Home Energy Savings Act

II 117TH CONGRESS 1ST SESSION S. 1753 To amend the Internal Revenue Code of 1986 to extend and update the credit for nonbusiness energy property. IN THE SENATE OF THE UNITED STATES MAY 20, 2021 Ms. HASSAN (for herself and Ms. COLLINS) 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 extend and update the credit for nonbusiness energy property. Be it enacted by the Senate and House of Representa- 1 tives of the United States of America in Congress assembled, 2 SECTION 1. SHORT TITLE. 3 This Act may be cited as the ‘‘Home Energy Savings 4 Act’’. 5 SEC. 2. UPDATING CREDIT FOR NONBUSINESS ENERGY 6 PROPERTY. 7 (a) IN GENERAL.—Section 25C of the Internal Rev- 8 enue Code of 1986 is amended— 9 VerDate Sep 11 2014 18:01 Jun 10, 2021 Jkt 019200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\S1753.IS S1753 pamtmann on DSKBC07HB2PROD with BILLS 2 •S 1753 IS (1) in subsection (a)(1), by striking ‘‘10 per- 1 cent’’ and inserting ‘‘15 percent’’, 2 (2) in subsection (b)— 3 (A) in paragraph (1)— 4 (i) by striking ‘‘$500’’ and inserting 5 ‘‘$1,200’’, and 6 (ii) by striking ‘‘December 31, 2005’’ 7 and inserting ‘‘December 31, 2021’’, and 8 (B) by striking paragraphs (2) and (3) and 9 inserting the following: 10 ‘‘(2) LIMITATION ON WINDOW ATTACHMENT 11 PRODUCTS.—In the case of amounts paid or in- 12 curred for products described in subsection (c)(2)(B) 13 by any taxpayer for any taxable year, the credit al- 14 lowed under this section with respect to such 15 amounts for such year shall not exceed the excess (if 16 any) of $600 over the aggregate credits allowed 17 under this section with respect to such amounts for 18 all prior taxable years ending after December 31, 19 2021. 20 ‘‘(3) LIMITATION ON INSULATION MATERIAL OR 21 SYSTEM.—In the case of amounts paid or incurred 22 for components described in subparagraph (A) or 23 (D) of subsection (c)(3) by any taxpayer for any tax- 24 able year, the credit allowed under this section with 25 VerDate Sep 11 2014 18:01 Jun 10, 2021 Jkt 019200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\S1753.IS S1753 pamtmann on DSKBC07HB2PROD with BILLS 3 •S 1753 IS respect to such amounts for such year shall not ex- 1 ceed the excess (if any) of $600 over the aggregate 2 credits allowed under this section with respect to 3 such amounts for all prior taxable years ending after 4 December 31, 2021. 5 ‘‘(4) LIMITATION ON WINDOWS.— 6 ‘‘(A) IN GENERAL.— 7 ‘‘(i) ENERGY STAR MOST EFFI- 8 CIENT.—In the case of amounts paid or in- 9 curred by any taxpayer for any taxable 10 year for components described in sub- 11 section (c)(3)(B) which meet the most effi- 12 cient certification under applicable Energy 13 Star program requirements, the credit al- 14 lowed under this section with respect to 15 such amounts for such year shall not ex- 16 ceed the excess (if any) of $600 over the 17 aggregate credits allowed under this sec- 18 tion with respect to such amounts for all 19 prior taxable years ending after December 20 31, 2021. 21 ‘‘(ii) ENERGY STAR.—In the case of 22 amounts paid or incurred by any taxpayer 23 for any taxable year for components de- 24 scribed in subsection (c)(3)(B) which do 25 VerDate Sep 11 2014 18:01 Jun 10, 2021 Jkt 019200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\S1753.IS S1753 pamtmann on DSKBC07HB2PROD with BILLS 4 •S 1753 IS not meet the most efficient certification 1 under applicable Energy Star program re- 2 quirements, the credit allowed under this 3 section with respect to such amounts for 4 such year shall not exceed the excess (if 5 any) of $200 over the aggregate credits al- 6 lowed under this section with respect to 7 such amounts for all prior taxable years 8 ending after December 31, 2021. 9 ‘‘(B) ELECTION.— 10 ‘‘(i) IN GENERAL.