text: SECTION 1. SHORT TITLE.
  
      This Act may be cited as the ``Resource Efficient Appliance 
  Incentives Act of 2005.''.
  
  SEC. 2. CREDIT FOR ENERGY EFFICIENT APPLIANCES.
  
      (a) In General.--Subpart D of part IV of subchapter 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. 45J. ENERGY EFFICIENT APPLIANCE CREDIT.
  
      ``(a) General Rule.--
              ``(1) In general.--For purposes of section 38, the energy 
          efficient appliance credit determined under this section for 
          any taxable year is an amount equal to the sum of the credit 
          amounts determined under paragraph (2) for each type of 
          qualified energy efficient appliance produced by the taxpayer 
          during the calendar year ending with or within the taxable 
          year.
              ``(2) Credit amounts.--The credit amount determined for any 
          type of qualified energy efficient appliance is--
                      ``(A) the applicable amount determined under 
                  subsection (b) with respect to such type, multiplied by
                      ``(B) the eligible production for such type.
      ``(b) Applicable Amount.--
              ``(1) In general.--For purposes of subsection (a)--
                      ``(A) Dishwashers.--The applicable amount is the 
                  energy savings amount in the case of a dishwasher 
                  which--
                              ``(i) is manufactured in calendar year 2006 
                          or 2007, and
                              ``(ii) meets the requirements of the Energy 
                          Star program which are in effect for 
                          dishwashers in 2007.
                      ``(B) Clothes washers.--The applicable amount is--
                              ``(i) $50, in the case of a clothes washer 
                          which--
                                      ``(I) is manufactured in calendar 
                                  year 2005, and
                                      ``(II) has an MEF of at least 1.42,
                              ``(ii) $100, in the case of a clothes 
                          washer which--
                                      ``(I) is manufactured in calendar 
                                  year 2005, 2006, or 2007, and
                                      ``(II) meets the requirements of 
                                  the Energy Star program which are in 
                                  effect for clothes washers in 2007, and
                              ``(iii) the energy and water savings 
                          amount, in the case of a clothes washer which--
                                      ``(I) is manufactured in calendar 
                                  year 2008, 2009, or 2010, and
                                      ``(II) meets the requirements of 
                                  the Energy Star program which are in 
                                  effect for clothes washers in 2010.
                      ``(C) Refrigerators.--
                              ``(i) 15 percent savings.--The applicable 
                          amount is $75 in the case of a refrigerator 
                          which--
                                      ``(I) is manufactured in calendar 
                                  year 2005 or 2006, and
                                      ``(II) consumes at least 15 percent 
                                  less kilowatt hours per year than the 
                                  2001 energy conservation standard.
                              ``(ii) 20 percent savings.--In the case of 
                          a refrigerator which consumes at least 20 
                          percent less kilowatt hours per year than the 
                          2001 energy conservation standards, the 
                          applicable amount is--
                                      ``(I) $125 for a refrigerator which 
                                  is manufactured in calendar year 2005, 
                                  2006, or 2007, and
                                      ``(II) $100 for a refrigerator 
                                  which is manufactured in calendar year 
                                  2008.
                              ``(iii) 25 percent savings.--In the case of 
                          a refrigerator which consumes at least 25 
                          percent less kilowatt hours per year than the 
                          2001 energy conservation standards, the 
                          applicable amount is--
                                      ``(I) $175 for a refrigerator which 
                                  is manufactured in calendar year 2005, 
                                  2006, or 2007, and
                                      ``(II) $150 for a refrigerator 
                                  which is manufactured in calendar year 
                                  2008, 2009, or 2010.
              ``(2) Energy savings amount.--For purposes of paragraph 
          (1)(A)--
                      ``(A) In general.--The energy savings amount is the 
                  lesser of--
                              ``(i) the product of--
                                      ``(I) $3, and
                                      ``(II) 100 multiplied by the energy 
                                  savings percentage, or
                              ``(ii) $100.
                      ``(B) Energy savings percentage.--For purposes of 
                  subparagraph (A), the energy savings percentage is the 
                  ratio of--
                              ``(i) the EF required by the Energy Star 
                          program for dishwashers in 2007 minus the EF 
                          required by the Energy Star program for 
                          dishwashers in 2005, to
                              ``(ii) the EF required by the Energy Star 
                          program for dishwashers in 2007.
              ``(3) Energy and water savings amount.--For purposes of 
          paragraph (1)(B)(iii)--
                      ``(A) In general.--The energy and water savings 
