S 1093

112th CONGRESS
1st Session

S. 1093

To amend the Internal Revenue Code of 1986 to provide that solar energy property need not be located on the property with respect to which it is generating electricity in order to qualify for the residential energy efficient property credit.

IN THE SENATE OF THE UNITED STATES

May 26, 2011

Mr. UDALL of Colorado introduced the following bill; which was read twice and referred to the Committee on Finance


A BILL

To amend the Internal Revenue Code of 1986 to provide that solar energy property need not be located on the property with respect to which it is generating electricity in order to qualify for the residential energy efficient property credit.

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

SECTION 1. SHORT TITLE.

    This Act may be cited as the `Solar Uniting Neighborhoods (SUN) Act of 2011'.

SEC. 2. CLARIFICATION WITH RESPECT TO LOCATION OF SOLAR ELECTRIC PROPERTY.

    (a) In General- Paragraph (2) of section 25D(d) of the Internal Revenue Code of 1986 is amended to read as follows:

      `(2) QUALIFIED SOLAR ELECTRIC PROPERTY EXPENDITURE-

        `(A) IN GENERAL- The term `qualified solar electric property expenditure' means an expenditure for property which uses solar energy to generate electricity--

          `(i) for use in a dwelling unit located in the United States and used as a residence by the taxpayer, or

          `(ii) which enters the electrical grid at any point which is not more than 50 miles from the point at which such a dwelling unit used as a residence by the taxpayer is connected to such grid, but only if such property is not used in a trade or business of the taxpayer or in an activity with respect to which a deduction is allowed to the taxpayer under section 162 or paragraph (1) or (2) of section 212.

        `(B) RECAPTURE- The Secretary may provide for the recapture of the credit under this subsection with respect to any property described in clause (ii) of subparagraph (A) which ceases to satisfy the requirements of such clause.'.

    (b) Limitation With Respect to Off-Site Solar Property- Subsection (b) of section 25D of the Internal Revenue Code of 1986 is amended by adding at the end the following new paragraph:

      `(3) MAXIMUM CREDIT FOR OFF-SITE SOLAR PROPERTY- In the case of any qualified solar electric property expenditure which is such an expenditure by reason of clause (ii) of subsection (d)(2)(A), the credit allowed under subsection (a) (determined without regard to subsection (c)) for any taxable year with respect to all such expenditures shall not exceed $50,000.'.

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

SEC. 3. CLARIFICATION WITH RESPECT TO LOCATION OF SOLAR WATER HEATING PROPERTY.

    (a) In General- Section 25D(d)(1) of the Internal Revenue Code of 1986 is amended--

      (1) by striking `The term' and inserting the following:

        `(A) IN GENERAL- The term', and

      (2) by adding at the end the following new subparagraph:

        `(B) OFF-SITE PROPERTY-

          `(i) IN GENERAL- Such term shall include an expenditure for property described in subparagraph (A) notwithstanding--

            `(I) whether such property is located on the same site as the dwelling unit for which the energy generated from such property is used, and

            `(II) whether the energy generated by such property displaces the energy used to heat the water load or space heating load for the dwelling, so long as any such displacement from such property occurs not more than 50 miles from such dwelling unit,

          but only if such property is not used in a trade or business of the taxpayer or in an activity with respect to which a deduction is allowed to the taxpayer under section 162 or paragraph (1) or (2) of section 212.

          `(ii) RECAPTURE- The Secretary may provide for the recapture of the credit under this subsection with respect to any property described in clause (i) which ceases to satisfy the requirements of such clause.'.

    (b) Limitation With Respect to Off-Site Solar Property- Paragraph (3) of section 25D(b) of the Internal Revenue Code of 1986, as added by section 2, is amended to read as follows:

      `(3) MAXIMUM CREDIT FOR OFF-SITE SOLAR PROPERTY- In the case of--

        `(A) any qualified solar electric property expenditure which is such an expenditure by reason of clause (ii) of subsection (d)(2)(A), and

        `(B) any qualified solar water heating property expenditure which is such an expenditure by reason of subparagraph (B) of subsection (d)(1),

      the credit allowed under subsection (a) (determined without regard to subsection (c)) for any taxable year with respect to all such expenditures shall not exceed $50,000.'.

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

SEC. 4. EXCLUSION OF INCOME FROM QUALIFYING SALES.

    (a) In General- Part III of subchapter B of chapter 1 is amended by inserting before section 140 the following new section:

`SEC. 139F. INCOME FROM QUALIFYING SALES OF SOLAR ELECTRICITY.

    `For any taxable year, gross income of any person shall not include any gain from the sale or exchange to the electrical grid during such taxable year of electricity which is generated by property with respect to which any qualified solar electric property expenditures are eligible to be taken into account under section 25D, but only to the extent such gain does not exceed the value of the electricity used at such residence during such taxable year.'.

    (b) Technical Amendment- The Internal Revenue Code of 1986 is amended by redesignating the section added to such Code by section 10108(f) of the Patient Protection and Affordable Care Act as section 139E, and by locating such section immediately after section 139D of such Code (as added by section 9021(a) of such Act) and immediately before section 139F of such Code (as added by this section).

    (c) Clerical Amendment- The table of sections for part III of subchapter B of chapter 1 of such Code is amended by striking all that follows after the item relating to section 139C and inserting the following items:

      `Sec. 139D. Indian health care benefits.

      `Sec. 139E. Free choice vouchers.

      `Sec. 139F. Income from qualifying sales of solar electricity.

      `Sec. 140. Cross references to other Acts.'.

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

END