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H.R. 1267House112th Congress (2011-2013)In Committee

To amend the Internal Revenue Code of 1986 to modify the application of the tonnage tax on certain vessels.

Sponsored by Wally HergerRep. Wally Herger (R-CA)
Introduced March 30, 2011

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Referred to the House Committee on Ways and Means.

Ways and Means Committee

March 30, 2011

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HouseIntro Referral

Introduced in House

March 30, 2011

HouseIntro Referral

Referred to the House Committee on Ways and Means.

Ways and Means Committee

March 30, 2011

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Introduced in HouseIssued March 30, 2011

I

112th CONGRESS

1st Session

H. R. 1267

IN THE HOUSE OF REPRESENTATIVES

March 30, 2011

Mr. Herger (for himself, Mr. Blumenauer, Mr. Gerlach, and Ms. Hirono) introduced the following bill; which was referred to the Committee on Ways and Means

A BILL

To amend the Internal Revenue Code of 1986 to modify the application of the tonnage tax on certain vessels.

1.

Modification of the application of the tonnage tax on vessels operating in the dual United States domestic and foreign trades

(a)

In general

Subsection (f) of section 1355 of the Internal Revenue Code of 1986 (relating to definitions and special rules) is amended to read as follows:

(f)

Effect of operating a qualifying vessel in the dual United States domestic and foreign trades

For purposes of this subchapter—

(1)

an electing corporation shall be treated as continuing to use a qualifying vessel in the United States foreign trade during any period of use in the United States domestic trade, and

(2)

gross income from such United States domestic trade shall not be excluded under section 1357(a), but shall not be taken into account for purposes of section 1353(b)(1)(B) or for purposes of section 1356 in connection with the application of section 1357 or 1358.

.

(b)

Regulatory authority for allocation of credits, income, and deductions

Section 1358 of the Internal Revenue Code of 1986 (relating to allocation of credits, income, and deductions) is amended—

(1)

by striking in accordance with this subsection in subsection (c) and inserting to the extent provided in such regulations as may be prescribed by the Secretary, and

(2)

by adding at the end the following new subsection:

(d)

Regulations

The Secretary shall prescribe regulations consistent with the provisions of this subchapter for the purpose of allocating gross income, deductions, and credits between or among qualifying shipping activities and other activities of a taxpayer.

.

(c)

Conforming amendments

(1)

Section 1355(a)(4) of the Internal Revenue Code of 1986 is amended by striking exclusively.

(2)

Section 1355(b)(1)(B) of such Code is amended by striking as a qualifying vessel and inserting in the transportation of goods or passengers.

(3)

Section 1355 of such Code is amended—

(A)

by striking subsection (g), and

(B)

by redesignating subsection (h) as subsection (g).

(d)

Effective date

The amendments made by this section shall apply to taxable years beginning after the date of the enactment of this Act.