The Water Conservation Rebate Tax Parity Act expands the federal tax code to exclude certain water and wastewater management rebates from taxable income, mirroring existing benefits for energy conservation subsidies. Homeowners who receive rebates or subsidies from utilities, states, or local governments for installing water-efficient fixtures, storm water management systems, or wastewater management improvements at their primary residence would no longer owe taxes on those rebate amounts. The bill covers subsidies for measures like low-flow toilets and showers, rain gardens, permeable pavement, and septic system upgrades. The tax benefits apply retroactively to amounts received after December 31, 2021, and the legislation does not clarify the tax treatment of similar subsidies received before that date. No specific funding is allocated in the bill, as it operates through the tax code rather than direct appropriations.
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