26 U.S.C. § 45K — Credit for producing fuel from a non-

Page 284 TITLE 26—INTERNAL REVENUE CODE § 45K 115–123, div. D, title I, § 40501(a), (b)(1), Feb. 9, 2018, 132 Stat. 153.) Editorial Notes REFERENCES IN TEXT The date of the enactment of this section and the date of the enactment of this paragraph, referred to in subsecs. (b)(4) and (d)(1)(B), are the date of enactment of Pub. L. 109–58, which was approved Aug. 8, 2005. The Rural Electrification Act of 1936, referred to in subsec. (e)(2)(A)(iii), is act May 20, 1936, ch. 432, 49 Stat. 1363, which is classified generally to chapter 31 (§ 901 et seq.) of Title 7, Agriculture. For complete classification of this Act to the Code, see section 901 of Title 7 and Tables. AMENDMENTS 2018—Subsec. (b)(4). Pub. L. 115–123, § 40501(a)(1), in- serted ‘‘or any amendment to’’ after ‘‘enactment of’’. Subsec. (b)(5). Pub. L. 115–123, § 40501(a)(2), added par. (5). Subsecs. (e), (f). Pub. L. 115–123, § 40501(b)(1), added subsec. (e) and redesignated former subsec. (e) as (f). 2007—Subsec. (b)(2). Pub. L. 110–172 reenacted heading without change and amended text generally. Prior to amendment, text read as follows: ‘‘The national mega- watt capacity limitation shall be 6,000 megawatts.’’ 2005—Subsec. (c)(2). Pub. L. 109–135, § 402(d)(1), amend- ed heading and text of par. (2) generally. Prior to amendment, text read as follows: ‘‘Rules similar to the rules of section 45(b)(1) shall apply for purposes of this section.’’ Subsec. (e). Pub. L. 109–135, § 402(d)(2), struck out ‘‘(2),’’ after ‘‘(1),’’. Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF 2018 AMENDMENT Pub. L. 115–123, div. D, title I, § 40501(c), Feb. 9, 2018, 132 Stat. 154, provided that: ‘‘(1) TREATMENT OF UNUTILIZED LIMITATION AMOUNTS.— The amendment made by subsection (a) [amending this section] shall take effect on the date of the enactment of this Act [Feb. 9, 2018]. ‘‘(2) TRANSFER OF CREDIT BY CERTAIN PUBLIC ENTI- TIES.—The amendments made by subsection (b) [amend- ing this section and section 501 of this title] shall apply to taxable years beginning after the date of the enact- ment of this Act.’’ EFFECTIVE DATE OF 2007 AMENDMENT Amendment by Pub. L. 110–172 effective as if included in the provisions of the Energy Policy Act of 2005, Pub. L. 109–58, to which such amendment relates, see section 6(e) of Pub. L. 110–172, set out as a note under section 30C of this title. EFFECTIVE DATE OF 2005 AMENDMENT Amendment by Pub. L. 109–135 effective as if included in the provision of the Energy Policy Act of 2005, Pub. L. 109–58, to which such amendment relates, see section 402(m)(1) of Pub. L. 109–135, set out as a note under sec- tion 23 of this title. EFFECTIVE DATE Section applicable to production in taxable years be- ginning after Aug. 8, 2005, see section 1306(d) of Pub. L. 109–58, set out as an Effective Date of 2005 Amendment note under section 38 of this title. § 45K. Credit for producing fuel from a non- conventional source (a) Allowance of credit For purposes of section 38, the nonconven- tional source production credit determined under this section for the taxable year is an amount equal to— (1) $3, multiplied by (2) the barrel-of-oil equivalent of qualified fuels— (A) sold by the taxpayer to an unrelated person during the taxable year, and (B) the production of which is attributable to the taxpayer. (b) Limitations and adjustments (1) Phaseout of credit The amount of the credit allowable under subsection (a) shall be reduced by an amount which bears the same ratio to the amount of the credit (determined without regard to this paragraph) as— (A) the amount by which the reference price for the calendar year in which the sale occurs exceeds $23.50, bears to (B) $6. (2) Credit and phaseout adjustment based on inflation The $3 amount in subsection (a) and the $23.50 and $6 amounts in paragraph (1) shall each be adjusted by multiplying such amount by the inflation adjustment factor for the cal- endar year in