Resilient construction tax credit

(a)

In general

Subpart D of part IV of subchapter A of chapter 1 of the Internal Revenue Code of 1986 is amended by inserting after section 45R the following new section:

45S.

Resilient construction

(a)

General rule

For purposes of section 38, in the case of an eligible contractor, the resilient construction credit for the taxable year is the applicable amount for each building— (1)constructed by the eligible contractor in a disaster area determined as a result of a federally declared major disaster, (2)the construction of which began after the date of such disaster in that area, (3)which— (A)in the case of qualified commercial property, is placed in service for commercial purposes, and (B)in the case of qualified residential property, is placed in service for residential purposes, and (4)for which a certificate of occupancy is issued before the end of the 2-year period beginning on the date of such disaster declaration in that area. (b)

Applicable amount

For purposes of subsection (a), the applicable amount is: (1)

Commercial property

In the case of a qualified commercial property, the applicable amount is the lesser of— (A)1 percent of the cost of construction, or (B)$25,000. (2)

Residential property

In the case of a qualified residential property, the applicable amount is the lesser of— (A)1 percent of the cost of construction, or (B)$3,000. (c)

Qualified property

For purposes of this section: (1)

Qualified commercial property

The term qualified commercial property means a building that is— (A)located in the United States, (B)defined in the scope of the 2009 or later International Building Code published by the International Code Council, and (C)designed and constructed to meet resilient construction requirements. (2)

Qualified residential property

The term qualified residential property means a building that is— (A)located in the United States, (B)defined in the scope of the 2009 or later International Residential Code published by the International Code Council, and (C)designed and constructed to meet resilient construction requirements. (d)

Resilient construction requirements

For purposes of this section: (1)

In general

The resilient construction requirements with respect to a property are that the property is designed and constructed to— (A)resist hazards brought on by a major disaster and continues to provide its primary functions after a major disaster, (B)reduce the magnitude or duration of a disruptive event, and (C)have the absorptive capacity, adaptive capacity, recoverability to withstand a potentially disruptive event. (2)

Treated as meeting resiliency requirements

For purposes of paragraph (1)— (A)in the case of a qualified commercial property, the property shall be treated as meeting the requirements specified in paragraph (1) if the property is a building which— (i)was designed to meet the requirements of the 2009 or later International Building Code published by the International Code Council and received the Insurance Institute for Business and Home Safety FORTIFIED for Safer Business designation, or (ii)was designed and built in a jurisdiction that requires commercial buildings to meet the requirements of the 2009 or later International Building Code published by the International Code Council© with amendments that are equivalent or more restrictive than the requirements described in FORTIFIED for Safer Business Standards published by the Insurance Institute for Business and Home Safety and received a certificate of occupancy (or other documentation stating that it has met the requirements of the building code) from the jurisdiction, and (B)in the case of a qualified residential property, the property shall be treated as meeting the requirements specified in paragraph (1) if the property is a building which was designed to meet the requirements of the 2009 or later International Residential Code published by the International Code Council, and meets one of the following requirements: (i)The building received the Insurance Institute for Business and Home Safety as FORTIFIED for Safer Living designation. (ii)The building received the Insurance Institute for Business and Home Safety as FORTIFIED for Existing Homes designation. (iii)It was designed and built in a jurisdiction that requires residential buildings to meet the requirements of the 2009 or later International Building Code published by the International Code Council© with amendments that are equivalent or more restrictive than the requirements described in FORTIFIED for Safer Living Builders Guide published by the Insurance Institute for Business and Home Safety and received a certificate of occupancy (or other documentation stating that it has met the requirements of the building code) from the jurisdiction. (3)

Absorptive capacity

The term absorptive capacity means the ability of the construction to endure a disruption without significant deviation from normal operating performance. (4)

Adaptive capacity

The term adaptive capacity means the ability of the construction to adapt to a drastic change in normal operating conditions. (5)

Recoverability

The term recoverability means the ability of the construction to recover quickly, and at low cost, from potentially disruptive events. (e)

Other Definitions

For purposes of this section: (1)

Eligible contractor

The term eligible contractor means the person who constructed the qualified building. (2)

Construction

The term construction includes new construction and reconstruction and rehabilitation that meets resilient construction requirements. (3)

Disaster area

The term disaster area has the meanings given such terms by section 165(h)(3). (4)

federally declared major disaster

The term federally declared major disaster means a disaster subsequently determined by the President of the United States to be a major disaster that warrants assistance by the Federal Government under the Robert T. Stafford Disaster Relief and Emergency Assistance Act. (f)

Basis reduction

For purposes of this subtitle, the basis of any property for which a credit is allowable under subsection (a) shall be reduced by the amount of such credit so allowed. (g)

Termination

This section shall not apply to any property for which a certificate for occupancy is issued after December 31, 2015.

(b)

Credit made part of general business credit

Section 38(b) of such Code, as amended by this Act, is amended by striking plus at the end of paragraph (35), by striking the period at the end of paragraph (36) and inserting , plus, and by adding at the end the following new paragraph:

(37)the resilient construction credit determined under section 45S(a).

(c)

Basis adjustment

Subsection (a) of section 1016 is amended by striking and at the end of paragraph (31), by striking the period at the end of paragraph (32) and inserting , and, and by adding at the end the following new paragraph:

(38)to the extent provided in section 45S(f), in the case of amounts with respect to which a credit has been allowed under section 45S.

(d)

Deduction for certain unused business credits

Section 196(c) (defining qualified business credits) is amended by striking and at the end of paragraph (13), by striking the period at the end of paragraph (14) and inserting , and, and by adding after paragraph (14) the following new paragraph:

(15)the resilient construction credit determined under section 45S(a).

(e)

Clerical amendment

The table of sections for subpart D of part IV of subchapter A of chapter 1 of such Code is amended by inserting after section 45R the following new item:

Sec. 45S. Resilient construction.

(f)

Effective date

The amendments made by this section shall apply to property for which a certificate for occupancy is issued after the date of the enactment of this Act.