I 

109TH CONGRESS 

2D SESSION H. R. 4716 

To amend the Internal Revenue Code of 1986 to provide credits for 

individuals and businesses for the installation of certain wind energy property. 

IN THE HOUSE OF REPRESENTATIVES 

FEBRUARY 8, 2006 

Mr. COLE of Oklahoma (for himself, Mr. REHBERG, Mr. GOODE, Mr. UDALL

of Colorado, Mr. CONAWAY, Mr. SANDERS, Mr. CASE, Mr. GILLMOR, and 

Mr. LUCAS) 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 

credits for individuals and businesses for the installation 

of certain wind 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 ‘‘Home and Farm Wind 

5 Energy Systems Act of 2006’’. 

6 SEC. 2. CREDIT FOR WIND ENERGY PROPERTY INSTALLED 

7 IN RESIDENCES AND BUSINESSES. 

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 inserting after section 30A the fol2 lowing new section: 

3 ‘‘SEC. 30E. WIND ENERGY 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 (10 

7 percent after December 31, 2015) of the amount paid or 

8 incurred by the taxpayer for qualified wind energy prop9 erty placed in service or installed during such taxable year. 

10 ‘‘(b) LIMITATION.—No credit shall be allowed under 

11 subsection (a) unless at least 50 percent of the energy pro12 duced annually by the qualified wind energy property is 

13 consumed on the site on which the property is placed in 

14 service or installed. 

15 ‘‘(c) QUALIFIED WIND ENERGY PROPERTY.—For 

16 purposes of this section, the term ‘qualified wind energy 

17 property’ means a qualifying wind turbine if— 

18 ‘‘(1) such turbine is placed in service or in19 stalled on or in connection with property located in 

20 the United States, 

21 ‘‘(2) in the case of an individual, the property 

22 on or in connection with which such turbine is in23 stalled is a dwelling unit which is located in the 

24 United States, 
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1 ‘‘(3) the original use of such turbine commences 

2 with the taxpayer, and 

3 ‘‘(4) such turbine carries at least a 5-year lim4 ited warranty covering defects in design, material, or 

5 workmanship, and, for property that is not installed 

6 by the taxpayer, at least a 5-year limited warranty 

7 covering defects in installation. 

8 ‘‘(d) OTHER DEFINITIONS.—For purposes of this 

9 section— 

10 ‘‘(1) QUALIFYING WIND TURBINE.—The term 

11 ‘qualifying wind turbine’ means a wind turbine of 

12 100 kilowatts of rated capacity or less which meets 

13 the latest performance rating standards published by 

14 the American Wind Energy Association and which is 

15 used to generate electricity. 

16 ‘‘(2) PRINCIPAL RESIDENCE.—The term ‘prin17 cipal residence’ shall have the same meaning as 

18 when used in section 121. 

19 ‘‘(e) LIMITATION BASED ON AMOUNT OF TAX.— 

20 ‘‘(1) IN GENERAL.—The credit allowed under 

21 subsection (a) for any taxable year shall not exceed 

22 the excess of— 

23 ‘‘(A) the sum of the regular tax liability 

24 (as defined in section 26(b)) plus the tax im25 posed by section 55, over 
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1 ‘‘(B) the sum of the credits allowable 

2 under this part (other than under this section 

3 and subpart C thereof, relating to refundable 

4 credits) and section 1397E. 

5 ‘‘(2) CARRYOVER OF UNUSED CREDIT.—If the 

6 credit allowable under subsection (a) exceeds the 

7 limitation imposed by paragraph (1) for such taxable 

8 year, such excess shall be carried to the succeeding 

9 taxable year and added to the credit allowable under 

10 subsection (a) for such taxable year. 

11 ‘‘(f) SPECIAL RULES.—For purposes of this sec12 tion— 

13 ‘‘(1) TENANT-STOCKHOLDER IN COOPERATIVE

14 HOUSING CORPORATION.—In the case of an indi15 vidual who is a tenant-stockholder (as defined in sec16 tion 216(b)(2)) in a cooperative housing corporation 

17 (as defined in section 216(b)(1)), such individual 

18 shall be treated as having paid his tenant-stock19 holder’s proportionate share (as defined in section 

20 216(b)(3)) of any expenditures paid or incurred for 

21 qualified wind energy property by such corporation, 

22 and such credit shall be allocated appropriately to 

23 such individual. 

24 ‘‘(2) CONDOMINIUMS.— 
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1 ‘‘(A) IN GENERAL.—In the case of an indi2 vidual who is a member of a condominium man3 agement association with respect to a condo4 minium which he owns, such individual shall be 

5 treated as having paid his proportionate share 

6 of expenditures paid or incurred for qualified 

7 wind energy property by such association, and 

8 such credit shall be allocated appropriately to 

9 such individual. 

10 ‘‘(B) CONDOMINIUM MANAGEMENT ASSO11 CIATION.—For purposes of this paragraph, the 

12 term ‘condominium management association’ 

13 means an organization which meets the require14 ments of section 528(c)(2) with respect to a 

15 condominium project of which substantially all 

16 of the units are used by individuals as resi17 dences. 

18 ‘‘(g) BASIS ADJUSTMENT.—For purposes of this sub19 title, if a credit is allowed under this section for any ex20 penditure with respect to a residence or other property, 

21 the basis of such residence or other property shall be re22 duced by the amount of the credit so allowed. 

23 ‘‘(h) APPLICATION OF CREDIT.—The credit allowed 

24 under this section shall apply to property placed in service 

25 or installed after December 31, 2005.’’. 
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1 (b) CONFORMING AMENDMENT.—Subsection (a) of 

2 section 1016 of such Code (relating to general rule for 

3 adjustments to basis) is amended by striking ‘‘and’’ at the 

4 end of paragraph (36), by striking the period at the end 

5 of paragraph (37) and inserting ‘‘, and’’, and by adding 

6 at the end the following new paragraph: 

7 ‘‘(38) in the case of a residence or other prop8 erty with respect to which a credit was allowed 

9 under section 30E, to the extent provided in section 

10 30E(g).’’. 

11 (c) CLERICAL AMENDMENT.—The table of sections 

12 for subpart B of part IV of subchapter A of chapter 1 

13 of such Code is amended by inserting after the item relat14 ing to section 30D the following new item: 

‘‘Sec. 30E. Wind energy property.’’. 

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

16 this section shall apply to taxable years ending after De17 cember 31, 2005. 

Æ