—For purposes of 11 any amounts paid or incurred by any tax- 12 payer for components described in sub- 13 section (c)(3)(B), the credit allowed under 14 this section shall only be allowed for com- 15 ponents described in clause (i) of subpara- 16 graph (A) or clause (ii) of such subpara- 17 graph, but not both, as elected by the tax- 18 payer during the first taxable year in 19 which such credit is being claimed by the 20 taxpayer. 21 ‘‘(ii) IRREVOCABILITY.—The Sec- 22 retary shall, through such rules, regula- 23 tions, and procedures as are determined 24 appropriate, establish procedures for mak- 25 VerDate Sep 11 2014 18:01 Jun 10, 2021 Jkt 019200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\S1753.IS S1753 pamtmann on DSKBC07HB2PROD with BILLS 5 •S 1753 IS ing an election under this subparagraph, 1 which shall require that— 2 ‘‘(I) any election made by the 3 taxpayer shall be irrevocable, and 4 ‘‘(II) such election shall remain 5 in effect for all subsequent taxable 6 years. 7 ‘‘(5) LIMITATION ON DOORS.—In the case of 8 amounts paid or incurred for components described 9 in subsection (c)(3)(C) by any taxpayer for any tax- 10 able year, the credit allowed under this section with 11 respect to such amounts for such year shall not ex- 12 ceed— 13 ‘‘(A) the excess (if any) of $500 over the 14 aggregate credits allowed under this section 15 with respect to such amounts for all prior tax- 16 able years ending after December 31, 2021, or 17 ‘‘(B) $250 for each exterior door. 18 ‘‘(6) LIMITATION ON RESIDENTIAL ENERGY 19 PROPERTY EXPENDITURES.—The amount of the 20 credit allowed under this section by reason of sub- 21 section (a)(2) shall not exceed— 22 ‘‘(A) in the case of any energy-efficient 23 building property— 24 VerDate Sep 11 2014 18:01 Jun 10, 2021 Jkt 019200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\S1753.IS S1753 pamtmann on DSKBC07HB2PROD with BILLS 6 •S 1753 IS ‘‘(i) for any item of property described 1 in clause (ii) of subparagraph (A) of sub- 2 section (d)(3), $800, 3 ‘‘(ii) for any item of property de- 4 scribed in clause (i) or (iii) of such sub- 5 paragraph, $600, and 6 ‘‘(iii) for any item of property de- 7 scribed in clause (iv) of such subpara- 8 graph, $400, and 9 ‘‘(B) in the case of any qualified natural 10 gas, propane, or oil furnace or hot water boiler 11 (as defined in subsection (d)(4)), an amount 12 equal to— 13 ‘‘(i) $600 for a hot water boiler, and 14 ‘‘(ii) in the case of a furnace, an 15 amount equal to the sum of— 16 ‘‘(I) $300, plus 17 ‘‘(II) if the taxpayer is converting 18 from a non-condensing furnace to a 19 condensing furnace, $300.’’, 20 (3) in subsection (c)— 21 (A) in paragraph (2), by striking subpara- 22 graphs (A) through (C) and inserting the fol- 23 lowing: 24 VerDate Sep 11 2014 18:01 Jun 10, 2021 Jkt 019200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\S1753.IS S1753 pamtmann on DSKBC07HB2PROD with BILLS 7 •S 1753 IS ‘‘(A) in the case of an exterior window, a 1 skylight, or an exterior door, applicable Energy 2 Star program requirements, 3 ‘‘(B) in the case of any window attachment 4 product, the applicable certification require- 5 ments for such product under the Attachments 6 Energy Rating Council Certification Program, 7 and 8 ‘‘(C) in the case of any other component, 9 the prescriptive criteria for such component es- 10 tablished by the International Energy Conserva- 11 tion Code, as such Code (including supple- 12 ments) is in effect on January 1 of the calendar 13 year in which such component is installed.’’, 14 (B) in paragraph (3), by striking subpara- 15 graph (D) and inserting the following: 16 ‘‘(D) any air barrier material, system, or 17 assembly which is specifically and primarily de- 18 signed to minimize the passage of air through 19 the building thermal envelope and its assemblies 20 when installed in or on a dwelling unit.’’, and 21 (C) by adding at the end the following new 22 paragraph: 23 ‘‘(5) LABOR COSTS.