[Congressional Bills 111th Congress]
[From the U.S. Government Publishing Office]
[H.R. 4296 Introduced in House (IH)]

111th CONGRESS
  1st Session
                                H. R. 4296

 To amend the Internal Revenue Code of 1986 to provide a tax incentive 
for the installation and maintenance of mechanical insulation property.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                           December 11, 2009

Mrs. Halvorson 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 provide a tax incentive 
for the installation and maintenance of mechanical insulation property.

    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 ``Mechanical Insulation Installation 
Incentive Act of 2009''.

SEC. 2. EXPENSING OF MECHANICAL INSULATION PROPERTY.

    (a) In General.--Part VI of subchapter B of chapter 1 of subtitle A 
of the Internal Revenue Code of 1986 (relating to itemized deductions 
for individuals and corporations) is amended by inserting after section 
179E the following new section:

``SEC. 179F. MECHANICAL INSULATION PROPERTY.

    ``(a) Treatment as Expenses.--There shall be allowed as a deduction 
an amount equal to the applicable percentage of the cost of mechanical 
insulation property placed in service during the taxable year.
    ``(b) Applicable Percentage.--For purposes of subsection (a)--
            ``(1) In general.--The term `applicable percentage' means 
        the lesser of--
                    ``(A) 30 percent, and
                    ``(B) the excess (if any) of--
                            ``(i) the energy savings (expressed as a 
                        percentage) obtained by placing such mechanical 
                        insulation property in service in connection 
                        with a mechanical system, over
                            ``(ii) the energy savings (expressed as a 
                        percentage) such property is required to meet 
                        by Standard 90.1-2007, developed and published 
                        by the American Society of Heating, 
                        Refrigerating and Air-Conditioning Engineers.
            ``(2) Special rule relating to maintenance.--In the case of 
        mechanical insulation property placed in service as a 
        replacement for insulation property--
                    ``(A) paragraph (1)(B) shall be applied without 
                regard to clause (ii) thereof, and
                    ``(B) the cost of such property shall be treated as 
                an expense for which a deduction is allowed under 
                section 162 instead of being treated as depreciable for 
                purposes of the deduction provided by section 167.
    ``(c) Definitions.--For purposes of this section--
            ``(1) Mechanical insulation property.--The term `mechanical 
        insulation property' means insulation materials, facings, and 
        accessory products--
                    ``(A) placed in service in connection with a 
                mechanical system which--
                            ``(i) is located in the United States, and
                            ``(ii) is of a character subject to an 
                        allowance for depreciation, and
                    ``(B) utilized for thermal, acoustical, and 
                personnel safety requirements for mechanical piping and 
                equipment, hot and cold applications, and heating, 
                venting and air conditioning applications which can be 
                used in a variety of facilities.
            ``(2) Cost.--The cost of mechanical insulation property 
        includes--
                    ``(A) the amounts paid or incurred for the 
                installation of such property,
                    ``(B) in the case of removal and disposal of the 
                old mechanical insulation property, 10 percent of the 
                cost of the new mechanical insulation property 
                (determined without regard to this subparagraph), and
                    ``(C) expenditures for labor costs properly 
                allocable to the preparation, assembly, and 
                installation of mechanical insulation property.
    ``(d) Coordination.--
            ``(1) Section 179d.--Subsection (a) shall not apply to the 
        cost of mechanical insulation property which is taken into 
        account under section 179D or which, but for subsection (b) of 
        section 179D, would be taken into account under such section.
            ``(2) Other deductions and credits.--
                    ``(A) In general.--The amount of any other 
                deduction or credit allowable under this chapter for 
                any cost of mechanical insulation property which is 
                taken into account under subsection (a) shall be 
                reduced by the amount of such cost so taken into 
                account.
                    ``(B) Exception for certain costs.--Subparagraph 
                (A) shall not apply to any amount properly attributable 
                to maintenance.
    ``(e) Allocation of Deduction for Tax-Exempt Property.--In the case 
of mechanical insulation property installed on or in property owned by 
an entity described in paragraph (3) or (4) of section 50(b), the 
person who is the primary contractor for the installation of such 
property shall be treated as the taxpayer that placed such property in 
service.
    ``(f) Certification.--For purposes of this section, energy savings 
shall be certified under regulations or other guidance provided by the 
Secretary, in consultation with the Secretary of Energy.''.
    (b) Deduction for Capital Expenditures.--Section 263(a)(1) of such 
Code (relating to capital expenditures) is amended by striking ``or'' 
at the end of subparagraph (K), by striking the period at the end of 
paragraph (L) and inserting ``, or'', and by adding at the end the 
following new subparagraph:
                    ``(M) expenditures for which a deduction is allowed 
                under section 179F.''.
    (c) Technical and Clerical Amendments.--
            (1) Section 312(k)(3)(B) of such Code is amended by 
        striking ``or 179E'' each place it appears in the text or 
        heading thereof and inserting ``179E, or 179F''.
            (2) Paragraphs (2)(C) and (3)(C) of section 1245(a) of such 
        Code are each amended by inserting ``179F,'' after ``179E,''.
            (3) The table of sections for part VI of subchapter B of 
        chapter 1 of subtitle A of such Code is amended by inserting 
        after the item relating to section 179E the following new item:

``Sec. 179F. Mechanical insulation property.''.
    (d) Effective Date.--The amendments made by this section shall 
apply to property placed in service after the date of enactment of this 
Act.
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