1. Modifications to income exclusion for certain wastewater management subsidies (a) In general Section 136(a) of the Internal Revenue Code of 1986 is amended— (1) by striking any subsidy provided and inserting any subsidy— (1) provided , (2) by striking the period at the end and inserting , or , and (3) by adding at the end the following new paragraph: (2) provided (directly or indirectly) by a State or local government to a resident of such State or locality for the purchase or installation of any wastewater management measure, but only if such measure is with respect to the taxpayer’s principal residence. . (b) Definition of wastewater management measure Section 136(c) of such Code is amended— (1) by striking Energy conservation measure in the heading thereof and inserting Definitions , (2) by striking In general in the heading of paragraph (1) and inserting Energy conservation measure , and (3) by redesignating paragraph (2) as paragraph (3) and by inserting after paragraph (1) the following: (2) Wastewater management measure For purposes of this section, the term wastewater management measure means any installation or modification of property primarily designed to manage wastewater (including septic tanks and cesspools) with respect to one or more dwelling units. . (c) Clerical amendments (1) The heading for section 136 of such Code is amended— (A) by inserting and wastewater after energy , and (B) by striking provided by public utilities . (2) The item relating to section 136 in the table of sections of part III of subchapter B of chapter 1 of such Code is amended— (A) by inserting and wastewater after energy , and (B) by striking provided by public utilities . (d) Effective date The amendments made by this section shall apply to amounts received after December 31, 2018.