S.Amdt. 2513

1. Adds SEC. __. CREDIT FOR MAINTENANCE OF RAILROAD TRACK; at the end of subtitle F of title V

   Adds a section

   Inserted: SEC. __. CREDIT FOR MAINTENANCE OF RAILROAD TRACK;

   Inserted: (a) Credit for Maintenance of Railroad Track.--

   Inserted: (1) In general.--Subpart D of part IV of subchapter A of chapter 1 (relating to business-related credits) is amended by adding at the end the following new section:

   Inserted: "SEC. 45I. RAILROAD TRACK MAINTENANCE CREDIT.

   Inserted: "(a) General Rule.--For purposes of section 38, the railroad track maintenance credit determined under this section for the taxable year is 50 percent of the amount of qualified railroad track maintenance expenditures paid or incurred by an eligible taxpayer during the taxable year.

   Inserted: "(b) Limitation.--The credit allowed under subsection (a) shall not exceed the product of--

   Inserted: "(1) $20,000, and

   Inserted: "(2) the number of miles of railroad track owned or leased by the taxpayer as of the close of the taxable year.

   Inserted: "(c) Qualified Railroad Track Maintenance Expenditures.--For purposes of this section, the term 'qualified railroad track maintenance expenditures' means expenditures (whether or not otherwise chargeable to capital account) for maintaining railroad track (including roadbed, bridges, and related track structures) owned or leased as of January 1, 2004, by the taxpayer of Class II or Class III railroads (as determined by the Surface Transportation Board).

   Inserted: "(d) Controlled Groups.--For purposes of subsection (b), rules similar to the rules of paragraph (1) of section 41(f) shall apply for purposes of this subsection.

   Inserted: "(e) Basis Adjustment.--For purposes of this subtitle, if a credit is allowed under this section with respect to any railroad track, the basis of such track shall be reduced by the amount of the credit so allowed.

   Inserted: "(f) Application of Section.--This section shall apply to qualified railroad track maintenance expenditures paid or incurred during taxable years beginning after December 31, 2003, and before January 1, 2009.

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   Inserted: "(g) Eligible Taxpayer.--For purposes of this subsection, the term 'eligible taxpayer' means--

   Inserted: "(1) any person who transports property using the rail facilities of the taxpayer or who furnishes railroad-related property or services to the taxpayer, and

   Inserted: "(2) any Class II or Class III railroad.".

   Inserted: (2) Limitation on carryback.--Section 39(d) (relating to transition rules), as amended by section 5453, is amended by adding at the end the following new paragraph:

   Inserted: "(14) No carryback of railroad track maintenance credit before effective date.--No portion of the unused business credit for any taxable year which is attributable to the railroad track maintenance credit determined under section 45G may be carried to a taxable year beginning before January 1, 2004.".

   Inserted: (3) Conforming Amendments.--

   Inserted: (A) Section 38(b) (relating to general business credit), as amended by section 5253 of this Act, is amended by striking "plus" at the end of paragraph (18), by striking the period at the end of paragraph (19) and inserting ", plus", and by adding at the end the following new paragraph:

   Inserted: "(20) the railroad track maintenance credit determined under section 45I(a).".

   Inserted: (B) Subsection (a) of section 1016 is amended by striking "and" at the end of paragraph (27), by striking the period at the end of paragraph (28) and inserting ", and", and by adding at the end the following new paragraph:

   Inserted: "(29) in the case of railroad track with respect to which a credit was allowed under section 45I, to the extent provided in section 45I(e).".

   Inserted: (4) Clerical Amendment.--The table of sections for subpart D of part IV of subchapter A of chapter 1, as amended by this Act, is amended by inserting after the item relating to section 45H the following new item:

   Inserted: "Sec. 45I. Railroad track maintenance credit.".

   Inserted: (5) Effective Date.--The amendments made by this section shall apply to taxable years beginning after December 31, 2003.

   Inserted: (b) Railroad Revitalization and Security Investment Credit.--

   Inserted: (1) In general.--Subpart D of part IV of subchapter A of chapter 1 (relating to business-related credits) is amended by adding at the end the following new section:

   Inserted: "SEC. 45J. RAILROAD REVITALIZATION AND SECURITY INVESTMENT CREDIT.

