ELECTION TO ACCELERATE THE AMT AND RESEARCH CREDITS IN LIEU OF BONUS DEPRECIATION.

SEC. 3081. ELECTION TO ACCELERATE THE AMT AND RESEARCH CREDITS IN LIEU OF BONUS DEPRECIATION.(a) In General.—Section 168(k) is amended by adding at the end the following new paragraph:“(4) Election to accelerate the amt and research credits in lieu of bonus depreciation.—“(A) In general.—If a corporation elects to have this paragraph apply for the first taxable year of the taxpayer ending after March 31, 2008, in the case of such taxable year and each subsequent taxable year—“(i) paragraph (1) shall not apply to any eligible qualified property placed in service by the taxpayer,“(ii) the applicable depreciation method used under this section with respect to such property shall be the straight line method, and“(iii) each of the limitations described in subparagraph (B) for any such taxable year shall be increased by the bonus depreciation amount which is—“(I) determined for such taxable year under subparagraph (C), and“(II) allocated to such limitation under subparagraph (E).“(B) Limitations to be increased.—The limitations described in this subparagraph are—“(i) the limitation imposed by section 38(c), and“(ii) the limitation imposed by section 53(c).“(C) Bonus depreciation amount.—For purposes of this paragraph—“(i) In general.—The bonus depreciation amount for any taxable year is an amount equal to 20 percent of the excess (if any) of—“(I) the aggregate amount of depreciation which would be allowed under this section for eligible qualified property placed in service by the taxpayer during such taxable year if paragraph (1) applied to all such property, over“(II) the aggregate amount of depreciation which would be allowed under this section for eligible qualified property placed in service by the taxpayer during such taxable year if paragraph (1) did not apply to any such property.122 STAT. 2904The aggregate amounts determined under subclauses (I) and (II) shall be determined without regard to any election made under subsection (b)(2)(C), (b)(3)(D), or (g)(7) and without regard to subparagraph (A)(ii).“(ii) Maximum amount.—The bonus depreciation amount for any taxable year shall not exceed the maximum increase amount under clause (iii), reduced (but not below zero) by the sum of the bonus depreciation amounts for all preceding taxable years.“(iii) Maximum increase amount.—For purposes of clause (ii), the term ‘maximum increase amount’ means, with respect to any corporation, the lesser of—“(I) $30,000,000, or“(II) 6 percent of the sum of the business credit increase amount, and the AMT credit increase amount, determined with respect to such corporation under subparagraph (E).“(iv) Aggregation rule.—All corporations which are treated as a single employer under section 52(a) shall be treated—“(I) as 1 taxpayer for purposes of this paragraph, and“(II) as having elected the application of this paragraph if any such corporation so elects.“(D) Eligible qualified property.—For purposes of this paragraph, the term ‘eligible qualified property’ means qualified property under paragraph (2), except that in applying paragraph (2) for purposes of this paragraph—“(i) ‘March 31, 2008’ shall be substituted for ‘December 31, 2007’ each place it appears in subparagraph (A) and clauses (i) and (ii) of subparagraph (E) thereof, and“(ii) only adjusted basis attributable to manufacture, construction, or production after March 31, 2008, and before January 1, 2009, shall be taken into account under subparagraph (B)(ii) thereof.“(E) Allocation of bonus depreciation amounts.—“(i) In general.—Subject to clauses (ii) and (iii), the taxpayer shall, at such time and in such manner as the Secretary may prescribe, specify the portion (if any) of the bonus depreciation amount for the taxable year which is to be allocated to each of the limitations described in subparagraph (B) for such taxable year.“(ii) Limitation on allocations.—The portion of the bonus depreciation amount which may be allocated under clause (i) to the limitations described in subparagraph (B) for any taxable year shall not exceed—“(I) in the case of the limitation described in subparagraph (B)(i), the excess of the business credit increase amount over the bonus depreciation amount allocated to such limitation for all preceding taxable years, and“(II) in the case of the limitation described in subparagraph (B)(ii), the excess of the AMT credit increase amount over the bonus depreciation 122 STAT. 2905 amount allocated to such limitation for all preceding taxable years.“(iii) Business credit increase amount.—For purposes of this paragraph, the term ‘business credit increase amount’ means the amount equal to the portion of the credit allowable under section 38 (determined without regard to subsection (c) thereof) for the first taxable year ending after March 31, 2008, which is allocable to business credit carryforwards to such taxable year which are—“(I) from taxable years beginning before January 1, 2006, and“(II) properly allocable (determined under the rules of section 38(d)) to the research credit determined under section 41(a).