26 U.S.C. § §45V. Credit for production of clean hyd — §45V. Credit for production of clean hydrogen

FEDERAL · 26 U.S.C. · Chapter Subchapter A—Determination of Tax Liability

§45V. Credit for production of clean hydrogen

26 U.S.C. § §45V. Credit for production of clean hyd

ChapterSubchapter A—Determination of Tax Liability

PartSubpart D—Business Related Credits

This text of 26 U.S.C. § §45V. Credit for production of clean hyd (§45V. Credit for production of clean hydrogen) is published on Counsel Stack Legal Research, covering United States primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

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26 U.S.C. § §45V. Credit for production of clean hyd.

Text

(a)Amount of credit For purposes of section 38, the clean hydrogen production credit for any taxable year is an amount equal to the product of—

(1)the kilograms of qualified clean hydrogen produced by the taxpayer during such taxable year at a qualified clean hydrogen production facility during the 10-year period beginning on the date such facility was originally placed in service, multiplied by

(2)the applicable amount (as determined under subsection (b)) with respect to such hydrogen.

(b)Applicable amount For purposes of subsection (a)(2), the applicable amount shall be an amount equal to the applicable percentage of $0.60. If any amount as determined under the preceding sentence is not a multiple of 0.1 cent, such amount shall be rounded to the nearest multiple of 0.1 cent. For purp

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(a) Amount of credit
For purposes of section 38, the clean hydrogen production credit for any taxable year is an amount equal to the product of—
(1) the kilograms of qualified clean hydrogen produced by the taxpayer during such taxable year at a qualified clean hydrogen production facility during the 10-year period beginning on the date such facility was originally placed in service, multiplied by
(2) the applicable amount (as determined under subsection (b)) with respect to such hydrogen.
(b) Applicable amount
For purposes of subsection (a)(2), the applicable amount shall be an amount equal to the applicable percentage of $0.60. If any amount as determined under the preceding sentence is not a multiple of 0.1 cent, such amount shall be rounded to the nearest multiple of 0.1 cent.
For purposes of paragraph (1), the applicable percentage shall be determined as follows:
(A) In the case of any qualified clean hydrogen which is produced through a process that results in a lifecycle greenhouse gas emissions rate of—
(i) not greater than 4 kilograms of CO2e per kilogram of hydrogen, and
(ii) not less than 2.5 kilograms of CO2e per kilogram of hydrogen,
the applicable percentage shall be 20 percent.
(B) In the case of any qualified clean hydrogen which is produced through a process that results in a lifecycle greenhouse gas emissions rate of—
(i) less than 2.5 kilograms of CO2e per kilogram of hydrogen, and
(ii) not less than 1.5 kilograms of CO2e per kilogram of hydrogen,
the applicable percentage shall be 25 percent.
(C) In the case of any qualified clean hydrogen which is produced through a process that results in a lifecycle greenhouse gas emissions rate of—
(i) less than 1.5 kilograms of CO2e per kilogram of hydrogen, and
(ii) not less than 0.45 kilograms of CO2e per kilogram of hydrogen,
the applicable percentage shall be 33.4 percent.
(D) In the case of any qualified clean hydrogen which is produced through a process that results in a lifecycle greenhouse gas emissions rate of less than 0.45 kilograms of CO2e per kilogram of hydrogen, the applicable percentage shall be 100 percent.
The $0.60 amount in paragraph (1) shall be adjusted by multiplying such amount by the inflation adjustment factor (as determined under section 45(e)(2), determined by substituting "2022" for "1992" in subparagraph (B) thereof) for the calendar year in which the qualified clean hydrogen is produced. If any amount as increased under the preceding sentence is not a multiple of 0.1 cent, such amount shall be rounded to the nearest multiple of 0.1 cent.
(c) Definitions
For purposes of this section—
Subject to subparagraph (B), the term "lifecycle greenhouse gas emissions" has the same meaning given such term under subparagraph (H) of section 211(o)(1) of the Clean Air Act (42 U.S.C. 7545(o)(1)), as in effect on the date of enactment of this section.
The term "lifecycle greenhouse gas emissions" shall only include emissions through the point of production (well-to-gate), as determined under the most recent Greenhouse gases, Regulated Emissions, and Energy use in Transportation model (commonly referred to as the "GREET model") developed by Argonne National Laboratory, or a successor model (as determined by the Secretary).
The term "qualified clean hydrogen" means hydrogen which is produced through a process that results in a lifecycle greenhouse gas emissions rate of not greater than 4 kilograms of CO2e per kilogram of hydrogen.
Such term shall not include any hydrogen unless—
(i) such hydrogen is produced—
(I) in the United States (as defined in section 638(1)) or a possession of the United States (as defined in section 638(2)),
(II) in the ordinary course of a trade or business of the taxpayer, and
(III) for sale or use, and
(ii) the production and sale or use of such hydrogen is verified by an unrelated party.
In the case of any hydrogen for which a lifecycle greenhouse gas emissions rate has not been determined for purposes of this section, a taxpayer producing such hydrogen may file a petition with the Secretary for determination of the lifecycle greenhouse gas emissions rate with respect to such hydrogen.
The term "qualified clean hydrogen production facility" means a facility—
(A) owned by the taxpayer,
(B) which produces qualified clean hydrogen, and
(C) the construction of which begins before January 1, 2028.
(d) Special rules
Rules similar to the rules section 45(e)(3) shall apply for purposes of this section.
No credit shall be allowed under this section with respect to any qualified clean hydrogen produced at a facility which includes carbon capture equipment for which a credit is allowed to any taxpayer under section 45Q for the taxable year or any prior taxable year.
Rules similar to the rule under section 45(b)(3) shall apply for purposes of this section.
For purposes of subsection (a)(1), in the case of any facility which—
(A) was originally placed in service before January 1, 2023, and, prior to the modification described in subparagraph (B), did not produce qualified clean hydrogen, and
(B) after the date such facility was originally placed in service—
(i) is modified to produce qualified clean hydrogen, and
(ii) amounts paid or incurred with respect to such modification are properly chargeable to capital account of the taxpayer,
such facility shall be deemed to have been originally placed in service as of the date that the property required to complete the modification described in subparagraph (B) is placed in service.
(e) Increased credit amount for qualified clean hydrogen production facilities
In the case of any qualified clean hydrogen production facility which satisfies the requirements of paragraph (2), the amount of the credit determined under subsection (a) with respect to qualified clean hydrogen described in subsection (b)(2) shall be equal to such amount (determined without regard to this sentence) multiplied by 5.
A facility meets the requirements of this paragraph if it is one of the following:
(A) A facility—
(i) the construction of which begins prior to the date that is 60 days after the Secretary publishes guidance with respect to the requirements of paragraphs (3)(A) and (4), and
(ii) which meets the requirements of paragraph (3)(A) with respect to alteration or repair of such facility which occurs after such date.
(B) A facility which satisfies the requirements of paragraphs (3)(A) and (4).
The requirements described in this subparagraph with respect to any qualified clean hydrogen production facility are that the taxpayer shall ensure that any laborers and mechanics employed by the taxpayer or any contractor or subcontractor in—
(i) the construction of such facility, and
(ii) with respect to any taxable year, for any portion of such taxable year which is within the period described in subsection (a)(2), the alteration or repair of such facility,
shall be paid wages at rates not less than the prevailing rates for construction, alteration, or repair of a similar character in the locality in which such facility is located as most recently determined by the Secretary of Labor, in accordance with subchapter IV of chapter 31 of title 40, United States Code. For purposes of determining an increased credit amount under paragraph (1) for a taxable year, the requirement under clause (ii) of this subparagraph is applied to such taxable year in which the alteration or repair of qualified facility occurs.
Rules similar to the rules of section 45(b)(7)(B) shall apply.
Rules similar to the rules of section 45(b)(8) shall apply.
The Secretary shall issue such regulations or other guidance as the Secretary determines necessary to carry out the purposes of this subsection, including regulations or other guidance which provides for requirements for recordkeeping or information reporting for purposes of administering the requirements of this subsection.
(f) Regulations
Not later than 1 year after the date of enactment of this section, the Secretary shall issue regulations or other guidance to carry out the purposes of this section, including regulations or other guidance for determining lifecycle greenhouse gas emissions.

