1.This Act may be cited as the
Building Efficiently Act of
2012
.
2.Shorter
depreciation recovery periods for energy efficient buildings
(a)25-Year recovery
period for energy efficient nonresidential real property
(1)Section 168(e)(3) of the Internal Revenue Code of 1986 is
amended by inserting after subparagraph (F) the following new
subparagraph:
(G)The term
25-year property means any qualified energy efficient
nonresidential real
property.
.
(2)Qualified energy
efficient nonresidential real property definedSubsection (i) of
section 168 of such Code is amended by adding at the end the following:
(20)Qualified
energy efficient nonresidential real property
(A)The term
qualified energy efficient nonresidential real property means a
building which is nonresidential real property which is described in
subparagraph (B), (C), or (D).
(B)New or
reconstructed buildingA building is described in this
subparagraph if—
(i)the certification
requirements of subparagraph (E) with respect to the building are met,
(ii)the original use
of the building commences with the taxpayer, and
(iii)the building is
placed in service after the date of the enactment of this paragraph.
(C)Improvements to
existing buildingA building
is described in this subparagraph if, only after improvements are made to the
building—
(i)the certification requirements of
subparagraph (E) with respect to the building are met,
(ii)the original use
of the improved building commences with the taxpayer,
(iii)the improved
building is placed in service after the date of the enactment of this
paragraph, and
(iv)the taxpayer elects to the application of
this paragraph with respect to the building.
(D)Buildings
acquired by purchaseA building is described in this subparagraph
if the building—
(i)is
acquired by purchase from an unrelated person,
(ii)meets the
certification requirements of subparagraph (E), and
(iii)is placed in service after the date of the
enactment of this paragraph.
(E)Certification
requirementsThe requirements
of this subparagraph are met if, with respect to a building, the building is
certified in accordance with section 179D(d)(6) as being constructed,
reconstructed, or modified, as the case may be, under a plan designed to reduce
the total annual energy and power costs of the building by 40 percent or more
in comparison to a reference building which meets the minimum requirements of
Standard 90.1–2004 using methods of calculation under section
179D(d)(2).
(F)The term
Standard 90.1–2004 means Standard 90.1–2004 of the American
Society of Heating, Refrigerating, and Air Conditioning Engineers and the
Illuminating Engineering Society of North America (as in effect on July 30,
2012).
(G)For purposes of
subparagraph (D), a person is related to another person if—
(i)the persons are
members of an affiliated group (as defined in section 1504), or
(ii)the persons have
a relationship described in subsection (b) of section 267; except that, for
purposes of this clause, the phrase 80 percent or more
shall be
substituted for the phrase more than 50 percent
each place it
appears in such subsection and rules similar to the rules of subsections (c)
and (e) (other than paragraphs (4) and (5) thereof) shall apply.
(H)If this section applies to a building by reason of
subsection (e)(3)(G), the deduction under section 179D shall not be
allowed.
.
(b)20-Year recovery
period for energy efficient residential rental property
(1)Subparagraph (F) of section 168(e)(3) of such Code
(relating to 20-year property) is amended to read as follows:
(F)The term 20-year property means—
(i)initial clearing
and grading land improvements with respect to any electric utility transmission
and distribution plant, and
(ii)any qualified energy efficient residential
rental
property.
.
(2)Qualified energy
efficient residential rental property definedSubsection (i) of
section 168 of such Code, as amended by subsection (a), is amended by adding at
the end the following:
(21)Qualified
energy efficient residential rental property
(A)The term
qualified energy efficient nonresidential real property means a
building which is residential rental property which is described in
subparagraph (B), (C), or (D).
(B)New or
reconstructed buildingA building is described in this
subparagraph if—
(i)the certification
requirements of subparagraph (E) with respect to the building are met,
(ii)the original use
of which commences with the taxpayer, and
(iii)the building is
placed in service after the date of the enactment of this paragraph.
(C)Improvements to
existing buildingA building
is described in this subparagraph if, only after improvements are made to the
building—
(i)the certification requirements of
subparagraph (E) with respect to the building are met,
(ii)the original use
of the improved building commences with the taxpayer,
(iii)the improved
building is placed in service after the date of the enactment of this
paragraph, and
(iv)the taxpayer
elects to the application of this paragraph with respect to the
building.
(D)Buildings
acquired by purchaseA building is described in this subparagraph
if the building—
(i)is
acquired by purchase from an unrelated person,
(ii)meets the
certification requirements of subparagraph (E), and
(iii)is placed in service after the date of the
enactment of this paragraph.
(E)Certification
requirementsThe requirements
of this subparagraph are met if, with respect to a building, the building is
certified in accordance with section 179D(d)(6) as being constructed,
reconstructed, or modified, as the case may be, under a plan designed to reduce
the total annual energy and power costs of the building by 40 percent or more
in comparison to a reference building which meets the minimum requirements of
the International Energy Conservation Code 2004 using methods of calculation
under section 179D(d)(2).
(F)For purposes of
subparagraph (D), a person is related to another person if—
(i)the persons are
members of an affiliated group (as defined in section 1504), or
(ii)the persons have
a relationship described in subsection (b) of section 267; except that, for
purposes of this clause, the phrase 80 percent or more
shall be
substituted for the phrase more than 50 percent
each place it
appears in such subsection and rules similar to the rules of subsections (c)
and (e) (other than paragraphs (4) and (5) thereof) shall apply.
(G)If this section applies to a building by reason of
subsection (e)(3)(F)(ii), the deduction under section 179D shall not be
allowed.
.
(c)
(1)The table
contained in section 168(c) of such Code is amended by inserting after the item
relating to 20-year property the following new item:
.
(2)The table contained in section 467(e)(3)(A)
of such Code is amended—
(A)by inserting
which is not 25-year property
after nonresidential real
property
, and
(B)by inserting after
the item relating to residential rental property and nonresidential real
property the following new item:
25-year property19 years.
.
(3)Clauses (iv), (v),
and (ix) of section 168(e)(3)(E) of such Code are each amended by inserting
(not described in subparagraph (G))
after
property
.
(d)Requirement To
use straight line methodParagraph (3) of section 168(b) of such
Code (relating to property to which straight line method applies) is amended by
redesignating subparagraphs (F), (G), (H), and (I) as subparagraphs (G), (H),
(I), and (J), respectively, and by inserting after subparagraph (E) the
following new subparagraph:
(F)Property described in subsection
(e)(3)(F)(ii) or subsection
(e)(3)(G).
.
(e)The table contained in
section 168(g)(3)(B) of such Code is amended by striking the item relating to
subparagraph (F) and inserting the following new items:
.
(f)The amendments made by
this section shall apply to property placed in service after December 31,
2012.