II 111th CONGRESS 2d Session S. 3137 IN THE SENATE OF THE UNITED STATES March 18, 2010 Mr. Udall of Colorado (for himself, Mr. Bennet, and Mr. Merkley) 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 provide that solar electric property need not be located on the property with respect to which it is generating electricity in order to qualify for the residential energy efficient property credit.

1.

Short title

This Act may be cited as the Solar Uniting Neighborhoods (SUN) Act of 2010.

2.

Clarification with respect to location of solar electric property

(a)

In general

Section 25D(d)(2) of the Internal Revenue Code of 1986 is amended— (1)by striking The term and inserting the following: (A)

In general

The term , and (2)by adding at the end the following new subparagraph: (B)

Off-site property

(i)

In general

Such term shall include an expenditure for qualified property described in the subparagraph (A) notwithstanding— (I)whether such qualified property is located on the same site as the dwelling unit for which the electricity generated from such property is used, and (II)whether the electricity generated by the qualified property enters the electrical grid, so long as such electricity enters the grid at any point located on the same local electrical grid to which such dwelling unit is connected. (ii)

Qualified property

For purposes of this subparagraph, the term qualified property means property— (I)which is not used in a trade or business or an activity engaged in for profit, and (II)the electricity generated from which does not result in annual income to the taxpayer in excess of amounts that would otherwise be charged to such taxpayer for electricity used at the taxpayer's residence during the year. (iii)

Recapture

The Secretary may provide for the recapture of the credit under this subsection with respect to any property described in this subparagraph which ceases to be qualified property. . (b)

Effective date

The amendments made by this section shall apply to taxable years beginning after the date of the enactment of this Act.