[Congressional Bills 110th Congress]
[From the U.S. Government Publishing Office]
[H.R. 7006 Engrossed in House (EH)]

  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
110th CONGRESS
  2d Session
                                H. R. 7006

_______________________________________________________________________

                                 AN ACT


 
    To amend the Internal Revenue Code of 1986 to provide disaster 
                           assistance relief.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE, ETC.

    (a) In General.--This Act may be cited as the ``Disaster Tax Relief 
Act of 2008''.
    (b) Reference.--Except as otherwise expressly provided, whenever in 
this Act an amendment or repeal is expressed in terms of an amendment 
to, or repeal of, a section or other provision, the reference shall be 
considered to be made to a section or other provision of the Internal 
Revenue Code of 1986.
    (c) Table of Contents.--The table of contents of this Act is as 
follows:

Sec. 1. Short title, etc.
Sec. 2. Losses attributable to federally declared disasters.
Sec. 3. Expensing of qualified disaster expenses.
Sec. 4. Net operating losses attributable to federally declared 
                            disasters.
Sec. 5. Waiver of certain mortgage revenue bond requirements following 
                            federally declared disasters.
Sec. 6. Determination of standard mileage rate for charitable 
                            contributions deduction.
Sec. 7. Additional low income housing allocations.
Sec. 8. Private activity disaster bonds.
Sec. 9. Waiver of limitation on charitable contributions for disaster 
                            relief.

SEC. 2. LOSSES ATTRIBUTABLE TO FEDERALLY DECLARED DISASTERS.

