Plain English summary not yet available
The full original text is available below. Check back soon as we process this bill.
I
117TH CONGRESS
1ST SESSION H. R. 2688
To amend the Internal Revenue Code of 1986 to permanently allow a tax
deduction for the mining, reclaiming, or recycling of critical minerals
and metals from the United States, and to support the development
of domestic supply chains for rare earth elements and other critical
materials essential to United States technology, manufacturing, energy,
healthcare and advanced medical devices, broadband infrastructure,
transportation, and national defense.
IN THE HOUSE OF REPRESENTATIVES
APRIL 20, 2021
Mr. GOODEN of Texas (for himself and Mr. VICENTE GONZALEZ of Texas)
introduced the following bill; which was referred to the Committee on
Ways and Means, and in addition to the Committee on Natural Re-
sources, for a period to be subsequently determined by the Speaker, in
each case for consideration of such provisions as fall within the jurisdic-
tion of the committee concerned
A BILL
To amend the Internal Revenue Code of 1986 to permanently
allow a tax deduction for the mining, reclaiming, or
recycling of critical minerals and metals from the United
States, and to support the development of domestic sup-
ply chains for rare earth elements and other critical
materials essential to United States technology, manufac-
turing, energy, healthcare and advanced medical devices,
broadband infrastructure, transportation, and national
defense.
VerDate Sep 11 2014
23:37 Jun 02, 2021
Jkt 019200
PO 00000
Frm 00001
Fmt 6652
Sfmt 6652
E:\BILLS\H2688.IH
H2688
kjohnson on DSK79L0C42PROD with BILLS
2
•HR 2688 IH
Be it enacted by the Senate and House of Representa-
1
tives of the United States of America in Congress assembled,
2
SECTION 1. PERMANENT FULL EXPENSING FOR PROPERTY
3
USED TO EXTRACT CRITICAL MINERALS AND
4
METALS WITHIN THE UNITED STATES.
5
(a) IN GENERAL.—Section 168(k) of the Internal
6
Revenue Code of 1986 is amended by adding at the end
7
the following:
8
‘‘(11) SPECIAL RULE FOR PROPERTY USED FOR
9
MINING OF CRITICAL MINERALS AND METALS WITH-
10
IN THE UNITED STATES.—
11
‘‘(A) IN
GENERAL.—In the case of any
12
qualified property which is substantially in-
13
volved in the mining, reclaiming, or recycling of
14
critical minerals and metals from deposits in
15
the United States—
16
‘‘(i) paragraph (2)(A)(iii) shall not
17
apply, and
18
‘‘(ii) the applicable percentage shall be
19
100 percent.
20
‘‘(B) CRITICAL MINERALS AND METALS.—
21
For purposes of this paragraph, the term ‘crit-
22
ical minerals and metals’ means cerium, cobalt,
23
dysprosium, erbium, europium, gadolinium,
24
graphite, holmium, lanthanum, lithium, lute-
25
VerDate Sep 11 2014
23:37 Jun 02, 2021
Jkt 019200
PO 00000
Frm 00002
Fmt 6652
Sfmt 6201
E:\BILLS\H2688.IH
H2688
kjohnson on DSK79L0C42PROD with BILLS
3
•HR 2688 IH
tium, manganese, neodymium, praseodymium,
1
promethium, samarium, scandium, terbium,
2
thulium, vanadium, ytterbium, and yttrium.’’.
3
(b) EFFECTIVE DATE.—The amendment made by
4
this section shall apply to property placed in service after
5
December 31, 2020.
6
SEC. 2. PERMANENT FULL EXPENSING FOR NONRESIDEN-
7
TIAL REAL PROPERTY USED FOR MINING OF
8
CRITICAL MINERALS AND METALS WITHIN
9
THE UNITED STATES.
