S 271 ISCommentsClose CommentsPermalink

To amend the Internal Revenue Code of 1986 to provide incentives to accelerate the production and adoption of plug-in electric vehicles and related component parts.CommentsClose CommentsPermalink

January 15, 2009CommentsClose CommentsPermalink

Ms. CANTWELL (for herself, Mr. HATCH, Mr. KERRY, Mr. ALEXANDER, Ms. STABENOW, and Mr. NELSON of Florida) introduced the following bill; which was read twice and referred to the Committee on FinanceCommentsClose CommentsPermalink

To amend the Internal Revenue Code of 1986 to provide incentives to accelerate the production and adoption of plug-in electric vehicles and related component parts.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 ‘Fuel Reduction using Electrons to End Dependence on the Mid-East (FREEDOM) Act of 2009’.CommentsClose CommentsPermalink

SEC. 2. INCENTIVES FOR MANUFACTURING FACILITIES PRODUCING PLUG-IN ELECTRIC DRIVE MOTOR VEHICLE AND COMPONENTS.

(a) Deduction for Manufacturing Facilities- Part VI of subchapter B of chapter 1 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. ELECTION TO EXPENSE MANUFACTURING FACILITIES PRODUCING PLUG-IN ELECTRIC DRIVE MOTOR VEHICLE AND COMPONENTS.

‘(a) Treatment as Expenses- A taxpayer may elect to treat the applicable percentage of the cost of any qualified plug-in electric drive motor vehicle manufacturing facility property as an expense which is not chargeable to a capital account. Any cost so treated shall be allowed as a deduction for the taxable year in which the qualified manufacturing facility property is placed in service.CommentsClose CommentsPermalink





‘(b) Applicable Percentage- For purposes of subsection (a), the applicable percentage is--CommentsClose CommentsPermalink





‘(1) 100 percent, in the case of qualified plug-in electric drive motor vehicle manufacturing facility property which is placed in service before January 1, 2012, andCommentsClose CommentsPermalink





‘(2) 50 percent, in the case of qualified plug-in electric drive motor vehicle manufacturing facility property which is placed in service after December 31, 2011, and before January 1, 2015.CommentsClose CommentsPermalink





‘(c) Election-CommentsClose CommentsPermalink





‘(1) IN GENERAL- An election under this section for any taxable year shall be made on the taxpayer’s return of the tax imposed by this chapter for the taxable year. Such election shall be made in such manner as the Secretary may by regulations prescribe.CommentsClose CommentsPermalink





‘(2) ELECTION IRREVOCABLE- Any election made under this section may not be revoked except with the consent of the Secretary.CommentsClose CommentsPermalink





‘(d) Qualified Plug-In Electric Drive Motor Vehicle Manufacturing Facility Property- For purposes of this section--CommentsClose CommentsPermalink





‘(1) IN GENERAL- The term ‘qualified plug-in electric drive motor vehicle manufacturing facility property’ means any qualified property--CommentsClose CommentsPermalink





‘(A) the original use of which commences with the taxpayer,CommentsClose CommentsPermalink





‘(B) which is placed in service by the taxpayer after the date of the enactment of this section and before January 1, 2015, andCommentsClose CommentsPermalink





‘(C) no written binding contract for the construction of which was in effect on or before the date of the enactment of this section.CommentsClose CommentsPermalink





‘(2) QUALIFIED PROPERTY-CommentsClose CommentsPermalink





‘(A) IN GENERAL- The term ‘qualified property’ means any property which is a facility or a portion of a facility used for the production of--CommentsClose CommentsPermalink





‘(i) any new qualified plug-in electric drive motor vehicle (as defined by section 30D(c)), orCommentsClose CommentsPermalink





‘(ii) any eligible component.CommentsClose CommentsPermalink





‘(B) ELIGIBLE COMPONENT- The term ‘eligible component’ means any battery, any electric motor or generator, or any power control unit which is designed specifically for use with a new qualified plug-in electric drive motor vehicle (as so defined).CommentsClose CommentsPermalink





‘(e) Special Rule for Dual Use Property- In the case of any qualified plug-in electric drive motor vehicle manufacturing facility property which is used to produce both qualified property and other property which is not qualified property, the amount of costs taken into account under subsection (a) shall be reduced by an amount equal to--CommentsClose CommentsPermalink