    (a) Waiver of Adjusted Gross Income Limitation.--
            (1) In general.--Subsection (h) of section 165 is amended 
        by redesignating paragraphs (3) and (4) as paragraphs (4) and 
        (5), respectively, and by inserting after paragraph (2) the 
        following new paragraph:
            ``(3) Special rule for losses in federally declared 
        disasters.--
                    ``(A) In general.--If an individual has a net 
                disaster loss for any taxable year, the amount 
                determined under paragraph (2)(A)(ii) shall be the sum 
                of--
                            ``(i) such net disaster loss, and
                            ``(ii) so much of the excess referred to in 
                        the matter preceding clause (i) of paragraph 
                        (2)(A) (reduced by the amount in clause (i) of 
                        this subparagraph) as exceeds 10 percent of the 
                        adjusted gross income of the individual.
                    ``(B) Net disaster loss.--For purposes of 
                subparagraph (A), the term `net disaster loss' means 
                the excess of--
                            ``(i) the personal casualty losses--
                                    ``(I) attributable to a federally 
                                declared disaster occurring after 
                                December 31, 2007, and before January 
                                1, 2012, and
                                    ``(II) occurring in a disaster 
                                area, over
                            ``(ii) personal casualty gains.
                    ``(C) Federally declared disaster.--For purposes of 
                this paragraph--
                            ``(i) Federally declared disaster.--The 
                        term `federally declared disaster' means any 
                        disaster subsequently determined by the 
                        President of the United States to warrant 
                        assistance by the Federal Government under the 
                        Robert T. Stafford Disaster Relief and 
                        Emergency Assistance Act.
                            ``(ii) Disaster area.--The term `disaster 
                        area' means the area so determined to warrant 
                        such assistance.''.
            (2) Conforming amendments.--
                    (A) Section 165(h)(4)(B) (as so redesignated) is 
                amended by striking ``paragraph (2)'' and inserting 
                ``paragraphs (2) and (3)''.
                    (B) Section 165(i)(1) is amended by striking 
                ``loss'' and all that follows through ``Act'' and 
                inserting ``loss occurring in a disaster area (as 
                defined by clause (ii) of subsection (h)(3)(C)) and 
                attributable to a federally declared disaster (as 
                defined by clause (i) of such subsection)''.
                    (C) Section 165(i)(4) is amended by striking 
                ``Presidentially declared disaster (as defined by 
                section 1033(h)(3))'' and inserting ``federally 
                declared disaster (as defined by subsection 
                (h)(3)(C)(i)''.
                    (D)(i) So much of subsection (h) of section 1033 as 
                precedes subparagraph (A) of paragraph (1) thereof is 
                amended to read as follows:
    ``(h) Special Rules for Property Damaged by Federally Declared 
Disasters.--
            ``(1) Principal residences.--If the taxpayer's principal 
        residence or any of its contents is located in a disaster area 
        and is compulsorily or involuntarily converted as a result of a 
        federally declared disaster--''.
                    (ii) Paragraph (2) of section 1033(h) is amended by 
                striking ``investment'' and all that follows through 
                ``disaster'' and inserting ``investment is located in a 
                disaster area and is compulsorily or involuntarily 
                converted as a result of a federally declared 
                disaster''.
                    (iii) Paragraph (3) of section 1033(h) is amended 
                to read as follows:
            ``(3) Federally declared disaster; disaster area.--The 
        terms ``federally declared disaster'' and ``disaster area'' 
        shall have the respective meaning given such terms by section 
        165(h)(3)(C).''.
                    (iv) Section 139(c)(2) is amended to read as 
                follows:
            ``(2) federally declared disaster (as defined by section 
        165(h)(3)(C)(i)),''.
                    (v) Subclause (II) of section 172(b)(1)(F)(ii) is 
                amended by striking ``Presidentially declared disasters 
                (as defined in section 1033(h)(3))'' and inserting 
                ``federally declared disasters (as defined by section 
                165(h)(3)(C)(i))''.
                    (vi) Subclause (III) of section 172(b)(1)(F)(ii) is 
                amended by striking ``Presidentially declared 
                disasters'' and inserting ``federally declared 
                disasters''.
                    (vii) Subsection (a) of section 7508A is amended by 
                striking ``Presidentially declared disaster (as defined 
                in section 1033(h)(3))'' and inserting ``federally 
                declared disaster (as defined by section 
                165(h)(3)(C)(i))''.
    (b) Increase in Standard Deduction by Disaster Casualty Loss.--
            (1) In general.--Paragraph (1) of section 63(c) is amended 
        by striking ``and'' at the end of subparagraph (B), by striking 
        the period at the end of subparagraph (C) and inserting ``, 
        and'', and by adding at the end the following new subparagraph:
                    ``(D) the disaster loss deduction.''.
            (2) Disaster loss deduction.--Subsection (c) of section 63 
        is amended by adding at the end the following new paragraph:
            ``(8) Disaster loss deduction.--For the purposes of 
        paragraph (1), the term `disaster loss deduction' means the net 
        disaster loss (as defined in section 165(h)(3)(B)).''.
            (3) Allowance in computing alternative minimum taxable 
        income.--Subparagraph (E) of section 56(b)(1) is amended by 
        adding at the end the following new sentence: ``The preceding 
        sentence shall not apply to so much of the standard deduction 
        as is determined under section 63(c)(1)(D).''.
    (c) Increase in Limitation on Individual Loss Per Casualty.--
Paragraph (1) of section 165(h) is amended by striking ``$100'' and 
inserting ``$500 ($100 for taxable years beginning after December 31, 
2011)''.
    (d) Effective Dates.--
            (1) In general.--Except as provided in paragraph (2), the 
        amendments made by this section shall apply to--
                    (A) taxable years beginning after December 31, 
                2007, and
                    (B) the taxpayer's last taxable year beginning 
                before January 1, 2008, solely for purposes of 
                determining the amount allowable as a deduction with 
                respect to any net disaster loss (as defined in section 
                165(h)(3)(B) of the Internal Revenue Code of 1986) for 
                such year by reason of an election under section 165(i) 
                of such Code.
            (2) Increase in limitation on individual loss per 
        casualty.--The amendment made by subsection (c) shall apply to 
        taxable years beginning after December 31, 2008.

SEC. 3. EXPENSING OF QUALIFIED DISASTER EXPENSES.

    (a) In General.--Part VI of subchapter B of chapter 1 is amended by 
inserting after section 198 the following new section:

``SEC. 198A. EXPENSING OF QUALIFIED DISASTER EXPENSES.

