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This bill would expand a federal tax credit for advanced manufacturing so that companies that make distribution transformers can also get the credit. Distribution transformers are important utility equipment that help move electricity through the power grid. The bill is meant to encourage more domestic production of these transformers, which could help strengthen the electric system and reduce supply problems. It would take effect for certain parts made and sold starting 90 days after the bill becomes law.
- It adds distribution transformers to an existing tax credit for advanced manufacturing production.
- The credit would equal 10% of the production costs for each distribution transformer made by the taxpayer.
- The bill defines “distribution transformer” by using the definition already found in federal energy law.
- The new rules would apply only to components produced and sold after the 90-day waiting period following enactment.
Official Summaries
Credit Incentives for Resilient Critical Utility Infrastructure and Transformers Act or the CIRCUIT Act
This bill expands the advanced manufacturing production tax credit to include up to 10% of the cost to produce transformers that have an input voltage of 34.5 kilovolts or less, have an output voltage of 600 volts or less, and are rated for operation at a frequency of 60 hertz (i.e., distribution transformers).
As background, the advanced manufacturing production tax credit (part of the general business tax credit) allows a tax credit for certain component parts (e.g., battery cells, solar modules, and inverters) and critical minerals (e.g., aluminum, lithium, and nickel) that are produced in the United States or a U.S. possession and sold generally to an unrelated third party for use in clean energy equipment. (Some exceptions apply.)
Current Full Text
[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[S. 448 Introduced in Senate (IS)]
<DOC>
119th CONGRESS
1st Session
S. 448
To amend the Internal Revenue Code of 1986 to expand the advanced
manufacturing production credit to include distribution transformers.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
February 6 (legislative day, February 5), 2025
Mr. Moran (for himself and Ms. Cortez Masto) 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 expand the advanced
manufacturing production credit to include distribution transformers.
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 ``Credit Incentives for Resilient
Critical Utility Infrastructure and Transformers Act'' or the ``CIRCUIT
Act''.
SEC. 2. EXPANSION OF ADVANCED MANUFACTURING PRODUCTION CREDIT TO
INCLUDE DISTRIBUTION TRANSFORMERS.
(a) In General.--Section 45X of the Internal Revenue Code of 1986
is amended--
(1) in subsection (b)(1)--
(A) in subparagraph (L)(ii), by striking ``and'' at
the end,
(B) in subparagraph (M), by striking the period at
the end and inserting ``, and'', and
(C) by adding at the end the following new
subparagraph:
``(N) in the case of any distribution transformer,
an amount equal to 10 percent of the costs incurred by
the taxpayer with respect to production of such
transformer.'', and
(2) in subsection (c)--
(A) in paragraph (1)(A)--
(i) in clause (iv), by striking ``and'' at
the end,
(ii) in clause (v), by striking the period
at the end and inserting ``, and'', and
(iii) by adding at the end the following
new clause:
``(vi) any distribution transformer.'', and
(B) by adding at the end the following new
paragraph:
``(7) Distribution transformer.--The term `distribution
transformer' has the same meaning given such term under section
321(35) of the Energy Policy and Conservation Act (42 U.S.C.
6291(35)).''.
(b) Effective Date.--The amendments made by this section shall
apply to components produced and sold after the date which is 90 days
after the date of enactment of this Act.
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