HR 6705 IHCommentsClose CommentsPermalink

112th CONGRESSCommentsClose CommentsPermalink

2d SessionCommentsClose CommentsPermalink

H. R. 6705CommentsClose CommentsPermalink

To amend the Internal Revenue Code of 1986 to reduce the depreciation recovery periods for energy efficient commercial buildings, and for other purposes.CommentsClose CommentsPermalink

IN THE HOUSE OF REPRESENTATIVESCommentsClose CommentsPermalink

December 21, 2012CommentsClose CommentsPermalink

Mr. LANGEVIN (for himself and Mr. WELCH) introduced the following bill; which was referred to the Committee on Ways and MeansCommentsClose CommentsPermalink

A BILLCommentsClose CommentsPermalink

To amend the Internal Revenue Code of 1986 to reduce the depreciation recovery periods for energy efficient commercial buildings, and for other purposes.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 ‘Building Efficiently Act of 2012’.CommentsClose CommentsPermalink

SEC. 2. SHORTER DEPRECIATION RECOVERY PERIODS FOR ENERGY EFFICIENT BUILDINGS.

(a) 25-Year Recovery Period for Energy Efficient Nonresidential Real Property-CommentsClose CommentsPermalink





(1) IN GENERAL- Section 168(e)(3) of the Internal Revenue Code of 1986 is amended by inserting after subparagraph (F) the following new subparagraph:CommentsClose CommentsPermalink





‘(G) 25-year PROPERTY- The term ‘25-year property’ means any qualified energy efficient nonresidential real property.’.CommentsClose CommentsPermalink





(2) QUALIFIED ENERGY EFFICIENT NONRESIDENTIAL REAL PROPERTY DEFINED- Subsection (i) of section 168 of such Code is amended by adding at the end the following:CommentsClose CommentsPermalink





‘(20) QUALIFIED ENERGY EFFICIENT NONRESIDENTIAL REAL PROPERTY-CommentsClose CommentsPermalink





‘(A) IN GENERAL- 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).CommentsClose CommentsPermalink





‘(B) NEW OR RECONSTRUCTED BUILDING- A building is described in this subparagraph if--CommentsClose CommentsPermalink





‘(i) the certification requirements of subparagraph (E) with respect to the building are met,CommentsClose CommentsPermalink





‘(ii) the original use of the building commences with the taxpayer, andCommentsClose CommentsPermalink





‘(iii) the building is placed in service after the date of the enactment of this paragraph.CommentsClose CommentsPermalink





‘(C) IMPROVEMENTS TO EXISTING BUILDING- A building is described in this subparagraph if, only after improvements are made to the building--CommentsClose CommentsPermalink





‘(i) the certification requirements of subparagraph (E) with respect to the building are met,CommentsClose CommentsPermalink





‘(ii) the original use of the improved building commences with the taxpayer,CommentsClose CommentsPermalink





‘(iii) the improved building is placed in service after the date of the enactment of this paragraph, andCommentsClose CommentsPermalink





‘(iv) the taxpayer elects to the application of this paragraph with respect to the building.CommentsClose CommentsPermalink





‘(D) BUILDINGS ACQUIRED BY PURCHASE- A building is described in this subparagraph if the building--CommentsClose CommentsPermalink





‘(i) is acquired by purchase from an unrelated person,CommentsClose CommentsPermalink





‘(ii) meets the certification requirements of subparagraph (E), andCommentsClose CommentsPermalink





‘(iii) is placed in service after the date of the enactment of this paragraph.CommentsClose CommentsPermalink





‘(E) CERTIFICATION REQUIREMENTS- The 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).CommentsClose CommentsPermalink





‘(F) STANDARD 90.1-2004- 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).CommentsClose CommentsPermalink





‘(G) RELATED PERSONS- For purposes of subparagraph (D), a person is related to another person if--CommentsClose CommentsPermalink





‘(i) the persons are members of an affiliated group (as defined in section 1504), orCommentsClose CommentsPermalink





‘(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.CommentsClose CommentsPermalink





‘(H) DENIAL OF DOUBLE BENEFIT- If this section applies to a building by reason of subsection (e)(3)(G), the deduction under section 179D shall not be allowed.’.CommentsClose CommentsPermalink





(b) 20-Year Recovery Period for Energy Efficient Residential Rental Property-CommentsClose CommentsPermalink





(1) IN GENERAL- Subparagraph (F) of section 168(e)(3) of such Code (relating to 20-year property) is amended to read as follows:CommentsClose CommentsPermalink