    ``(a) In General.--A taxpayer may elect to treat any qualified 
disaster expenses which are paid or incurred by the taxpayer as an 
expense which is not chargeable to capital account. Any expense which 
is so treated shall be allowed as a deduction for the taxable year in 
which it is paid or incurred.
    ``(b) Qualified Disaster Expense.--For purposes of this section, 
the term `qualified disaster expense' means any expenditure--
            ``(1) which is paid or incurred in connection with a trade 
        or business or with business-related property,
            ``(2) which is--
                    ``(A) for the abatement or control of hazardous 
                substances that were released on account of a federally 
                declared disaster,
                    ``(B) for the removal of debris from, or the 
                demolition of structures on, real property which is 
                business-related property damaged or destroyed as a 
                result of a federally declared disaster, or
                    ``(C) for the repair of business-related property 
                damaged as a result of a federally declared disaster, 
                and
            ``(3) is otherwise chargeable to capital account.
    ``(c) Other Definitions.--For purposes of this section--
            ``(1) Business-related property.--The term `business-
        related property' means property--
                    ``(A) held by the taxpayer for use in a trade or 
                business or for the production of income, or
                    ``(B) described in section 1221(a)(1) in the hands 
                of the taxpayer.
            ``(2) Federally declared disaster.--The term `federally 
        declared disaster' has the meaning given such term by section 
        165(h)(3)(C)(i), except that such term shall not include any 
        disaster occurring before January 1, 2008, or after December 
        31, 2011.
    ``(d) Deduction Recaptured as Ordinary Income on Sale, etc.--Solely 
for purposes of section 1245, in the case of property to which a 
qualified disaster expense would have been capitalized but for this 
section--
            ``(1) the deduction allowed by this section for such 
        expense shall be treated as a deduction for depreciation, and
            ``(2) such property (if not otherwise section 1245 
        property) shall be treated as section 1245 property solely for 
        purposes of applying section 1245 to such deduction.
    ``(e) Coordination With Other Provisions.--Sections 198, 280B, and 
468 shall not apply to amounts which are treated as expenses under this 
section.
    ``(f) Regulations.--The Secretary shall prescribe such regulations 
as may be necessary or appropriate to carry out the purposes of this 
section.''.
    (b) Clerical Amendment.--The table of sections for part VI of 
subchapter B of chapter 1 is amended by inserting after the item 
relating to section 198 the following new item:

``Sec. 198A. Expensing of Qualified Disaster Expenses.''.
    (c) Effective Date.--The amendments made by this section shall 
apply to amounts paid or incurred after December 31, 2007.

SEC. 4. NET OPERATING LOSSES ATTRIBUTABLE TO FEDERALLY DECLARED 
              DISASTERS.

    (a) In General.--Paragraph (1) of section 172(b) is amended by 
adding at the end the following new subparagraph:
                    ``(J) Certain losses attributable federally 
                declared disasters.--In the case of a taxpayer who has 
                a qualified disaster loss (as defined in subsection 
                (j)), such loss shall be a net operating loss carryback 
                to each of the 5 taxable years preceding the taxable 
                year of such loss.''.
    (b) Qualified Disaster Loss.--Section 172 is amended by 
redesignating subsections (j) and (k) as subsections (k) and (l), 
respectively, and by inserting after subsection (i) the following new 
subsection:
    ``(j) Rules Relating to Qualified Disaster Losses.--For purposes of 
this section--
            ``(1) In general.--The term `qualified disaster loss' means 
        the lesser of--
                    ``(A) the sum of--
                            ``(i) the losses allowable under section 
                        165 for the taxable year--
                                    ``(I) attributable to a federally 
                                declared disaster (as defined in 
                                section 165(h)(3)(C)(i)) occurring 
                                after December 31, 2007, and before 
                                January 1, 2012, and
                                    ``(II) occurring in a disaster area 
                                (as defined in section 
                                165(h)(3)(C)(ii)), and
                            ``(ii) the deduction for the taxable year 
                        for qualified disaster expenses which is 
                        allowable under section 198A(a) or which would 
                        be so allowable if not otherwise treated as an 
                        expense, or
                    ``(B) the net operating loss for such taxable year.
            ``(2) Coordination with subsection (b)(2).--For purposes of 
        applying subsection (b)(2), a qualified disaster loss for any 
        taxable year shall be treated in a manner similar to the manner 
        in which a specified liability loss is treated.
            ``(3) Election.--Any taxpayer entitled to a 5-year 
        carryback under subsection (b)(1)(J) from any loss year may 
        elect to have the carryback period with respect to such loss 
        year determined without regard to subsection (b)(1)(J). Such 
        election shall be made in such manner as may be prescribed by 
        the Secretary and shall be made by the due date (including 
        extensions of time) for filing the taxpayer's return for the 
        taxable year of the net operating loss. Such election, once 
        made for any taxable year, shall be irrevocable for such 
        taxable year.''.
    (c) Loss Deduction Allowed in Computing Alternative Minimum Taxable 
Income.--Subsection (d) of section 56 is amended by adding at the end 
the following new paragraph:
            ``(3) Net operating loss attributable to federally declared 
        disasters.--In the case of a taxpayer which has a qualified 
        disaster loss (as defined by section 172(b)(1)(J)) for the 
        taxable year, paragraph (1) shall be applied by increasing the 
        amount determined under subparagraph (A)(ii)(I) thereof by the 
        sum of the carrybacks and carryovers of such loss.''.
    (d) Conforming Amendments.--
            (1) Clause (ii) of section 172(b)(1)(F) is amended by 
        inserting ``or qualified disaster loss (as defined in 
        subsection (j))'' before the period at the end of the last 
        sentence.
            (2) Paragraph (1) of section 172(i) is amended by adding at 
        the end the following new flush sentence:
        ``Such term shall not include any qualified disaster loss (as 
        defined in subsection (j)).''.
    (e) Effective Date.--The amendments made by this section shall 
apply to net operating losses for taxable years beginning after 
December 31, 2007.

