AMERICAN WIND
ENERGY ASSOCIATION APPLAUDS PROPOSED
INCENTIVE FOR HOME, SMALL BUSINESS WIND SYSTEMS
Move by Senator Ken Salazar and co-sponsors opens way for
federal tax credit for consumers purchasing a small wind system.
The American Wind
Energy Association today praised Senators Ken Salazar (D-Colo.) and Gordon
Smith (R-Ore.) for introducing legislation that would allow purchasers
of a small wind system to receive a credit on their taxes for a portion
of the turbine’s cost.
The “Rural Wind Energy Development Act” (S. 673) would provide
a federal tax credit of $1,500 per ½ kilowatt (kW) of capacity
to purchasers of small wind systems nationwide. This five-year credit
would apply to all wind systems with capacities of under 100 kW used to
power individual homes, farms, or small businesses. Joining Salazar and
Smith as original co-sponsors of the bill were Senators Byron Dorgan (D-N.D.)
and Larry Craig (R-Idaho).
“There is a great satisfaction in generating your own electricity,
and doing so in a way that reduces global warming emissions and strengthens
the country’s energy security,” said AWEA Executive Director
Randall Swisher. “The bill proposed by Senators Salazar and Smith
empowers consumers and is good energy policy.”
AWEA Small-Wind Advocate
Ron Stimmel noted that the bill’s introduction is a positive development
for small wind. “This would be the first federal incentive in 20
years to help individuals – homeowners, farmers, and small business
owners - buy a small wind turbine,” said Stimmel. The credit would
help bring down the up-front cost of purchasing a system and spur a market
that is growing, but remains well below what industry experts believe
is its full potential.
The bill would also allow the credit to be carried over—meaning
that in the event that using the credit reduces the consumer’s taxable
income below the minimum threshold, the unusable excess credit would be
carried over to the next tax year. This provision essentially allows a
consumer with a low annual income to take full advantage of the credit.
The bill would also provide for an accelerated depreciation of three years
for small wind turbines.
AWEA, formed in 1974, is the national trade association
of the U.S. wind energy industry. The association's membership includes
turbine manufacturers, wind project developers, utilities, academicians,
and interested individuals. More information on wind energy is available
at the AWEA web site: www.awea.org.
Here is the actual language of the proposed bill in the House:
IRA bill proposed:
Rural Wind Energy Development Act
H. R. 1772
To amend the Internal Revenue Code of 1986 to provide credits for the
installation of wind energy property, including by rural homeowners, farmers,
ranchers, and small businesses, and for other purposes.
IN
THE HOUSE OF REPRESENTATIVES |
March
29, 2007 |
| Mr. BLUMENAUER (for himself, Mr. COLE of Oklahoma, Mr. RENZI, Mr. HALL of New York, Mr. UDALL of Colorado, Mr. MCCOTTER, Mr. CONAWAY, Mrs. MCMORRIS RODGERS, Mr. WAXMAN, Mr. LUCAS, Mr. MCDERMOTT, and Mr. GILLMOR) introduced the following bill; which was referred to the Committee on Ways and Means |
A
BILL |
To amend the Internal Revenue Code of 1986 to provide credits for the installation of wind energy property, including by rural homeowners, farmers, ranchers, and small businesses, and for other purposes. |
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SECTION 1. SHORT TITLE.
This Act may be cited as the `Rural Wind Energy Development Act'.
SEC. 2. CREDIT FOR INSTALLATION OF WIND ENERGY PROPERTY INCLUDING
BY RURAL HOMEOWNERS, FARMERS, RANCHERS, AND SMALL BUSINESSES.
(a) In General- Subpart B of part IV of subchapter A of chapter 1 of the Internal Revenue Code of 1986 is amended by adding at the end the following new section:
SEC. 30D. WIND ENERGY PROPERTY.
(a) Allowance of Credit- There shall be allowed as a credit against the tax imposed by this chapter for the taxable year an amount equal to $1,500 with respect to each half kilowatt of capacity of qualified wind energy property placed in service or installed by the taxpayer during such taxable year.
(b) Limitation- No credit shall be allowed under subsection (a) unless at least 50 percent of the energy produced annually by the qualified wind energy property is consumed on the site on which the property is placed in service or installed.
(c) Qualified Wind Energy Property- For purposes of this section, the term `qualified wind energy property' means a wind turbine of 100 kilowatts of rated capacity or less if--
(1) such turbine is placed in service or installed on or in connection with property located in the United States, (2) in the case of an individual, the property on or in connection with which such turbine is installed is a dwelling unit, (3) the original use of such turbine commences with the taxpayer, and (4) such turbine carries at least a 5-year limited warranty covering defects in design, material, or workmanship, and, for property that is not installed by the taxpayer, at least a 5-year limited warranty covering defects in installation.
