Page:United States Statutes at Large Volume 118.djvu/1511

 118 STAT. 1481 PUBLIC LAW 108–357—OCT. 22, 2004 the application of this subsection) and the ratio of such excess to 50,000 barrels. ‘‘(c) BASIS REDUCTION.— ‘‘(1) IN GENERAL.—For purposes of this title, the basis of any property shall be reduced by the portion of the cost of such property taken into account under subsection (a). ‘‘(2) ORDINARY INCOME RECAPTURE.—For purposes of section 1245, the amount of the deduction allowable under subsection (a) with respect to any property which is of a character subject to the allowance for depreciation shall be treated as a deduction allowed for depreciation under section 167.’’. ‘‘(d) COORDINATION WITH OTHER PROVISIONS.—Section 280B shall not apply to amounts which are treated as expenses under this section.’’. (b) CONFORMING AMENDMENTS.— (1) Section 263(a)(1), as amended by this Act, is amended by striking ‘‘or’’ at the end of subparagraph (G), by striking the period at the end of subparagraph (H) and inserting ‘‘, or’’, and by adding at the end the following new subparagraph: ‘‘(I) expenditures for which a deduction is allowed under section 179B.’’. (2) Section 263A(c)(3) is amended by inserting ‘‘179B,’’ after ‘‘section’’. (3) Section 312(k)(3)(B) is amended by striking ‘‘or 179A’’ each place it appears in the heading and text and inserting ‘‘179A, or 179B’’. (4) Section 1016(a) 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 inserting after paragraph (29) the following new paragraph: ‘‘(30) to the extent provided in section 179B(c).’’. (5) Paragraphs (2)(C) and (3)(C) of section 1245(a) are each amended by inserting ‘‘179B,’’ after ‘‘179A,’’. (6) The table of sections for part VI of subchapter B of chapter 1, as amended by this Act, is amended by inserting after the item relating to section 179A the following new item: ‘‘Sec. 179B. Deduction for capital costs incurred in complying with Envi ronmental Protection Agency sulfur regulations.’’. (c) EFFECTIVE DATE.—The amendment made by this section shall apply to expenses paid or incurred after December 31, 2002, in taxable years ending after such date. SEC. 339. CREDIT FOR PRODUCTION OF LOW SULFUR DIESEL FUEL. (a) IN GENERAL.—Subpart D of part IV of subchapter A of chapter 1 (relating to business related credits), as amended by this Act, is amended by inserting after section 45G the following new section: ‘‘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.— 26 USC 179B note.

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