December 31, 2005.“(2) Subsection (c).—The amendments made by subsection (c) shall apply to taxable years beginning after December 31, 2005.”.(d) Amendments Related to Section 1306.—(1) Paragraph (2) of section 45J(c) is amended to read as follows:“(2) Phaseout of credit.—“(A) In general.—The amount of the credit determined under subsection (a) shall be reduced by an amount which bears the same ratio to the amount of the credit (determined without regard to this paragraph) as—119 STAT. 2611“(i) the amount by which the reference price (as defined in section 45(e)(2)(C)) for the calendar year in which the sale occurs exceeds 8 cents, bears to“(ii) 3 cents.“(B) Phaseout adjustment based on inflation.—The 8 cent amount in subparagraph (A) shall be adjusted by multiplying such amount by the inflation adjustment factor (as defined in section 45(e)(2)(B)) for the calendar year in which the sale occurs. If any amount as increased under the preceding sentence is not a multiple of 0.1 cent, such amount shall be rounded to the nearest multiple of 0.1 cent.”.(2) Subsection (e) of section 45J is amended by striking “(2),”.(e) Amendment Related to Section 1309.—Subparagraph (B) of section 169(d)(5) is amended by adding at beginning thereof “in the case of facility placed in service in connection with a plant or other property placed in operation after December 31, 1975,”.(f) Amendments Related to Section 1311.—(1) Clause (i) of section 172(b)(1)(I) is amended to read as follows:“(i) In general.—At the election of the taxpayer for any taxable year ending after December 31, 2005, and before January 1, 2009, in the case of a net operating loss for a taxable year ending after December 31, 2002, and before January 1, 2006, there shall be a net operating loss carryback to each of the 5 taxable years preceding the taxable year of such loss to the extent that such loss does not exceed 20 percent of the sum of the electric transmission property capital expenditures and the pollution control facility capital expenditures of the taxpayer for the taxable year preceding the taxable year for which such election is made.”.(2) Clause (ii) of section 172(b)(1)(I) is amended by striking “in a taxable year” and inserting “for a taxable year”.(3) Subparagraph (I) of section 172(b)(1) is amended by striking clause (iv) and (v), by redesignating clause (vi) as clause (v), and by inserting after clause (iii) the following:“(iv) Special rules relating to credit or refund.—In the case of the portion of the loss which is carried back 5 years by reason of clause (i)—“(I) an application under section 6411(a) with respect to such portion shall not fail to be treated as timely filed if filed within 24 months after the due date specified under such section, and“(II) references in sections 6501(h), 6511(d)(2)(A), and 6611(f)(1) to the taxable year in which such net operating loss arises or results in a net operating loss carryback shall be treated as references to the taxable year for which such election is made.”.(g) Amendment Related to Section 1322.—Subsection (a) of section 45K is amended by striking “if the taxpayer elects to have this section apply,”.(h) Amendment Related to Section 1331.—Paragraph (3) of section 1250(b) is amended by striking “or by section 179D”.119 STAT. 2612(i) Amendments Related to Section 1335.—(1) Paragraph (1) of section 25D(b) is amended by inserting “(determined without regard to subsection (c))” after “subsection (a)”.(2) Subparagraphs (A) and (B) of section 25D(e)(4) are amended to read as follows:“(A) Maximum expenditures.—The maximum amount of expenditures which may be taken into account under subsection (a) by all such individuals with respect to such dwelling unit during such calendar year shall be—“(i) $6,667 in the case of any qualified photovoltaic property expenditures,“(ii) $6,667 in the case of any qualified solar water heating property expenditures, and“(iii) $1,667 in the case of each half kilowatt of capacity of qualified fuel cell property (as defined in section 48(c)(1)) for which qualified fuel cell property expenditures are made.“(B) Allocation of expenditures.—The expenditures allocated to any individual for the taxable year in which such calendar year ends shall be an amount equal to the lesser of—“(i) the amount of expenditures made by such individual with respect to such dwelling during such calendar year, or“(ii) the maximum amount of such expenditures set forth in subparagraph (A) multiplied by a fraction—“(I) the numerator of which is the amount of such expenditures with respect to such dwelling made by such individual during such calendar year, and“(II) the denominator of which is the total expenditures made by all such individuals with respect to such dwelling during such calendar year.”