which the sale occurs. In the case of gas from a tight formation, the $3 amount in subsection (a) shall not be adjusted. (3) Credit reduced for grants, tax-exempt bonds, and subsidized energy financing (A) In general The amount of the credit allowable under subsection (a) with respect to any project for any taxable year (determined after the ap- plication of paragraphs (1) and (2)) shall be reduced by the amount which is the product of the amount so determined for such year and a fraction— (i) the numerator of which is the sum, for the taxable year and all prior taxable years, of— (I) grants provided by the United States, a State, or a political subdivision of a State for use in connection with the project, (II) proceeds of any issue of State or local government obligations used to provide financing for the project the in- terest on which is exempt from tax under section 103, and (III) the aggregate amount of sub- sidized energy financing (within the meaning of section 48(a)(4)(C)) provided in connection with the project, and (ii) the denominator of which is the ag- gregate amount of additions to the capital account for the project for the taxable year and all prior taxable years. (B) Amounts determined at close of year The amounts under subparagraph (A) for any taxable year shall be determined as of the close of the taxable year. (4) Credit reduced for energy credit The amount allowable as a credit under sub- section (a) with respect to any project for any taxable year (determined after the application Page 285 TITLE 26—INTERNAL REVENUE CODE § 45K of paragraphs (1), (2), and (3)) shall be reduced by the excess of— (A) the aggregate amount allowed under section 38 for the taxable year or any prior taxable year by reason of the energy per- centage with respect to property used in the project, over (B) the aggregate amount recaptured with respect to the amount described in subpara- graph (A)— (i) under section 49(b) or 50(a) for the taxable year or any prior taxable year, or (ii) under this paragraph for any prior taxable year. The amount recaptured under section 49(b) or 50(a) with respect to any property shall be ap- propriately reduced to take into account any reduction in the credit allowed by this section by reason of the preceding sentence. (5) Credit reduced for enhanced oil recovery credit The amount allowable as a credit under sub- section (a) with respect to any project for any taxable year (determined after application of paragraphs (1), (2), (3), and (4)) shall be reduced by the excess (if any) of— (A) the aggregate amount allowed under section 38 for the taxable year and any prior taxable year by reason of any enhanced oil recovery credit determined under section 43 with respect to such project, over (B) the aggregate amount recaptured with respect to the amount described in subpara- graph (A) under this paragraph for any prior taxable year. (c) Definition of qualified fuels For purposes of this section— (1) In general The term ‘‘qualified fuels’’ means— (A) oil produced from shale and tar sands, (B) gas produced from— (i) geopressured brine, Devonian shale, coal seams, or a tight formation, or (ii) biomass, and (C) liquid, gaseous, or solid synthetic fuels produced from coal (including lignite), in- cluding such fuels when used as feedstocks. (2) Gas from geopressured brine, etc. (A) In general Except as provided in subparagraph (B), the determination of whether any gas is pro- duced from geopressured brine, Devonian shale, coal seams, or a tight formation shall be made in accordance with section 503 of the Natural Gas Policy Act of 1978 (as in ef- fect before the repeal of such section). (B) Special rules for gas from tight forma- tions The term ‘‘gas produced from a tight for- mation’’ shall only include gas from a tight formation— (i) which, as of April 20, 1977, was com- mitted or dedicated to interstate com- merce (as defined in section 2(18) of the Natural Gas Policy Act of 1978, as in effect