10
(a) IN GENERAL.—Section 168 of the Internal Rev-
11
enue Code of 1986 is amended by adding at the end the
12
following new subsection:
13
‘‘(n) SPECIAL ALLOWANCE FOR NONRESIDENTIAL
14
REAL PROPERTY USED FOR MINING OF CRITICAL MIN-
15
ERALS AND METALS WITHIN THE UNITED STATES.—
16
‘‘(1) NEW STRUCTURES.—In the case of any
17
qualified real property—
18
‘‘(A)(i) if such property is placed in service
19
on or after the date of enactment of this sub-
20
section, the depreciation deduction provided by
21
section 167(a) for the taxable year in which
22
such property is placed in service shall include
23
an allowance equal to 100 percent of the ad-
24
justed basis of such property, or
25
VerDate Sep 11 2014
23:37 Jun 02, 2021
Jkt 019200
PO 00000
Frm 00003
Fmt 6652
Sfmt 6201
E:\BILLS\H2688.IH
H2688
kjohnson on DSK79L0C42PROD with BILLS
4
•HR 2688 IH
‘‘(ii) if such property was placed in service
1
before the date of enactment of this subsection,
2
the depreciation deduction provided by section
3
167(a) for the first taxable year beginning after
4
such date shall include an allowance equal to
5
100 percent of the adjusted basis of such prop-
6
erty, and
7
‘‘(B) the adjusted basis of such property
8
shall be reduced by the amount of such deduc-
9
tion before computing the amount otherwise al-
10
lowable as a depreciation deduction under this
11
chapter for such taxable year and any subse-
12
quent taxable year.
13
‘‘(2) QUALIFIED
REAL
PROPERTY.—For pur-
14
poses of this subsection, the term ‘qualified real
15
property’ means any nonresidential real property
16
which is substantially involved in the mining, re-
17
claiming, or recycling of critical minerals and metals
18
(as defined in subsection (k)(11)(B)) from deposits
19
in the United States.’’.
20
(b) EFFECTIVE DATE.—The amendment made by
21
this section shall apply to taxable years beginning after
22
December 31, 2020.
23
VerDate Sep 11 2014
23:37 Jun 02, 2021
Jkt 019200
PO 00000
Frm 00004
Fmt 6652
Sfmt 6201
E:\BILLS\H2688.IH
H2688
kjohnson on DSK79L0C42PROD with BILLS
5
•HR 2688 IH
SEC. 3. DEDUCTION FOR PURCHASE OF CRITICAL MIN-
1
ERALS AND METALS EXTRACTED WITHIN THE
2
UNITED STATES.
3
(a) IN GENERAL.—Part VI of subchapter B of chap-
4
ter 1 of the Internal Revenue Code of 1986 is amended
5
by inserting after section 176 the following new section:
6
‘‘SEC. 177. DEDUCTION FOR PURCHASE OF CRITICAL MIN-
7
ERALS AND METALS EXTRACTED WITHIN THE
8
UNITED STATES.
9
‘‘(a) ALLOWANCE OF DEDUCTION.—There shall be
10
allowed as a deduction for the taxable year an amount
11
equal to 200 percent of the cost paid or incurred by the
12
taxpayer for the purchase or acquisition of critical min-
13
erals and metals (as defined in section 168(k)(11)(B))
14
which have been extracted from deposits in the United
15
States.
16
‘‘(b) APPLICATION WITH OTHER DEDUCTIONS.—No
17
deduction shall be allowed under any other provision of
18
this chapter with respect to any expenditure with respect
19
to which a deduction is allowed or allowable under this
20
section to the taxpayer.’’.
21
(b) CONFORMING AMENDMENT.—The table of sec-
22
tions for part VI of subchapter B of chapter 1 of the Inter-
23
nal Revenue Code of 1986 is amended by inserting after
24
the item relating to section 176 the following new item:
25
VerDate Sep 11 2014
23:37 Jun 02, 2021
Jkt 019200
PO 00000
Frm 00005
Fmt 6652
Sfmt 6201
E:\BILLS\H2688.IH
H2688
kjohnson on DSK79L0C42PROD with BILLS
6
•HR 2688 IH
‘‘Sec. 177. Deduction for purchase of critical minerals and metals extracted
within the United States.’’.
