This bill would change federal tax rules so certain state and local payments for home wastewater systems do not count as taxable income. It adds a new category to Internal Revenue Code section 136 for "wastewater management measures," defined as installations or modifications to manage wastewater (including septic tanks and cesspools) for one or more dwelling units. The exclusion applies to subsidies provided directly or indirectly by a State or local government to a resident for the purchase or installation of such a measure for the taxpayer's residence. The change would apply to amounts received after the law is enacted, in taxable years ending after that date.
If you receive a state or local subsidy to buy or install a septic system, cesspool, or similar wastewater management equipment for your home, that payment would not have to be reported as gross income on your federal tax return under this bill. The rule applies only to subsidies from state or local governments and only when the work is for your residence.
No publicly available information.
Proponents say the bill excludes state and local wastewater management subsidies from gross income so homeowners who receive those payments are not taxed on them. The bill’s text focuses on making that exclusion explicit in section 136 of the tax code and defines what counts as a wastewater management measure.
No publicly available information.