Bill Details
S.425 - 119th Congress
Status
Latest action
2025-02-05 - Read twice and referred to the Committee on Finance. (text: CR S668)
Introduced Date
2025-02-05
Policy Area
Taxation
Committees
View committees (1)
Sponsors
Cosponsors
8
0
0
AI Summary This summary was generated by AI from the bill text. AI can get information wrong.
This bill would change a federal tax credit for capturing carbon oxide so that different approved ways of storing or using it are treated more evenly. It updates the tax rules for carbon oxide that is put into secure underground storage, used in certain oil or natural gas recovery projects, or put to other approved uses. The bill also changes the dollar amounts used to calculate the credit and makes the new rules apply to taxable years starting after December 31, 2024.
- It rewrites the rules for the carbon capture tax credit so it covers three main paths: secure geological storage, use in enhanced oil or natural gas recovery followed by secure storage, and other approved uses.
- It changes the credit amount for some projects to $17 per ton for taxable years after 2024 and before 2027, with later amounts adjusted for inflation.
- It also keeps a higher $36-per-ton amount in certain cases by updating the law’s references to match the new structure.
- It makes a matching change to another tax code section so the credit can still be claimed properly under the updated rules.
Official Summaries
No summaries available
Current Full Text
[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[S. 425 Introduced in Senate (IS)]
<DOC>
119th CONGRESS
1st Session
S. 425
To amend the Internal Revenue Code of 1986 to modify the carbon oxide
sequestration credit to ensure parity for different uses and
utilizations of qualified carbon oxide.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
February 5, 2025
Mr. Barrasso (for himself, Mr. Lankford, Mr. Cassidy, Mr. Hoeven, Mr.
Justice, and Mr. Sheehy introduced the following bill; which was read
twice and referred to the Committee on Finance
_______________________________________________________________________
A BILL
To amend the Internal Revenue Code of 1986 to modify the carbon oxide
sequestration credit to ensure parity for different uses and
utilizations of qualified carbon oxide.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Enhancing Energy Recovery Act''.
SEC. 2. PARITY FOR DIFFERENT USES AND UTILIZATIONS OF QUALIFIED CARBON
OXIDE.
(a) In General.--Section 45Q of the Internal Revenue Code of 1986
is amended--
(1) in subsection (a)--
(A) in paragraph (2)(B)(ii), by adding ``and'' at
the end,
(B) in paragraph (3), by striking subparagraph (B)
and inserting the following:
``(B)(i) disposed of by the taxpayer in secure
geological storage and not used by the taxpayer as
described in clause (ii) or (iii),
``(ii) used by the taxpayer as a tertiary injectant
in a qualified enhanced oil or natural gas recovery
project and disposed of by the taxpayer in secure
geological storage, or
``(iii) utilized by the taxpayer in a manner
described in subsection (f)(5).'', and
(C) by striking paragraph (4), and
(2) in subsection (b)--
(A) in paragraph (1)--
(i) by striking subparagraph (A) and
inserting the following:
``(A) Except as provided in subparagraph (B) or
(C), the applicable dollar amount shall be an amount
equal to--
``(i) for any taxable year beginning in a
calendar year after 2024 and before 2027, $17,
and
``(ii) for any taxable year beginning in a
calendar year after 2026, an amount equal to
the product of $17 and the inflation adjustment
factor for such calendar year determined under
section 43(b)(3)(B) for such calendar year,
determined by substituting `2025' for
`1990'.'', and
(ii) in subparagraph (B), by striking
``shall be applied'' and all that follows
through the period and inserting ``shall be
applied by substituting `$36' for `$17' each
place it appears.'',
(B) in paragraph (2)(B), by striking ``paragraphs
(3)(A) and (4)(A)'' and inserting ``paragraph (3)(A)'',
and
(C) in paragraph (3), by striking ``the dollar
amounts applicable under paragraph (3) or (4)'' and
inserting ``the dollar amount applicable under
paragraph (3)'',
(3) in subsection (f)--
(A) in paragraph (5)(B)(i), by striking
``(4)(B)(ii)'' and inserting ``(3)(B)(iii)'', and
(B) in paragraph (9), by striking ``paragraphs (3)
and (4) of subsection (a)'' and inserting ``subsection
(a)(3)'', and
(4) in subsection (h)(3)(A)(ii), by striking ``paragraph
(3)(A) or (4)(A) of subsection (a)'' and inserting ``subsection
(a)(3)(A)''.
(b) Conforming Amendment.--Section 6417(d)(3)(C)(i)(II)(bb) of the
Internal Revenue Code of 1986 is amended by striking ``paragraph (3)(A)
or (4)(A) of section 45Q(a)'' and inserting ``section 45Q(a)(3)(A)''.
(c) Effective Date.--The amendments made by this section shall
apply to taxable years beginning after December 31, 2024.
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