A bill to amend the Internal Revenue Code of 1954 to provide that no foreign tax credit, and no deduction, shall be allowed for taxes paid of accrued to Libya during the period any declaration by the President of a national emergency is in effect with respect to Libya and to provide that the exclusion from gross income of earned income of U.S. citizens living abroad shall not apply to income attributable to Libya during such period.

Amends the Internal Revenue Code to disallow, while a declaration of national emergency is in effect: (1) a foreign income tax credit for any income, war profits, or excess profits taxes paid or accrued to Libya; (2) a business expense income tax deduction for any such taxes paid to Libya; and (3) the income tax exclusion of earned income of U.S. citizens living abroad for any income attributable to Libya.

Describes such a declaration as a declaration by the President of a national emergency under the International Emergency Economic Powers Act after a finding that the policies and actions of Libya constitute an unusual and extraordinary threat to the national security and foreign policy of the United States.