[Congressional Bills 110th Congress]
[From the U.S. Government Publishing Office]
[S. 2314 Introduced in Senate (IS)]







110th CONGRESS
  1st Session
                                S. 2314

To amend the Internal Revenue Code of 1986 to make geothermal heat pump 
   systems eligible for the energy credit and the residential energy 
           efficient property credit, and for other purposes.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                            November 6, 2007

 Mr. Salazar (for himself, Mr. Inhofe, and Mr. Tester) introduced the 
 following bill; which was read twice and referred to the Committee on 
                                Finance

_______________________________________________________________________

                                 A BILL


 
To amend the Internal Revenue Code of 1986 to make geothermal heat pump 
   systems eligible for the energy credit and the residential energy 
           efficient property credit, and for other purposes.

    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 ``Geothermal Heat Pump Development Act 
of 2007''.

SEC. 2. ENERGY CREDIT FOR GEOTHERMAL HEAT PUMP SYSTEMS.

    (a) In General.--Subparagraph (A) of section 48(a)(3) of the 
Internal Revenue Code of 1986 is amended by striking ``or'' at the end 
of clause (iii), by inserting ``or'' at the end of clause (iv), and by 
adding at the end the following new clause:
                            ``(v) equipment which uses the ground or 
                        ground water as a thermal energy source to heat 
                        a structure or as a thermal energy sink to cool 
                        a structure,''.
    (b) Effective Date.--The amendments made by this section shall 
apply to property placed in service after the date of the enactment of 
this Act.

SEC. 3. RESIDENTIAL ENERGY EFFICIENT PROPERTY CREDIT FOR GEOTHERMAL 
              HEAT PUMP SYSTEMS.

    (a) In General.--Subsection (a) of section 25D of the Internal 
Revenue Code of 1986 is amended by striking ``and'' at the end of 
paragraph (2), by striking the period at the end of paragraph (3) and 
inserting ``, and'', and by adding at the end the following new 
paragraph:
            ``(4) 30 percent of the qualified geothermal heat pump 
        property expenditures made by the taxpayer during the taxable 
        year.''.
    (b) Qualified Geothermal Heat Pump Property Expenditures.--
Subsection (d) of section 25D of such Code is amended by adding at the 
end the following new paragraph:
            ``(4) Qualified geothermal heat pump property 
        expenditures.--
                    ``(A) In general.--The term `qualified geothermal 
                heat pump property expenditures' means an expenditure 
                for qualified geothermal heat pump property installed 
                on or in connection with a dwelling unit located in the 
                United States and used as a principal residence (within 
                the meaning of section 121) by the taxpayer.
                    ``(B) Qualified geothermal heat pump property.--The 
                term `qualified geothermal heat pump property' means 
                any equipment which--
                            ``(i) uses the ground or ground water as a 
                        thermal energy source to heat the dwelling unit 
                        referred to in subparagraph (A) or as a thermal 
                        energy sink to cool such dwelling unit, and
                            ``(ii) meets the requirements of the Energy 
                        Star program which are in effect at the time 
                        that the expenditure for such equipment is 
                        made.''.
    (c) Maximum Credit Limitation.--Paragraph (1) of section 25D(b) of 
such Code is amended by striking ``and'' at the end of subparagraph 
(B), by striking the period at the end of subparagraph (C) and 
inserting ``, and'', and by adding at the end the following new 
subparagraph:
                    ``(D) $2,000 with respect to any qualified 
                geothermal heat pump property expenditures.''.
    (d) Coordination With Credit for Nonbusiness Energy Property.--
Subsection (b) of section 25D of such Code is amended by adding at the 
end the following new paragraph:
            ``(3) Denial of double benefit for geothermal heat pumps.--
        The credit allowed under subsection (a) (determined without 
        regard to this paragraph and subsection (c)) with respect to 
        any qualified geothermal heat pump property expenditures shall 
        be reduced by the amount of any credit allowed under section 
        25C with respect to such expenditures.''.
    (e) Credit Allowed Against Alternative Minimum Tax.--
            (1) In general.--Section 25D(b) of such Code, as amended by 
        subsection (c), is amended by adding at the end the following 
        new paragraph:
            ``(3) Qualified geothermal heat pump property expenditure 
        credit allowed against alternative minimum tax.--In the case of 
        a taxable year to which section 26(b)(2) does not apply, the 
        credit allowed under subsection (a)(4) 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 this 
                subpart (other than subsection (a)(4)) and section 27 
                for the taxable year.''.
            (2) Conforming amendments.--
                    (A) Subsection (c) of section 25D of such Code is 
                amended--
                            (i) by inserting ``paragraphs (1), (2), and 
                        (3) of'' before ``subsection (a)'' both places 
                        it appears in paragraph (2), and
                            (ii) by adding at the end the following new 
                        paragraph:
            ``(3) Carryforward of unused qualified geothermal heat pump 
        property expenditure credit.--In the case of a taxable year to 
        which section 26(b)(2) does not apply, if the credit allowable 
        under subsection (a)(4) for any taxable year exceeds the 
        limitation imposed by subsection (b)(3) for such taxable year, 
        such excess shall be carried to the succeeding taxable year and 
        added to the credit allowable under subsection (a)(4) for such 
        succeeding taxable year.''.
                    (B) Section 23(b)(4)(B) of such Code is amended by 
                inserting ``and section 25D(a)(4)'' after ``this 
                section''.
                    (C) Section 24(b)(3)(B) of such Code is amended by 
                striking ``sections 23 and 25B'' and inserting 
                ``sections 23, 25B, and 25D(a)(4)''.
                    (D) Section 26(a)(1) of such Code is amended by 
                striking ``and 25B'' and inserting ``25B, and 
                25D(a)(4)''.
    (f) Effective Date.--The amendments made by this section shall 
apply to expenditures made after the date of the enactment of this Act.

SEC. 4. 3-YEAR ACCELERATED DEPRECIATION PERIOD FOR GEOTHERMAL HEAT PUMP 
              SYSTEMS.

    (a) In General.--Subparagraph (A) of section 168(e)(3) of the 
Internal Revenue Code of 1986 is amended by striking ``and'' at the end 
of clause (ii), by striking the period at the end of clause (iii) and 
inserting ``, and'', and by adding at the end the following new clause:
                            ``(iv) any property which is described in 
                        clause (v) of section 48(a)(3)(A).''.
    (b) Conforming Amendment.--Subclause (I) of section 
168(e)(3)(B)(vi) of such Code is amended by inserting ``clause (i), 
(ii), (iii), or (iv) of'' before ``subparagraph (A)''.
    (c) Effective Date.--The amendments made by this section shall 
apply to property placed in service after the date of the enactment of 
this Act.
                                 <all>