SEC. 5. WAIVER OF CERTAIN MORTGAGE REVENUE BOND REQUIREMENTS FOLLOWING 
              FEDERALLY DECLARED DISASTERS.

    (a) In General.--Paragraph (11) of section 143(k) is amended to 
read as follows:
            ``(11) Special rules for federally declared disasters.--
                    ``(A) Principal residence destroyed.--If the 
                principal residence (within the meaning of section 121) 
                of a taxpayer is--
                            ``(i) rendered unsafe for use as a 
                        residence by reason of a federally declared 
                        disaster, or
                            ``(ii) demolished or relocated by reason of 
                        an order of the government of a State or 
                        political subdivision thereof on account of a 
                        federally declared disaster,
                then for the 2-year period beginning on the date of the 
                disaster declaration, subsection (d)(1) shall not apply 
                with respect to such taxpayer and subsection (e) shall 
                be applied by substituting `110' for `90' in paragraph 
                (1) thereof.
                    ``(B) Principal residence damaged.--
                            ``(i) In general.--If the principal 
                        residence (within the meaning of section 121) 
                        of a taxpayer resulting from a federally 
                        declared disaster, was damaged, any owner-
                        financing provided in connection with the 
                        repair or reconstruction of such residence 
                        shall be treated as a qualified rehabilitation 
                        loan.
                            ``(ii) Limitation.--The aggregate owner-
                        financing to which clause (i) applies shall not 
                        exceed the lesser of--
                                    ``(I) the cost of such repair or 
                                reconstruction, or
                                    ``(II) $150,000.
                    ``(C) Federally declared disaster.--For purposes of 
                this paragraph, the term `federally declared disaster' 
                has the meaning given such term by section 
                165(h)(3)(C)(i), except that such term shall not 
                include any disaster occurring before January 1, 2008, 
                or after December 31, 2011.''.
    (b) Effective Date.--The amendment made by subsection (a) shall 
apply to obligations issued after the date of the enactment of this 
Act.

SEC. 6. DETERMINATION OF STANDARD MILEAGE RATE FOR CHARITABLE 
              CONTRIBUTIONS DEDUCTION.

    (a) In General.--Subsection (i) of section 170 (relating to 
standard mileage rate for use of passenger automobile) is amended by 
adding at the end the following new sentence: ``In the case of the use 
of a passenger automobile after the date of the enactment of this 
sentence and before January 1, 2012, the standard mileage rate shall be 
the rate determined by the Secretary, which rate shall not be less than 
the standard mileage rate used for purposes of section 213.''.
    (b) Effective Date.--The amendment made by this section shall apply 
to taxable years ending after the date of the enactment of this Act.

SEC. 7. ADDITIONAL LOW INCOME HOUSING ALLOCATIONS.

