Title: Disaster Savings and Resilient Construction Act of 2018
Policy area: Taxation

Summary:
Disaster Savings and Resilient Construction Act of 2018
This bill amends the Internal Revenue Code to allow a business-related tax credit for a specified portion of the cost of commercial and residential buildings that comply with resilient construction requirements in a federally-declared major disaster area.
The bill defines "resilient construction requirements" as requirements that such buildings are designed and constructed to: (1) resist hazards brought on by a major disaster; (2) continue to provide their primary functions after a major disaster; (3) reduce the magnitude or duration of a disruptive event; and (4) have the absorptive capacity, adaptive capacity, and recoverability to withstand a potentially disruptive event.
The credit does not apply to property for which a certificate of occupancy is issued after December 31, 2022.

[Congressional Bills 115th Congress]
[From the U.S. Government Publishing Office]
[H.R. 6841 Introduced in House (IH)]

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115th CONGRESS
  2d Session
                                H. R. 6841

  To amend the Internal Revenue Code of 1986 to provide a credit for 
              owning certain disaster resilient property.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                           September 17, 2018

   Mr. Reed 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 a credit for 
              owning certain disaster resilient property.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Disaster Savings and Resilient 
Construction Act of 2018''.

SEC. 2. DISASTER RESILIENT PROPERTY TAX CREDIT.

    (a) In General.--Subpart D of part IV of subchapter A of chapter 1 
of the Internal Revenue Code of 1986 is amended by inserting after 
section 30D the following new section:

``SEC. 30E. DISASTER RESILIENT PROPERTY.

