What This Bill Does
This bill changes the tax credit amounts for companies that capture carbon dioxide and use it in certain ways. The bill increases the dollar amounts that qualify for the carbon oxide sequestration credit, which is a tax benefit under federal law.
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Who It Affects
Businesses and companies that capture carbon dioxide and use it or store it in ways described by current tax law.
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Key Provisions
- For carbon dioxide captured and used in the first manner described in current law, the tax credit amount becomes $12 per unit (Sec. 2(a)(1))
- For carbon dioxide captured and used in the second manner described in current law, the tax credit amount becomes $17 per unit (Sec. 2(a)(1))
- After 2023, the $12 and $17 amounts will automatically increase each year based on inflation using a specific calculation method (Sec. 2(a)(2))
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What Changes
The tax credit dollars increase from their current levels to $12 and $17 depending on how the carbon dioxide is used. These amounts will rise with inflation every year after 2023.
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Important Definitions
"Qualified carbon oxide" - Not defined in bill text
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Effective Date
Carbon dioxide captured and utilized after December 31, 2023 (Sec. 2(b))
I
118TH CONGRESS
1ST SESSION H. R. 1262
To amend the Internal Revenue Code of 1986 to increase the applicable
dollar amount for qualified carbon oxide which is captured and utilized
for purposes of the carbon oxide sequestration credit.
IN THE HOUSE OF REPRESENTATIVES
FEBRUARY 28, 2023
Mr. SCHWEIKERT (for himself and Ms. SEWELL) introduced the following bill;
which was referred to the Committee on Ways and Means
A BILL
To amend the Internal Revenue Code of 1986 to increase
the applicable dollar amount for qualified carbon oxide
which is captured and utilized for purposes of the carbon
oxide sequestration credit.
Be it enacted by the Senate and House of Representa-
1
tives of the United States of America in Congress assembled,
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SECTION 1. SHORT TITLE.
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This Act may be cited as the ‘‘CCU Parity Act of
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2023’’.
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•HR 1262 IH
SEC. 2. INCREASE APPLICABLE DOLLAR AMOUNT FOR
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QUALIFIED CARBON OXIDE WHICH IS CAP-
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TURED AND UTILIZED.
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(a) IN GENERAL.—Section 45Q(b)(1)(A) of the In-
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ternal Revenue Code of 1986 is amended—
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(1) in clause (i), by striking subclause (II) and
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inserting the following—
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‘‘(II) for purposes of paragraph
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(4) of such subsection—
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‘‘(aa) with respect to any
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qualified carbon oxide which is
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captured and used in the manner
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described in clause (i) of para-
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graph (4)(B) of such subsection,
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$12, and
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‘‘(bb) with respect to any
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qualified carbon oxide which is
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captured and utilized in the man-
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ner described in clause (ii) of
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paragraph (4)(B) of such sub-
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section, $17, and’’, and
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(2) in clause (ii), by striking subclause (II) and
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inserting the following:
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‘‘(II) for purposes of paragraph
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(4) of such subsection—
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•HR 1262 IH
‘‘(aa) with respect to any
1
qualified carbon oxide which is
2
captured and used in the manner
3
described in clause (i) of para-
4
graph (4)(B) of such subsection,
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an amount equal to the product
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of $12 and the inflation adjust-
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ment factor for such calendar
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year determined under section
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43(b)(3)(B) for such calendar
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year, determined by substituting
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‘2025’ for ‘1990’, and
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‘‘(bb) with respect to any
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qualified carbon oxide which is
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captured and utilized in the man-
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ner described in clause (ii) of
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paragraph (4)(B) of such sub-
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section, an amount equal to the
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product of $17 and the inflation
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adjustment factor for such cal-
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endar year determined under sec-
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tion 43(b)(3)(B) for such cal-
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endar year, determined by sub-
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stituting ‘2025’ for ‘1990’.’’.
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•HR 1262 IH
(b) EFFECTIVE DATE.—The amendments made by
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this section shall apply to carbon oxide captured and uti-
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lized after December 31, 2023.
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Æ
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