Mechanical Insulation Installation Incentive Act of 2013 - Amends the Internal Revenue Code to allow an additional tax deduction for the cost of installing mechanical insulation property. Limits the amount of such deduction to the lesser of 30% or the reduction in energy loss from the installed mechanical insulation property compared to property that meets the minimum requirements of American Society of Heating, Refrigerating and Air-Conditioning Engineers (ASHRAE) standard 90.1-2007. Allows the cost of replacing mechanical insulation property to be treated as a deductible business expense in the current taxable year.
Defines "mechanical insulation property" as insulation materials, facings, and accessory products: (1) placed in service in connection with a mechanical system which is located in the United States and of a character subject to an allowance for depreciation; and (2) utilized for thermal, acoustical, and personnel safety requirements for mechanical piping and equipment, hot and cold applications, and heating, venting and air conditioning applications which can be used in a variety of facilities.
Allows a tax deduction for capital expenditures related to mechanical insulation property.
[Congressional Bills 113th Congress]
[From the U.S. Government Publishing Office]
[S. 775 Introduced in Senate (IS)]
113th CONGRESS
1st Session
S. 775
To amend the Internal Revenue Code of 1986 to provide a tax incentive
for the installation and maintenance of mechanical insulation property.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
April 22, 2013
Mrs. Gillibrand (for herself and Mr. Johanns) introduced the following
bill; which was read twice and referred to the Committee on Finance
_______________________________________________________________________
A BILL
To amend the Internal Revenue Code of 1986 to provide a tax incentive
for the installation and maintenance of mechanical insulation 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 ``Mechanical Insulation Installation
Incentive Act of 2013''.
SEC. 2. EXPENSING OF MECHANICAL INSULATION PROPERTY.
(a) In General.--Part VI of subchapter B of chapter 1 of subtitle A
of the Internal Revenue Code of 1986 is amended by inserting after
section 179E the following new section:
``SEC. 179F. MECHANICAL INSULATION PROPERTY.
``(a) Treatment as Expenses.--In addition to any other deduction in
this subtitle, there shall be allowed as a deduction an amount equal to
the applicable percentage of the cost of mechanical insulation property
placed in service during the taxable year.
``(b) Applicable Percentage.--For purposes of subsection (a)--
``(1) In general.--The term `applicable percentage' means
the lesser of--
``(A) 30 percent, and
``(B) the reduction in energy loss (expressed as a
percentage) from the installed mechanical insulation
property compared to reference mechanical insulation
property which meets the minimum requirements of ASHRAE
standard 90.1-2007.
``(2) Special rule relating to maintenance.--In the case of
mechanical insulation property placed in service as a
replacement for insulation property--
``(A) paragraph (1)(B) shall not apply, and
``(B) the cost of such property shall be treated as
an expense for which a deduction is allowed under
section 162 instead of being treated as depreciable for
purposes of the deduction provided by section 167.
``(c) Definitions.--For purposes of this section--
``(1) Mechanical insulation property.--The term `mechanical
insulation property' means insulation materials, facings, and
accessory products--
``(A) placed in service in connection with a
mechanical system which--
``(i) is located in the United States, and
``(ii) is of a character subject to an
allowance for depreciation, and
``(B) utilized for thermal requirements for
mechanical piping and equipment, hot and cold
applications, and heating, venting and air conditioning
applications which can be used in a variety of
facilities.
``(2) Cost.--The cost of mechanical insulation property
includes--
``(A) the amounts paid or incurred for the
installation of such property for that incremental
portion above the minimums in ASHRAE standard 90.1-2007
and the total insulation cost for maintenance
applications,
``(B) in the case of removal and disposal of the
old mechanical insulation property, 10 percent of the
cost of the new mechanical insulation property
(determined without regard to this subparagraph), and
``(C) expenditures for labor costs properly
allocable to the preparation, assembly, and
installation of mechanical insulation property.
``(d) Coordination.--Subsection (a) shall not apply to the cost of
mechanical insulation property which is taken into account under
section 179D or which, but for subsection (b) of section 179D, would be
taken into account under such section.
``(e) Allocation of Deduction for Tax-Exempt Property.--In the case
of mechanical insulation property installed on or in property owned by
an entity described in paragraph (3) or (4) of section 50(b), the
person who is the primary contractor for the installation of such
property shall be treated as the taxpayer that placed such property in
service.
``(f) Certification.--For purposes of this section, energy savings
shall be certified under regulations or other guidance provided by the
Secretary, in consultation with the Secretary of Energy.
``(g) Termination.--This section shall not apply to any property
placed in service after the end of the 5-year period beginning on the
date of the enactment of this section.''.
(b) Deduction for Capital Expenditures.--Section 263(a)(1) of the
Internal Revenue Code of 1986 is amended by striking ``or'' at the end
of subparagraph (K), by striking the period at the end of paragraph (L)
and inserting ``, or'', and by adding at the end the following new
subparagraph:
``(M) expenditures for which a deduction is allowed
under section 179F.''.
(c) Technical and Clerical Amendments.--
(1) Section 312(k)(3)(B) of the Internal Revenue Code of
1986 is amended by striking ``or 179E'' each place it appears
in the text or heading thereof and inserting ``179E, or 179F''.
(2) Paragraphs (2)(C) and (3)(C) of section 1245(a) of such
Code are each amended by inserting ``179F,'' after ``179E,''.
(3) The table of sections for part VI of subchapter B of
chapter 1 of subtitle A of such Code is amended by inserting
after the item relating to section 179E the following new item:
``Sec. 179F. Mechanical insulation property.''.
(d) Effective Date.--The amendments made by this section shall
apply to property placed in service after the date of enactment of this
Act.
<all>
Introduced in Senate
Read twice and referred to the Committee on Finance.
Llama 3.2 · runs locally in your browser
Ask anything about this bill. The AI reads the full text to answer.
Enter to send · Shift+Enter for new line