article: SECTION 1. SHORT TITLE. This Act may be cited as the ``Coastal Restoration Tax Credit Act of 2005''. SEC. 2. CREDIT FOR EXPENSES INCURRED IN RESTORING AND PROTECTING COASTAL LANDS. (a) In General.--Subpart B of part IV of subchapter A of chapter 1 of the Internal Revenue Code of 1986 is amended by adding at the end the following new section: ``SEC. 30B. CREDIT FOR EXPENSES INCURRED IN RESTORING AND PROTECTING COASTAL LANDS. ``(a) Allowance of Credit.--There shall be allowed as a credit against the tax imposed by this chapter for the taxable year an amount equal to the qualified expenditures of the taxpayer for the taxable year. ``(b) Limitations.-- ``(1) Maximum credit.--The credit allowed under subsection (a) for a taxable year shall not exceed $2,000,000. ``(2) Limitation based on amount of tax.--The credit allowed under subsection (a) for the taxable year shall not exceed the excess of-- ``(A) the sum of the regular tax liability (as defined in section 26(b)) plus the tax imposed by section 55, over ``(B) the sum of the credits allowable under subpart A and sections 27 and 30A for the taxable year. ``(c) Qualified Expenditures.--For purposes of this section-- ``(1) In general.--The term `qualified expenditures' means amounts paid or incurred by the taxpayer for an approved project. ``(2) Approved project.--The term `approved project' means any project approved by the Natural Resources Conservation Service to restore or protect coastal lands located in the United States. ``(d) Carryovers Allowed.-- ``(1) In general.--If the credit amount allowable under subsection (a) for a taxable year exceeds the amount of the limitation under subsection (c) for such taxable year (referred to as the `unused credit year' in this paragraph), such excess shall be allowed as a credit carryforward for each of the taxable years following the unused credit year or as a credit carryback for each of the taxable years preceeding the unused credit year. ``(2) Rules.--For purposes of paragraph (1), rules similar to the rules of section 39 shall apply, except that-- ``(A) subsection (a)(1) shall be applied-- ``(i) by substituting `3 taxable years' for `1 taxable years' in subparagraph (A) thereof, and ``(ii) by substituting `5 taxable years' for `20 taxable years' in subparagraph (B) thereof, and ``(B) subsection (a)(2) shall be applied-- ``(i) by substituting `8 taxable years' for `21 taxable years' in subparagraph (A) thereof, and ``(ii) by substituting `7 taxable years' for `20 taxable years' in subparagraph (B). ``(e) Special Rules.-- ``(1) Basis reduction.--The basis of any property for which a credit is allowable under subsection (a) shall be reduced by the amount of such credit (determined without regard to subsection (b)(2)). ``(2) No double benefit.--The amount of any deduction or credit allowable under this chapter (other than the credit allowable under subsection (a)), shall be reduced by the amount of credit allowed under subsection (a) (determined without regard to subsection (b)(2)) for the taxable year. ``(3) Reduction for assistance.--The amount taken into account under subsection (a) with respect to any project shall be reduced by the amount of any Federal, State, or local grant or other assistance received by the taxpayer during such taxable year or any prior taxable year which was used to make qualified expenditures and which was not included in the gross income of such taxpayer.''. (b) Basis Adjustment.--Section 1016(a) of such Code is amended by striking ``and'' at the end of paragraph (30), by striking the period at the end of paragraph (31) and inserting ``, and'', and by adding at the end the following new paragraph: ``(32) to the extent provided in section 30B(e)(1).''. (c) Clerical Amendment.--The table of sections for subpart B of part IV of subchapter A of chapter 1 of such Code is amended by inserting after the item relating to section 30A the following new item: ``Sec. 30B. Credit for expenses incurred in restoring and protecting coastal lands.''. (d) Effective Date.--The amendments made by this section shall apply to taxable years beginning after December 31, 2004.
summary: Coastal Restoration Tax Credit Act of 2005 - Amends the Internal Revenue Code to allow a tax credit for expenditures related to any project approved by the Natural Resources Conservation Service to restore or protect coastal lands in the United States.