Source Credit

History

(Added and amended Pub. L. 117–169, title I, §13204(a)(1)–(3), Aug. 16, 2022, 136 Stat. 1936, 1938, 1939; Pub. L. 119–21, title VII, §70511, July 4, 2025, 139 Stat. 252.)

Editorial Notes

Editorial Notes

References in Text
The date of enactment of this section, referred to in subsecs. (c)(1)(A) and (f), is the date of enactment of Pub. L. 117–169, which was approved Aug. 16, 2022.

Amendments
2025—Subsec. (c)(3)(C). Pub. L. 119–21 substituted "January 1, 2028" for "January 1, 2033".
2022—Subsec. (d)(3). Pub. L. 117–169, §13204(a)(2), added par. (3).
Subsec. (d)(4). Pub. L. 117–169, §13204(a)(3), added par. (4).

Statutory Notes and Related Subsidiaries

Effective Date
Pub. L. 117–169, title I, §13204(a)(5), Aug. 16, 2022, 136 Stat. 1939, provided that:
"(A) In general.—The amendments made by paragraphs (1) [enacting this section] and (4) [amending section 38 of this title] of this subsection shall apply to hydrogen produced after December 31, 2022.
"(B) Credit reduced for tax-exempt bonds.—The amendment made by paragraph (2) [amending this section] shall apply to facilities the construction of which begins after the date of enactment of this Act [Aug. 16, 2022].
"(C) Modification of existing facilities.—The amendment made by paragraph (3) [amending this section] shall apply to modifications made after December 31, 2022."

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26 U.S.C. § §45V. Credit for production of clean hyd, Counsel Stack Legal Research, https://law.counselstack.com/usc/26/§45V. Credit for production of clean hyd.