“(iv) AMT credit increase amount.—For purposes of this paragraph, the term ‘AMT credit increase amount’ means the amount equal to the portion of the minimum tax credit under section 53(b) for the first taxable year ending after March 31, 2008, determined by taking into account only the adjusted minimum tax for taxable years beginning before January 1, 2006. For purposes of the preceding sentence, credits shall be treated as allowed on a first-in, first-out basis.“(F) Credit refundable.—For purposes of section 6401(b), the aggregate increase in the credits allowable under part IV of subchapter A for any taxable year resulting from the application of this paragraph shall be treated as allowed under subpart C of such part (and not any other subpart).“(G) Other rules.—“(i) Election.—Any election under this paragraph (including any allocation under subparagraph (E)) may be revoked only with the consent of the Secretary.“(ii) Partnerships with electing partners.—In the case of a corporation making an election under subparagraph (A) and which is a partner in a partnership, for purposes of determining such corporation’s distributive share of partnership items under section 702—“(I) paragraph (1) shall not apply to any eligible qualified property, and“(II) the applicable depreciation method used under this section with respect to such property shall be the straight line method.“(iii) Special rule for passenger aircraft.—In the case of any passenger aircraft, the written binding contract limitation under paragraph (2)(A)(iii)(I) shall not apply for purposes of subparagraphs (C)(i)(I) and (D).”.(b) Application to Certain Automotive Partnerships.—(1) In general.—If an applicable partnership elects the application of this subsection—(A) the partnership shall be treated as having made a payment against the tax imposed by chapter 1 of the Internal Revenue Code of 1986 for any applicable taxable 122 STAT. 2906 year of the partnership in the amount determined under paragraph (3),(B) in the case of any eligible qualified property placed in service by the partnership during any applicable taxable year—(i) section 168(k) of such Code shall not apply in determining the amount of the deduction allowable with respect to such property under section 168 of such Code,(ii) the applicable depreciation method used with respect to such property shall be the straight line method, and(C) the amount of the credit determined under section 41 of such Code for any applicable taxable year with respect to the partnership shall be reduced by the amount of the deemed payment under subparagraph (A) for the taxable year.(2) Treatment of deemed payment.—(A) In general.—Notwithstanding any other provision of the Internal Revenue Code of 1986, the Secretary of the Treasury or his delegate shall not use the payment of tax described in paragraph (1) as an offset or credit against any tax liability of the applicable partnership or any partner but shall refund such payment to the applicable partnership.(B) No interest.—The payment described in paragraph (1) shall not be taken into account in determining any amount of interest under such Code.(3) Amount of deemed payment.—The amount determined under this paragraph for any applicable taxable year shall be the least of the following:(A) The amount which would be determined for the taxable year under section 168(k)(4)(C)(i) of the Internal Revenue Code of 1986 (as added by the amendments made by this section) if an election under section 168(k)(4) of such Code were in effect with respect to the partnership.(B) The amount of the credit determined under section 41 of such Code for the taxable year with respect to the partnership.(C) $30,000,000, reduced by the amount of any payment under this subsection for any preceding taxable year.(4) Definitions.—For purposes of this subsection—(A) Applicable partnership.—The term “applicable partnership” means a domestic partnership that—(i) was formed effective on August 3, 2007, and(ii) will produce in excess of 675,000 automobiles during the period beginning on January 1, 2008, and ending on June 30, 2008.(B) Applicable taxable year.—The term “applicable taxable year” means any taxable year during which eligible qualified property is placed in service.(C) Eligible qualified property.—The term “eligible qualified property” has the meaning given such term by section 168(k)(4)(D) of the Internal Revenue Code of 1986 (as added by the amendments made by this section).(c) Conforming Amendment.—Section 1324(b)(2) of title 31, United States Code, as amended by this Act, is amended—122 STAT. 2907(1) by inserting “168(k)(4)(F),” after “36,”, and(2) by inserting “, or due under section 3081(b)(2) of the Housing Assistance Tax Act of 2008” before the period at the end.(d) Effective Date.—The amendments made by this section shall apply to taxable years ending after March 31, 2008.