| IRC code section |
Code section description |
Senate approved July 1, 2025 |
| Section 25C |
Energy efficient home improvement credit |
Terminates credit for all property placed in service after Dec. 31, 2025. |
| Section 25D |
Residential clean energy credit |
Terminates credit with respect to any expenditure made after Dec. 31, 2025. |
| Section 25E |
Previously-owned clean vehicles |
Terminates credit as of Sept. 30, 2025. |
| Section 30C |
Alternative fuel vehicle refueling property credit |
Terminates if placed in service after June 30, 2026. |
| Section 30D |
Clean vehicle credit |
Terminates if acquired after Sept. 30, 2025. |
| Section 45L |
New energy efficient home credit |
Terminates credit for any home acquired after June 30, 2026. |
| Section 45 |
Production tax credit (PTC) |
Wind and solar facilities that begin construction after one-year from enactment would need to be placed in service by Dec. 31, 2027. |
| Section 48 |
Investment tax credit (ITC) |
Termination of energy credit for any energy properties not described under section 48(a)(2)(A)(i) for properties that begin construction on or after June 16, 2025.
Removal of energy property under section 48 from five-year MACRS depreciation. |
| Section 48C |
Advanced energy project credit program |
No additional credits allowed to replace projects that revoked certification. |
| Section 48D |
Advanced manufacturing investment tax credit |
Increased the credit amount from 25% to 35% for properties placed in service after Dec. 31, 2025. |
| Section 48E |
Clean electricity investment tax credit |
For electricity produced by solar or wind, the credit is terminated for any facility placed in service after Dec. 31, 2027. Solar or wind facilities that begin construction before July 5, 2026 are exempt from the Dec. 31, 2027 placed in service rule.
For electricity produced by all other qualified facilities, the phase out facilities receive 100% of the credit for construction of which begins in 2033, 75% in 2034, 50% in 2035, and 0% in 2036.
No credit is allowed for any investments that are rented or leased to a third party.
Adjusted domestic content percentage that any facilities or energy storage technology that begins construction before June 16, 2025, 40%, before Jan. 1, 2026, 45%, before Jan. 1, 2027, 50%, and after Dec. 31, 2026, 55%.
Qualified fuel cell properties that begin construction after Dec. 31, 2025, are eligible for a fixed base credit of 30% of eligible costs and bonus credits do not apply. This means that the PW&A, domestic content and energy community bonuses do not apply. In addition, for qualified fuel cell projects, the zero GHG emissions requirements, and recapture rules for GHG emissions greater than 10g of CO2 per kWh would not apply. This means that fossil fuel natural gas can be used as fuel and still earn the tax credit. |
| Section 45Y |
Clean electricity production tax credit |
For electricity produced by solar or wind, the credit is terminated for any facility placed in service after Dec. 31, 2027. The solar or wind facilities that begin construction within 12 months after the date of the enactment are exempt from the Dec. 31,2027 placed in service rule.
For electricity produced by all other qualified facilities, the phase out facilities receive 100% of the credit for construction of which begins in 2033, 75% in 2034, 50% in 2035, and 0% in 2036.
No credit is allowed for a facility that begins construction after 2025 that includes any material assistance from a prohibited foreign entity.
No credit is allowed in any taxable year if the taxpayer is a specified foreign entity, a foreign influenced entity, or a facility that meets the 'effective control' requirement — which basically covers any facility for which a prohibited foreign entity has specific authority over key aspects of the production of electricity. Also includes 'material assistance' rules that can be re-evaluated for error up to 6 years after the credit is claimed.
No credit is allowed for electricity that is produced by property that is leased to a third party.
Amends the rules for emissions rates table by adding a provision to consider studies that demonstrate a net lifecycle GHG emissions rate that is not greater than zero using 'widely accepted LCA concepts'.
Adds a 'Nuclear energy community' bonus credit that generally follows the same rules as the fossil fuel MSA test, but with nuclear. Only advanced nuclear facilities would be able to claim this.
Credits cannot be transferred to a specified foreign entity. |
| Section 45Q |
Carbon oxide sequestration credit |
No credit if the taxpayer is a specified foreign entity or a foreign-influenced entity for any taxable year beginning after the enactment.
Additional requirements on the qualified carbon dioxide that is disposed of by the taxpayer in a secure geological storage and not used by the taxpayer as a tertiary injectant in a qualified enhanced oil or natural gas recovery project and disposed of by the taxpayer in secure geological storage, or utilized by the taxpayer in a manner described under section 45Q(f)(5). This applies to facilities or equipment placed in service after the enactment.
