| IRA code section |
Code section description |
Changes to code section |
| Section 25C |
Energy efficient home improvement credit |
Terminates for property placed in service more than 180 days after enactment. |
| Section 25D |
Residential clean energy credit |
Terminates for expenditures made more than 180 days after enactment. |
| Section 25E |
Previously-owned clean vehicles |
Terminates credit for vehicles acquired more than 90 days after enactment. |
| Section 30C |
Alternative fuel vehicle refueling property credit |
Terminates credit for property placed in service within 12 months after enactment. |
| Section 30D |
Clean vehicle credit |
Terminates credit for vehicles acquired more than 180 days after enactment. |
| Section 45L |
New energy efficient home credit |
Terminates credit for homes acquired more than 12 months after enactment. |
| Section 45 |
Production tax credit (PTC) |
No change, only available for projects beginning construction before 2025. |
| Section 48 |
Investment tax credit (ITC) |
No change, only available for projects beginning construction before 2025. |
| Section 48C |
Advanced energy project credit program |
Restricts funds returned to the Secretary from being later reissued and is effective of the date of enactment. |
| Section 48D |
Advanced manufacturing investment tax credit |
The credit is now equal to 30% (up from 25%) of the qualified investment for taxable years related to an advanced manufacturing facility placed in service after Dec. 31, 2025. No credit is allowed for taxable years beginning after enactment if the taxpayer is a specified foreign entity (SPE).
Phasing out of the credit is included for producing critical minerals in 2031-2033 with no credit beginning in 2034, and early wind components applicable to components produced and sold after 2027. |
| Section 48E |
Clean electricity investment tax credit |
For electricity produced by solar or wind, the credit begins phasing out in calendar year 2026, with facilities beginning construction in 2026 receiving 60% of the value of the credit, while facilities beginning construction in 2027 receive 20% of the value. No credit available for solar or wind facilities beginning construction after 2028. The provisions will also deny the section 48E credit for wind and solar leasing to residential customers starting in 2026.
For electricity produced by other qualified facilities (e.g., hydropower, nuclear, geothermal) or energy storage technology, 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 or is owned by a prohibited foreign entity. |
| Section 45Y |
Clean electricity production tax credit |
For electricity produced by solar or wind, the credit begins phasing out in calendar year 2026, with facilities beginning construction in 2026 receiving 60% of the value of the credit, while facilities beginning construction in 2027 receive 20% of the value. No credit available for facilities beginning construction after 2028. The phase-out does not apply to any single facility that has more than 1000MW of capacity and has a certain grant or lease with the US BLM by June 16, 2025.
For electricity produced by all other qualified facilities (e.g., hydropower, nuclear, geothermal), facilities receive 100% of the credit for construction of which begins in 2033, 75% in 2034, 50 percent 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 or is owned by a prohibited foreign entity. |
| Section 45Q |
Carbon oxide sequestration credit |
Conforms credit values for captured carbon oxide that is disposed of in secure geological storage and that which is utilized first and then sequestered, effective for equipment placed in service after Dec. 31, 2022. The provision also restricts access to the credit for certain prohibited foreign entities, effective for taxable years after the date of enactment. |
| Section 45U |
Zero-emission nuclear power production credit |
Disallows the credit where a taxpayer uses fuel produced in a covered nation (defined in 10 USC section 4872(f)) or by a covered entity. Requires the taxpayer to certify that fuel used in a credit-qualifying facility complies with these restrictions (exception for fuel acquired by binding written contract before Jan. 1, 2023). These changes are effective for taxable years beginning after Dec. 31, 2027.
No credit is allowed for taxable years beginning after enactment if the taxpayer is a specified foreign entity (SPE). No credit is allowed for taxable years that begin two years after the date of enactment for a foreign-influenced entity. |
| Section 45V |
Clean hydrogen production credit |
Accelerates the expiration to facilities the construction of which begins after Dec. 31, 2025. |
| Section 45W |
Qualified commercial clean vehicles credit |
Terminates for vehicles acquired more than 180 days after enactment. |
| Section 45X |
Advanced manufacturing production tax credit |
Phases out credit for producing critical minerals with 75% of the credit allowed in 2031, 50% in 2032, 25% in 2033, and no credit beginning after 2034. The provision also phases out the credit early for wind components, applicable to components produced and sold after Dec. 31, 2027. For all eligible components, it strikes a rule that deemed eligible components that have been integrated into another eligible component to have been sold to an unrelated party, applicable to components sold during years after 2026.
No credit is allowed for components manufactured beginning 2026 that includes any material assistance from a prohibited foreign entity and no credit is allowed for taxable years beginning after enactment if the taxpayer is a prohibited foreign entity or foreign influenced entity. |
| Section 45Z |
Clean fuel production tax credit |
Extends the credit through Dec. 31, 2031. Imposes a 20% haircut on the value of the credit for fuel produced from feedstocks produced or grown outside the U.S., effective after 2025.
Provides the Secretary of the Treasury authority to establish distinct emissions rates for specific manure feedstocks, effective for transportation fuel produced Dec. 31, 2025. Generally prevents negative emissions rates for fuels, effective for emissions rates published for taxable years after Dec. 31, 2025.
Authorizes the Secretary to provide rules addressing certain related-party sales. This addresses overlapping claims for this credit as well as an excise tax credit in section 6426(k)(1), by reducing the value of 45Z to the extent a credit under section 6426(k)(1) was taken, effective for fuel sold after 2024. Termination of the section 6426(k) credit for periods after Sept. 30, 2025.
The updates also restrict access to the credit for certain prohibited foreign entities, effective for taxable years after the date of enactment. |
| Section 168(e)(3)(B) |
Cost recovery for qualified clean energy facilities |
Terminates the special recovery period for clean energy facilities for property placed in service after the date of enactment. |
| Section 179D |
Energy efficient commercial buildings deduction |
Terminates the deduction with respect to property constructed 12 months after enactment. |
| Section 6417 |
Elective payment of applicable credits |
Removes the direct pay phase out exception (no phase-out if domestic steel, iron or manufactured products are not available using the domestic products would increase the cost by more than 25%). |
| Section 6418 |
Transfer of certain credits |
Restores transferability for the full life of all applicable credits. Credits cannot be transferred to a specified foreign entity. |
| 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. |