(c) EFFECTIVE DATE.—The amendments made by
1
this section shall apply to amounts paid or incurred after
2
December 31, 2020.
3
SEC. 4. INCREASE IN RATE OF PERCENTAGE DEPLETION
4
FOR CRITICAL MINERALS AND METALS FROM
5
DEPOSITS IN THE UNITED STATES.
6
(a) IN GENERAL.—Section 613(b)(1) of the Internal
7
Revenue Code of 1986 is amended by striking ‘‘and’’ at
8
the end of subparagraph (A), by striking the period at
9
the end of subparagraph (B) and inserting ‘‘; and’’, and
10
by adding at the end the following new subparagraph:
11
‘‘(C) critical minerals and metals (as de-
12
fined in section 168(k)(11)(B)) from deposits in
13
the United States.’’.
14
(b) EFFECTIVE DATE.—The amendments made by
15
this section shall apply to taxable years beginning after
16
December 31, 2020.
17
SEC. 5. GRANT PROGRAM FOR DEVELOPMENT OF CRITICAL
18
MINERALS AND METALS.
19
(a) ESTABLISHMENT.—The Secretary of the Interior
20
shall establish a grant program to finance pilot projects
21
for the development of critical minerals and metals in the
22
United States.
23
VerDate Sep 11 2014
23:37 Jun 02, 2021
Jkt 019200
PO 00000
Frm 00006
Fmt 6652
Sfmt 6201
E:\BILLS\H2688.IH
H2688
kjohnson on DSK79L0C42PROD with BILLS
7
•HR 2688 IH
(b) LIMITATION
ON
GRANT
AWARDS.—A grant
1
awarded
under
subsection
(a)
may
not
exceed
2
$10,000,000.
3
(c) ECONOMIC
VIABILITY.—In awarding grants
4
under subsection (a), the Secretary of the Interior shall
5
give priority to projects the Secretary determines are likely
6
to be economically viable over the long term.
7
(d) SECONDARY RECOVERY.—In awarding grants
8
under subsection (a) during a fiscal year, the Secretary
9
of the Interior shall seek to award not less than 30 percent
10
of the total amount of grants awarded during that fiscal
11
year for projects relating to secondary recovery of critical
12
minerals and metals.
13
(e) AUTHORIZATION
OF APPROPRIATIONS.—There
14
are authorized to be appropriated to the Secretary of the
15
Interior $50,000,000 for each of fiscal years 2022 through
16
2025 to carry out the grant program established under
17
subsection (a).
18
(f) DEFINITIONS.—In this section:
19
(1) CRITICAL
MINERALS
AND
METALS.—The
20
term ‘‘critical minerals and metals’’ means cerium,
21
cobalt, dysprosium, erbium, europium, gadolinium,
22
graphite, holmium, lanthanum, lithium, lutetium,
23
manganese,
neodymium,
praseodymium,
pro-
24
VerDate Sep 11 2014
23:37 Jun 02, 2021
Jkt 019200
PO 00000
Frm 00007
Fmt 6652
Sfmt 6201
E:\BILLS\H2688.IH
H2688
kjohnson on DSK79L0C42PROD with BILLS
8
•HR 2688 IH
methium, samarium, scandium, terbium, thulium,
1
vanadium, ytterbium, and yttrium.
2
(2) SECONDARY
RECOVERY.—The term ‘‘sec-
3
ondary recovery’’ means the recovery of minerals
4
and metals from discarded end-use products or from
5
waste products produced during the metal refining
6
and manufacturing process, including from mine
7
waste piles, acid mine drainage sludge, or byprod-
8
ucts produced through legacy mining and metallurgy
9
activities.
10
Æ
VerDate Sep 11 2014
23:37 Jun 02, 2021
Jkt 019200
PO 00000
Frm 00008
Fmt 6652
Sfmt 6301
E:\BILLS\H2688.IH
H2688
kjohnson on DSK79L0C42PROD with BILLS