HR 4296 IHCommentsClose CommentsPermalink

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

December 11, 2009CommentsClose CommentsPermalink

Mrs. HALVORSON introduced the following bill; which was referred to the Committee on Ways and MeansCommentsClose CommentsPermalink

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

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,CommentsClose CommentsPermalink

SECTION 1. SHORT TITLE.

This Act may be cited as the ‘Mechanical Insulation Installation Incentive Act of 2009’.CommentsClose CommentsPermalink

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:CommentsClose CommentsPermalink

‘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.CommentsClose CommentsPermalink





‘(b) Applicable Percentage- For purposes of subsection (a)--CommentsClose CommentsPermalink





‘(1) IN GENERAL- The term ‘applicable percentage’ means the lesser of--CommentsClose CommentsPermalink





‘(A) 30 percent, andCommentsClose CommentsPermalink





‘(B) the excess (if any) of--CommentsClose CommentsPermalink





‘(i) the energy savings (expressed as a percentage) obtained by placing such mechanical insulation property in service in connection with a mechanical system, overCommentsClose CommentsPermalink





‘(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.CommentsClose CommentsPermalink





‘(2) SPECIAL RULE RELATING TO MAINTENANCE- In the case of mechanical insulation property placed in service as a replacement for insulation property--CommentsClose CommentsPermalink





‘(A) paragraph (1)(B) shall be applied without regard to clause (ii) thereof, andCommentsClose CommentsPermalink





‘(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.CommentsClose CommentsPermalink





‘(c) Definitions- For purposes of this section--CommentsClose CommentsPermalink





‘(1) MECHANICAL INSULATION PROPERTY- The term ‘mechanical insulation property’ means insulation materials, facings, and accessory products--CommentsClose CommentsPermalink





‘(A) placed in service in connection with a mechanical system which--CommentsClose CommentsPermalink





‘(i) is located in the United States, andCommentsClose CommentsPermalink





‘(ii) is of a character subject to an allowance for depreciation, andCommentsClose CommentsPermalink





‘(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.CommentsClose CommentsPermalink





‘(2) COST- The cost of mechanical insulation property includes--CommentsClose CommentsPermalink





‘(A) the amounts paid or incurred for the installation of such property,CommentsClose CommentsPermalink





‘(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), andCommentsClose CommentsPermalink





‘(C) expenditures for labor costs properly allocable to the preparation, assembly, and installation of mechanical insulation property.CommentsClose CommentsPermalink





‘(d) Coordination-CommentsClose CommentsPermalink





‘(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.CommentsClose CommentsPermalink





‘(2) OTHER DEDUCTIONS AND CREDITS-CommentsClose CommentsPermalink





‘(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.CommentsClose CommentsPermalink





‘(B) EXCEPTION FOR CERTAIN COSTS- Subparagraph (A) shall not apply to any amount properly attributable to maintenance.CommentsClose CommentsPermalink





‘(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.CommentsClose CommentsPermalink





‘(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.’.CommentsClose CommentsPermalink





(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:CommentsClose CommentsPermalink





‘(M) expenditures for which a deduction is allowed under section 179F.’.CommentsClose CommentsPermalink





(c) Technical and Clerical Amendments-CommentsClose CommentsPermalink





(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’.CommentsClose CommentsPermalink





(2) Paragraphs (2)(C) and (3)(C) of section 1245(a) of such Code are each amended by inserting ‘179F,’ after ‘179E,’.CommentsClose CommentsPermalink





(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:CommentsClose CommentsPermalink





‘Sec. 179F. Mechanical insulation property.’.CommentsClose CommentsPermalink





(d) Effective Date- The amendments made by this section shall apply to property placed in service after the date of enactment of this Act.CommentsClose CommentsPermalink