(d) Limitation Based on Amount of Tax-
(1) IN GENERAL- The credit allowed under subsection (a) for any taxable year shall not exceed the excess of-- ......... (A) the sum of the regular tax liability (as defined in section 26(b)) plus the tax imposed by section 55, over ......... (B) the sum of the credits allowable under this part (other than under this section and subpart C thereof, relating to refundable credits) and section 1397E. (2) CARRYOVER OF UNUSED CREDIT- If the credit allowable under subsection (a) exceeds the limitation imposed by paragraph (1) for such taxable year, such excess shall be carried to the succeeding taxable year and added to the credit allowable under subsection (a) for such taxable year.
(e) Special Rules- For purposes of this section--
| (1) TENANT-STOCKHOLDER IN COOPERATIVE HOUSING CORPORATION- In the case of an individual who is a tenant-stockholder (as defined in section 216(b)(2)) in a cooperative housing corporation (as defined in section 216(b)(1)), such individual shall be treated as having paid his tenant-stockholder's proportionate share (as defined in section 216(b)(3)) of any expenditures paid or incurred for qualified wind energy property by such corporation, and such credit shall be allocated appropriately to such individual. | |
| (2) CONDOMINIUMS- | |
| (A) IN GENERAL- In the case of an individual who is a member of a condominium management association with respect to a condominium which he owns, such individual shall be treated as having paid his proportionate share of expenditures paid or incurred for qualified wind energy property by such association, and such credit shall be allocated appropriately to such individual. | |
| (B) CONDOMINIUM MANAGEMENT ASSOCIATION- For purposes of this paragraph, the term `condominium management association' means an organization which meets the requirements of section 528(c)(2) with respect to a condominium project of which substantially all of the units are used by individuals as dwelling units. | |
(f) Basis Adjustment- For purposes
of this subtitle, if a credit is allowed under this section for any expenditure
with respect to a dwelling unit or other property, the increase in the
basis of such dwelling unit or other property which would (but for this
subsection) result from such expenditure shall be reduced by the amount
of the credit so allowed.
(g) Application of Credit- The credit allowed under this section shall
apply to property placed in service or installed after December 31, 2006,
and before January 1, 2012.
(b) Conforming Amendment- Subsection (a) of section 1016 of the Internal
Revenue Code of 1986 (relating to general rule for adjustments to basis)
is amended by striking `and' at the end of paragraph (36), by striking
the period at the end of paragraph (37) and inserting `, and', and by
adding at the end the following new paragraph:
| (38) in the case of a dwelling unit or other property with respect to which a credit was allowed under section 30D, to the extent provided in section 30D(f). |
(c) Clerical Amendment-
The table of sections for subpart B of part IV of subchapter A of chapter
1 of the Internal Revenue Code of 1986 is amended by inserting after the
item relating to section 30C the following new item:
| Sec. 30D. Wind energy property. |
(d) Effective Date- The amendments made by this section shall apply to
taxable years ending after December 31, 2006.
SEC. 3. 3-YEAR ACCELERATED DEPRECIATION PERIOD FOR WIND ENERGY PROPERTY.
| (a) In General- Subparagraph (A) of section 168(e)(3) of the Internal Revenue Code of 1986 is amended by striking `and' at the end of clause (ii), by striking the period at the end of clause (iii) and inserting `, and', and by inserting after clause (iii) the following new clause: | |
| ........... | (iv) any property which would be described in subparagraph (A) of section 48(a)(3) if `wind energy' were substituted for `solar energy' in clause (i) thereof and the last sentence of such section did not apply to such subparagraph. |
| (b) Conforming Amendment- Section 168(e)(3)(B)(vi)(I) of such Code is amended to read as follows: | |
| ........... | (I) is described in subparagraph (A) of section 48(a)(3) if the last sentence of such section did not apply to such subparagraph, |
| (c) Effective Date- The amendments made by this section shall apply to property placed in service after December 31, 2006. | |
| Rural Wind Energy Development Act (This is the Senate version, as proposed) | |
S 673 IS
110th
CONGRESS 1st Session S. 673 |
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| To amend the Internal Revenue Code of 1986 to provide credits for the installation of wind energy property, including by rural homeowners, farmers, ranchers, and small businesses, and for other purposes. | |||
IN THE SENATE
OF THE UNITED STATES |
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| Mr. SALAZAR (for himself,
Mr. SMITH, Mr. DORGAN, and Mr. CRAIG) introduced the following bill;
which was read twice and referred to the Committee on Finance
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A
BILL |
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To amend the Internal Revenue Code of 1986 to provide credits for the installation of wind energy property, including by rural homeowners, farmers, ranchers, and small businesses, and for other purposes. |
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SECTION 1.
SHORT TITLE. |
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| SEC. 2. CREDIT FOR INSTALLATION OF WIND ENERGY PROPERTY INCLUDING BY RURAL HOMEOWNERS, FARMERS, RANCHERS, AND SMALL BUSINESSES. | |||
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| SEC. 30D. WIND ENERGY PROPERTY. | |||
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| SEC. 3. 3-YEAR ACCELERATED DEPRECIATION PERIOD FOR WIND ENERGY PROPERTY. | |||
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