BTU Act of 2019

To amend the Internal Revenue Code of 1986 to include biomass heating appliances for tax credits available for energy-efficient building property and energy property. 1. Short title This Act may be cited as the Biomass Thermal Utilization Act of 2019 BTU Act of 2019 2. Residential energy-efficient property credit for biomass fuel property expenditures (a) Allowance of credit Section 25D(a) (1) in paragraph (4), by striking and (2) in paragraph (5), by adding and (3) by inserting after paragraph (5) the following: (6) the qualified biomass fuel property expenditures, . (b) Qualified biomass fuel property expenditures Section 25D(d) of such Code is amended by adding at the end the following new paragraph: (6) Qualified biomass fuel property expenditure (A) In general The term qualified biomass fuel property expenditure (i) which uses the burning of biomass fuel to heat a dwelling unit located in the United States and used as a residence by the taxpayer, or to heat water for use in such a dwelling unit, and (ii) which has a thermal efficiency rating of at least 75 percent (measured by the higher heating value of the fuel). (B) Biomass fuel For purposes of this section, the term biomass fuel . (c) Applicable percentage Subsection (g) of section 25D of such Code is amended— (1) by redesignating paragraphs (1), (2), and (3) as subparagraphs (A), (B), and (C), respectively, and by moving such subparagraphs (as so redesignated) 2 ems to the right; (2) by striking For purposes of (1) In general Except as provided under paragraph (2), for purposes of ; and (3) by adding at the end the following: (2) Applicable percentage for qualified biomass fuel property expenditures In the case of any qualified biomass fuel property expenditures made by the taxpayer during the taxable year, the applicable percentage shall be 30 percent. . (d) Termination Subsection (h) of section 25D of such Code is amended to read as follows: (h) Termination (1) In general Except as provided under paragraph (2), the credit allowed under this section shall not apply to property placed in service after December 31, 2021. (2) Application to qualified biomass fuel property In the case of property described in subsection (d)(6), the credit allowed under this section shall not apply to property placed in service after December 31, 2023. . (e) Effective date The amendments made by this section shall apply to expenditures paid or incurred in taxable years beginning after December 31, 2018. 3. Investment tax credit for biomass heating property (a) In general Section 48(a)(3)(A) (1) by striking or (2) by adding or (3) and by inserting after clause (vii) the following new clause: (viii) open-loop biomass (within the meaning of section 45(c)(3)) heating property, including boilers or furnaces that operate at thermal output efficiencies of not less than 65 percent (measured by the higher heating value of the fuel) and that provide thermal energy in the form of heat, hot water, or steam for space heating, air conditioning, domestic hot water, or industrial process heat, . (b) 30 15 (1) Energy percentage (A) In general Section 48(a)(2)(A) of such Code is amended— (i) by striking and (ii) by redesignating clause (ii) as clause (iii); and (iii) by inserting after clause (i) the following new clause: (ii) in the case of energy property described in paragraph (3)(A)(viii) the construction of which begins before January 1, 2024, 15 percent (30 percent in the case of any such property which operates at a thermal output efficiency of not less than 80 percent (measured by the higher heating value of the fuel)), and . (B) Conforming amendment Section 48(a)(2)(A)(iii) of such Code, as so redesignated, is amended by inserting or (ii) clause (i) (c) Effective date The amendments made by this section shall apply to periods after December 31, 2018, in taxable years ending after such date, under rules similar to the rules of section 48(m)

Summary: Biomass Thermal Utilization Act of 2019 or the BTU Act of 2019 This bill expands the tax credit for residential energy efficient property to include 30% of qualified biomass fuel property expenditures for property placed in service before 2024. A qualified biomass fuel property expenditure is an expenditure for property that uses the burning of biomass fuel (a plant-derived fuel available on a renewable or recurring basis) to heat a dwelling used as a residence, or to heat water for use in such dwelling, and which has a thermal efficiency rating of at least 75%. The bill also allows (1) a 15% energy tax credit until 2024 for investment in open-loop biomass heating property, including boilers or furnaces that operate at thermal output efficiencies of at least 65% and provide thermal energy in the form of heat, hot water, or steam for space heating, air conditioning, domestic hot water, or industrial process heat; and (2) a 30% credit until 2024 for investment in such property that operates at a thermal output efficiency of at least 80%.