on the date of the enactment of this clause), or (ii) which is produced from a well drilled after such date of enactment. (3) Biomass The term ‘‘biomass’’ means any organic ma- terial other than— (A) oil and natural gas (or any product thereof), and (B) coal (including lignite) or any product thereof. (d) Other definitions and special rules For purposes of this section— (1) Only production within the United States taken into account Sales shall be taken into account under this section only with respect to qualified fuels the production of which is within— (A) the United States (within the meaning of section 638(1)), or (B) a possession of the United States (with- in the meaning of section 638(2)). (2) Computation of inflation adjustment factor and reference price (A) In general The Secretary shall, not later than April 1 of each calendar year, determine and publish in the Federal Register the inflation adjust- ment factor and the reference price for the preceding calendar year in accordance with this paragraph. (B) Inflation adjustment factor The term ‘‘inflation adjustment factor’’ means, with respect to a calendar year, a fraction the numerator of which is the GNP implicit price deflator for the calendar year and the denominator of which is the GNP implicit price deflator for calendar year 1979. The term ‘‘GNP implicit price deflator’’ means the first revision of the implicit price deflator for the gross national product as computed and published by the Department of Commerce. (C) Reference price The term ‘‘reference price’’ means with re- spect to a calendar year the Secretary’s esti- mate of the annual average wellhead price per barrel for all domestic crude oil the price of which is not subject to regulation by the United States. (3) Production attributable to the taxpayer In the case of a property or facility in which more than 1 person has an interest, except to the extent provided in regulations prescribed by the Secretary, production from the prop- erty or facility (as the case may be) shall be allocated among such persons in proportion to their respective interests in the gross sales from such property or facility. (4) Gas from geopressured brine, Devonian shale, coal seams, or a tight formation The amount of the credit allowable under subsection (a) shall be determined without re- gard to any production attributable to a prop- erty from which gas from Devonian shale, coal seams, geopressured brine, or a tight forma- tion was produced in marketable quantities before January 1, 1980. Page 286 TITLE 26—INTERNAL REVENUE CODE § 45K (5) Barrel-of-oil equivalent The term ‘‘barrel-of-oil equivalent’’ with re- spect to any fuel means that amount of such fuel which has a Btu content of 5.8 million; ex- cept that in the case of qualified fuels de- scribed in subparagraph (C) of subsection (c)(1), the Btu content shall be determined without regard to any material from a source not described in such subparagraph. (6) Barrel defined The term ‘‘barrel’’ means 42 United States gallons. (7) Related persons Persons shall be treated as related to each other if such persons would be treated as a sin- gle employer under the regulations prescribed under section 52(b). In the case of a corpora- tion which is a member of an affiliated group of corporations filing a consolidated return, such corporation shall be treated as selling qualified fuels to an unrelated person if such fuels are sold to such a person by another member of such group. (8) Pass-thru in the case of estates and trusts Under regulations prescribed by the Sec- retary, rules similar to the rules of subsection (d) of section 52 shall apply. (e) Application of section This section shall apply with respect to quali- fied fuels— (1) which are— (A) produced from a well drilled after De- cember 31, 1979, and before January 1, 1993, or (B) produced in a facility placed in service after December 31, 1979, and before January 1, 1993, and (2) which are sold before