[Congressional Bills 107th Congress]
[From the U.S. Government Publishing Office]
[H.R. 2393 Introduced in House (IH)]







107th CONGRESS
  1st Session
                                H. R. 2393

   To amend the Internal Revenue Code of 1986 to allow individuals a 
   credit against income tax for energy conservation expenditures in 
      residences and for purchases of energy efficient appliances.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                             June 28, 2001

Mr. Israel (for himself and Mr. Crowley) introduced the following bill; 
         which was referred to the Committee on Ways and Means

_______________________________________________________________________

                                 A BILL


 
   To amend the Internal Revenue Code of 1986 to allow individuals a 
   credit against income tax for energy conservation expenditures in 
      residences and for purchases of energy efficient appliances.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Energy Cost and Tax Relief Act''.

SEC. 2. TAX CREDIT FOR ENERGY CONSERVATION EXPENDITURES IN RESIDENCES.

    (a) In General.--Subpart A of part IV of subchapter A of chapter 1 
of the Internal Revenue Code of 1986 (relating to nonrefundable 
personal credits against tax) is amended by inserting after section 25B 
the following new section:

``SEC. 25C. ENERGY CONSERVATION PROPERTY IN RESIDENCES.

    ``(a) Allowance of Credit.--In the case of an individual, there 
shall be allowed as a credit against the tax imposed by this chapter 
for the taxable year an amount equal to 50 percent of the expenditures 
made by the taxpayer for qualified energy conservation property during 
such taxable year.
    ``(b) Limitation.--The credit allowed under subsection (a) with 
respect to each dwelling unit for any taxable year shall not exceed 
$2,500.
    ``(c) Qualified Energy Conservation Property.--For purposes of this 
section--
            ``(1) In general.--The term `qualified energy conservation 
        property' means energy conservation property described in 
        paragraph (2) if--
                    ``(A) the property is certified by the Secretary of 
                Energy to equal or exceed energy conservation standards 
                for such property or for the installation of such 
                property, and
                    ``(B) the property is installed on or in connection 
                with a dwelling unit which is located in the United 
                States and which is used by the taxpayer as a 
                residence.
            ``(2) Description of energy conservation property.--For 
        purposes of paragraph (1), energy conservation property 
        described in this paragraph is the following:
                    ``(A) Ceiling insulation.
                    ``(B) Weatherstripping.
                    ``(C) Water heater insulation blankets.
                    ``(D) Low-flow showerheads.
                    ``(E) Caulking in ceilings.
                    ``(F) Insulation of plenums and ducts.
                    ``(G) Storm windows with a U-value of 0.45 or less.
                    ``(H) Thermal doors and windows.
                    ``(I) Duty cyclers.
                    ``(J) Clock thermostats.
                    ``(K) Evaporative coolers.
                    ``(L) Whole house fans.
                    ``(M) External shading devices.
                    ``(N) Thermal energy storage devices with central 
                control systems.
                    ``(O) Controls and automatic switching devices 
                between natural and electric lighting.
                    ``(P) Any other property that the Secretary of 
                Energy determines to be an effective device for the 
                conservation of energy.
    ``(d) Certification.--For purposes of subsection (c)(1)(A)--
            ``(1) Products.--A certification with respect to qualified 
        energy conservation property shall be made by the manufacturer 
        of such property.
            ``(2) Installation.--A certification with respect to the 
        installation of qualified energy conservation property shall be 
        made by the person who sold or installed the property.
            ``(3) Form.--Certifications referred to in this subsection 
        shall be in such form as the Secretary shall prescribe, and, 
        except in the case of a certification by a representative of a 
        local building regulatory authority, shall include the taxpayer 
        identification number of the person making the certification.
    ``(e) Special Rules.--For purposes of this section--
            ``(1) Dollar amounts in case of joint occupancy.--In the 
        case of any dwelling unit which if jointly occupied and used 
        during any calendar year as a residence by 2 or more 
        individuals the following shall apply:
                    ``(A) The amount of the credit allowable under 
                subsection (a) by reason of expenditures (as the case 
                may be) made during such calendar year by any of such 
                individuals with respect to such dwelling unit shall be 
                determined by treating all of such individuals as 1 
                taxpayer whose taxable year is such calendar year.
                    ``(B) There shall be allowable with respect to such 
                expenditures to each of such individuals, a credit 
                under subsection (a) for the taxable year in which such 
                calendar year ends in an amount which bears the same 
                ratio to the amount determined under subparagraph (A) 
                as the amount of such expenditures made by such 
                individual during such calendar year bears to the 
                aggregate of such expenditures made by all of such 
                individuals during such calendar year.
            ``(2) Tenant-stockholder in cooperative housing 
        corporation.--In the case of an individual who is a tenant-
        stockholder (as defined in section 216) in a cooperative 
        housing corporation (as defined in such section), such 
        individual shall be treated as having made his tenant-
        stockholder's proportionate share (as defined in section 
        216(b)(3)) of any expenditures of such corporation.
            ``(3) Condominiums.--
                    ``(A) In general.--In the case of an individual who 
                is a member of a condominium management association 
                with respect to a condominium which he owns, such 
                individual shall be treated as having made his 
                proportionate share of any expenditures of such 
                association.
                    ``(B) Condominium management association.--For 
                purposes of this paragraph, the term `condominium 
                management association' means an organization which 
                meets the requirements of paragraph (1) of section 
                528(c) (other than subparagraph (E) thereof) with 
                respect to a condominium project substantially all of 
                the units of which are used as residences.
            ``(4) Joint ownership of energy items.--
                    ``(A) In general.--Any expenditure otherwise 
                qualifying as an expenditure for qualified energy 
                conservation property shall not be treated as failing 
                to so qualify merely because such expenditure was made 
                with respect to 2 or more dwelling units.
                    ``(B) Limits applied separately.--In the case of 
                any expenditure described in subparagraph (A), the 
                amount of the credit allowable under subsection (a) 
                shall (subject to paragraph (1)) be computed separately 
                with respect to the amount of the expenditure made for 
                each dwelling unit.
            ``(5) Allocation in certain cases.--If less than 80 percent 
        of the use of an item is for nonbusiness residential purposes, 
        only that portion of the expenditures for such item which is 
        properly allocable to use for nonbusiness residential purposes 
        shall be taken into account.
            ``(6) When expenditure made; amount of expenditure.--
                    ``(A) In general.--Except as provided in 
                subparagraph (B), an expenditure with respect to an 
                item shall be treated as made when the original 
                installation of the item is completed.
                    ``(B) Expenditures part of building construction.--
                In the case of an expenditure in connection with the 
                construction or reconstruction of a structure, such 
                expenditure shall be treated as made when the original 
                use of the constructed or reconstructed structure by 
                the taxpayer begins.
                    ``(C) Amount.--The amount of any expenditure shall 
                be the cost thereof.
            ``(7) Other applicable rules.--Rules similar to the rules 
        of paragraphs (4) and (5) of section 48(a) shall apply for 
        purposes of this section.
    ``(f) Basis Adjustments.--For purposes of this subtitle, if a 
credit is allowed under this section for any expenditure with respect 
to any property, the increase in the basis of such property which would 
(but for this subsection) result from such expenditure shall be reduced 
by the amount of the credit so allowed.
    ``(g) Denial of Double Benefit.--No deduction or other credit shall 
be allowed under this chapter for any expenditure for which credit is 
allowed under this section.
    ``(h) Election To Have Credit Not Apply.--A taxpayer may elect to 
have this section not apply for any taxable year.
    ``(i) Application of Section.--This section shall apply to 
expenditures with respect to property placed in service after December 
31, 2000.''.
    (b) Conforming Amendment.--Subsection (a) of section 1016 of such 
Code (relating to general rule for adjustments to basis) is amended by 
striking ``and'' at the end of paragraph (27), by striking the period 
at the end of paragraph (28) and inserting ``, and'', and by adding at 
the end the following new paragraph:
            ``(29) in the case of a residence with respect to which a 
        credit was allowed under section 25C, to the extent provided in 
        section 25C(f).''.
    (c) Clerical Amendment.--The table of sections for subpart A of 
part IV of subchapter A of chapter 1 of such Code is amended by 
inserting after the item relating to section 25B the following new 
item:

