Page:United States Statutes at Large Volume 111 Part 1.djvu/907

 PUBLIC LAW 105-34—AUG. 5, 1997 111 STAT. 883 "SEC. 198. EXPENSING OF ENVIRONMENTAL REMEDIATION COSTS. "(a) IN GENERAL.— ^A taxpayer may elect to treat any qualified environmental remediation expenditure which is paid or incurred by the taxpayer as an expense which is not chargeable to capital account, i^y expenditure which is so treated shall be allowed as a deduction for the taxable year in which it is paid or incurred. "(b) QUALIFIED ENVIRONMENTAL REMEDIATION EXPENDITURE.— For purposes of this section— "(1) IN GENERAL.— The term 'qualified environmental remediation expenditure' means any expenditure— "(A) which is otherwise chargeable to capital account, and "(B) which is paid or incurred in connection with the abatement or control of hazardous substances at a qualified contaminated site. "(2) SPECIAL RULE FOR EXPENDITURES FOR DEPRECIABLE PROPERTY. —Such term shall not include any expenditure for the acquisition of property of a character subject to the allowance for depreciation which is used in connection with the abatement or control of hazardous substances at a qualified contaminated site; except that the portion of the allowance under section 167 for such property which is otherwise allocated to such site shall be treated as a qualified environmental remediation expenditure. "(c) QUALIFIED CONTAMINATED SITE.— For purposes of this section— " (1) QUALIFIED CONTAMINATED SITE.— "(A) IN GENERAL.— The term 'qualified contaminated site' means any area— "(i) which is held by the taxpayer for use in a trade or business or for the production of income, or which is property described in section 1221(1) in the hands of the taxpayer, "(ii) which is within a targeted area, and "(iii) at or on which there has been a release (or threat of release) or disposal of any hazardous substance. "(B) TAXPAYER MUST RECEIVE STATEMENT FROM STATE ENVIRONMENTAL AGENCY.—An area shall be treated as a qualified contaminated site with respect to expenditures paid or incurred during any taxable year only if the taxpayer receives a statement from the appropriate agency of the State in which such area is located that such area meets the requirements of clauses (ii) and (iii) of subparagraph (A). " (C) APPROPRIATE STATE AGENCY.— For purposes of subparagraph (B), the chief executive officer of each State may, in consultation with the Administrator of the Environmental Protection Agency, designate the appropriate State environmental agency within 60 days of the date of the enactment of this section. If the chief executive officer of a State has not designated an appropriate State environmental agency within such 60-day period, the appropriate environmental agency for such State shall be designated by the Administrator of the Environmental Protection Agency. " (2) TARGETED AREA.—

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