S.Amdt. 5213

1. Adds SEC. ___. LIMITATION OF DEDUCTION FOR INCOME ATTRIBUTABLE TO DOMESTIC PRODUCTION OF OIL, GAS, OR PRIMARY PRODUCTS THEREOF at the end of S.Amdt. 5147

   Adds a section

   In S.Amdt. 5147 as proposed

   (a) Definitions.--In this section: (1) Eligible producing state.--The term "eligible producing State" means--(A) a new producing State; and (B) any other producing State that has, within the offshore administrative boundaries beyond the submerged land of a State, areas available for oil leasing, natural gas leasing, or both. (2) New producing area.--The term "new producing area" means an area that is--(A) within the offshore administrative boundaries beyond the submerged land of a State; and (B) not available for oil or natural gas leasing as of the date of enactment of this Act. (3) New producing state.--The term "new producing State" means a State with respect to which a petition has been approved by the Secretary under subsection (b). (4) Qualified revenues.--The term "qualified revenues" means all rentals, royalties, bonus bids, and other sums due and payable to the United States from leases entered into on or after the date of enactment of this Act for new producing areas. (5) Secretary.--The term "Secretary" means the Secretary of the Interior. (b) Petition for Leasing New Producing Areas.--(1) In general.--Notwithstanding any other provision of law, the Governor of a State, with the concurrence of the State legislature, may submit to the Secretary a petition requesting that the Secretary make a new producing area of the State eligible for oil leasing, gas leasing, or both, as determined by the State, in accordance with the Outer Continental Shelf Lands Act (43 U.S.C. 1331 et seq.) and the Mineral Leasing Act (30 U.S.C. 181 et seq.). (2) Action by secretary.--As soon as practicable after the date on which the Secretary receives a petition under paragraph (1), the Secretary shall approve or disapprove the petition. (c) Disposition of Qualified Outer Continental Shelf Revenues From Eligible Producing States.--Notwithstanding section 9 of the Outer Continental Shelf Lands Act (43 U.S.C. 1338), for each applicable fiscal year, the Secretary of the Treasury shall deposit--(1) 50 percent of qualified revenues in the general fund of the Treasury; and (2) 50 percent of qualified revenues in a special account in the Treasury, which the Secretary shall disburse to eligible producing States for new producing areas, to be allocated in accordance with subsection (d). (d) Allocation to Eligible Producing States.--The amount made available under subsection (c)(2) shall be allocated to eligible producing States in amounts (based on a formula established by the Secretary by regulation) that are inversely proportional to the respective distances between the point on the coastline of each eligible producing State that is closest to the geographic center of the applicable leased tract and the geographic center of the leased tract, as determined by the Secretary. (e) Effect.--Nothing in this section affects any authority that permits energy production under any other provision of law.

   Inserted: SEC. ___. LIMITATION OF DEDUCTION FOR INCOME ATTRIBUTABLE TO DOMESTIC PRODUCTION OF OIL, GAS, OR PRIMARY PRODUCTS THEREOF.

   Inserted: (a) Denial of Deduction for Major Integrated Oil Companies for Income Attributable to Domestic Production of Oil, Gas, or Primary Products Thereof.--

   Inserted: (1) In general.--Subparagraph (B) of section 199(c)(4) of the Internal Revenue Code of 1986 (relating to exceptions) is amended by striking "or" at the end of clause (ii), by striking the period at the end of clause (iii) and inserting ", or", and by inserting after clause (iii) the following new clause:

   Inserted: "(iv) in the case of any major integrated oil company (as defined in section 167(h)(5)(B)), the production, refining, processing, transportation, or distribution of oil, gas, or any primary product thereof during any taxable year described in section 167(h)(5)(B).".

   Inserted: (2) Primary product.--Section 199(c)(4)(B) of such Code is amended by adding at the end the following flush sentence:

   Inserted: "For purposes of clause (iv), the term 'primary product' has the same meaning as when used in section 927(a)(2)(C), as in effect before its repeal.".

   Inserted: (b) Limitation on Oil Related Qualified Production Activities Income for Taxpayers Other Than Major Integrated Oil Companies.--

   Inserted: (1) In general.--Section 199(d) of the Internal Revenue Code of 1986 is amended by redesignating paragraph (9) as paragraph (10) and by inserting after paragraph (8) the following new paragraph:

   Inserted: "(9) Special rule for taxpayers with oil related qualified production activities income.--

   Inserted: "(A) In general.--If a taxpayer (other than a major integrated oil company (as defined in section 167(h)(5)(B))) has oil related qualified production activities income for any taxable year beginning after 2009, the amount of the deduction under subsection (a) shall be reduced by 3 percent of the least of--

   Inserted: "(i) the oil related qualified production activities income of the taxpayer for the taxable year,

   Inserted: "(ii) the qualified production activities income of the taxpayer for the taxable year, or

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   Inserted: "(iii) taxable income (determined without regard to this section).

   Inserted: "(B) Oil related qualified production activities income.--The term 'oil related qualified production activities income' means for any taxable year the qualified production activities income which is attributable to the production, refining, processing, transportation, or distribution of oil, gas, or any primary product thereof during such taxable year.".

   Inserted: (2) Conforming amendment.--Section 199(d)(2) of such Code (relating to application to individuals) is amended by striking "subsection (a)(1)(B)" and inserting "subsections (a)(1)(B) and (d)(9)(A)(iii)".

   Inserted: (c) Effective Date.--The amendments made by this section shall apply to taxable years beginning after December 31, 2008.

   Original wording

   At the end add the following:

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