‘(1) the total amount of such costs (determined before the application of this subsection), multiplied byCommentsClose CommentsPermalink





‘(2) the percentage of property expected to be produced which is not qualified property.’.CommentsClose CommentsPermalink





(b) Refund of Credit for Prior Year Minimum Tax Liability- Section 53 of the Internal Revenue Code of 1986 (relating to credit for prior year minimum tax liability) is amended by adding at the end the following new subsection:CommentsClose CommentsPermalink





‘(g) Election To Treat Amounts Attributable to Qualified Manufacturing Facility-CommentsClose CommentsPermalink





‘(1) IN GENERAL- In the case of an eligible taxpayer, the amount determined under subsection (c) for the taxable year (after the application of subsection (e)) shall be increased by an amount equal to the applicable percentage of any qualified plug-in electric drive motor vehicle manufacturing facility property which is placed in service during the taxable year.CommentsClose CommentsPermalink





‘(2) APPLICABLE PERCENTAGE- For purposes of paragraph (1), the applicable percentage is--CommentsClose CommentsPermalink





‘(A) 35 percent, in the case of qualified plug-in electric drive motor vehicle manufacturing facility property which is placed in service before January 1, 2012, andCommentsClose CommentsPermalink





‘(B) 17.5 percent, in the case of qualified plug-in electric drive motor vehicle manufacturing facility property which is placed in service after December 31, 2011, and before January 1, 2015.CommentsClose CommentsPermalink





‘(3) ELIGIBLE TAXPAYER- For purposes of this subsection, the term ‘eligible taxpayer’ means any taxpayer--CommentsClose CommentsPermalink





‘(A) who places in service qualified plug-in electric drive motor vehicle manufacturing facility property during the taxable year,CommentsClose CommentsPermalink





‘(B) who does not make an election under section 179F(c), andCommentsClose CommentsPermalink





‘(C) who makes an election under this subsection.CommentsClose CommentsPermalink





‘(4) OTHER DEFINITIONS AND SPECIAL RULES-CommentsClose CommentsPermalink





‘(A) QUALIFIED PLUG-IN ELECTRIC DRIVE MOTOR VEHICLE MANUFACTURING FACILITY PROPERTY- The term ‘qualified plug-in electric drive motor vehicle manufacturing facility property’ has the meaning given such term under section 179F(d).CommentsClose CommentsPermalink





‘(B) SPECIAL RULE FOR DUAL USE PROPERTY- In the case of any qualified plug-in electric drive motor vehicle manufacturing facility property which is used to produce both qualified property (as defined in section 179F(d)) and other property which is not qualified property, the amount of costs taken into account under paragraph (1) shall be reduced by an amount equal to--CommentsClose CommentsPermalink





‘(i) the total amount of such costs (determined before the application of this subparagraph), multiplied byCommentsClose CommentsPermalink





‘(ii) the percentage of property expected to be produced which is not qualified property.CommentsClose CommentsPermalink





‘(C) ELECTION-CommentsClose CommentsPermalink





‘(i) IN GENERAL- An election under this subsection for any taxable year shall be made on the taxpayer’s return of the tax imposed by this chapter for the taxable year. Such election shall be made in such manner as the Secretary may by regulations prescribe.CommentsClose CommentsPermalink





‘(ii) ELECTION IRREVOCABLE- Any election made under this subsection may not be revoked except with the consent of the Secretary.CommentsClose CommentsPermalink





‘(5) CREDIT REFUNDABLE- For purposes of this title (other than this section), the credit allowed by reason of this subsection shall be treated as if it were allowed under subpart C.’.CommentsClose CommentsPermalink





(c) Clerical Amendment- The table of sections for part VI of subchapter B of chapter 1 of the Internal Revenue Code of 1986 is amended by adding at the end the following new item:CommentsClose CommentsPermalink





‘Sec. 179F. Election to expense manufacturing facilities producing plug-in electric drive motor vehicle and components.’.CommentsClose CommentsPermalink





(d) Effective Date- The amendments made by this section shall apply to taxable years beginning after the date of the enactment of this Act.CommentsClose CommentsPermalink

SEC. 3. CONSUMER INCENTIVES FOR PLUG-IN ELECTRIC DRIVE MOTOR VEHICLES.

