26 USC 179C - Election to expense certain refineries

U.S Code last checked for updates: Nov 22, 2024

§ 179C.

Election to expense certain refineries

(a)

Treatment as expenses

(b)

Election

(1)

In general

(2)

Election irrevocable

(c)

Qualified refinery property

(1)

In general

The term “qualified refinery property” means any portion of a qualified refinery—

(A)

the original use of which commences with the taxpayer,

(B)

which is placed in service by the taxpayer after the date of the enactment of this section and before January 1, 2014,

(C)

in the case any portion of a qualified refinery (other than a qualified refinery which is separate from any existing refinery), which meets the requirements of subsection (e),

(D)

which meets all applicable environmental laws in effect on the date such portion was placed in service,

(E)

no written binding contract for the construction of which was in effect on or before June 14, 2005, and

(F)

(i)

the construction of which is subject to a written binding construction contract entered into before January 1, 2010,

(ii)

which is placed in service before January 1, 2010, or

(iii)

in the case of self-constructed property, the construction of which began after June 14, 2005, and before January 1, 2010.

(2)

Special rule for sale-leasebacks

For purposes of paragraph (1)(A), if property is—

(A)

originally placed in service after the date of the enactment of this section by a person, and

(B)

sold and leased back by such person within 3 months after the date such property was originally placed in service,

such property shall be treated as originally placed in service not earlier than the date on which such property is used under the leaseback referred to in subparagraph (B).

(3)

Effect of waiver under Clean Air Act

(d)

Qualified refinery

(e)

Production capacity

The requirements of this subsection are met if the portion of the qualified refinery—

(1)

enables the existing qualified refinery to increase total volume output (determined without regard to asphalt or lube oil) by 5 percent or more on an average daily basis, or

(2)

enables the existing qualified refinery to process shale, tar sands, or qualified fuels (as defined in section 45K(c)) at a rate which is equal to or greater than 25 percent of the total throughput of such qualified refinery on an average daily basis.

(f)

Ineligible refinery property

No deduction shall be allowed under subsection (a) for any qualified refinery property—

(1)

the primary purpose of which is for use as a topping plant, asphalt plant, lube oil facility, crude or product terminal, or blending facility, or

(2)

which is built solely to comply with consent decrees or projects mandated by Federal, State, or local governments.

(g)

Election to allocate deduction to cooperative owner

(1)

In general

If—

(A)

a taxpayer 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 taxpayer are organizations to which part I of subchapter T apply,

the taxpayer 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 taxpayer shall not be reduced under section 1382 by reason of any amount to which the preceding sentence applies.

(2)

Form and effect of election

(3)

Written notice to owners

(h)

Reporting

(Added Pub. L. 109–58, title XIII, § 1323(a), Aug. 8, 2005, 119 Stat. 1013; amended Pub. L. 110–343, div. B, title II, § 209(a), (b), Oct. 3, 2008, 122 Stat. 3840.)

cite as: 26 USC 179C