§ 198. Expensing of environmental remediation costs
(a)
In general
A taxpayer may elect to treat any qualified environmental remediation expenditure which is paid or incurred by the taxpayer as an expense which is not chargeable to capital account. Any expenditure which is so treated shall be allowed as a deduction for the taxable year in which it is paid or incurred.
(b)
Qualified environmental remediation expenditure
For purposes of this section—
(2)
Special rule for expenditures for depreciable property
Such term shall not include any expenditure for the acquisition of property of a character subject to the allowance for depreciation which is used in connection with the abatement or control of hazardous substances at a qualified contaminated site; except that the portion of the allowance under section
167 for such property which is otherwise allocated to such site shall be treated as a qualified environmental remediation expenditure.
(c)
Qualified contaminated site
For purposes of this section—
(1)
In general
The term “qualified contaminated site” means any area—
(2)
National priorities listed sites not included
Such term shall not include any site which is on, or proposed for, the national priorities list under section 105(a)(8)(B) of the Comprehensive Environmental Response, Compensation, and Liability Act of 1980 (as in effect on the date of the enactment of this section).
(3)
Taxpayer must receive statement from State environmental agency
An area shall be treated as a qualified contaminated site with respect to expenditures paid or incurred during any taxable year only if the taxpayer receives a statement from the appropriate agency of the State in which such area is located that such area meets the requirement of paragraph (1)(B).
(4)
Appropriate State agency
For purposes of paragraph (3), the chief executive officer of each State may, in consultation with the Administrator of the Environmental Protection Agency, designate the appropriate State environmental agency within 60 days of the date of the enactment of this section. If the chief executive officer of a State has not designated an appropriate environmental agency within such 60-day period, the appropriate environmental agency for such State shall be designated by the Administrator of the Environmental Protection Agency.
(d)
Hazardous substance
For purposes of this section—
(e)
Deduction recaptured as ordinary income on sale, etc.
Solely for purposes of section
1245, in the case of property to which a qualified environmental remediation expenditure would have been capitalized but for this section—
(g)
Regulations
The Secretary shall prescribe such regulations as may be necessary or appropriate to carry out the purposes of this section.
(h)
Termination
This section shall not apply to expenditures paid or incurred after December 31, 2011.