Providing Useful Relief for Enhanced Water Act

“25F. Water filtration credit

“(a) Allowance of credit—In the case of an individual, there shall be allowed as a credit against the tax imposed by this chapter for the taxable year an amount equal to the sum of—

“(1) 20 percent of qualified primary residence filtration expenditures, and

“(2) 10 percent of qualified non-primary residence filtration expenditures.

“(b) Maximum credit—The credit allowed under subsection (a) for any taxable year shall not exceed $2,500.

“(c) Carryforward of unused credit—If the credit allowable under subsection (a) exceeds the limitation imposed by subsection (b), such excess shall be carried to the succeeding taxable year and added to the credit allowable under subsection (a) for such succeeding taxable year.

“(d) Definitions—For purposes of this section—

“(1) Qualified primary residence filtration expenditure—The term “qualified primary residence filtration expenditure” means an expenditure for a qualified water filter for use in a dwelling unit located in the United States and used as a the primary residence of the taxpayer.

“(2) Qualified non-primary residence filtration expenditure—The term “qualified non-primary residence filtration expenditure” means an expenditure for a qualified water filter for use in a dwelling unit located in the United States and used as a secondary residence of the taxpayer.

“(3) Qualified water filter—For purposes of this section, the term “qualified water filter”—

“(A) means a home water filtration system the purpose of which is to remove at least 90 percent of lead, PFAS, and PFOAS from drinking water, and

“(B) does not include maintenance costs or replacement parts for such filtration system.

“(4) PFAS—The term “PFAS” means per- and polyfluoroalkyl substances that contain at least one fully fluorinated carbon atom.

“(5) PFOA—The term “PFOA” means perfluorooctanoic acid.

“(e) Basis adjustment—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 subsection) result from such expenditure shall be reduced by the amount of the credit so allowed.”