26 U.S.C. § 179B : US Code - Section 179B: Deduction for capital costs incurred in complying with Environmental Protection Agency sulfur regulations

Search 26 U.S.C. § 179B : US Code - Section 179B: Deduction for capital costs incurred in complying with Environmental Protection Agency sulfur regulations

(a) Allowance of deduction
In the case of a small business refiner (as defined in section
45H(c)(1)) which elects the application of this section, there
shall be allowed as a deduction an amount equal to 75 percent of
qualified capital costs (as defined in section 45H(c)(2)) which are
paid or incurred by the taxpayer during the taxable year.
(b) Reduced percentage
In the case of a small business refiner with average daily
domestic refinery runs for the 1-year period ending on December 31,
2002, in excess of 155,000 barrels, the number of percentage points
described in subsection (a) shall be reduced (not below zero) by
the product of such number (before 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.
(e) Election to allocate deduction to cooperative owner
(1) In general
If -
(A) a small business refiner to which subsection (a) applies
is an organization to which part I of subchapter T applies, and
(B) one or more persons directly holding an ownership
interest in the refiner are organizations to which part I of
subchapter T apply,
the refiner may elect to allocate all or a portion of the
deduction allowable under subsection (a) to such persons. Such
allocation shall be equal to the person's ratable share of the
total amount allocated, determined on the basis of the person's
ownership interest in the taxpayer. The taxable income of the
refiner shall not be reduced under section 1382 by reason of any
amount to which the preceding sentence applies.
(2) Form and effect of election
An election under paragraph (1) for any taxable year shall be
made on a timely filed return for such year. Such election, once
made, shall be irrevocable for such taxable year.
(3) Written notice to owners
If any portion of the deduction available under subsection (a)
is allocated to owners under paragraph (1), the cooperative shall
provide any owner receiving an allocation written notice of the
amount of the allocation. Such notice shall be provided before
the date on which the return described in paragraph (2) is due.