   Inserted: "(a) General Rule.--For purposes of section 38, the railroad revitalization and security investment credit determined under this section for the taxable year is the amount of qualified project expenditures paid or incurred by an eligible taxpayer during the taxable year.

   Inserted: "(b) Qualified Project Expenditures.--For purposes of this section, the term 'qualified project expenditures' means expenditures (whether or not otherwise chargeable to capital account) with respect to rail lines which are included in a State rail plan (within the meaning of section 22101 of title 49, United States Code) for--

   Inserted: "(A) planning and environmental review,

   Inserted: "(B) rail line rehabilitation,

   Inserted: "(C) upgrades and development of rail lines,

   Inserted: "(D) projects for safety and security with respect to rail lines,

   Inserted: "(E) passenger equipment acquisition with respect to rail lines,

   Inserted: "(F) rail station improvement, and

   Inserted: "(G) intermodal facilities development.

   Inserted: An expenditure shall not be a qualified project expenditure unless there is a written agreement between a State and the owner of the infrastructure improved by the expenditures regarding the use and ownership of such infrastructure, including compensation for such use and assurances regarding the capacity of such infrastructure.

   Inserted: "(c) Limitations.--

   Inserted: "(1) In general.--The credit allowed under subsection (a) shall not exceed 50 percent of the amount allocated to such project under this subsection.

   Inserted: "(2) National limitation.--There is a railroad revitalization and security investment credit limitation of $167,000,000 for each calendar year.

   Inserted: "(3) Allocation of limitation.--The limitation under paragraph (2) shall be allocated by the Secretary to each State with a State rail plan (within the meaning of section 22101 of title 49, United States Code) based on the following considerations:

   Inserted: "(A) the number of rail miles in active use in the State;

   Inserted: "(B) the number of rail cars loaded in the State;

   Inserted: "(C) the number of railroad and public road grade crossings in the State;

   Inserted: "(D) the number of intercity passenger rail miles; and

   Inserted: "(E) the number of intercity passenger embarkations.

   Inserted: "(d) Eligible Taxpayer.--For purposes of this section, the term 'eligible taxpayer' means a taxpayer who is an employer for purposes of the Railroad Retirement Act of 1974 and who is a carrier for purposes of the Railway Labor Act (unless such person is a commuter rail passenger transportation (as defined in section 24102 of title 49, United States Code) operator of a State or local authority (as defined in section 5302 of such title) or an Alaska railroad or it contractor).

   Inserted: "(e) Controlled Groups.--For purposes of subsection (b), rules similar to the rules of paragraph (1) of section 41(f) shall apply for purposes of this subsection.

   Inserted: "(f) Basis Adjustment.--For purposes of this subtitle, if a credit is allowed under this section with respect to any railroad track, the basis of such track shall be reduced by the amount of the credit so allowed.

   Inserted: "(g) Application of Section.--This section shall apply to qualified railroad track maintenance expenditures paid or incurred during taxable years beginning after December 31, 2003, and before January 1, 2009.

   Inserted: "(h) Credit Transferability.--

   Inserted: "(1) In general.--Any credit allowable under this section may be transferred (but not more than once) as provided by the Secretary, and the determination as to whether the credit is allowable shall be made without regard to the tax-exempt status of the transferor.

   Inserted: "(2) Minimum price for transfer.--No transfer shall be allowed under this subsection unless the transferor receives compensation for the credit transfer equal to at least 50 percent of the amount of credit transferred. The excess of the amount of credit transferred over the compensation received by the transferor for such transfer shall be included in the gross income of the transferee.".

   Inserted: (2) Limitation on carryback.--Section 39(d) (relating to transition rules), as amended by subsection (a), is amended by adding at the end the following new paragraph:

   Inserted: "(16) No carryback of section 45j credit before effective date.--No portion of the unused business credit for any taxable year which is attributable to the credit determined under section 45J(a) may be carried back to a taxable year beginning on or before the date of the enactment of section 45J.".

   Inserted: (3) Conforming Amendments.--

   Inserted: (A) Section 38(b) (relating to general business credit), as amended by subsection (a), is amended by striking "plus" at the end of paragraph (19), by striking the period at the end of paragraph (20) and inserting ", plus", and by adding at the end the following new paragraph:

   Inserted: "(21) the railroad revitalization and security investment credit determined under section 45J(a).".