.(3)(A)(i) The matter preceding subparagraph (A) of section 23(b)(4) is amended by striking “The credit” and inserting “In the case of a taxable year to which section 26(a)(2) does not apply, the credit”.(ii) Subsection (c) of section 23 is amended to read as follows:“(c) Carryforwards of Unused Credit.—“(1) Rule for years in which all personal credits allowed against regular and alternative minimum tax.—In the case of a taxable year to which section 26(a)(2) applies, if the credit allowable under subsection (a) for any taxable year exceeds the limitation imposed by section 26(a)(2) for such taxable year reduced by the sum of the credits allowable under this subpart (other than this section and sections 25D and 1400C), such excess shall be carried to the succeeding taxable year and added to the credit allowable under subsection (a) for such taxable year.“(2) Rule for other years.—In the case of a taxable year to which section 26(a)(2) does not apply, if the credit allowable under subsection (a) for any taxable year exceeds the limitation imposed by subsection (b)(4) for such taxable year, such excess shall be carried to the succeeding taxable 119 STAT. 2613 year and added to the credit allowable under subsection (a) for such taxable year.“(3) Limitation.—No credit may be carried forward under this subsection to any taxable year following the fifth taxable year after the taxable year in which the credit arose. For purposes of the preceding sentence, credits shall be treated as used on a first-in first-out basis.”.(B)(i) The matter preceding subparagraph (A) of section 24(b)(3) is amended by striking “The credit” and inserting “In the case of a taxable year to which section 26(a)(2) does not apply, the credit”.(ii) Paragraph (1) of section 24(d) is amended to read as follows:“(1) In general.—The aggregate credits allowed to a taxpayer under subpart C shall be increased by the lesser of—“(A) the credit which would be allowed under this section without regard to this subsection and the limitation under section 26(a)(2) or subsection (b)(3), as the case may be, or“(B) the amount by which the aggregate amount of credits allowed by this subpart (determined without regard to this subsection) would increase if the limitation imposed by section 26(a)(2) or subsection (b)(3), as the case may be, were increased by the excess (if any) of—“(i) 15 percent of so much of the taxpayer’s earned income (within the meaning of section 32) which is taken into account in computing taxable income for the taxable year as exceeds $10,000, or“(ii) in the case of a taxpayer with 3 or more qualifying children, the excess (if any) of—“(I) the taxpayer’s social security taxes for the taxable year, over“(II) the credit allowed under section for the taxable year.The amount of the credit allowed under this subsection shall not be treated as a credit allowed under this subpart and shall reduce the amount of credit otherwise allowable under subsection (a) without regard to section 26(a)(2) or subsection (b)(3), as the case may be. For purposes of subparagraph (B), any amount excluded from gross income by reason of section 112 shall be treated as earned income which is taken into account in computing taxable income for the taxable year.”.(C) Subparagraph (C) of section 25(e)(1) is amended to read as follows:“(C) Applicable tax limit.—For purposes of this paragraph, the term ‘applicable tax limit’ means—“(i) in the case of a taxable year to which section 26(a)(2) applies, the limitation imposed by section 26(a)(2) for the taxable year reduced by the sum of the credits allowable under this subpart (other than this section and sections 23, 25D, and 1400C), and“(ii) in the case of a taxable year to which section 26(a)(2) does not apply, the limitation imposed by section 26(a)(1) for the taxable year reduced by the sum of the credits allowable under this subpart (other than this section and sections 23, 24, 25B, 25D, and 1400C).”.119 STAT. 2614(D) The matter preceding paragraph (1) of section 25B(g) is amended by striking “The credit” and inserting “In the case of a taxable year to which section 26(a)(2) does not apply, the credit”.(E) Subsection (c) of section 25D is amended to read as follows:“(c) Carryforward of Unused Credit.—“(1) Rule for years in which all personal credits allowed against regular and alternative minimum tax.