I 

111TH CONGRESS 

2D SESSION H. R. 4599 

To amend the Internal Revenue Code of 1986 to provide an elective payment 

for specified energy property. 

IN THE HOUSE OF REPRESENTATIVES 

FEBRUARY 4, 2010 

Mr. BLUMENAUER (for himself, Mr. MCDERMOTT, Mr. VAN HOLLEN, Ms. 

LINDA T. SA ́NCHEZ of California, Mr. WALZ, Mr. LARSON of Connecticut, Mr. THOMPSON of California, Mr. DOGGETT, Mr. PASCRELL, 

and Mr. POMEROY) 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 

an elective payment for specified energy 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. SHORT TITLE. 

4 This Act may be cited as the ‘‘Renewable Energy Ex5 pansion Act of 2010’’. 

6 SEC. 2. ELECTIVE PAYMENT FOR SPECIFIED ENERGY 

7 PROPERTY. 

8 (a) IN GENERAL.—Chapter 65 of the Internal Rev9 enue Code of 1986 (relating to abatements, credits, and 


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1 refunds) is amended by adding at the end the following 

2 new subchapter: 

3 ‘‘Subchapter C—Direct Payment Provisions 

‘‘Sec. 6451. Elective payment for specified energy property. 

4 ‘‘SEC. 6451. ELECTIVE PAYMENT FOR SPECIFIED ENERGY 

5 PROPERTY. 

6 ‘‘(a) IN GENERAL.—Any person making an election 

7 under this section with respect to any specified energy 

8 property originally placed in service by such person during 

9 the taxable year shall be treated as making a payment, 

10 against the tax imposed by subtitle A for the taxable year, 

11 equal to the applicable percentage of the basis of such 

12 property. Such payment shall be treated as made on the 

13 later of the due date of the return of such tax or the date 

14 on which such return is filed. 

15 ‘‘(b) APPLICABLE PERCENTAGE.—For purposes of 

16 this section, the term ‘applicable percentage’ means— 

17 ‘‘(1) 30 percent in the case of any property de18 scribed in paragraph (2)(A)(i) or (5) of section 

19 48(a), and 

20 ‘‘(2) 10 percent in the case of any other prop21 erty. 

22 ‘‘(c) DOLLAR LIMITATIONS.—In the case of property 

23 described in paragraph (1), (2), or (3) of section 48(c), 

24 the payment otherwise treated as made under subsection 


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1 (a) with respect to such property shall not exceed the limi2 tation applicable to such property under such paragraph. 

3 ‘‘(d) SPECIFIED ENERGY PROPERTY.—For purposes 

4 of this section— 

5 ‘‘(1) IN GENERAL.—The term ‘specified energy 

6 property’ means energy property (within the mean7 ing of section 48) which— 

8 ‘‘(A) is originally placed in service before 

9 January 1, 2013, or 

10 ‘‘(B) is originally placed in service on or 

11 after such date and before the credit termi12 nation date with respect to such property, but 

13 only if the construction of such property began 

14 before January 1, 2013. 

15 ‘‘(2) CREDIT TERMINATION DATE.—The term 

16 ‘credit termination date’ means— 

17 ‘‘(A) in the case of any energy property 

18 which is part of a facility described in para19 graph (1) of section 45(d), January 1, 2013, 

20 ‘‘(B) in the case of any energy property 

21 which is part of a facility described in para22 graph (2), (3), (4), (6), (7), (9), or (11) of sec23 tion 45(d), January 1, 2014, and 

24 ‘‘(C) in the case of any energy property de25 scribed in section 48(a)(3), January 1, 2017. 


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1 In the case of any property which is described in 

2 subparagraph (C) and also in another subparagraph 

3 of this paragraph, subparagraph (C) shall apply with 

4 respect to such property. 

5 ‘‘(e) SPECIAL RULES FOR CERTAIN NON-TAX6 PAYERS.— 

7 ‘‘(1) DENIAL OF PAYMENT.—Subsection (a) 

8 shall not apply with respect to any property origi9 nally placed in service by— 

10 ‘‘(A) any governmental entity, 

11 ‘‘(B) any organization described in section 

12 501(c) or 401(a) and exempt from tax under 

13 section 501(a), or 

14 ‘‘(C) any entity referred to in paragraph 

15 (4) of section 54(j). 

16 ‘‘(2) EXCEPTION FOR PROPERTY USED IN UN17 RELATED TRADE OR BUSINESS.—Paragraph (1) 

18 shall not apply with respect to any property origi19 nally placed in service by an entity described in sec20 tion 511(a)(2) if substantially all of the income de21 rived from such property by such entity is unrelated 

22 business taxable income (as defined in section 512). 

23 ‘‘(3) SPECIAL RULES FOR PARTNERSHIPS AND

24 S CORPORATIONS.—In the case of property originally 


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1 placed in service by a partnership or an S corpora2 tion— 

3 ‘‘(A) the election under subsection (a) may 

4 be made only by such partnership or S corpora5 tion, 

6 ‘‘(B) such partnership or S corporation 

7 shall be treated as making the payment referred 

8 to in subsection (a) only to the extent of the 

9 proportionate share of such partnership or S 

10 corporation as is owned by persons who would 

11 be treated as making such payment if the prop12 erty were originally placed in service by such 

13 persons, and 

14 ‘‘(C) the return required to be made by 

15 such partnership or S corporation under section 

16 6031 or 6037 (as the case may be) shall be 

17 treated as a return of tax for purposes of sub18 section (a). 

19 For purposes of subparagraph (B), rules similar to the 

20 rules of section 168(h)(6) (other than subparagraph (F) 

21 thereof) shall apply. 