    (a) In General.--Subsection (h) of section 42 of is amended by 
redesignating paragraph (8) as paragraph (9) and by inserting after 
paragraph (7) the following new paragraph:
            ``(8) Additional allocations for disasters.--
                    ``(A) In general.--In addition to any other 
                allocation made under this subsection, the Secretary 
                may, upon application by any State, make allocations of 
                housing credit dollar amounts to such State for 
                allocation to buildings in such State consistent with 
                the requirements of subparagraph (C).
                    ``(B) Limitations.--The aggregate qualified 
                disaster allocations made by the Secretary under this 
                paragraph may not exceed $190,000,000. Any allocation 
                which is terminated by the Secretary (by reason of 
                disuse or otherwise) shall not be treated as having 
                been allocated for purposes of the preceding sentence.
                    ``(C) Disaster housing allocations.--For purposes 
                of this section--
                            ``(i) In general.--Allocations under this 
                        paragraph may be made by the Secretary only to 
                        States which include a disaster area.
                            ``(ii) Priority for housing loss disaster 
                        areas.--In making allocation under this 
                        paragraph, the Secretary shall give priority to 
                        housing loss disaster areas.
                            ``(iii) Limitation to buildings located in 
                        housing loss disaster areas.--Any allocation of 
                        housing credit dollar amounts under this 
                        paragraph may be allocated by such State (or a 
                        housing credit agency of such State) only to--
                                    ``(I) buildings located in a 
                                disaster area, and
                                    ``(II) in the case of any 
                                allocation made by reason of a priority 
                                under clause (ii), buildings located in 
                                the housing loss disaster area with 
                                respect to which such priority was 
                                given.
                            ``(iv) Pro rata allocations.--The 
                        allocations made by the Secretary under this 
                        paragraph shall be made ratably over the period 
                        described in subparagraph (F) unless the 
                        Secretary determines, on the basis of the 
                        severity or frequency of disasters, that a 
                        different allocation is appropriate.
                    ``(D) Housing loss disaster area.--For purposes of 
                this paragraph, the term `housing loss disaster area' 
                means any county or municipality--
                            ``(i) with respect to which the Governor of 
                        the State in which such county or municipality 
                        is located demonstrates to the satisfaction of 
                        the Secretary that the lesser of--
                                    ``(I) 1,000 dwelling units, or
                                    ``(II) 10 percent of the dwelling 
                                units located in such county or 
                                municipality,
                        have been rendered uninhabitable by reason of 
                        damage to or destruction of such units caused 
                        by a federally declared disaster, and
                            ``(ii) which is located in a disaster area.
                    ``(E) Definitions and special rules.--For purposes 
                of this paragraph--
                            ``(i) Federally declared disaster; disaster 
                        area.--The terms ``federally declared 
                        disaster'' and ``disaster area'' shall have the 
                        respective meaning given such terms by section 
                        165(h)(3)(C).
                            ``(ii) No effect on carryovers.--An 
                        allocation of housing credit dollar amount to a 
                        State under this paragraph shall not be taken 
                        into account under paragraph (3).
                            ``(iii) Consultation with fema.--Any 
                        allocation made under this paragraph by the 
                        Secretary shall be made after consultation with 
                        the Director of the Federal Emergency 
                        Management Agency.
                    ``(F) Termination.--Allocations under this 
                paragraph may be made only with respect to disasters 
                occurring during the period beginning on January 1, 
                2008, and ending on December 31, 2011. No allocation 
                under this paragraph may be made to any building after 
                December 31, 2012.''.
    (b) Effective Date.--The amendment made by this section shall apply 
to allocations made after the date of the enactment of this Act.

SEC. 8. PRIVATE ACTIVITY DISASTER BONDS.