                  amount is the lesser of--
                              ``(i) the product of--
                                      ``(I) $10, and
                                      ``(II) 100 multiplied by the energy 
                                  and water savings percentage, or
                              ``(ii) $200.
                      ``(B) Energy and water savings percentage.--For 
                  purposes of subparagraph (A), the energy and water 
                  savings percentage is the average of the MEF savings 
                  percentage and the WF savings percentage.
                      ``(C) MEF savings percentage.--For purposes of this 
                  subparagraph, the MEF savings percentage is the ratio 
                  of--
                              ``(i) the MEF required by the Energy Star 
                          program for clothes washers in 2010 minus the 
                          MEF required by the Energy Star program for 
                          clothes washers in 2007, to
                              ``(ii) the MEF required by the Energy Star 
                          program for clothes washers in 2010.
                      ``(D) WF savings percentage.--For purposes of this 
                  subparagraph, the WF savings percentage is the ratio 
                  of--
                              ``(i) the WF required by the Energy Star 
                          program for clothes washers in 2010 minus the 
                          WF required by the Energy Star program for 
                          clothes washers in 2007, to
                              ``(ii) the WF required by the Energy Star 
                          program for clothes washers in 2010.
      ``(c) Eligible Production.--
              ``(1) In general.--Except as provided in paragraphs (2) and 
          (3), the eligible production in a calendar year with respect to 
          each type of energy efficient appliance is the excess of--
                      ``(A) the number of appliances of such type which 
                  are produced by the taxpayer in the United States 
                  during such calendar year, over
                      ``(B) the average number of appliances of such type 
                  which were produced by the taxpayer (or any 
                  predecessor) in the United States during the preceding 
                  3-calendar year period.
              ``(2) Special rule for refrigerators.--The eligible 
          production in a calendar year with respect to each type of 
          refrigerator described in subsection (b)(1)(C) is the excess 
          of--
                      ``(A) the number of appliances of such type which 
                  are produced by the taxpayer in the United States 
                  during such calendar year, over
                      ``(B) 110 percent of the average number of 
                  appliances of such type which were produced by the 
                  taxpayer (or any predecessor) in the United States 
                  during the preceding 3-calendar year period.
              ``(3) Special rule for 2005 production.--For purposes of 
          determining eligible production for calendar year 2005--
                      ``(A) only production after the date of enactment 
                  of this section shall be taken into account under 
                  paragraphs (1)(A) and (2)(A), and
                      ``(B) the amount taken into account under 
                  paragraphs (1)(B) and (2)(B) shall be an amount which 
                  bears the same ratio to the amount which would (but for 
                  this paragraph) be taken into account under such 
                  paragraph as--
                              ``(i) the number of days in calendar year 
                          2005 after the date of enactment of this 
                          section, bears to
                              ``(ii) 365.
      ``(d) Types of Energy Efficient Appliance.--For purposes of this 
  section, the types of energy efficient appliances are--
              ``(1) dishwashers described in subsection (b)(1)(A),
              ``(2) clothes washers described in subsection (b)(1)(B)(i),
              ``(3) clothes washers described in subsection 
          (b)(1)(B)(ii),
              ``(4) clothes washers described in subsection 
          (b)(1)(B)(iii),
              ``(5) refrigerators described in subsection (b)(1)(C)(i),
              ``(6) refrigerators described in subsection 
          (b)(1)(C)(ii)(I),
              ``(7) refrigerators described in subsection 
          (b)(1)(C)(ii)(II),
              ``(8) refrigerators described in subsection 
          (b)(1)(C)(iii)(I), and
              ``(9) refrigerators described in subsection 
          (b)(1)(C)(iii)(II).
      ``(e) Limitations.--
              ``(1) Aggregate credit amount allowed.--The aggregate 
          amount of credit allowed under subsection (a) with respect to a 
          taxpayer for any taxable year shall not exceed $75,000,000 
          reduced by the amount of the credit allowed under subsection 
          (a) to the taxpayer (or any predecessor) for all prior taxable 
          years.
              ``(2) Amount allowed for certain appliances.--
                      ``(A) In general.--In the case of appliances 
                  described in subparagraph (C), the aggregate amount of 
                  the credit allowed under subsection (a) with respect to 
                  a taxpayer for any taxable year shall not exceed 
                  $20,000,000 reduced by the amount of the credit allowed 
                  under subsection (a) to the taxpayer (or any 
                  predecessor) for all prior taxable years with respect 
                  to such appliances.
                      ``(B) Election to increase allowable credit.--In 
                  the case of any taxpayer who makes an election under 
                  this subparagraph--
                              ``(i) subparagraph (A) shall be applied by 
                          substituting `$25,000,000' for `$20,000,000', 
                          and