—The term ‘qualified en- 24 ergy efficiency improvements’ includes expenditures 25 VerDate Sep 11 2014 18:01 Jun 10, 2021 Jkt 019200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\S1753.IS S1753 pamtmann on DSKBC07HB2PROD with BILLS 8 •S 1753 IS for labor costs properly allocable to the onsite prepa- 1 ration, assembly, or original installation of any en- 2 ergy efficient building envelope component.’’, 3 (4) in subsection (d)— 4 (A) in paragraph (2)— 5 (i) in subparagraph (A)— 6 (I) in clause (i), by adding ‘‘or’’ 7 at the end, 8 (II) in clause (ii), by striking ‘‘, 9 or’’ and inserting a period, and 10 (III) by striking clause (iii), and 11 (ii) by striking subparagraphs (B) and 12 (C) and inserting the following: 13 ‘‘(B) EFFICIENCY STANDARDS.—Property 14 described in subparagraph (A) shall meet or ex- 15 ceed the requirements of the highest efficiency 16 tier (not including any advanced tier) estab- 17 lished by the Consortium for Energy Efficiency 18 which are in effect on January 1 of the cal- 19 endar year in which the property was ac- 20 quired.’’, 21 (B) by striking paragraph (3) and insert- 22 ing the following: 23 VerDate Sep 11 2014 18:01 Jun 10, 2021 Jkt 019200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\S1753.IS S1753 pamtmann on DSKBC07HB2PROD with BILLS 9 •S 1753 IS ‘‘(3) ENERGY-EFFICIENT BUILDING PROP- 1 ERTY.—The term ‘energy-efficient building property’ 2 means property which— 3 ‘‘(A) is— 4 ‘‘(i) an electric heat pump water heat- 5 er, 6 ‘‘(ii) an electric heat pump, 7 ‘‘(iii) a central air conditioner, or 8 ‘‘(iv) a natural gas, propane, or oil 9 water heater, and 10 ‘‘(B) meets or exceeds the requirements of 11 the highest efficiency tier (not including any ad- 12 vanced tier) established by the Consortium for 13 Energy Efficiency which are in effect on Janu- 14 ary 1 of the calendar year in which the property 15 was acquired.’’, 16 (C) in paragraph (4), by striking ‘‘achieves 17 an annual fuel utilization efficiency rate of not 18 less than 95’’ and inserting ‘‘meets or exceeds 19 the requirements of the highest efficiency tier 20 (not including any advanced tier) established by 21 the Consortium for Energy Efficiency which are 22 in effect on January 1 of the calendar year in 23 which the property was acquired’’, and 24 (D) by striking paragraph (5), 25 VerDate Sep 11 2014 18:01 Jun 10, 2021 Jkt 019200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6201 E:\BILLS\S1753.IS S1753 pamtmann on DSKBC07HB2PROD with BILLS 10 •S 1753 IS (5) in subsection (e), by adding the following 1 new paragraphs at the end: 2 ‘‘(4) INSTALLATION STANDARDS.—The terms 3 ‘energy efficient building envelope component’ and 4 ‘qualified energy property’ shall not include any 5 components or property which are not installed ac- 6 cording to any applicable Air Conditioning Contrac- 7 tors of America Quality Installation standards which 8 are in effect at the time that such components or 9 property are placed in service. 10 ‘‘(5) REPLACEMENT OF TERMINATED STAND- 11 ARDS.—In the case of any standard, requirement, or 12 criteria applicable to any energy efficient building 13 envelope component or qualified energy property 14 which is terminated after the date of enactment of 15 the Home Energy Savings Act, the Secretary, in 16 consultation with the Secretary of Energy, shall 17 identify a similar standard, requirement, or criteria 18 for purposes of determining the eligibility of any 19 such component or property for purposes of credit 20 allowed under this section.’’, and 21 (6) in subsection (g)(2), by striking ‘‘December 22 31, 2021’’ and inserting ‘‘December 31, 2028’’. 23 VerDate Sep 11 2014 18:01 Jun 10, 2021 Jkt 019200 PO 00000 Frm 00010 Fmt 6652 Sfmt 6201 E:\BILLS\S1753.IS S1753 pamtmann on DSKBC07HB2PROD with BILLS 11 •S 1753 IS (b) EFFECTIVE DATE.—The amendments made by 1 this section shall apply to property placed in service after 2 December 31, 2021. 3 Æ VerDate Sep 11 2014 18:01 Jun 10, 2021 Jkt 019200 PO 00000 Frm 00011 Fmt 6652 Sfmt 6301 E:\BILLS\S1753.IS S1753 pamtmann on DSKBC07HB2PROD with BILLS