(a) Increase in Number of Plug-In Electric Drive Motor Vehicles Eligible for Tax Credit-CommentsClose CommentsPermalink





(1) IN GENERAL- Subparagraph (B) of section 30D(b)(2) of the Internal Revenue Code of 1986 is amended by striking ‘250,000’ and inserting ‘500,000’.CommentsClose CommentsPermalink





(2) EFFECTIVE DATE- The amendment made by this subsection shall apply to taxable years beginning after December 31, 2008.CommentsClose CommentsPermalink





(b) Conversion Kits-CommentsClose CommentsPermalink





(1) IN GENERAL- Section 30B of the Internal Revenue Code of 1986 (relating to alternative motor vehicle credit) is amended by redesignating subsections (i) and (j) as subsections (j) and (k), respectively, and by inserting after subsection (h) the following new subsection:CommentsClose CommentsPermalink





‘(i) Plug-In Conversion Credit-CommentsClose CommentsPermalink





‘(1) IN GENERAL- For purposes of subsection (a), the plug-in conversion credit determined under this subsection with respect to any motor vehicle which is converted to a qualified plug-in electric drive motor vehicle is the lesser of--CommentsClose CommentsPermalink





‘(A) an amount equal to--CommentsClose CommentsPermalink





‘(i) $1,250, plusCommentsClose CommentsPermalink





‘(ii) $100 for each half kilowatt hour of capacity of the plug-in traction battery module installed in such vehicle in excess of 2.5 kilowatt hours, orCommentsClose CommentsPermalink





‘(B) 50 percent of the cost of the plug-in traction battery module installed in such vehicle as part of such conversion.CommentsClose CommentsPermalink





‘(2) LIMITATIONS- The amount of the credit allowed under this subsection shall not exceed $4,000 with respect to the conversion of any motor vehicle.CommentsClose CommentsPermalink





‘(3) DEFINITIONS AND SPECIAL RULES- For purposes of this subsection--CommentsClose CommentsPermalink





‘(A) QUALIFIED PLUG-IN ELECTRIC DRIVE MOTOR VEHICLE- The term ‘qualified plug-in electric drive motor vehicle’ means any new qualified plug-in electric drive motor vehicle (as defined in section 30D(c), determined without regard to paragraphs (4) and (6) thereof).CommentsClose CommentsPermalink





‘(B) PLUG-IN TRACTION BATTERY MODULE- The term ‘plug-in traction battery module’ means an electro-chemical energy storage device which--CommentsClose CommentsPermalink





‘(i) has a traction battery capacity of not less than 2.5 kilowatt hours,CommentsClose CommentsPermalink





‘(ii) is equipped with an electrical plug by means of which it can be energized and recharged when plugged into an external source of electric power,CommentsClose CommentsPermalink





‘(iii) consists of a standardized configuration and is mass produced,CommentsClose CommentsPermalink





‘(iv) has been tested and approved by the National Highway Transportation Safety Administration as compliant with applicable motor vehicle and motor vehicle equipment safety standards when installed by a mechanic with standardized training in protocols established by the battery manufacturer as part of a nationwide distribution program, andCommentsClose CommentsPermalink





‘(v) is certified by a battery manufacturer as meeting the requirements of clauses (i) through (iv).CommentsClose CommentsPermalink





‘(C) CREDIT ALLOWED TO LESSOR OF BATTERY MODULE- In the case of a plug-in traction battery module which is leased to the taxpayer, the credit allowed under this subsection shall be allowed to the lessor of the plug-in traction battery module.CommentsClose CommentsPermalink





‘(D) CREDIT ALLOWED IN ADDITION TO OTHER CREDITS- The credit allowed under this subsection shall be allowed with respect to a motor vehicle notwithstanding whether a credit has been allowed with respect to such motor vehicle under this section (other than this subsection) in any preceding taxable year.CommentsClose CommentsPermalink





‘(4) TERMINATION- This subsection shall not apply to conversions made after December 31, 2012.’.CommentsClose CommentsPermalink