22 ‘‘(f) COORDINATION WITH PRODUCTION AND IN23 VESTMENT CREDITS.—In the case of any property with 

24 respect to which an election is made under this section— 


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1 ‘‘(1) DENIAL OF PRODUCTION AND INVEST2 MENT CREDITS.—No credit shall be determined 

3 under section 45 or 48 with respect to such property 

4 for the taxable year in which such property is origi5 nally placed in service or any subsequent taxable 

6 year. 

7 ‘‘(2) REDUCTION OF PAYMENT BY PROGRESS

8 EXPENDITURES ALREADY TAKEN INTO ACCOUNT.— 

9 The amount of the payment treated as made under 

10 subsection (a) with respect to such property shall be 

11 reduced by the aggregate amount of credits deter12 mined under section 48 with respect to such prop13 erty for all taxable years preceding the taxable year 

14 in which such property is originally placed in service. 

15 ‘‘(g) OTHER DEFINITIONS AND SPECIAL RULES.— 

16 For purposes of this section— 

17 ‘‘(1) OTHER DEFINITIONS.—Terms used in this 

18 section which are also used in section 45 or 48 shall 

19 have the same meaning for purposes of this section 

20 as when used in such sections. 

21 ‘‘(2) APPLICATION OF RECAPTURE RULES, 

22 ETC.—Except as otherwise provided by the Sec23 retary— 


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1 ‘‘(A) IN GENERAL.—Except as otherwise 

2 provided in this paragraph, rules similar to the 

3 rules of section 50 shall apply. 

4 ‘‘(B) EXCEPTION TO LIMITATION ON REAL

5 ESTATE INVESTMENT TRUSTS, ETC.—Para6 graph (1) of section 50(d) shall not apply. 

7 ‘‘(C) APPLICATION OF NORMALIZATION

8 RULES.—Paragraph (2) of section 50(d) shall 

9 not apply with respect to property placed in 

10 service by a person in the trade or business of 

11 furnishing or selling electrical energy if any law 

12 or regulation requires that not less than a cer13 tain amount of the electrical energy so fur14 nished or sold by such person be derived from 

15 one or more renewable resources. 

16 ‘‘(3) PROVISION OF INFORMATION.—A person 

17 shall not be treated as having elected the application 

18 of this section unless the taxpayer provides such in19 formation as the Secretary (in consultation with the 

20 Secretary of Energy) may require for purposes of 

21 verifying the proper amount to be treated as a pay22 ment under subsection (a) and evaluating the effec23 tiveness of this section. 

24 ‘‘(4) EXCLUSION FROM GROSS INCOME.—Any 

25 credit or refund allowed or made by reason of this 


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1 section shall not be includible in gross income or al2 ternative minimum taxable income. 

3 ‘‘(5) COORDINATION WITH GRANT PROGRAM.— 

4 If a grant under section 1603 of the American Re5 covery and Reinvestment Tax Act of 2009 is made 

6 with respect to any specified energy property— 

7 ‘‘(A) no election may be made under sub8 section (a) with respect to such property on or 

9 after the date of such grant, and 

10 ‘‘(B) if such grant is made after such elec11 tion, such property shall be treated as having 

12 ceased to be specified energy property imme13 diately after such property was originally placed 

14 in service.’’. 

15 (b) CONFORMING AMENDMENTS.— 

16 (1) Subparagraph (A) of section 6211(b)(4)(A) 

17 of such Code is amended by inserting ‘‘and sub18 chapter C of chapter 65 (including any payment 

19 treated as made under such subchapter)’’ after 

20 ‘‘6431’’. 

21 (2) Subparagraph (B) of section 6425(c)(1) of 

22 such Code is amended— 

23 (A) by striking ‘‘the credits’’ and inserting 

24 ‘‘the sum of— 

25 ‘‘(i) the credits’’, 


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1 (B) by striking the period at the end of 

2 clause (i) thereof (as amended by this para3 graph) and inserting ‘‘, plus’’, and 

4 (C) by adding at the end the following new 

5 clause: 

6 ‘‘(ii) the payments treated as made 

7 under subchapter C of chapter 65.’’. 

8 (3) Paragraph (3) of section 6654(f) of such 

9 Code is amended— 

10 (A) by striking ‘‘the credits’’ and inserting 

11 ‘‘the sum of— 

12 ‘‘(A) the credits’’, 

13 (B) by striking the period at the end of 

14 subparagraph (A) thereof (as amended by this 

15 paragraph) and inserting ‘‘, and’’, and 

16 (C) by adding at the end the following new 

17 subparagraph: 

18 ‘‘(B) the payments treated as made under 

19 subchapter C of chapter 65.’’. 

20 (4) Subparagraph (B) of section 6655(g)(1) of 

21 such Code is amended— 

22 (A) by striking ‘‘the credits’’ and inserting 

23 ‘‘the sum of— 

24 ‘‘(i) the credits’’, 


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1 (B) by striking the period at the end of 

2 clause (i) thereof (as amended by this para3 graph) and inserting ‘‘, plus’’, and 

4 (C) by adding at the end the following new 

5 clause: 

6 ‘‘(ii) the payments treated as made 

7 under subchapter C of chapter 65.’’. 

8 (5) Paragraph (2) of section 1324(b) of title 

9 31, United States Code, is amended by inserting ‘‘, 

10 or from the provisions of subchapter C of chapter 65 

11 of such Code’’ before the period at the end. 

12 (6) The table of subchapters for chapter 65 of 

13 the Internal Revenue Code of 1986 is amended by 

14 adding at the end the following new item: 

‘‘SUBCHAPTER C. DIRECT PAYMENT PROVISIONS.’’ 

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

16 this section shall apply to property originally placed in 

17 service after the date of the enactment of this Act. 

Æ 


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