S 4021 — Promoting Reduction of Emissions through Landscaping Equipment Act

For purposes of section 38, the amount of the investment credit determined under this section for any taxable year shall be the sum of— (1) the rehabilitation credit, (2) the energy credit, (3) the qualifying advanced coal project credit, (4) the qualifying gasification project credit, (5) the qualifying advanced energy project credit, (6) the advanced manufacturing investment credit, and (7) the clean electricity investment credit.

(a) General rule (1) Certain nonrecourse financing excluded from credit base (A) Limitation The credit base of any property to which this paragraph applies shall be reduced by the nonqualified nonrecourse financing with respect to such credit base (as of the close of the taxable year in which placed in service). (B) Property to which paragraph applies This paragraph applies to any property which— (i) is placed in service during the taxable year by a taxpayer described in section 465(a)(1), and (ii) is used in connection with an activity with respect to which any loss is subject to limitation under section 465. (C) Credit base defined For purposes of this paragraph, the term “credit base” means— (i) the portion of the basis of any qualified rehabilitated building attributable to qualified rehabilitation expenditures, (ii) the basis of any energy property, (iii) the basis of any property which is part of a qualifying advanced coal project under section 48A, (iv) the basis of any property which is part of a qualifying gasification project under section 48B, (v) the basis of any property which is part of a qualifying advanced energy project under section 48C, (vi) the basis of any qualified property (as defined in subsection (b)(2) of section 48D) which is part of an advanced manufacturing facility (as defined in subsection (b)(3) of such section), (vii) the basis of any qualified property which is part of a qualified facility under section 48E, and (viii) the basis of any energy storage technology under section 48E. (D) Nonqualified nonrecourse financing (i) In general For purposes of this paragraph and paragraph (2), the term “nonqualified nonrecourse financing” means any nonrecourse financing which is not qualified commercial financing. (ii) Qualified commercial financing For purposes of this paragraph, the term “qualified commercial financing” means any financing with respect to any property if— (I) such property is acquired by the taxpayer from a person who is not a related person, (II) the amount of the nonrecourse financing with respect to such property does not exceed 80 percent of the credit base of such property, and (III) such financing is borrowed from a qualified person or represents a loan from any Federal, State, or local government or instrumentality thereof, or is guaranteed by any Federal, State, or local government.  Such term shall not include any convertible debt. (iii) Nonrecourse financing For purposes of this subparagraph, the term “nonrecourse financing” includes— (I) any amount with respect to which the taxpayer is protected against loss through guarantees, stop-loss agreements, or other similar arrangements, and (II) except to the extent provided in regulations, any amount borrowed from a person who has an interest (other than as a creditor) in the activity in which the property is used or from a related person to a person (other than the taxpayer) having such an interest.  In the case of amounts borrowed by a corporation from a shareholder, subclause (II) shall not apply to an interest as a shareholder. (iv) Qualified person For purposes of this paragraph, the term “qualified person” means any person which is actively and regularly engaged in the business of lending money and which is not— (I) a related person with respect to the taxpayer, (II) a person from which the taxpayer acquired the property (or a related person to such person), or (III) a person who receives a fee with respect to the taxpayer’s investment in the property (or a related person to such person). (v) Related person For purposes of this subparagraph, the term “related person” has the meaning given such term by section 465(b)(3)(C). Except as otherwise provided in regulations prescribed by the Secretary, the determination of whether a person is a related person shall be made as of the close of the taxable year in which the property is placed in service. (E) Application to partnerships and S corporations For purposes of this paragrap...