January 1, 2003. (f) Extension for certain facilities (1) In general In the case of a facility for producing quali- fied fuels described in subparagraph (B)(ii) or (C) of subsection (c)(1)— (A) for purposes of subsection (e)(1)(B), such facility shall be treated as being placed in service before January 1, 1993, if such fa- cility is placed in service before July 1, 1998, pursuant to a binding written contract in ef- fect before January 1, 1997, and (B) if such facility is originally placed in service after December 31, 1992, paragraph (2) of subsection (e) shall be applied with re- spect to such facility by substituting ‘‘Janu- ary 1, 2008’’ for ‘‘January 1, 2003’’. (2) Special rule Paragraph (1) shall not apply to any facility which produces coke or coke gas unless the original use of the facility commences with the taxpayer. (g) Extension for facilities producing coke or coke gas Notwithstanding subsection (e)— (1) In general In the case of a facility for producing coke or coke gas (other than from petroleum based products) which was placed in service before January 1, 1993, or after June 30, 1998, and be- fore January 1, 2010, this section shall apply with respect to coke and coke gas produced in such facility and sold during the period— (A) beginning on the later of January 1, 2006, or the date that such facility is placed in service, and (B) ending on the date which is 4 years after the date such period began. (2) Special rules In determining the amount of credit allow- able under this section solely by reason of this subsection— (A) Daily limit The amount of qualified fuels sold during any taxable year which may be taken into account by reason of this subsection with re- spect to any facility shall not exceed an av- erage barrel-of-oil equivalent of 4,000 barrels per day. Days before the date the facility is placed in service shall not be taken into ac- count in determining such average. (B) Extension period to commence with unadjusted credit amount For purposes of applying subsection (b)(2) to the $3 amount in subsection (a), in the case of fuels sold after 2005, subsection (d)(2)(B) shall be applied by substituting ‘‘2004’’ for ‘‘1979’’. (C) Denial of double benefit This subsection shall not apply to any fa- cility producing qualified fuels for which a credit was allowed under this section for the taxable year or any preceding taxable year by reason of subsection (f). (D) Nonapplication of phaseout Subsection (b)(1) shall not apply. (E) Coordination with section 45 No credit shall be allowed with respect to any coke or coke gas which is produced using steel industry fuel (as defined in sec- tion 45(c)(7)) as feedstock if a credit is al- lowed to any taxpayer under section 45 with respect to the production of such steel indus- try fuel. (Added Pub. L. 96–223, title II, § 231(a), Apr. 2, 1980, 94 Stat. 268, § 44D; amended Pub. L. 97–34, title VI § 611(a), Aug. 13, 1981, 95 Stat. 339; Pub. L. 97–354, § 5(a)(1), Oct. 19, 1982, 96 Stat. 1692; Pub. L. 97–448, title II, § 202(a), Jan. 12, 1983, 96 Stat. 2396; renumbered § 29 and amended Pub. L. 98–369, div. A, title IV, §§ 471(c), 474(h), title VI, § 612(e)(1), title VII, § 722(d)(1), (2), July 18, 1984, 98 Stat. 826, 831, 912, 973; Pub. L. 99–514, title VII, § 701(c)(3), title XVIII, § 1879(c)(1), Oct. 22, 1986, 100 Stat. 2340, 2906; Pub. L. 100–647, title VI, § 6302, Nov. 10, 1988, 102 Stat. 3755; Pub. L. 101–508, title XI, §§ 11501(a), (b)(1), (c)(1), 11813(b)(1), 11816, Nov. 5, 1990, 104 Stat. 1388–479, 1388–550, 1388–558; Pub. L. 102–486, title XIX, § 1918, Oct. 24, 1992, 106 Stat. 3025; Pub. L. 104–188, title I, §§ 1205(d)(3), 1207(a), Aug. 20, 1996, 110 Stat. 1776; renumbered § 45K and amended Pub. L. 109–58, title XIII, §§ 1321(a), 1322(a)(1), (3)(E), (F), (b), Aug. 8, 2005, 119 Stat. 1010–1012; Pub. L. 109–135, title IV, §§ 402(g), 412(l), Dec. 21, 2005, 119 Stat. 2611, 2637; Page 287 TITLE 26—INTERNAL REVENUE CODE § 45K Pub. L. 109–432, div. A, title