II 

111TH CONGRESS 

1ST SESSION S. 1321 

To amend the Internal Revenue Code of 1986 to provide a credit for property 

labeled under the Environmental Protection Agency WaterSense program. 

IN THE SENATE OF THE UNITED STATES 

JUNE 23, 2009 

Mr. UDALL of Colorado (for himself and Mrs. GILLIBRAND) 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 

a credit for property labeled under the Environmental 

Protection Agency WaterSense program. 

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

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Water Accountability 

5 Tax Efficiency Reinvestment Act of 2009’’ or as the 

6 ‘‘WATER Act of 2009’’. 

7 SEC. 2. CREDIT FOR WATERSENSE LABELED PROPERTY. 

8 (a) IN GENERAL.—Subpart B of part IV of sub9 chapter A of chapter 1 of the Internal Revenue Code of 


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1 1986 is amended by adding at the end the following new 

2 section: 

3 ‘‘SEC. 30E. WATERSENSE LABELED PROPERTY. 

4 ‘‘(a) ALLOWANCE OF CREDIT.—There shall be al5 lowed as a credit against the tax imposed by this chapter 

6 for the taxable year an amount equal to 30 percent of the 

7 amounts paid or incurred by the taxpayer during such tax8 able year for certified WaterSense labeled property. 

9 ‘‘(b) LIFETIME LIMITATION.—The aggregate amount 

10 of the credits allowed under this section with respect to 

11 any taxpayer for any taxable year shall not exceed the ex12 cess (if any) of $1,500 over the aggregate credits allowed 

13 under this section with respect to such taxpayer for all 

14 prior taxable years. 

15 ‘‘(c) CERTIFIED WATERSENSE LABELED PROP16 ERTY.—For purposes of this section, the term ‘certified 

17 WaterSense labeled property’ means any property— 

18 ‘‘(1) which is certified by a licensed independent 

19 third party as meeting specifications of the Environ20 mental Protection Agency WaterSense program, and 

21 ‘‘(2) the original use of which commences with 

22 the taxpayer. 

23 ‘‘(d) APPLICATION WITH OTHER CREDITS.— 

24 ‘‘(1) BUSINESS CREDIT TREATED AS PART OF

25 GENERAL BUSINESS CREDIT.—So much of the credit 


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1 which would be allowed under subsection (a) for any 

2 taxable year (determined without regard to this sub3 section) that is attributable to property of a char4 acter subject to an allowance for depreciation shall 

5 be treated as a credit listed in section 38(b) for such 

6 taxable year (and not allowed under subsection (a)). 

7 ‘‘(2) PERSONAL CREDIT.— 

8 ‘‘(A) IN GENERAL.—For purposes of this 

9 title, the credit allowed under subsection (a) for 

10 any taxable year (determined after application 

11 of paragraph (1)) shall be treated as a credit 

12 allowable under subpart A for such taxable 

13 year. 

14 ‘‘(B) LIMITATION BASED ON AMOUNT OF

15 TAX.—In the case of a taxable year to which 

16 section 26(a)(2) does not apply, the credit al17 lowed under subsection (a) for any taxable year 

18 (determined after application of paragraph (1)) 

19 shall not exceed the excess of— 

20 ‘‘(i) the sum of the regular tax liabil21 ity (as defined in section 26(b)) plus the 

22 tax imposed by section 55, over 

23 ‘‘(ii) the sum of the credits allowable 

24 under subpart A (other than this section 


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1 and sections 23, 25D, 30, and 30D) and 

2 section 27 for the taxable year. 

3 ‘‘(e) SPECIAL RULES.—For purposes of this sec4 tion— 

5 ‘‘(1) AGGREGATION RULES.—All persons treat6 ed as a single employer under subsection (a) or (b) 

7 of section 52, or subsection (m) or (o) of section 

8 414, shall be treated as a one person. 

9 ‘‘(2) BASIS REDUCTION.—For purposes of this 

10 subtitle, the basis of any property for which a credit 

11 is allowable under subsection (a) shall be reduced by 

12 the amount of such credit so allowed (determined 

13 without regard to subsection (d)). 

14 ‘‘(3) NO DOUBLE BENEFIT.—The amount of 

15 any deduction or other credit allowable under this 

16 chapter with respect to any property for which credit 

17 is allowable under subsection (a) shall be reduced by 

18 the amount of credit allowed under subsection (a) 

19 with respect to such property (determined without 

20 regard to subsection (d)). 

21 ‘‘(4) PROPERTY USED OUTSIDE UNITED STATES

22 NOT QUALIFIED.—No credit shall be allowable under 

23 subsection (a) with respect to any property referred 

24 to in section 50(b)(1). 


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1 ‘‘(f) TERMINATION.—This section shall not apply to 

2 any property placed in service after December 31, 2010.’’. 

3 (b) CONFORMING AMENDMENTS.— 

4 (1)(A) Section 24(b)(3)(B) of the Internal Rev5 enue Code of 1986 is amended by striking ‘‘and 

6 30D’’ and inserting ‘‘30D, and 30E’’. 

7 (B) Section 25(e)(1)(C)(ii) of such Code is 

8 amended by inserting ‘‘30E,’’ after ‘‘30D,’’. 

9 (C) Section 25B(g)(2) of such Code is amended 

10 by striking ‘‘and 30D’’ and inserting ‘‘30D, and 

11 30E’’. 

12 (D) Section 26(a)(1) of such Code is amended 

13 by striking ‘‘and 30D’’ and inserting ‘‘30D, and 

14 30E’’. 

15 (E) Section 904(i) of such Code is amended by 

16 striking ‘‘and 30D’’ and inserting ‘‘30D, and 30E’’. 

17 (F) Section 1400C(d)(2) of such Code is 

18 amended by striking ‘‘and 30D’’ and inserting 

19 ‘‘30D, and 30E’’. 

20 (2) Section 1016(a) of such Code is amended 

21 by striking ‘‘and’’ at the end of paragraph (36), by 

22 striking the period at the end of paragraph (37) and 

23 inserting ‘‘, and’’, and by adding at the end the fol24 lowing new paragraph: 


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1 ‘‘(38) to the extent provided in section 

2 30E(e)(2).’’. 

3 (3) The table of sections for subpart B of part 

4 IV of subchapter A of chapter 1 of such Code is 

5 amended by adding at the end the following new 

6 item: 

‘‘Sec. 30E. WaterSense labeled property.’’. 

7 (c) EFFECTIVE DATE.—The amendments made by 

8 this section shall apply to property placed in service after 

9 the date of the enactment of this Act. 

Æ 


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