26 U.S.C. § 179A : US Code - Section 179A: Deduction for clean-fuel vehicles and certain refueling property

Search 26 U.S.C. § 179A : US Code - Section 179A: Deduction for clean-fuel vehicles and certain refueling property

(a) Allowance of deduction
(1) In general
There shall be allowed as a deduction an amount equal to the
cost of -
(A) any qualified clean-fuel vehicle property, and
(B) any qualified clean-fuel vehicle refueling property.
The deduction under the preceding sentence with respect to any
property shall be allowed for the taxable year in which such
property is placed in service.
(2) Incremental cost for certain vehicles
If a vehicle may be propelled by both a clean-burning fuel and
any other fuel, only the incremental cost of permitting the use
of the clean-burning fuel shall be taken into account.
(b) Limitations
(1) Qualified clean-fuel vehicle property
(A) In general
The cost which may be taken into account under subsection
(a)(1)(A) with respect to any motor vehicle shall not exceed -
(i) in the case of a motor vehicle not described in clause
(ii) or (iii), $2,000,
(ii) in the case of any truck or van with a gross vehicle
weight rating greater than 10,000 pounds but not greater than
26,000 pounds, $5,000, or
(iii) $50,000 in the case of -
(I) a truck or van with a gross vehicle weight rating
greater than 26,000 pounds, or
(II) any bus which has a seating capacity of at least 20
adults (not including the driver).
(B) Phaseout
In the case of any qualified clean-fuel vehicle property
placed in service after December 31, 2005, the limit otherwise
allowable under subparagraph (A) shall be reduced by 75
percent.
(2) Qualified clean-fuel vehicle refueling property
(A) In general
The aggregate cost which may be taken into account under
subsection (a)(1)(B) with respect to qualified clean-fuel
vehicle refueling property placed in service during the taxable
year at a location shall not exceed the excess (if any) of -
(i) $100,000, over
(ii) the aggregate amount taken into account under
subsection (a)(1)(B) by the taxpayer (or any related person
or predecessor) with respect to property placed in service at
such location for all preceding taxable years.
(B) Related person
For purposes of this paragraph, a person shall be treated as
related to another person if such person bears a relationship
to such other person described in section 267(b) or 707(b)(1).
(C) Election
If the limitation under subparagraph (A) applies for any
taxable year, the taxpayer shall, on the return of tax for such
taxable year, specify the items of property (and the portion of
costs of such property) which are to be taken into account
under subsection (a)(1)(B).
(c) Qualified clean-fuel vehicle property defined
For purposes of this section -
(1) In general
The term "qualified clean-fuel vehicle property" means property
which is acquired for use by the taxpayer and not for resale, the
original use of which commences with the taxpayer, with respect
to which the environmental standards of paragraph (2) are met,
and which is described in either of the following subparagraphs:
(A) Retrofit parts and components
Any property installed on a motor vehicle which is propelled
by a fuel which is not a clean-burning fuel for purposes of
permitting such vehicle to be propelled by a clean-burning fuel
-
(i) if the property is an engine (or modification thereof)
which may use a clean-burning fuel, or
(ii) to the extent the property is used in the storage or
delivery to the engine of such fuel, or the exhaust of gases
from combustion of such fuel.
(B) Original equipment manufacturer's vehicles
A motor vehicle produced by an original equipment
manufacturer and designed so that the vehicle may be propelled
by a clean-burning fuel, but only to the extent of the portion
of the basis of such vehicle which is attributable to an engine
which may use such fuel, to the storage or delivery to the
engine of such fuel, or to the exhaust of gases from combustion
of such fuel.
(2) Environmental standards
Property shall not be treated as qualified clean-fuel vehicle
property unless -
(A) the motor vehicle of which it is a part meets any
applicable Federal or State emissions standards with respect to
each fuel by which such vehicle is designed to be propelled, or
(B) in the case of property described in paragraph (1)(A),
such property meets applicable Federal and State emissions-
related certification, testing, and warranty requirements.
(3) Exception for qualified electric vehicles
The term "qualified clean-fuel vehicle property" does not
include any qualified electric vehicle (as defined in section
30(c)).
(d) Qualified clean-fuel vehicle refueling property defined
For purposes of this section, the term "qualified clean-fuel
vehicle refueling property" means any property (not including a
building and its structural components) if -
(1) such property is of a character subject to the allowance
for depreciation,
(2) the original use of such property begins with the taxpayer,
and
(3) such property is -
(A) for the storage or dispensing of a clean-burning fuel
into the fuel tank of a motor vehicle propelled by such fuel,
but only if the storage or dispensing of the fuel is at the
point where such fuel is delivered into the fuel tank of the
motor vehicle, or
(B) for the recharging of motor vehicles propelled by
electricity, but only if the property is located at the point
where the motor vehicles are recharged.
(e) Other definitions and special rules
For purposes of this section -
(1) Clean-burning fuel
The term "clean-burning fuel" means -
(A) natural gas,
(B) liquefied natural gas,
(C) liquefied petroleum gas,
(D) hydrogen,
(E) electricity, and
(F) any other fuel at least 85 percent of which is 1 or more
of the following: methanol, ethanol, any other alcohol, or
ether.
(2) Motor vehicle
The term "motor vehicle" means any vehicle which is
manufactured primarily for use on public streets, roads, and
highways (not including a vehicle operated exclusively on a rail
or rails) and which has at least 4 wheels.
(3) Cost of retrofit parts includes cost of installation
The cost of any qualified clean-fuel vehicle property referred
to in subsection (c)(1)(A) shall include the cost of the original
installation of such property.
(4) Recapture
The Secretary shall, by regulations, provide for recapturing
the benefit of any deduction allowable under subsection (a) with
respect to any property which ceases to be property eligible for
such deduction.
(5) Property used outside United States, etc., not qualified
No deduction shall be allowed under subsection (a) with respect
to any property referred to in section 50(b) or with respect to
the portion of the cost of any property taken into account under
section 179.
(6) Basis reduction
(A) In general
For purposes of this title, the basis of any property shall
be reduced by the portion of the cost of such property taken
into account under subsection (a).
(B) Ordinary income recapture
For purposes of section 1245, the amount of the deduction
allowable under subsection (a) with respect to any property
which is of a character subject to the allowance for
depreciation shall be treated as a deduction allowed for
depreciation under section 167.
(f) Termination
This section shall not apply to any property placed in service
after December 31, 2005.