I 

111TH CONGRESS 

1ST SESSION H. R. 2198 

To amend the Internal Revenue Code of 1986 to provide a shorter recovery 

period for the depreciation of certain systems installed in nonresidential 

real property or residential rental property. 

IN THE HOUSE OF REPRESENTATIVES 

APRIL 30, 2009 

Ms. BEAN (for herself and Mr. HOEKSTRA) 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 

a shorter recovery period for the depreciation of certain 

systems installed in nonresidential real property or residential rental property. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. RECOVERY PERIOD FOR DEPRECIATION OF 

4 CERTAIN SYSTEMS INSTALLED IN NONRESI5 DENTIAL AND RESIDENTIAL RENTAL BUILD6 INGS. 

7 (a) 20-YEAR RECOVERY PERIOD FOR HIGHLY EFFI8 CIENT HVAC&R EQUIPMENT.—Subparagraph (F) of secVerDate Nov 24 2008 03:25 May 02, 2009 Jkt 079200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\H2198.IH H2198

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1 tion 168(e)(3) of the Internal Revenue Code of 1986 (re2 lating to 20-year property) is amended to read as follows: 

3 ‘‘(F) 20-YEAR PROPERTY.—The term ‘20- 

4 year property’ means— 

5 ‘‘(i) initial clearing and grading land 

6 improvements with respect to any electric 

7 utility transmission and distribution plant, 

8 and 

9 ‘‘(ii) any property— 

10 ‘‘(I) which is part of a heating, 

11 ventilation, air conditioning, or com12 mercial refrigeration system, 

13 ‘‘(II) which exceeds by at least 

14 10 percent the applicable minimum 

15 performance standard for such system 

16 or component under the National Ap17 pliance Energy Conservation Act of 

18 1987 or the Energy Policy Act of 

19 1992 (as such Acts are in effect on 

20 the date that such property is placed 

21 in service and taking into account any 

22 changes to the American Society of 

23 Heating, Refrigerating and Air-condi24 tioning Engineers Standard 90.1 


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1 which have been adopted by the De2 partment of Energy as of such date), 

3 ‘‘(III) which is installed on or in 

4 a building which is nonresidential real 

5 property or residential rental prop6 erty, 

7 ‘‘(IV) the original use of which 

8 commences with the taxpayer (the 

9 owner or lessor in the case of residen10 tial rental property), and 

11 ‘‘(V) which is placed in service 

12 before January 1, 2013.’’ 

13 (b) 25-YEAR RECOVERY PERIOD.—Section 168(e)(3) 

14 of such Code is further amended by inserting after sub15 paragraph (F) the following new subparagraph: 

16 ‘‘(G) 25-YEAR PROPERTY.—The term ‘25- 

17 year property’ means any property— 

18 ‘‘(i) which is part of a heating, ven19 tilation, air conditioning, or commercial re20 frigeration system, 

21 ‘‘(ii) which is not described in sub22 paragraph (F), 

23 ‘‘(iii) which is installed on or in a 

24 building which is nonresidential real prop25 erty or residential rental property, 


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1 ‘‘(iv) the original use of which com2 mences with the taxpayer (the owner or 

3 lessor in the case of residential rental 

4 property), and 

5 ‘‘(v) which is placed in service before 

6 January 1, 2013.’’. 

7 (c) CONFORMING AMENDMENTS.— 

8 (1) The table contained in section 168(c) of 

9 such Code is amended by inserting after the item re10 lating to 20-year property the following new item: 

‘‘25-year property ........................................................................ 25 years’’. 

11 (2) The table contained in section 467(e)(3)(A) 

12 of such Code is amended by inserting after the item 

13 relating to residential rental property and nonresi14 dential real property the following new item: 

‘‘25-year property ........................................................................ 25 years’’. 

15 (d) REQUIREMENT TO USE STRAIGHT LINE METH16 OD.—Paragraph (3) of section 168(b) of such Code (relat17 ing to property to which straight line method applies) is 

18 amended by redesignating subparagraphs (F), (G), (H), 

19 and (I) as subparagraphs (G), (H), (I), and (J), respec20 tively, and by inserting after subparagraph (E) the fol21 lowing new subparagraph: 

22 ‘‘(F) Property described in subsection 

23 (e)(3)(F)(ii) and subsection (e)(3)(G).’’. 


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1 (e) ALTERNATIVE SYSTEM.—The table contained in 

2 section 168(g)(3)(B) of such Code is amended by striking 

3 the items relating to subparagraph (F) and inserting the 

4 following new items: 

‘‘(F)(i) ................................................................................................ 20

(F)(ii) ............................................................................................... 20

(G) .................................................................................................... 25’’. 

5 (f) EFFECTIVE DATE.—The amendments made by 

6 this section shall apply to property placed in service after 

7 December 31, 2008. 

Æ 


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