    (a) In General.--Section 144 is amended by adding at the end the 
following new subsection:
    ``(d) Qualified Disaster Bond.--
            ``(1) In general.--For purposes of this part, the term 
        `qualified disaster bond' means any bond issued as part of an 
        issue if--
                    ``(A) 95 percent or more of the net proceeds of the 
                issue are to be used for the replacement, repair, 
                reconstruction, or renovation of property of a 
                character subject to the allowance for depreciation 
                which was damaged or destroyed as a result of a 
                federally declared disaster, and
                    ``(B) such bond is designated by a State for 
                purposes of this subsection.
            ``(2) Designation of bonds.--
                    ``(A) Designation by state.--The maximum aggregate 
                face amount of bonds designated under paragraph (1)(B) 
                by any State may not exceed the bond limitation 
                allocated to such State by the Secretary under 
                subparagraph (B).
                    ``(B) Allocation of bond limitation.--
                            ``(i) In general.--The Secretary may, upon 
                        application by any State, make allocation of 
                        bond limitation to such State if such State 
                        includes a disaster area.
                            ``(ii) Limitation.--The aggregate amount of 
                        bond limitation allocated to the States by the 
                        Secretary under clause (i) may not exceed 
                        $13,000,000,000. Any allocation which is 
                        terminated by the Secretary (by reason of 
                        disuse or otherwise) shall not be treated as 
                        having been allocated for purposes of the 
                        preceding sentence.
                            ``(iii) Priority for business loss disaster 
                        areas.--In making allocation under this 
                        subsection, the Secretary shall give priority 
                        to business loss disaster areas.
                            ``(iv) Limitation to buildings located in 
                        business loss disaster areas.--Any allocation 
                        of bond limitation under this subsection may be 
                        used by such State only to issue bonds with 
                        respect to--
                                    ``(I) property located in a 
                                disaster area, and
                                    ``(II) in the case of any 
                                allocation made by reason of a priority 
                                under clause (iii), property located in 
                                the business loss disaster area with 
                                respect to which such priority was 
                                given.
                            ``(v) Pro rata allocations.--The 
                        allocations made by the Secretary under this 
                        subparagraph shall be made ratably over the 
                        period described in paragraph (5) unless the 
                        Secretary determines, on the basis of the 
                        severity or frequency of disasters, that a 
                        different allocation is appropriate.
            ``(3) Business loss disaster area.--For purposes of this 
        subsection, the term `business loss disaster area' means any 
        county or municipality--
                    ``(A) with respect to which the Governor of the 
                State in which such county or municipality is located 
                demonstrates to the satisfaction of the Secretary that 
                business property located in such county or 
                municipality has sustained damages by reason of a 
                federally declared disaster of at least the lesser of--
                            ``(i) $50,000,000, or
                            ``(ii) 5 percent of the value of all such 
                        business property (determined immediately 
                        before such disaster on the basis of property 
                        tax records or such other method as the 
                        Secretary determines appropriate), and
                    ``(B) which is located in a disaster area.
            ``(4) Definitions and special rules.--For purposes of this 
        subsection--
                    ``(A) Federally declared disaster; disaster area.--
                The terms ``federally declared disaster'' and 
                ``disaster area'' shall have the respective meaning 
                given such terms by section 165(h)(3)(C).
                    ``(B) Certain uses prohibited.--A bond which is 
                part of an issue shall not be treated as a qualified 
                disaster bond if any proceeds of such issue are to be 
                used for any property described in section 1400N(p)(3).
                    ``(C) Consultation with fema.--Any allocation made 
                under this subsection by the Secretary shall be made 
                after consultation with the Director of the Federal 
                Emergency Management Agency.
            ``(5) Termination.--Allocations under this subsection may 
        be made only--
                    ``(A) before December 31, 2012, and
                    ``(B) with respect to disasters occurring during 
                the period beginning on January 1, 2008, and ending on 
                December 31, 2011.''.
    (b) Exemption From Alternative Minimum Tax.--
            (1) Subparagraph (C) of section 57(a)(5) is amended by 
        redesignating clauses (iv) and (v) as clauses (v) and (vi) and 
        by inserting after clause (iii) the following new clause:
                            ``(iv) Exception for qualified disaster 
                        bonds.--For purposes of clause (i), the term 
                        `private activity bond' shall not include any 
                        qualified disaster bond (as defined in section 
                        144(d)).''.
            (2) Clause (iii) of section 56(g)(4)(B) is amended--
                    (A) by striking ``section 57(a)(5)(C)(iii)'' and 
                inserting ``clause (iii) or (iv) of section 
                57(a)(5)(C)'', and
                    (B) by striking ``housing'' in the heading thereof.
    (c) Conforming Amendments.--
            (1) Section 141(e)(1) is amended by striking ``or'' at the 
        end of subparagraph (F), by striking the period at the end of 
        subparagraph (G) and inserting ``, or'', and by adding at the 
        end the following new subparagraph:
                    ``(H) qualified disaster bond.''.
            (2) Section 146(g) is amended by striking ``and'' at the 
        end of paragraph (3), by striking the period at the end of 
        paragraph (4) and inserting ``, and'', and by inserting after 
        paragraph (4) the following new paragraph:
            ``(5) any qualified disaster bond.''.
            (3) The heading of section 144 is amended by inserting ``; 
        qualified disaster bond'' after ``qualified redevelopment 
        bond''.
    (d) Effective Date.--The amendments made by this section shall 
apply to obligations issued after the date of the enactment of this 
Act.