                              ``(ii) the aggregate amount of the credit 
                          allowed under subsection (a) with respect to 
                          such taxpayer for any taxable year for 
                          appliances described in subparagraph (C) and 
                          the additional appliances described in 
                          subparagraph (D) shall not exceed $50,000,000 
                          reduced by the amount of the credit allowed 
                          under subsection (a) to the taxpayer (or any 
                          predecessor) for all prior taxable years with 
                          respect to such appliances.
                      ``(C) Appliances described.--The appliances 
                  described in this subparagraph are--
                              ``(i) clothes washers described in 
                          subsection (b)(1)(B)(i), and
                              ``(ii) refrigerators described in 
                          subsection (b)(1)(C)(i).
                      ``(D) Additional appliances.--The additional 
                  appliances described in this subparagraph are--
                              ``(i) refrigerators described in subsection 
                          (b)(1)(C)(ii)(I), and
                              ``(ii) refrigerators described in 
                          subsection (b)(1)(C)(ii)(II).
              ``(3) Limitation based on gross receipts.--The credit 
          allowed under subsection (a) with respect to a taxpayer for the 
          taxable year shall not exceed an amount equal to 2 percent of 
          the average annual gross receipts of the taxpayer for the 3 
          taxable years preceding the taxable year in which the credit is 
          determined.
              ``(4) Gross receipts.--For purposes of this subsection, the 
          rules of paragraphs (2) and (3) of section 448(c) shall apply.
      ``(f) Definitions.--For purposes of this section--
              ``(1) Qualified energy efficient appliance.--The term 
          `qualified energy efficient appliance' means--
                      ``(A) any dishwasher described in subsection 
                  (b)(1)(A),
                      ``(B) any clothes washer described in subsection 
                  (b)(1)(B), and
                      ``(C) any refrigerator described in subsection 
                  (b)(1)(C).
              ``(2) Dishwasher.--The term `dishwasher' means a 
          residential dishwasher subject to the energy conservation 
          standards established by the Department of Energy.
              ``(3) Clothes washer.--The term `clothes washer' means a 
          residential model clothes washer, including a residential style 
          coin operated washer.
              ``(4) Refrigerator.--The term `refrigerator' means a 
          residential model automatic defrost refrigerator-freezer which 
          has an internal volume of at least 16.5 cubic feet.
              ``(5) MEF.--The term `MEF' means the modified energy factor 
          established by the Department of Energy for compliance with the 
          Federal energy conservation standards.
              ``(6) EF.--The term `EF' means the energy factor 
          established by the Department of Energy for compliance with the 
          Federal energy conservation standards.
              ``(7) WF.--The term `WF' means Water Factor (as determined 
          by the Secretary of Energy).
              ``(8) Produced.--The term `produced' includes manufactured.
              ``(9) 2001 energy conservation standard.--The term `2001 
          energy conservation standard' means the energy conservation 
          standards promulgated by the Department of Energy and effective 
          July 1, 2001.
      ``(g) Special Rules.--For purposes of this section--
              ``(1) In general.--Rules similar to the rules of 
          subsections (c), (d), and (e) of section 52 shall apply.
              ``(2) Controlled group.--
                      ``(A) In general.--All persons treated as a single 
                  employer under subsection (a) or (b) of section 52 or 
                  subsection (m) or (o) of section 414 shall be treated 
                  as a single producer.
                      ``(B) Inclusion of foreign corporations.--For 
                  purposes of subparagraph (A), in applying subsections 
                  (a) and (b) of section 52 to this section, section 1563 
                  shall be applied without regard to subsection (b)(2)(C) 
                  thereof.
              ``(3) Verification.--No amount shall be allowed as a credit 
          under subsection (a) with respect to which the taxpayer has not 
          submitted such information or certification as the Secretary, 
          in consultation with the Secretary of Energy, determines 
          necessary.''.
      (b) Conforming Amendment.--Section 38(b) of the Internal Revenue 
  Code of 1986 (relating to general business credit) is amended by 
  striking ``plus'' at the end of paragraph (18), by striking the period 
  at the end of paragraph (19) and inserting ``, plus'', and by adding at 
  the end the following new paragraph:
              ``(20) the energy efficient appliance credit determined 
          under section 45J(a).''.
      (c) Clerical Amendment.--The table of sections for subpart D of 
  part IV of subchapter A of chapter 1 of the Internal Revenue Code of 
  1986 is amended by adding at the end the following new item:
  
          ``Sec. 45J. Energy efficient appliance credit''.
      (d) Effective Date.--The amendments made by this section shall 
  apply to appliances produced after the date of the enactment of this 
  Act, in taxable years ending after such date.
target: Resource Efficient Appliance Incentives Act of 2005 - Amends the Internal Revenue Code to allow a business tax credit for the production of certain water and energy efficient appliances (e.g., dishwashers, clothes washers, and refrigerators). Bases the amount of such credit on specified energy and water efficiency ratings.
feat_title: A bill to amend the Internal Revenue Code of 1986 to allow for an energy efficient appliance credit.