‘(F) 20-year PROPERTY- The term ‘20-year property’ means--CommentsClose CommentsPermalink





‘(i) initial clearing and grading land improvements with respect to any electric utility transmission and distribution plant, andCommentsClose CommentsPermalink





‘(ii) any qualified energy efficient residential rental property.’.CommentsClose CommentsPermalink





(2) QUALIFIED ENERGY EFFICIENT RESIDENTIAL RENTAL PROPERTY DEFINED- Subsection (i) of section 168 of such Code, as amended by subsection (a), is amended by adding at the end the following:CommentsClose CommentsPermalink





‘(21) QUALIFIED ENERGY EFFICIENT RESIDENTIAL RENTAL PROPERTY-CommentsClose CommentsPermalink





‘(A) IN GENERAL- 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).CommentsClose CommentsPermalink





‘(B) NEW OR RECONSTRUCTED BUILDING- A building is described in this subparagraph if--CommentsClose CommentsPermalink





‘(i) the certification requirements of subparagraph (E) with respect to the building are met,CommentsClose CommentsPermalink





‘(ii) the original use of which commences with the taxpayer, andCommentsClose CommentsPermalink





‘(iii) the building is placed in service after the date of the enactment of this paragraph.CommentsClose CommentsPermalink





‘(C) IMPROVEMENTS TO EXISTING BUILDING- A building is described in this subparagraph if, only after improvements are made to the building--CommentsClose CommentsPermalink





‘(i) the certification requirements of subparagraph (E) with respect to the building are met,CommentsClose CommentsPermalink





‘(ii) the original use of the improved building commences with the taxpayer,CommentsClose CommentsPermalink





‘(iii) the improved building is placed in service after the date of the enactment of this paragraph, andCommentsClose CommentsPermalink





‘(iv) the taxpayer elects to the application of this paragraph with respect to the building.CommentsClose CommentsPermalink





‘(D) BUILDINGS ACQUIRED BY PURCHASE- A building is described in this subparagraph if the building--CommentsClose CommentsPermalink





‘(i) is acquired by purchase from an unrelated person,CommentsClose CommentsPermalink





‘(ii) meets the certification requirements of subparagraph (E), andCommentsClose CommentsPermalink





‘(iii) is placed in service after the date of the enactment of this paragraph.CommentsClose CommentsPermalink





‘(E) CERTIFICATION REQUIREMENTS- The 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).CommentsClose CommentsPermalink





‘(F) RELATED PERSONS- For purposes of subparagraph (D), a person is related to another person if--CommentsClose CommentsPermalink





‘(i) the persons are members of an affiliated group (as defined in section 1504), orCommentsClose CommentsPermalink





‘(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.CommentsClose CommentsPermalink





‘(G) DENIAL OF DOUBLE BENEFIT- If this section applies to a building by reason of subsection (e)(3)(F)(ii), the deduction under section 179D shall not be allowed.’.CommentsClose CommentsPermalink





(c) Conforming Amendments-CommentsClose CommentsPermalink





(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:CommentsClose CommentsPermalink

‘25-year propertyCommentsClose CommentsPermalink

--25 years’.CommentsClose CommentsPermalink

(2) The table contained in section 467(e)(3)(A) of such Code is amended--CommentsClose CommentsPermalink





(A) by inserting ‘which is not 25-year property’ after ‘nonresidential real property’, andCommentsClose CommentsPermalink





(B) by inserting after the item relating to residential rental property and nonresidential real property the following new item:CommentsClose CommentsPermalink

‘25-year propertyCommentsClose CommentsPermalink

--19 years.’.CommentsClose CommentsPermalink

(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’.CommentsClose CommentsPermalink





(d) Requirement To Use Straight Line Method- Paragraph (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:CommentsClose CommentsPermalink





‘(F) Property described in subsection (e)(3)(F)(ii) or subsection (e)(3)(G).’.CommentsClose CommentsPermalink





(e) Alternative System- 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:CommentsClose CommentsPermalink

‘(F)(i)CommentsClose CommentsPermalink

--25CommentsClose CommentsPermalink

(F)(ii)CommentsClose CommentsPermalink

--20CommentsClose CommentsPermalink

(G)CommentsClose CommentsPermalink

--25’.CommentsClose CommentsPermalink

(f) Effective Date- The amendments made by this section shall apply to property placed in service after December 31, 2012.CommentsClose CommentsPermalink