                              ``Sec. 25C. Energy conservation property 
                                        in residences.''.
    (d) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after December 31, 2000.

SEC. 3. TAX CREDIT FOR PURCHASES OF ENERGY EFFICIENT APPLIANCES.

    (a) In General.--Subpart A of part IV of subchapter A of chapter 1 
of the Internal Revenue Code of 1986 (relating to nonrefundable 
personal credits against tax), as amended by section 2, is amended by 
inserting after section 25C the following new section:

``SEC. 25D. ENERGY EFFICIENT APPLIANCES.

    ``(a) Allowance of Credit.--In the case of an individual, there 
shall be allowed as a credit against the tax imposed by this chapter an 
amount equal to 50 percent of the amount paid by the taxpayer for the 
purchase of any qualified appliance.
    ``(b) Limitation.--The credit allowed under subsection (a) for any 
taxable year shall not exceed $2,500.
    ``(c) Qualified Appliance.--For purposes of this section--
            ``(1) In general.--The term `qualified appliance' means any 
        appliance listed in paragraph (2) if it meets the standards in 
        the Appliance Standards Program of the Department of Energy (in 
        part 430 of chapter II of title 10 of the Code of Federal 
        Regulations).
            ``(2) List of appliances.--For purposes of paragraph (1), 
        the appliances listed in this paragraph are the following:
                    ``(A) Air conditioners--central air and heat pumps.
                    ``(B) Air conditioners--room.
                    ``(C) Clothes dryers.
                    ``(D) Clothes washers.
                    ``(E) Heating equipment--furnaces and boilers.
                    ``(F) Kitchen ranges and ovens.
                    ``(G) Refrigerators, refrigerator-freezers, and 
                freezers.
                    ``(H) Showerheads and faucets.
                    ``(I) Water closets and urinals.
                    ``(J) Water heaters.''.
    (b) Clerical Amendment.--The table of sections for subpart A of 
part IV of subchapter A of chapter 1 of such Code, as amended by 
section 2, is amended by inserting after the item relating to section 
25C the following new item:

``25D. Energy efficient appliances.''.
    (c) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after December 31, 2000.
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