   Inserted: (B) Subsection (a) of section 1016 is amended by striking "and" at the end of paragraph (28), by striking the period at the end of paragraph (29) and inserting ", and", and by adding at the end the following new paragraph:

   Inserted: "(30) in the case of qualified projects with respect to which a credit was allowed under section 45J, to the extent provided in section 45J(f).".

   Inserted: (4) Clerical Amendment.--The table of sections for subpart D of part IV of subchapter A of chapter 1, as amended by subsection (a), is amended by inserting after the item relating to section 45I the following new item:

   Inserted: "Sec. 45J. Railroad revitalization and security investment credit.".

   Inserted: (5) Effective Date.--The amendments made by this section shall apply to taxable years beginning after December 31, 2003.

   Inserted: SEC. __. CONSISTENT AMORTIZATION OF PERIODS FOR INTANGIBLES.

   Inserted: (a) Start-Up Expenditures.--

   Inserted: (1) Allowance of deduction.--Paragraph (1) of section 195(b) (relating to start-up expenditures) is amended to read as follows:

   Inserted: "(1) Allowance of deduction.--If a taxpayer elects the application of this subsection with respect to any start-up expenditures--

   Inserted: "(A) the taxpayer shall be allowed a deduction for the taxable year in which the active trade or business begins in an amount equal to the lesser of--

   Inserted: "(i) the amount of start-up expenditures with respect to the active trade or business, or

   Inserted: "(ii) $5,000, reduced (but not below zero) by the amount by which such start-up expenditures exceed $50,000, and

   Inserted: "(B) the remainder of such start-up expenditures shall be allowed as a deduction ratably over the 180-month period beginning with the month in which the active trade or business begins.".

   Inserted: (2) Conforming amendment.--Subsection (b) of section 195 is amended by striking "Amortize" and inserting "Deduct" in the heading.

   Inserted: (b) Organizational Expenditures.--Subsection (a) of section 248 (relating to organizational expenditures) is amended to read as follows:

   Inserted: "(a) Election to Deduct.--If a corporation elects the application of this subsection (in accordance with regulations prescribed by the Secretary) with respect to any organizational expenditures--

   Inserted: "(1) the corporation shall be allowed a deduction for the taxable year in which the corporation begins business in an amount equal to the lesser of--

   Inserted: "(A) the amount of organizational expenditures with respect to the taxpayer, or

   Inserted: "(B) $5,000, reduced (but not below zero) by the amount by which such organizational expenditures exceed $50,000, and

   Inserted: "(2) the remainder of such organizational expenditures shall be allowed as a deduction ratably over the 180-month period beginning with the month in which the corporation begins business.".

   Inserted: (c) Treatment of Organizational and Syndication Fees or Partnerships.--

   Inserted: (1) In general.--Section 709(b) (relating to amortization of organization fees) is amended by redesignating paragraph (2) as paragraph (3) and by amending paragraph (1) to read as follows:

   Inserted: "(1) Allowance of deduction.--If a taxpayer elects the application of this subsection (in accordance with regulations prescribed by the Secretary) with respect to any organizational expenses--

   Inserted: "(A) the taxpayer shall be allowed a deduction for the taxable year in which the partnership begins business in an amount equal to the lesser of--

   Inserted: "(i) the amount of organizational expenses with respect to the partnership, or

   Inserted: "(ii) $5,000, reduced (but not below zero) by the amount by which such organizational expenses exceed $50,000, and

   Inserted: "(B) the remainder of such organizational expenses shall be allowed as a deduction ratably over the 180-month period beginning with the month in which the partnership begins business.

   Inserted: "(2) Dispositions before close of amortization period.--In any case in which a partnership is liquidated before the end of the period to which paragraph (1)(B) applies, any deferred expenses attributable to the partnership which were not allowed as a deduction by reason of this section may be deducted to the extent allowable under section 165.".

   Inserted: (2) Conforming amendment.--Subsection (b) of section 709 is amended by striking "Amortization" and inserting "Deduction" in the heading.

   Inserted: (d) Effective Date.--The amendments made by this section shall apply to amounts paid or incurred after the date of the enactment of this Act.

   Original wording

   At the end of subtitle F of title V, insert the following:

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As printed