Establishes a technology-neutral tax credit for investments in next-generation carbon dioxide removal technologies.
Introduces a new section (45BB) in the Internal Revenue Code for the carbon dioxide removal credit.
The credit amount is based on net carbon dioxide removal achieved by qualifying projects, with specific amounts set for different types of projects ($110 for biomass-based projects and $250 for others).
Credit amounts will be adjusted for inflation starting in 2025.
Defines key terms such as “carbon dioxide removal,” “net carbon dioxide removal,” and “qualifying carbon dioxide removal project.”
Specifies that qualifying projects must begin construction before January 1, 2035, and must be owned by the taxpayer.
Requires the Secretary of the Treasury, in consultation with other agencies, to establish a selection process for qualifying carbon dioxide removal approaches.
Mandates lifecycle analysis and monitoring for determining net carbon dioxide removal, including independent verification.
Limits the credit to projects located within the United States or its possessions.
Prohibits claiming the credit for projects that also receive certain other tax credits (e.g., carbon oxide sequestration credit).
Allows for elective payment and transfer of the credit under specific conditions.
The legislation includes provisions for studies and certifications related to biomass feedstocks and marine carbon dioxide removal approaches.
Effective for projects placed in service after December 31, 2024.
