1. Short title This Act may be cited as the Economic Development Act for Distressed Zones of 2018 . 2. Economically distressed zones (a) In general Chapter 1 of the Internal Revenue Code of 1986 is amended by adding at the end the following new subchapter: AA Economically Distressed Zones Sec. 1400AA–1. Economically Distressed Zones. Sec. 1400AA–2. Designation of economically distressed zones. 1400AA–1. Economically Distressed Zone credit (a) Allowance of credit There shall be allowed as a credit against the tax imposed by subtitle A for the taxable year an amount equal to sum of— (1) an amount equal to 40 percent of the sum of— (A) the aggregate amount of the taxpayer’s economically distressed zone wages for such taxable year, plus (B) the allocable employee fringe benefit expenses of the taxpayer for such taxable year, (2) an amount equal to 40 percent of the depreciation and amortization allowances for the taxable year with respect to property of the taxpayer which are located and used in the active conduct of a trade or business within an economically distressed zone, and (3) an amount equal to 30 percent of the payments made by the taxpayer in course of a trade or business for purchases of services or tangible property from an unrelated person (40 percent in the case of such a purchase from an unrelated minority business) located within an economically distressed zone. (b) Denial of double benefit Any wages or other expenses taken into account in determining the credit under this section may not be taken into account in determining the credit under sections 41, and any other provision determined by the Secretary to be substantially similar. (c) Definitions and special rules For purposes of this section— (1) Qualified economically distressed zone wages (A) In general The term qualified economically distressed zone wages means amounts paid or incurred by the taxpayer for the taxable year which are— (i) in connection with the active conduct of a trade or business of the taxpayer within an economically