‘‘(4) JOINT OWNERSHIP OF ENERGY ITEMS.— 
‘‘(A) IN GENERAL.—Any expenditure oth-
erwise qualifying as a qualified renewable en-
ergy system expenditure shall not be treated as 
failing to so qualify merely because such ex-
penditure was made with respect to 2 or more 
dwelling units. 
‘‘(B) LIMITS
APPLIED
SEPARATELY.—In 
the case of any expenditure described in sub-
paragraph (A), the amount of the credit allow-
able under subsection (a) shall (subject to para-
graph (1)) be computed separately with respect 
to the amount of the expenditure made by each 
individual. 
‘‘(e) BASIS ADJUSTMENTS.—For purposes of this 
subtitle, if a credit is allowed under this section for any 
expenditure with respect to any property, the increase in 
the basis of such property which would (but for this sub-
section) result from such expenditure shall be reduced by 
the amount of the credit so allowed. 
‘‘(f) TERMINATION.—This section shall not apply to 
expenditures made after December 31, 2009.’’. 
(b) CLERICAL AMENDMENT.—The table of sections 
for subpart A of part IV of subchapter A of chapter 1
of such Code is amended by inserting after the item relat-
ing to section 25B the following new item: 
‘‘Sec. 25C. Residential renewable energy system.’’. 
(c) BASIS ADJUSTMENT.—Section 1016(a) of such 
Code is amended by striking ‘‘and’’ at the end of para-
graph (27), by striking the period at the end of paragraph 
(28) and inserting ‘‘, and’’, and by adding at the end the 
following new paragraph: 
‘‘(29) to the extent provided in section 
25C(e).’’. 
(d) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years beginning after 
December 31, 2004. 
SEC. 6. CREDIT FOR RENEWABLE ENERGY SYSTEMS 
PLACED IN SERVICE BY SMALL BUSINESSES. 
(a) IN GENERAL.—Subpart D of part IV of sub-
chapter A of chapter 1 of the Internal Revenue Code of 
1986 (relating to business related credits) is amended by 
adding at the end the following new section: 
‘‘SEC. 45G. RENEWABLE ENERGY SYSTEMS CREDIT. 
‘‘(a) IN GENERAL.—For purposes of section 38, in 
the case of an eligible small business, the amount of the 
renewable energy systems credit determined under this 
section for any taxable year shall be an amount equal to 
20 percent of the qualified renewable energy system ex-
penditures for the taxable year.
‘‘(b) LIMITATION.—The amount of the credit allowed 
under subsection (a) for a taxable year shall not exceed 
$10,000. 
‘‘(c) ELIGIBLE SMALL BUSINESS.—For purposes of 
this section, the term ‘eligible small business’ has the 
meaning given such term by section 44(b). 
‘‘(d) QUALIFIED RENEWABLE ENERGY SYSTEM EX-
PENDITURES.—The term ‘qualified renewable energy sys-
tem expenditures’ has the meaning given such term by sec-
tion 25C(c)(1), except that ‘commercial property’ shall be 
substituted for ‘dwelling unit’ each place it appears and 
subparagraph (A)(ii) thereof shall not apply. 
‘‘(e) APPLICABLE RULES.—For purposes of this sec-
tion, rules similar to the rules of paragraphs (2), (6), and 
(7) of section 44(d) shall apply.’’. 
(b) CREDIT MADE PART OF GENERAL BUSINESS 
CREDIT.—Section 38(b) of such Code (relating to current 
year business credit) is amended by striking ‘‘plus’’ at the 
end of paragraph (14), by striking the period at the end 
of paragraph (15) and inserting ‘‘, plus’’, and by adding 
at the end the following new paragraph: 
‘‘(16) the renewable energy systems credit de-
termined under section 45G(a).’’.
(c) LIMITATION ON CARRYBACK.—Section 39(d) of 
such Code (relating to transitional rules) is amended by 
adding at the end the following new paragraph: 
‘‘(11) NO CARRYBACK OF RENEWABLE ENERGY 
SYSTEMS
CREDIT
BEFORE
EFFECTIVE
DATE.—No 
portion of the unused business credit for any taxable 
year which is attributable to the credit determined 
under section 45G may be carried back to any tax-
able year ending on or before the date of the enact-
ment of section 45G.’’. 
(d) CLERICAL AMENDMENT.—The table of sections 
for subpart D of part IV of subchapter A of chapter 1 
of such Code is amended by adding at the end the fol-
lowing new item: 
‘‘Sec. 45G. Renewable energy systems credit.’’. 
(e) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years ending after the 
date of the enactment of this Act. 
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