II, § 211(a), (b), Dec. 20, 2006, 120 Stat. 2947, 2948; Pub. L. 110–343, div. B, title I, § 108(d)(2), Oct. 3, 2008, 122 Stat. 3821; Pub. L. 113–295, div. A, title II, § 210(a), Dec. 19, 2014, 128 Stat. 4031.) INFLATION ADJUSTED ITEMS FOR CERTAIN TAX YEARS For inflation adjustment of certain items in this section, see Internal Revenue Notices listed in a table below. Editorial Notes REFERENCES IN TEXT Section 503 of the Natural Gas Policy Act of 1978 (as in effect before the repeal of such section), referred to in subsec. (c)(2)(A), was classified to section 3413 of Title 15, Commerce and Trade, prior to repeal by Pub. L. 101–60, § 3(b)(5), July 26, 1989, 103 Stat. 159, effective Jan. 1, 1993. Section 2(18) of the Natural Gas Policy Act of 1978, re- ferred to in subsec. (c)(2)(B)(i), is classified to section 3301(18) of Title 15, Commerce and Trade. The date of the enactment of this clause, and such date of enactment, referred to in subsec. (c)(2)(B), prob- ably mean the date of enactment of Pub. L. 101–508, which amended subsec. (c)(2)(B) of this section gen- erally, and which was approved Nov. 5, 1990. AMENDMENTS 2014—Subsec. (g)(2)(E). Pub. L. 113–295 amended sub- par. (E) generally. Prior to amendment, text read as follows: ‘‘No credit shall be allowed with respect to any qualified fuel which is steel industry fuel (as defined in section 45(c)(7)) if a credit is allowed to the taxpayer for such fuel under section 45.’’ 2008—Subsec. (g)(2)(E). Pub. L. 110–343 added subpar. (E). 2006—Subsec. (g)(1). Pub. L. 109–432, § 211(b), inserted ‘‘(other than from petroleum based products)’’ after ‘‘producing coke or coke gas’’ in introductory provi- sions. Subsec. (g)(2)(D). Pub. L. 109–432, § 211(a), added sub- par. (D). 2005—Pub. L. 109–58, § 1322(a)(1), renumbered section 29 of this title as this section. Subsec. (a). Pub. L. 109–135, § 402(g), struck out ‘‘if the taxpayer elects to have this section apply,’’ after ‘‘For purposes of section 38,’’ in introductory provisions. Pub. L. 109–58, § 1322(a)(3)(E), substituted ‘‘For pur- poses of section 38, if the taxpayer elects to have this section apply, the nonconventional source production credit determined under this section for the taxable year is’’ for ‘‘There shall be allowed as a credit against the tax imposed by this chapter for the taxable year’’ in introductory provisions. Subsec. (b)(6). Pub. L. 109–58, § 1322(a)(3)(F), struck out heading and text of par. (6). Text read as follows: ‘‘The credit allowed by subsection (a) for any taxable year shall not exceed the excess (if any) of— ‘‘(A) the regular tax for the taxable year reduced by the sum of the credits allowable under subpart A and section 27, over ‘‘(B) the tentative minimum tax for the taxable year.’’ Subsec. (c)(2)(A). Pub. L. 109–58, § 1322(b)(1)(A), in- serted ‘‘(as in effect before the repeal of such section)’’ after ‘‘1978’’. Subsecs. (e), (f). Pub. L. 109–58, § 1322(b)(1)(B), redesig- nated subsecs. (f) and (g) as (e) and (f), respectively, and struck out former subsec. (e), which related to applica- tion of section with the Natural Gas Policy Act of 1978. Subsec. (g). Pub. L. 109–135, § 412(l)(1), substituted ‘‘subsection (e)’’ for ‘‘subsection (f)’’ in introductory provisions. Pub. L. 109–58, § 1322(b)(1)(B), redesignated subsec. (h) as (g). Subsec. (g)(1)(A). Pub. L. 109–58, § 1322(b)(2)(A), sub- stituted ‘‘subsection (e)(1)(B)’’ for ‘‘subsection (f)(1)(B)’’. Subsec. (g)(1)(B). Pub. L. 109–58, § 1322(b)(2)(B), sub- stituted ‘‘subsection (e)’’ for ‘‘subsection (f)’’. Subsec. (g)(2)(C). Pub. L. 109–135, § 412(l)(2), sub- stituted ‘‘subsection (f)’’ for ‘‘subsection (g)’’. Subsec. (h). Pub. L. 109–58, § 1322(b)(1)(B), redesignated subsec. (h) as (g). Pub. L. 109–58, § 1321(a), added subsec. (h). 1996—Subsec. (b)(6)(A). Pub. L. 104–188, § 1205(d)(3), substituted ‘‘section 27’’ for ‘‘sections 27 and 28’’. Subsec. (g)(1)(A). Pub. L. 104–188, § 1207(a), substituted ‘‘July 1, 1998’’ for ‘‘January 1, 1997’’ and ‘‘January 1, 1997’’ for ‘‘January 1, 1996’’. 