I 
114TH CONGRESS 
2D SESSION 
H. R. 4615 
To amend the Internal Revenue Code of 1986 to exclude from gross income 
amounts received from a water department for water conservation effi-
ciency measures and water runoff management improvements. 
IN THE HOUSE OF REPRESENTATIVES 
FEBRUARY 25, 2016 
Mr. HUFFMAN (for himself and Mr. ROHRABACHER) 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 exclude 
from gross income amounts received from a water de-
partment for water conservation efficiency measures and 
water runoff management improvements. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Water Conservation 
Rebate Tax Parity Act’’. 
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SEC. 2. EXCLUSION OF AMOUNTS RECEIVED FROM A 
WATER 
DEPARTMENT 
FOR 
WATER 
CON-
SERVATION 
EFFICIENCY 
MEASURES 
AND 
WATER 
RUNOFF 
MANAGEMENT 
IMPROVE-
MENTS. 
(a) IN GENERAL.—Part III of subchapter B of chap-
ter 1 of the Internal Revenue Code of 1986 is amended 
by inserting after section 139E the following new section: 
‘‘SEC. 139F. WATER CONSERVATION EFFICIENCY MEAS-
URES AND WATER RUNOFF MANAGEMENT IM-
PROVEMENTS. 
‘‘(a) IN GENERAL.—Gross income shall not include 
the value of any water conservation and efficiency measure 
or water runoff management improvement (or any sub-
sidy, rebate, or other amount for such a measure or im-
provement) received directly or indirectly from a water de-
partment. 
‘‘(b) DENIAL
OF
DOUBLE
BENEFIT.—Notwith-
standing any other provision of this subtitle, no deduction 
or credit shall be allowed for, or by reason of, any expendi-
ture to the extent of the amount excluded under sub-
section (a) for any subsidy, rebate or other amount which 
was provided with respect to such expenditure. The ad-
justed basis of any property shall be reduced by the 
amount excluded under subsection (a) which was provided 
with respect to such property. 
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‘‘(c) DEFINITIONS.—For purposes of this section— 
‘‘(1) WATER CONSERVATION AND EFFICIENCY 
MEASURE.—The term ‘water conservation and effi-
ciency measure’ means any evaluation of water use, 
or any installation or modification of property, the 
primary purpose of which is to reduce consumption 
of water or to improve the management of water de-
mand with respect to one or more dwelling units. 
‘‘(2) WATER RUNOFF MANAGEMENT IMPROVE-
MENT.—The term ‘water runoff management im-
provement’ means any installation or modification of 
property the primary purpose of which is to reduce 
or manage storm water runoff with respect to one or 
more dwelling units. 
‘‘(3) WATER DEPARTMENT.—The term ‘water 
department’ means any entity (including a public or 
private utility, the Federal Government, a State or 
local government or any political subdivision thereof, 
or any instrumentality of the foregoing) engaged 
in— 
‘‘(A) the provision of water to the public 
through pipes or other constructed conveyances, 
or 
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‘‘(B) the collection, treatment, manage-
ment, or disposal of stormwater or wastewater 
generated by the public. 
‘‘(4) DWELLING
UNIT.—The term ‘dwelling 
unit’ has the meaning given such term by section 
280A(f)(1).’’. 
(b) CLERICAL AMENDMENT.—The table of sections 
for part III of subchapter B of chapter 1 of such Code 
is amended by inserting after the item relating to section 
139E the following new item: 
‘‘Sec. 139F. Water conservation efficiency measures and water runoff manage-
ment improvements.’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years beginning after 
December 31, 2014. 
(d) NO
INFERENCE
REGARDING
PROPER
TAX 
TREATMENT.—Nothing in this Act or the amendments 
made by this Act shall be construed to create any infer-
ence with respect to the proper tax treatment of any sub-
sidy or rebate received directly or indirectly from a water 
department for any water conservation and efficiency 
measure or water runoff management improvement in any 
taxable year ending on or before the date of the enactment 
of this Act. 
Æ 
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