—In the case of a taxable year to which section 26(a)(2) applies, if the credit allowable under subsection (a) exceeds the limitation imposed by section 26(a)(2) for such taxable year reduced by the sum of the credits allowable under this subpart (other than this section), such excess shall be carried to the succeeding taxable year and added to the credit allowable under subsection (a) for such succeeding taxable year.“(2) Rule for other years.—In the case of a taxable year to which section 26(a)(2) does not apply, if the credit allowable under subsection (a) exceeds the limitation imposed by section 26(a)(1) for such taxable year reduced by the sum of the credits allowable under this subpart (other than this section and sections 23, 24, and 25B), such excess shall be carried to the succeeding taxable year and added to the credit allowable under subsection (a) for such succeeding taxable year.”.(F) Subsection (d) of section 1400C is amended to read as follows:“(d) Carryforward of Unused Credit.—“(1) Rule for years in which all personal credits allowed against regular and alternative minimum tax.—In the case of a taxable year to which section 26(a)(2) applies, if the credit allowable under subsection (a) exceeds the limitation imposed by section 26(a)(2) for such taxable year reduced by the sum of the credits allowable under subpart A of part IV of subchapter A (other than this section and section 25D), such excess shall be carried to the succeeding taxable year and added to the credit allowable under subsection (a) for such taxable year.“(2) Rule for other years.—In the case of a taxable year to which section 26(a)(2) does not apply, if the credit allowable under subsection (a) exceeds the limitation imposed by section 26(a)(1) for such taxable year reduced by the sum of the credits allowable under subpart A of part IV of subchapter A (other than this section and sections 23, 24, 25B, and 25D), such excess shall be carried to the succeeding taxable year and added to the credit allowable under subsection (a) for such taxable year.”.(G) Subsection (i) of section 904 is amended to read as follows:“(i) Coordination With Nonrefundable Personal Credits.—In the case of any taxable year of an individual to which section 26(a)(2) does not apply, for purposes of subsection (a), the tax against which the credit is taken is such tax reduced by the sum of the credits allowable under subpart A of part IV of subchapter A of this chapter (other than sections 23, 24, and 25B).”.119 STAT. 2615(H) Application of egtrra sunset.—The amendments made by this paragraph (and each part thereof) shall be subject to title IX of the Economic Growth and Tax Relief Reconciliation Act of 2001 in the same manner as the provisions of such Act to which such amendment (or part thereof) relates.(4) Subsection (b) of section 1335 of the Energy Policy Act of 2005 is amended by striking paragraphs (1), (2), and (3). The Internal Revenue Code of 1986 shall be applied and administered as if the amendments made such paragraphs had never been enacted.(j) Amendment Related to Section 1341.—Paragraph (6) of section 30B(h) is amended by adding at the end the following sentence: “For purposes of subsection (g), property to which this paragraph applies shall be treated as of a character subject to an allowance for depreciation.”.(k) Amendment Related to Section 1342.—Paragraph (2) of section 30C(e) is amended by adding at the end the following sentence: “For purposes of subsection (d), property to which this paragraph applies shall be treated as of a character subject to an allowance for depreciation.”.(l) Amendments Related to Section 1351.—(1) Paragraph (6) of section 41(f) (relating to special rules) is amended by adding at the end the following:“(C) Foreign research.—For purposes of subsection (a)(3), amounts paid or incurred for any energy research conducted outside the United States, the Commonwealth of Puerto Rico, or any possession of the United States shall not be taken into account.“(D) Denial of double benefit.—Any amount taken into account under subsection (a)(3) shall not be taken into account under paragraph (1) or (2) of subsection (a).”.(2) Clause (ii) of section 41(b)(3)(C) is amended by striking “(other than an energy research consortium)”.(m) Effective Date.—(1) In general.—Except as provided in paragraphs (2) and (3), the amendments made by this section shall take effect as if included in the provisions of the Energy Policy Act of 2005 to which they relate.(2) Repeal of public utility holding company act of 1935.—The amendments made by subsection (a) shall not apply with respect to any transaction ordered in compliance with the Public Utility Holding Company Act of 1935 before its repeal.(3) Coordination of personal credits.—The amendments made by subsection (i)(3) shall apply to taxable years beginning after December 31, 2005.