(2) CREDIT TREATED AS PART OF ALTERNATIVE MOTOR VEHICLE CREDIT- Section 30B(a) of such Code is amended by striking ‘and’ at the end of paragraph (3), by striking the period at the end of paragraph (4) and inserting ‘, and’, and by adding at the end the following new paragraph:CommentsClose CommentsPermalink





‘(5) the plug-in conversion credit determined under subsection (i).’.CommentsClose CommentsPermalink





(3) NO RECAPTURE FOR VEHICLES CONVERTED TO QUALIFIED PLUG-IN ELECTRIC DRIVE MOTOR VEHICLES- Paragraph (8) of section 30B(h) of such Code is amended by adding at the end the following: ‘, except that no benefit shall be recaptured if such property ceases to be eligible for such credit by reason of conversion to a qualified plug-in electric drive motor vehicle.’.CommentsClose CommentsPermalink





(4) EFFECTIVE DATE- The amendments made by this subsection shall apply to property placed in service after December 31, 2008, in taxable years beginning after such date.CommentsClose CommentsPermalink





(c) Certain 2- or 3-Wheeled Motor Vehicles Eligible for Credit-CommentsClose CommentsPermalink





(1) IN GENERAL- Section 30D of the Internal Revenue Code of 1986 is amended--CommentsClose CommentsPermalink





(A) by redesignating subsections (f) and (g) as subsections (g) and (h), respectively, andCommentsClose CommentsPermalink





(B) by inserting after subsection (e) the following new subsection:CommentsClose CommentsPermalink





‘(f) 2- or 3-Wheeled Motor Vehicles- For purposes of this section--CommentsClose CommentsPermalink





‘(1) IN GENERAL- Except as provided in paragraph (2), 2- or 3-wheeled motor vehicles shall be treated in the same manner as motor vehicles.CommentsClose CommentsPermalink





‘(2) EXCEPTIONS-CommentsClose CommentsPermalink





‘(A) APPLICABLE AMOUNT- For purposes of this subsection, the applicable amount shall be $1,250.CommentsClose CommentsPermalink





‘(B) OTHER EXCEPTIONS-CommentsClose CommentsPermalink





‘(i) Subparagraph (B) of subsection (a)(2) shall be applied with respect to 2- or 3-wheeled motor vehicles by substituting ‘$100 for each half kilowatt hour’ for ‘$417 for each kilowatt hour’.CommentsClose CommentsPermalink





‘(ii) Subparagraph (A) of subsection (b)(1) shall be applied with respect to 2- or 3-wheeled motor vehicles by substituting ‘$3,750’ for ‘$7,500’.CommentsClose CommentsPermalink





‘(iii) Subsection (c)(1) shall be applied with respect to 2- or 3-wheeled motor vehicles by substituting ‘2.5 kilowatt hours’ for ‘4 kilowatt hours’.CommentsClose CommentsPermalink





‘(iv) Subsection (c)(3) shall not apply with respect to 2- or 3-wheeled motor vehicles.CommentsClose CommentsPermalink





‘(3) APPLICATION OF LIMITATION- The limitation provided in subsection (b)(2) shall be applied separately with respect to 2- or 3-wheeled vehicles and with respect to other motor vehicles, and in applying such limitation to 2- or 3-wheeled vehicles, ‘50,000’ shall be substituted for ‘500,000’.CommentsClose CommentsPermalink





‘(4) 2- OR 3-WHEELED MOTOR VEHICLE- The term ‘2- or 3-wheeled vehicle’ means any vehicle--CommentsClose CommentsPermalink





‘(A) which would be described in section 30(c)(2) except that it has 2 or 3 wheels,CommentsClose CommentsPermalink





‘(B) with motive power having a seat or saddle for the use of the rider and designed to travel on not more than 3 wheels in contact with the ground,CommentsClose CommentsPermalink





‘(C) which has an electric motor that produces in excess of 5-brake horsepower,CommentsClose CommentsPermalink





‘(D) which draws propulsion from 1 or more traction batteries, andCommentsClose CommentsPermalink





‘(E) which has been certified to the Department of Transportation pursuant to section 567 of title 49, Code of Federal Regulations, as conforming to all applicable Federal motor vehicle safety standards in effect on the date of the manufacture of the vehicle.’.CommentsClose CommentsPermalink