(a) In general In the case of an applicable entity making an election (at such time and in such manner as the Secretary may provide) under this section with respect to any applicable credit determined with respect to such entity, such entity shall be treated as making a payment against the tax imposed by subtitle A (for the taxable year with respect to which such credit was determined) equal to the amount of such credit. (b) Applicable credit The term “applicable credit” means each of the following: (1) So much of the credit for alternative fuel vehicle refueling property allowed under section 30C which, pursuant to subsection (d)(1) of such section, is treated as a credit listed in section 38(b). (2) So much of the renewable electricity production credit determined under section 45(a) as is attributable to qualified facilities which are originally placed in service after December 31, 2022. (3) So much of the credit for carbon oxide sequestration determined under section 45Q(a) as is attributable to carbon capture equipment which is originally placed in service after December 31, 2022. (4) The zero-emission nuclear power production credit determined under section 45U(a). (5) So much of the credit for production of clean hydrogen determined under section 45V(a) as is attributable to qualified clean hydrogen production facilities which are originally placed in service after December 31, 2012. (6) In the case of a tax-exempt entity described in clause (i), (ii), or (iv) of section 168(h)(2)(A), the credit for qualified commercial vehicles determined under section 45W by reason of subsection (d)(3) thereof. (7) The credit for advanced manufacturing production under section 45X(a). (8) The clean electricity production credit determined under section 45Y(a). (9) The clean fuel production credit determined under section 45Z(a). (10) The energy credit determined under section 48. (11) The qualifying advanced energy project credit determined under section 48C. (12) The clean electricity investment credit determined under section 48E. (c) Application to partnerships and S corporations (1) In general In the case of any applicable credit determined with respect to any facility or property held directly by a partnership or S corporation, any election under subsection (a) shall be made by such partnership or S corporation. If such partnership or S corporation makes an election under such subsection (in such manner as the Secretary may provide) with respect to such credit— (A) the Secretary shall make a payment to such partnership or S corporation equal to the amount of such credit, (B) subsection (e) shall be applied with respect to such credit before determining any partner’s distributive share, or shareholder’s pro rata share, of such credit, (C) any amount with respect to which the election in subsection (a) is made shall be treated as tax exempt income for purposes of sections 705 and 1366, and (D) a partner’s distributive share of such tax exempt income shall be based on such partner’s distributive share of the otherwise applicable credit for each taxable year. (2) Coordination with application at partner or shareholder level In the case of any facility or property held directly by a partnership or S corporation, no election by any partner or shareholder shall be allowed under subsection (a) with respect to any applicable credit determined with respect to such facility or property. (3) Treatment of payments to partnerships and S corporations For purposes of section 1324 of title 31, United States Code, the payments under paragraph (1)(A) shall be treated in the same manner as a refund due from a credit provision referred to in subsection (b)(2) of such section. (d) Special rules For purposes of this section— (1) Applicable entity (A) In general The term “applicable entity” means— (i) any organization exempt from the tax imposed by subtitle A, (ii) any State or political subdivision thereof, (iii) the Tennessee Valley Authority, (iv)...

(a) In general In the case of an eligible taxpayer which elects to transfer all (or any portion specified in the election) of an eligible credit determined with respect to such taxpayer for any taxable year to a taxpayer (referred to in this section as the “transferee taxpayer”) which is not related (within the meaning of section 267(b) or 707(b)(1)) to the eligible taxpayer, the transferee taxpayer specified in such election (and not the eligible taxpayer) shall be treated as the taxpayer for purposes of this title with respect to such credit (or such portion thereof). (b) Treatment of payments made in connection with transfer With respect to any amount paid by a transferee taxpayer to an eligible taxpayer as consideration for a transfer described in subsection (a), such consideration— (1) shall be required to be paid in cash, (2) shall not be includible in gross income of the eligible taxpayer, and (3) with respect to the transferee taxpayer, shall not be deductible under this title. (c) Application to partnerships and S corporations (1) In general In the case of any eligible credit determined with respect to any facility or property held directly by a partnership or S corporation, if such partnership or S corporation makes an election under subsection (a) (in such manner as the Secretary may provide) with respect to such credit— (A) any amount received as consideration for a transfer described in such subsection shall be treated as tax exempt income for purposes of sections 705 and 1366, and (B) a partner’s distributive share of such tax exempt income shall be based on such partner’s distributive share of the otherwise eligible credit for each taxable year. (2) Coordination with application at partner or shareholder level In the case of any facility or property held directly by a partnership or S corporation, no election by any partner or shareholder shall be allowed under subsection (a) with respect to any eligible credit determined with respect to such facility or property. (d) Taxable year in which credit taken into account In the case of any credit (or portion thereof) with respect to which an election is made under subsection (a), such credit shall be taken into account in the first taxable year of the transferee taxpayer ending with, or after, the taxable year of the eligible taxpayer with respect to which the credit was determined. (e) Limitations on election (1) Time for election An election under subsection (a) to transfer any portion of an eligible credit shall be made not later than the due date (including extensions of time) for the return of tax for the taxable year for which the credit is determined, but in no event earlier than 180 days after the date of the enactment of this section. Any such election, once made, shall be irrevocable. (2) No additional transfers No election may be made under subsection (a) by a transferee taxpayer with respect to any portion of an eligible credit which has been previously transferred to such taxpayer pursuant to this section. (f) Definitions For purposes of this section— (1) Eligible credit (A) In general The term “eligible credit” means each of the following: (i) So much of the credit for alternative fuel vehicle refueling property allowed under section 30C which, pursuant to subsection (d)(1) of such section, is treated as a credit listed in section 38(b). (ii) The renewable electricity production credit determined under section 45(a). (iii) The credit for carbon oxide sequestration determined under section 45Q(a). (iv) The zero-emission nuclear power production credit determined under section 45U(a). (v) The clean hydrogen production credit determined under section 45V(a). (vi) The advanced manufacturing production credit determined under section 45X(a). (vii) The clean electricity production credit determined under section 45Y(a). (viii) The clean fuel production credit determined under section 45Z(a). (ix) The energy credit determined under section 48. (x) The qualif...