Applicable dollar amount for the taxable year beginning in the calendar year after 2024 and before 2027 is $17 and any taxable year beginning in the calendar year after 2026, the amount is $17 and the inflation adjustment. This applies to facilities or equipment placed in service after the enactment. |
| Section 45U |
Zero-emission nuclear power production credit |
No credit is allowed if the taxpayer is a specified foreign entity as defined in 7701 (a)(51)(B), applicable in the taxable years beginning after the date of enactment.
No credit is allowed if the taxpayer is a foreign influenced entity as defined in section 7701(a)(51)(D), applicable in any taxable year that begins two years after the date of the enactment. |
| Section 45V |
Clean hydrogen production credit |
Terminated for facilities that begin construction after Jan. 1, 2028. |
| Section 45W |
Qualified commercial clean vehicles credit |
Terminates if acquired after Sept. 30, 2025. |
| Section 45X |
Advanced manufacturing production tax credit |
Sale of integrated components rules apply if primary component is integrated, incorporated, or assembled into a secondary component that is produced within the same manufacturing facility as the primary component and sold to an related person, and not less than 65% of the total direct material costs are attributable to the primary components. This applies to the taxable years after Dec. 31, 2026.
Phase out for critical minerals other than metallurgical coal that was produced during the calendar year 2031, 75%, 2032, 50%, 2033, 25%, and after 2033, 0%. No credit allowed to the production of wind components produced and sold after Dec. 31, 2027.
Inclusion of metallurgical coal as an applicable critical mineral. 2.5% production credits allowed for metallurgical coal produced until Dec. 31, 2029.
Modified definition of battery module to include all essential equipment needed for battery functionality, such as current collector assemblies and voltage sense harness, or any other essential energy collection equipment.
Restrictions of credit for any property that received any material assistance from a prohibited foreign entity that was used in a product sold after Jan. 1, 2027. |
| Section 45Z |
Clean fuel production tax credit |
Only fuel derived from a feedstock produced or grown in the U.S., Mexico, or Canada is eligible.
Emission rates may be rounded to the nearest multiple of 5kgs of CO2e per MMBtu by the Secretary and the emission rate cannot be less than zero. Emission rates shall be adjusted as necessary to exclude any emissions attributed to indirect land use change. For any fuel that is derived from animal manure, the Secretary shall provide a distinct emission rate with respect to such fuel based on the specific animal manure feedstock.
45Z credit is extended to Dec. 31, 2029.
Denial of double benefit that fuel produced from a fuel that is eligible for 45Z is not allowed.
Additional related person rules may be prescribed by the Secretary. Section 6426(k) amended by not allowing the credit to the extent 45Z is allowable for the fuel sold or used on or after the enactment, and fuel sold or used before the date of the enactment, but only to the extent that claims for the credits under section 6426(k) with respect to the sale or use that have not been paid or allowed as of the date of the enactment. Termination of the section 6426(k) credit for the period after Sept. 30, 2025. Registration of fuel producers for section 40B for transportation fuel produced after Dec. 31, 2024. Small agri-biodiesel producer credit under section 40A(b)(4) increased from 10 cents for each gallon to 20 cents, for any sale or use after Dec. 31, 2026. Small agri-biodiesel production credit under 40A can be transferred under section 6418 for the fuel sold or used after June 30, 2025.
No credit if the taxpayer is a specified foreign entity for any taxable year beginning after the date of enactment. No credit if the taxpayer is a foreign-influenced entity for any taxable year beginning after the date which is 2 years after the date of enactment.
Unless specified, the changes are applied to fuel produced after Dec. 31, 2025. |
| Section 168(e)(3)(B) |
Cost recovery for qualified clean energy facilities |
Terminates the special recovery period for clean energy property that begins construction after Dec. 31, 2024.
|
| Section 179D |
Energy efficient commercial buildings deduction |
Terminated for property that begins construction after June 30, 2026. |
| Section 6417 |
Elective payment of applicable credits |
If electing direct pay under 6417 and if having any disallowed credits (for example overstated its foreign material assistance ratio), then the disallowance counts as an excessive payment and triggers 20% penalty on the overpaid amount. |
| Section 6418 |
Transfer of certain credits |
Retains the full 6418 transferability election for all IRA credits through their statutory sunset. However, it prohibits transfers to any specified foreign entities. |
| Section 6662 |
Imposition of accuracy-related penalty on underpayments |
Under section 6662, there is a deemed substantial understatement of income tax if the understatement of tax is greater than 1% of the tax required due to energy credit (45X, 45Y, 48E). If a supplier knowingly or willfully provided false certification caused misstatement of taxes, the supplier may be subject to penalties. |