(2) EFFECTIVE DATE- The amendments made by this subsection shall apply to property placed in service after December 31, 2008, in taxable years beginning after such date.CommentsClose CommentsPermalink





(d) Credit With Respect to Low-Speed Vehicles-CommentsClose CommentsPermalink





(1) IN GENERAL- Subsection (e) of section 30D of the Internal Revenue Code of 1986 is amended by adding at the end the following new paragraph:CommentsClose CommentsPermalink





‘(11) SPECIAL RULES FOR LOW-SPEED VEHICLES- In the case of a low-speed vehicle which meets the requirements of section 571.500 of title 49, Code of Federal Regulations--CommentsClose CommentsPermalink





‘(A) subparagraph (A) of subsection (a)(2) shall be applied with respect low-speed vehicles by substituting ‘$1,250’ for ‘$2,500’,CommentsClose CommentsPermalink





‘(B) subparagraph (B) of subsection (a)(2) shall be applied with respect to low-speed vehicles by substituting ‘$100 for each half kilowatt hour’ for ‘$417 for each kilowatt hour’,CommentsClose CommentsPermalink





‘(C) subparagraph (A) of subsection (b)(1) shall be applied with respect to low-speed vehicles by substituting ‘$3,750’ for ‘$7,500’,CommentsClose CommentsPermalink





‘(D) the limitation provided in subsection (b)(2) shall be applied separately with respect to low-speed vehicles and with respect to other motor vehicles, and in applying such limitation to low-speed vehicles, ‘50,000’ shall be substituted for ‘500,000’, andCommentsClose CommentsPermalink





‘(E) subsection (c)(3) shall not apply with respect to low-speed vehicles.’.CommentsClose CommentsPermalink





(2) EFFECTIVE DATE- The amendment made by this subsection shall apply to property placed in service after December 31, 2008, in taxable years beginning after such date.CommentsClose CommentsPermalink

SEC. 4. RECOVERY PERIOD FOR DEPRECIATION OF SMART METERS AND SMART GRID SYSTEMS.

(a) 5-Year Recovery Period-CommentsClose CommentsPermalink





(1) IN GENERAL- Subparagraph (B) of section 168(e)(3) of the Internal Revenue Code of 1986 is amended by striking ‘and’ at the end of clause (vi), by striking the period at the end of clause (vii) and inserting ‘, and’, and by adding at the end the following new clauses:CommentsClose CommentsPermalink





‘(viii) any qualified smart electric meter, andCommentsClose CommentsPermalink





‘(ix) any qualified smart electric grid system.’.CommentsClose CommentsPermalink





(2) CONFORMING AMENDMENTS- Subparagraph (D) of section 168(e)(3) of such Code is amended by inserting ‘and’ at the end of clause (i), by striking the comma at the end of clause (ii) and inserting a period, and by striking clauses (iii) and (iv).CommentsClose CommentsPermalink





(b) Technical Amendments- Paragraphs (18)(A)(ii) and (19)(A)(ii) of section 168(i) of the Internal Revenue Code of 1986 are each amended by striking ‘16 years’ and inserting ‘10 years’.CommentsClose CommentsPermalink





(c) Effective Dates-CommentsClose CommentsPermalink





(1) IN GENERAL- Except as provided in paragraph (2), the amendments made by this section shall apply to property placed in service after the date of the enactment of this Act.CommentsClose CommentsPermalink





(2) TECHNICAL AMENDMENT- The amendments made by subsection (b) shall take effect as if included in section 306 of the Energy Improvement and Extension Act of 2008.CommentsClose CommentsPermalink

SEC. 5. EXPANSION AND EXTENSION OF ELECTRIC AND ALTERNATIVE FUEL VEHICLE REFUELING PROPERTY CREDIT.

(a) In General- Section 30C of the Internal Revenue Code of 1986 is amended--CommentsClose CommentsPermalink





(1) by striking ‘30 percent’ in subsection (a) and inserting ‘50 percent’, andCommentsClose CommentsPermalink





(2) by striking ‘$30,000’ in subsection (b)(1) and inserting ‘$50,000’.CommentsClose CommentsPermalink





(b) Effective Date- The amendments made by this section shall apply to property placed in service after the date of the enactment of this Act, in taxable years ending after such date.CommentsClose CommentsPermalink