Internal Revenue Code:Sec. 45H. Credit for production of low sulfur diesel fuel
From TaxAlmanac, A Free Online Resource for Tax Professionals
Note: You are using this website at your own risk, subject to our Disclaimer and Website Use and Contribution Terms.
From TaxAlmanac
(Redirected from Sec. 45H. Credit for production of low sulfur diesel fuel)
Contents |
Location
TITLE 26 - INTERNAL REVENUE CODE
Subtitle A - Income Taxes
CHAPTER 1 - NORMAL TAXES AND SURTAXES
Subchapter A - Determination of Tax Liability
PART IV - CREDITS AGAINST TAXES
Statute
SEC. 45H. CREDIT FOR PRODUCTION OF LOW SULFUR DIESEL FUEL.
(a) In General.--For purposes of section 38, the amount of the low
sulfur diesel fuel production credit determined under this section with
respect to any facility of a small business refiner is an amount equal
to 5 cents for each gallon of low sulfur diesel fuel produced during the
taxable year by such small business refiner at such facility.
(b) Maximum Credit.--
(1) In general.--The aggregate credit determined under
subsection (a) for any taxable year with respect to any facility
shall not exceed--
(A) 25 percent of the qualified capital costs
incurred by the small business refiner with respect to
such facility, reduced by
(B) the aggregate credits determined under this
section for all prior taxable years with respect to such
facility.
(2) Reduced percentage.--In the case of a small business
refiner with average daily domestic refinery runs for the 1-year
period ending on December 31, 2002, in excess of 155,000
barrels, the number of percentage points described in paragraph
(1) shall be reduced (not below zero) by the product of such
number (before the application of this paragraph) and the ratio
of such excess to 50,000 barrels.
(c) Definitions and Special Rule.--For purposes of this section--
(1) Small business refiner.--The term `small business
refiner' means, with respect to any taxable year, a refiner of
crude oil--
(A) with respect to which not more than 1,500
individuals are engaged in the refinery operations of
the business on any day during such taxable year, and
(B) the average daily domestic refinery run or
average retained production of which for all facilities
of the taxpayer for the 1-year period ending on December
31, 2002, did not exceed 205,000 barrels.
(2) Qualified capital costs.--The term `qualified capital
costs' means, with respect to any facility, those costs paid or
incurred during the applicable period for compliance with the
applicable EPA regulations with respect to such facility,
including expenditures for the construction of new process
operation units or the dismantling and reconstruction of
existing process units to be used in the production of low
sulfur diesel fuel, associated adjacent or offsite equipment
(including tankage, catalyst, and power supply), engineering,
construction period interest, and sitework.
(3) Applicable epa regulations.--The term `applicable EPA
regulations' means the Highway Diesel Fuel Sulfur Control
Requirements of the Environmental Protection Agency.
(4) Applicable period.--The term `applicable period'
means, with respect to any facility, the period beginning on
January 1, 2003, and ending on the earlier of the date which is
1 year after the date on which the taxpayer must comply with the
applicable EPA regulations with respect to such facility or
December 31, 2009.
(5) Low sulfur diesel fuel.--The term `low sulfur diesel
fuel' means diesel fuel with a sulfur content of 15 parts per
million or less.
(d) Reduction in Basis.--For purposes of this subtitle, if a
credit is determined under this section for any expenditure with respect
to any property, the increase in basis of such property which would (but
for this subsection) result from such expenditure shall be reduced by
the amount of the credit so determined.
(e) Special Rule for Determination of Refinery Runs.--For purposes
this section and section 179B(b), in the calculation of average daily
domestic refinery run or retained production, only
refineries which on April 1, 2003, were refineries of the refiner or a
related person (within the meaning of section 613A(d)(3)), shall be
taken into account.
(f) Certification.--
(1) Required.--No <<NOTE: Deadline.>> credit shall be
allowed unless, not later than the date which is 30 months after
the first day of the first taxable year in which the low sulfur
diesel fuel production credit is determined with respect to a
facility, the small business refiner obtains certification from
the Secretary, after consultation with the Administrator of the
Environmental Protection Agency, that the taxpayer's qualified
capital costs with respect to such facility will result in
compliance with the applicable EPA regulations.
(2) Contents of application.--An application for
certification shall include relevant information regarding unit
capacities and operating characteristics sufficient for the
Secretary, after consultation with the Administrator of the
Environmental Protection Agency, to determine that such
qualified capital costs are necessary for compliance with the
applicable EPA regulations.
(3) Review period.--Any <<NOTE: Deadline.>> application
shall be reviewed and notice of certification, if applicable,
shall be made within 60 days of receipt of such application. In
the event the Secretary does not notify the taxpayer of the
results of such certification within such period, the taxpayer
may presume the certification to be issued until so notified.
(4) Statute of limitations.--With respect to the credit
allowed under this section--
(A) the statutory period for the assessment of any
deficiency attributable to such credit shall not expire
before the end of the 3-year period ending on the date
that the review period described in paragraph (3) ends
with respect to the taxpayer, and
(B) such deficiency may be assessed before the
expiration of such 3-year period notwithstanding the
provisions of any other law or rule of law which would
otherwise prevent such assessment.
(g) Cooperative Organizations.--
(1) Apportionment of credit.--
(A) In general.--In the case of a cooperative
organization described in section 1381(a), any portion
of the credit determined under subsection (a) for the
taxable year may, at the election of the organization,
be apportioned among patrons eligible to share in
patronage dividends on the basis of the quantity or
value of business done with or for such patrons for the
taxable year.
(B) Form and effect of election.--An election
under subparagraph (A) for any taxable year shall be
made on a timely filed return for such year. Such
election, once made, shall be irrevocable for such
taxable year.
(2) Treatment of organizations and patrons.--
(A) Organizations.--The amount of the credit not
apportioned to patrons pursuant to paragraph (1) shall
be included in the amount determined under subsection
(a) for the taxable year of the organization.
(B) Patrons.--The amount of the credit apportioned
to patrons pursuant to paragraph (1) shall be included
in the amount determined under subsection (a) for the
first taxable year of each patron ending on or after the
last day of the payment period (as defined in section
1382(d)) for the taxable year of the organization or, if
earlier, for the taxable year of each patron ending on
or after the date on which the patron receives notice
from the cooperative of the apportionment.
(3) Special rule.--If the amount of a credit which has
been apportioned to any patron under this subsection is
decreased for any reason--
(A) such amount shall not increase the tax imposed
on such patron, and
(B) the tax imposed by this chapter on such
organization shall be increased by such amount.
The increase under subparagraph (B) shall not be treated as tax
imposed by this chapter for purposes of determining the amount
of any credit under this chapter or for purposes of section 55.
Sources
Pub.L. 108-357, Sec.339, dated October 22, 2004.