    ``(a) General Rule.--There shall be allowed as a credit against the 
tax imposed by this chapter for the taxable year an amount equal to the 
applicable amount for each qualified building placed in service during 
the taxable year.
    ``(b) Applicable Amount.--For purposes of subsection (a)--
            ``(1) Commercial property.--In the case of a qualified 
        commercial property, the applicable amount is the lesser of--
                    ``(A) 1 percent of the cost of the building, or
                    ``(B) $25,000 per building.
            ``(2) Residential property.--In the case of a qualified 
        residential property, the applicable amount is the lesser of--
                    ``(A) 1 percent of the cost of the property (or 
                construction cost for rehabilitation of the property), 
                or
                    ``(B) $3,000 per property.
    ``(c) Qualified Building.--For purposes of subsection (a)--
            ``(1) In general.--The term `qualified building' means a 
        building--
                    ``(A) owned by the taxpayer in a disaster area 
                determined as a result of a federally declared major 
                disaster,
                    ``(B) the construction of which began after the 
                date of such disaster in that area,
                    ``(C) which--
                            ``(i) is qualified commercial property 
                        placed in service for commercial purposes, or
                            ``(ii) is qualified residential property is 
                        placed in service for residential purposes, and
                    ``(D) for which a certificate of occupancy is 
                issued before the end of the 3-year period beginning on 
                the date of such disaster declaration in that area.
            ``(2) Qualified commercial property.--The term `qualified 
        commercial property' means a building that is--
                    ``(A) located in the United States,
                    ``(B) defined in the scope of the 2009 or later 
                International Building Code published by the 
                International Code Council, and
                    ``(C) designed and constructed to meet resilient 
                construction requirements.
            ``(3) Qualified residential property.--The term `qualified 
        residential property' means a building that is--
                    ``(A) located in the United States,
                    ``(B) defined in the scope of the 2009 or later 
                International Residential Code published by the 
                International Code Council, and
                    ``(C) designed and constructed to meet resilient 
                construction requirements.
    ``(d) Resilient Construction Requirements.--For purposes of this 
section--
            ``(1) In general.--The resilient construction requirements 
        with respect to a property are that the property is designed 
        and constructed to--
                    ``(A) resist hazards brought on by a major disaster 
                and continues to provide its primary functions after a 
                major disaster,
                    ``(B) reduce the magnitude or duration of a 
                disruptive event, and
                    ``(C) have the absorptive capacity, adaptive 
                capacity, and recoverability to withstand a potentially 
                disruptive event.
            ``(2) Treated as meeting resiliency requirements.--For 
        purposes of paragraph (1)--
                    ``(A) in the case of a qualified commercial 
                property, the property shall be treated as meeting the 
                requirements specified in paragraph (1) if the property 
                is a building which--
                            ``(i) was designed to meet the requirements 
                        of the 2009 or later International Building 
                        Code published by the International Code 
                        Council and received the Insurance Institute 
                        for Business and Home Safety FORTIFIED for 
                        Safer Business designation, or
                            ``(ii) was designed and built in a 
                        jurisdiction that requires commercial buildings 
                        to meet the requirements of the 2009 or later 
                        International Building Code published by the 
                        International Code Council with amendments that 
                        are equivalent or more restrictive than the 
                        requirements described in FORTIFIED for Safer 
                        Business Standards published by the Insurance 
                        Institute for Business and Home Safety and 
                        received a certificate of occupancy (or other 
                        documentation stating that it has met the 
                        requirements of the building code) from the 
                        jurisdiction, and
                    ``(B) in the case of a qualified residential 
                property, the property shall be treated as meeting the 
                requirements specified in paragraph (1) if the property 
                is a building which was designed to meet the 
                requirements of the 2009 or later International 
                Residential Code published by the International Code 
                Council, and meets one of the following requirements:
                            ``(i) The building received the Insurance 
                        Institute for Business and Home Safety as 
                        FORTIFIED for Safer Living designation.
                            ``(ii) The building received the Insurance 
                        Institute for Business and Home Safety as 
                        FORTIFIED for Existing Homes designation, 
                        silver level.
                            ``(iii) It was designed and built in a 
                        jurisdiction that requires residential 
                        buildings to meet the requirements of the 2009 
                        or later International Building Code published 
                        by the International Code Council with 
                        amendments that are equivalent or more 
                        restrictive than the requirements described in 
                        FORTIFIED for Safer Living Builders Guide 
                        published by the Insurance Institute for 
                        Business and Home Safety and received a 
                        certificate of occupancy (or other 
                        documentation stating that it has met the 
                        requirements of the building code) from the 
                        jurisdiction.
            ``(3) Absorptive capacity.--The term `absorptive capacity' 
        means the ability of the construction to endure a disruption 
        without significant deviation from normal operating 
        performance.
            ``(4) Adaptive capacity.--The term `adaptive capacity' 
        means the ability of the construction to adapt to a drastic 
        change in normal operating conditions.
            ``(5) Recoverability.--The term `recoverability' means the 
        ability of the construction to recover quickly, and at low 
        cost, from potentially disruptive events.
    ``(e) Other Definitions.--For purposes of this section--
            ``(1) Construction.--The term `construction' includes new 
        construction and reconstruction and rehabilitation that meets 
        resilient construction requirements.
            ``(2) Federally declared major disaster.--The term 
        `federally declared major disaster' means a disaster 
        subsequently determined by the President of the United States 
        to be a `major disaster' that warrants assistance by the 
        Federal Government under the Robert T. Stafford Disaster Relief 
        and Emergency Assistance Act.
            ``(3) Disaster area.--The term `disaster area' means the 
        area so determined to warrant such assistance.
    ``(f) Application With Other Credits.--
            ``(1) Business credit treated as part of general business 
        credit.--So much of the credit which would be allowed under 
        subsection (a) for any taxable year (determined without regard 
        to this subsection) that is attributable to property of a 
        character subject to an allowance for depreciation shall be 
        treated as a credit listed in section 38(b) for such taxable 
        year (and not allowed under subsection (a)).
            ``(2) Personal credit.--For purposes of this title, the 
        credit allowed under subsection (a) for any taxable year 
        (determined after application of paragraph (1)) shall be 
        treated as a credit allowable under subpart A for such taxable 
        year.
    ``(g) Basis Reduction.--For purposes of this subtitle, the basis of 
any property for which a credit is allowable under subsection (a) shall 
be reduced by the amount of such credit so allowed.
    ``(h) Termination.--This section shall not apply to any property 
for which a certificate for occupancy is issued after December 31, 
2022.''.
    (b) Credit Made Part of General Business Credit.--Section 38(b) of 
such Code is amended by striking ``plus'' at the end of paragraph (35), 
by striking the period at the end of paragraph (36) and inserting ``, 
plus'', and by adding at the end the following new paragraph:
            ``(37) the portion of the disaster resilient property 
        credit to which section 30E(f)(1) applies.''.
    (c) Basis Adjustment.--Section 1016(a) of such Code is amended by 
striking ``and'' at the end of paragraph (30), by striking the period 
at the end of paragraph (31) and inserting a comma, by striking ``and'' 
at the end of paragraph (36), by striking the period at the end of 
paragraph (37) and inserting ``, and'', and by adding at the end the 
following new paragraph:
            ``(38) to the extent provided in section 30E(g), in the 
        case of amounts with respect to which a credit has been allowed 
        under section 30E.''.
    (d) Clerical Amendment.--The table of sections for subpart B of 
part IV of subchapter A of chapter 1 of such Code is amended by 
inserting after the item relating to section 30D the following new 
item:

``Sec. 30E. Disaster resilient property.''.
    (e) Effective Date.--The amendments made by this section shall 
apply to property for which a certificate for occupancy is issued after 
the date of the enactment of this Act.
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