SEC. 9. WAIVER OF LIMITATION ON CHARITABLE CONTRIBUTIONS FOR DISASTER 
              RELIEF.

    (a) In General.--Section 170(b) is amended by adding at the end the 
following new paragraph:
            ``(3) Waiver of limitation in case of disaster relief.--
                    ``(A) In general.--Except as otherwise provided in 
                subparagraph (B), paragraphs (1) and (2) shall not 
                apply to qualified disaster contributions and such 
                contributions shall not be taken into account for 
                purposes of applying such paragraphs or subsection (d) 
                to other contributions.
                    ``(B) Treatment of excess contributions.--For 
                purposes of this section--
                            ``(i) Individuals.--In the case of an 
                        individual--
                                    ``(I) Limitation.--Any qualified 
                                disaster contribution shall be allowed 
                                only to the extent that the aggregate 
                                of such contributions does not exceed 
                                the excess of the taxpayer's 
                                contribution base over the amount of 
                                all other charitable contributions 
                                allowable under paragraph (1).
                                    ``(II) Carryover.--If the aggregate 
                                amount of qualified disaster 
                                contributions made in the contribution 
                                year (within the meaning of subsection 
                                (d)(1)) exceeds the limitation of 
                                subclause (I), such excess shall be 
                                added to the excess described in the 
                                portion of subparagraph (A) of such 
                                subsection which precedes clause (i) 
                                thereof for purposes of applying such 
                                subsection.
                            ``(ii) Corporations.--In the case of a 
                        corporation--
                                    ``(I) Limitation.--Any qualified 
                                disaster contribution shall be allowed 
                                only to the extent that the aggregate 
                                of such contributions does not exceed 
                                the excess of the taxpayer's taxable 
                                income (as determined under paragraph 
                                (2)) over the amount of all other 
                                charitable contributions allowable 
                                under such paragraph.
                                    ``(II) Carryover.--Rules similar to 
                                the rules of clause (i)(II) shall apply 
                                for purposes of this clause.
                    ``(C) Exception to overall limitation on itemized 
                deductions.--So much of any deduction allowed under 
                this section as does not exceed the qualified disaster 
                contributions paid during the taxable year shall not be 
                treated as an itemized deduction for purposes of 
                section 68.
                    ``(D) Qualified disaster contributions.--
                            ``(i) In general.--For purposes of this 
                        subsection, the term `qualified disaster 
                        contribution' means any charitable contribution 
                        if--
                                    ``(I) such contribution is paid 
                                during the period beginning on the date 
                                of the enactment of this paragraph, and 
                                ending on December 31, 2009, in cash to 
                                an organization described in paragraph 
                                (1)(A) (other than an organization 
                                described in section 509(a)(3)),
                                    ``(II) such contribution is for 
                                relief efforts related to a federally 
                                declared disaster (as defined in 
                                section 165(h)(3)(C)(i)), and
                                    ``(III) the taxpayer has elected 
                                the application of this subsection with 
                                respect to such contribution.
                            ``(ii) Exception.--Such term shall not 
                        include a contribution if the contribution is 
                        for establishment of a new, or maintenance in a 
                        donor advised fund (as defined in section 
                        4966(d)(2)).
                            ``(iii) Application of election to 
                        partnerships and s corporations.--In the case 
                        of a partnership or S corporation, the election 
                        under clause (i)(III) shall be made separately 
                        by each partner or shareholder.''.
    (b) Effective Date.--The amendments made by this section shall 
apply to taxable years ending after the date of the enactment of this 
Act.

            Passed the House of Representatives September 24, 2008.

            Attest:

                                                                 Clerk.
110th CONGRESS

  2d Session

                               H. R. 7006

_______________________________________________________________________

                                 AN ACT

    To amend the Internal Revenue Code of 1986 to provide disaster 
                           assistance relief.