Page:United States Statutes at Large Volume 120.djvu/2995

 120 STAT. 2964

PUBLIC LAW 109–432—DEC. 20, 2006

(h) and by inserting after subsection (f) the following new subsection: ‘‘(g) GREAT LAKES DOMESTIC SHIPPING TO NOT DISQUALIFY VESSEL.— ‘‘(1) IN GENERAL.—If the electing corporation elects (at such time and in such manner as the Secretary may require) to apply this subsection for any taxable year to any qualifying vessel which is used in qualified zone domestic trade during the taxable year— ‘‘(A) solely for purposes of subsection (a)(4), such use shall be treated as use in United States foreign trade (and not as use in United States domestic trade), and ‘‘(B) subsection (f) shall not apply with respect to such vessel for such taxable year. ‘‘(2) EFFECT OF TEMPORARILY OPERATING VESSEL IN UNITED STATES DOMESTIC TRADE.—In the case of a qualifying vessel to which this subsection applies— ‘‘(A) IN GENERAL.—An electing corporation shall be treated as using such vessel in qualified zone domestic trade during any period of temporary use in the United States domestic trade (other than qualified zone domestic trade) if the electing corporation gives timely notice to the Secretary stating— ‘‘(i) that it temporarily operates or has operated in the United States domestic trade (other than qualified zone domestic trade) a qualifying vessel which had been used in the United States foreign trade or qualified zone domestic trade, and ‘‘(ii) its intention to resume operation of the vessel in the United States foreign trade or qualified zone domestic trade. ‘‘(B) NOTICE.—Notice shall be deemed timely if given not later than the due date (including extensions) for the corporation’s tax return for the taxable year in which the temporary cessation begins. ‘‘(C) PERIOD DISREGARD IN EFFECT.—The period of temporary use under subparagraph (A) continues until the earlier of the date of which— ‘‘(i) the electing corporation abandons its intention to resume operations of the vessel in the United States foreign trade or qualified zone domestic trade, or ‘‘(ii) the electing corporation resumes operation of the vessel in the United States foreign trade or qualified zone domestic trade. ‘‘(D) NO DISREGARD IF DOMESTIC TRADE USE EXCEEDS 30 DAYS.—Subparagraph (A) shall not apply to any qualifying vessel which is operated in the United States domestic trade (other than qualified zone domestic trade) for more than 30 days during the taxable year. ‘‘(3) ALLOCATION OF INCOME AND DEDUCTIONS TO QUALIFYING SHIPPING ACTIVITIES.—In the case of a qualifying vessel to which this subsection applies, the Secretary shall prescribe rules for the proper allocation of income, expenses, losses, and deductions between the qualified shipping activities and the other activities of such vessel. ‘‘(4) QUALIFIED ZONE DOMESTIC TRADE.—For purposes of this subsection—

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