1992—Subsec. (g). Pub. L. 102–486 added subsec. (g). 1990—Subsec. (b)(3)(A)(i)(III). Pub. L. 101–508, § 11813(b)(1)(A), substituted ‘‘section 48(a)(4)(C)’’ for ‘‘section 48(l)(11)(C)’’. Subsec. (b)(4). Pub. L. 101–508, § 11813(b)(1)(B), sub- stituted ‘‘section 49(b) or 50(a)’’ for ‘‘section 47’’ in two places. Subsec. (b)(5), (6). Pub. L. 101–508, § 11501(c)(1), added par. (5) and redesignated former par. (5) as (6). Subsec. (c)(1)(B) to (E). Pub. L. 101–508, § 11816(a), in- serted ‘‘and’’ at end of subpar. (B), substituted a period for a comma at end of subpar. (C), and struck out sub- par. (D) which related to qualifying processed wood fuels, and subpar. (E) which related to steam produced from solid agricultural byproducts (not including tim- ber byproducts). Subsec. (c)(2)(B). Pub. L. 101–508, § 11501(b)(1), amend- ed subpar. (B) generally. Prior to amendment, subpar. (B) read as follows: ‘‘The term ‘gas produced from a tight formation’ shall only include— ‘‘(i) gas the price of which is regulated by the United States, and ‘‘(ii) gas for which the maximum lawful price appli- cable under the Natural Gas Policy Act of 1978 is at least 150 percent of the then applicable price under section 103 of such Act.’’ Subsec. (c)(3). Pub. L. 101–508, § 11813(b)(1)(C), amended par. (3) generally. Prior to amendment, par. (3) read as follows: ‘‘The term ‘biomass’ means any organic mate- rial which is an alternate substance (as defined in sec- tion 48(l)(3)(B)) other than coal (including lignite) or any product of such coal.’’ Subsec. (c)(4). Pub. L. 101–508, § 11816(b)(1), struck out par. (4) ‘‘Qualifying processed wood fuel’’ which read as follows: ‘‘(A) IN GENERAL.—The term ‘qualifying processed wood fuel’ means any processed solid wood fuel (other than charcoal, fireplace products, or a product used for ornamental or recreational purposes) which has a Btu content per unit of volume or weight, determined with- out regard to any nonwood elements, which is at least 40 percent greater per unit of volume or weight than the Btu content of the wood from which it is produced (determined immediately before the processing). ‘‘(B) ELECTION.—A taxpayer shall elect, at such time and in such manner as the Secretary by regulations may prescribe, as to whether Btu content per unit shall be determined for purposes of this paragraph on a vol- ume or weight basis. Any such election— ‘‘(i) shall apply to all production from a facility; and ‘‘(ii) shall be effective for the taxable year with re- spect to which it is made and for all subsequent tax- able years and, once made, may be revoked only with the consent of the Secretary.’’ Subsec. (c)(5). Pub. L. 101–508, § 11816(b)(1), struck out par. (5) ‘‘Agricultural byproduct steam’’ which read as follows: ‘‘Steam produced from solid agricultural by- products which is used by the taxpayer in his trade or business shall be treated as having been sold by the taxpayer to an unrelated person on the date on which it is used.’’ Subsec. (d)(4). Pub. L. 101–508, § 11816(b)(2), amended par. (4) generally, striking out ‘‘Special rules applica- ble to’’ before ‘‘Gas’’ in heading, redesignating former Page 288 TITLE 26—INTERNAL REVENUE CODE § 45K subpar. (A) as par. (4), striking out subpar. (B) which related to the reference price and application of phase- out for Devonian shale, and making minor changes in phraseology. Subsec. (d)(5), (6). Pub. L. 101–508, § 11816(b)(3), (4), re- designated par. (6) as (5), substituted ‘‘subparagraph (C)’’ for ‘‘subparagraph (C), (D), or (E)’’, and struck out former par. (5) which read as follows: ‘‘In the case of a facility for the production of— ‘‘(A) qualifying processed wood fuel, or ‘‘(B) steam from solid agricultural byproducts, paragraph (1) of subsection (b) shall not apply with re- spect to the amount of the credit allowable under sub- section (a) for fuels sold during the 3-year period begin- ning on the date the facility is placed in service.’’ Subsec. (d)(7) to (9). Pub. L. 101–508, § 11816(b)(3), re- designated pars. (7) to (9) as (6) to (8), respectively. Subsec. (f). Pub. L. 101–508, § 11816(b)(5), amended sub- sec. (f) generally, redesignating former par. (1) as sub- sec. (f), making minor changes in phraseology, sub- stituting par. (2) for former par. (1)(B) which read as follows: ‘‘which are sold after December 31, 1979, and be- fore January 1, 2003.’’, and striking out former par. (2) which related to special rules applicable to qualified processed wood and solid agricultural byproduct steam. Subsec. (f)(1)(A)(i), (ii). Pub. L. 101–508, § 11501(a)(1), substituted ‘‘1993’’ for ‘‘1991’’. Subsec. (f)(1)(B). Pub. L. 101–508, § 11501(a)(2), sub- stituted ‘‘2003’’ for ‘‘2001’’. 1988—Subsec. (f)(1)(A)(i), (ii). Pub. L. 100–647 sub- stituted ‘‘1991’’ for ‘‘1990’’. 1986—Subsec. (b)(5). Pub. L. 99–514, § 701(c)(3), amended par. (5) generally. Prior to amendment, par. (5) read as follows: ‘‘The credit allowed by subsection (a) for a tax- able year shall not exceed the taxpayer’s tax liability for the taxable year (as defined in section 26(b)), re- duced by the sum of the credits allowable under sub- part A and sections 27 and 28.’’ Subsec. (d)(8). Pub. L. 99–514, § 1879(c)(1), inserted pro- vision directing that a corporation which is a member of an affiliated group of corporations filing a consoli- dated return shall be treated as selling qualified fuels to an unrelated person if such fuels are sold to such person by another member of such group. 1984—Pub. L. 98–369, § 471(c), renumbered section 44D of this title as this section. Subsec. (b)(1)(A). Pub. L. 98–369, § 722(d)(1), sub- stituted ‘‘in which the sale occurs’’ for ‘‘in which the taxable year begins’’. Subsec. (b)(2). Pub. L. 98–369, § 722(d)(2), substituted ‘‘in which the sale occurs’’ for ‘‘in which a taxable year begins’’. Subsec. (b)(5). Pub. L. 98–369, § 612(e)(1), substituted ‘‘section 26(b)’’ for ‘‘section 25(b)’’. Pub. L. 98–369, § 474(h), amended par. (5) generally, substituting ‘‘shall not exceed the taxpayer’s tax liabil- ity for the taxable year (as defined in section 25(b)), re- duced by the sum of the credits allowable under sub- part A and sections 27 and 28’’ for ‘‘shall not exceed the tax imposed by this chapter for such taxable year, re- duced by the sum of the credits allowable under a sec- tion of this subpart having a lower number or letter designation than this section, other than the credits al- lowable by sections 31, 39, and 43. For purposes of the preceding sentence, the term ‘tax imposed by this chap- ter’ shall not include any tax treated as not imposed by this chapter under the last sentence of section 53(a)’’. 1983—Subsec. (f)(1)(B), (2)(A)(i). Pub. L. 97–448 sub- stituted ‘‘December 31, 1979’’ for ‘‘December 3, 1979’’. 1982—Subsec. (d)(9). Pub. L. 97–354 substituted ‘‘Pass- thru in the case of estates and trusts’’ for ‘‘Pass- through in the case of subchapter S corporations, etc.’’ in par. heading, and substituted provisions relating to the applicability of rules similar to rules of subsec. (d) of section 52 for provisions relating to the applicability of rules similar to rules of subsecs. (d) and (e) of section 52. 1981—Subsec. (e). Pub. L. 97–34 substituted provisions respecting application with the Natural Gas Policy Act of 1978 for prior provision reading ‘‘If the taxpayer makes an election under section 107(d) of the Natural Gas Policy Act of 1978 to have subsections (a) and (b) of section 107 of that Act, and subtitle B of title I of that Act, apply with respect to gas described in sub- section (c)(1)(B)(i) produced from any well on a prop- erty, then the credit allowable by subsection (a) shall not be allowed with respect to any gas produced on that property.’’ Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF 2014 AMENDMENT Amendment by Pub. L. 113–295 effective as if included in the provisions of the Energy Improvement and Ex- tension Act of 2008, Pub. L. 110–343, div. B, to which such amendment relates, see section 210(h) of Pub. L. 113–295, set out as a note under section 45 of this title. EFFECTIVE DATE OF 2008 AMENDMENT Amendment by Pub. L. 110–343 applicable to fuel pro- duced and sold after Sept. 30, 2008, see section 108(e) of Pub. L. 110–343, set out as a note under section 45 of this title. EFFECTIVE DATE OF 2006 AMENDMENT Pub. L. 109–432, div. A, title II, § 211(c), Dec. 20, 2006, 120 Stat. 2948, provided that: ‘‘The amendments made by this section [amending this section] shall take effect as if included in section 1321 of the Energy Policy Act of 2005 [Pub. L. 109–58].’’ EFFECTIVE DATE OF 2005 AMENDMENTS Amendment by section 402(g) of Pub. L. 109–135 effec- tive as if included in the provision of the Energy Policy Act of 2005, Pub. L. 109–58, to which such amendment relates, see section 402(m)(1) of Pub. L. 109–135, set out as an Effective and Termination Dates of 2005 Amend- ments note under section 23 of this title. Pub. L. 109–58, title XIII, § 1321(b), Aug. 8, 2005, 119 Stat. 1011, provided that: ‘‘The amendment made by this section [amending this section] shall apply to fuel produced and sold after December 31, 2005, in taxable years ending after such date.’’ Pub. L. 109–58, title XIII, § 1322(c), Aug. 8, 2005, 119 Stat. 1012, provided that: ‘‘(1) IN GENERAL.—Except as provided in paragraph (2), the amendments made by this section [amending this section and sections 30, 38, 43, 45, 45I, 53, 55, 613A, and 772 of this title and renumbering section 29 of this title as this section] shall apply to credits determined under the Internal Revenue Code of 1986 for taxable years end- ing after December 31, 2005. ‘‘(2) SUBSECTION (b).—The amendments made by sub- section (b) [amending this section] shall take effect on the date of the enactment of this Act [Aug. 8, 2005].’’ EFFECTIVE DATE OF 1996 AMENDMENT Pub. L. 104–188, title I, § 1205(e), Aug. 20, 1996, 110 Stat. 1776, provided that: ‘‘The amendments made by this section [amending this section and sections 30, 38, 39, 45C, 53, 55, and 280C of this title] shall apply to amounts paid or incurred in taxable years ending after June 30, 1996.’’ Pub. L. 104–188, title I, § 1207(b), Aug. 20, 1996, 110 Stat. 1776, provided that: ‘‘The amendment made by this sec- tion [amending this section] shall take effect on the date of the enactment of this Act [Aug. 20, 1996].’’ EFFECTIVE DATE OF 1990 AMENDMENT Pub. L. 101–508, title XI, § 11501(b)(2), Nov. 5, 1990, 104 Stat. 1388–479, provided that: ‘‘The amendment made by paragraph (1) [amending this section] shall apply to gas produced after December 31, 1990.’’ Pub. L. 101–508, title XI, § 11501(c)(2), Nov. 5, 1990, 104 Stat. 1388–480, provided that: ‘‘The amendment made by paragraph (1) [amending this section] shall apply to taxable years beginning after December 31, 1990.’’ Page 289 TITLE 26—INTERNAL REVENUE CODE § 45L Pub. L. 101–508, title XI, § 11813(c), Nov. 5, 1990, 104 Stat. 1388–555, provided that: ‘‘(1) IN GENERAL.—Except as provided in paragraph (2), the amendments made by this section [enacting section 50 of this title and amending this section and sections 38, 42, 46 to 49, 52, 55, 108, 145, 147, 168, 170, 179, 196, 280F, 312, 465, 469, 861, 865, 1016, 1033, 1245, 1274A, 1371, 1388 and 1503 of this title] shall apply to property placed in serv- ice after December 31, 1990. ‘‘(2) EXCEPTIONS.—The amendments made by this sec- tion shall not apply to— ‘‘(A) any transition property (as defined in section 49(e) of the Internal Revenue Code of 1986 (as in effect on the day before the date of the enactment of this Act [Nov. 5, 1990]), ‘‘(B) any property with respect to which qualified progress expenditures were previously taken into ac- count under section 46(d) of such Code (as so in ef- fect), and ‘‘(C) any property described in section 46(b)(2)(C) of such Code (as so in effect).’’ Pub. L. 101–508, title XI, § 11821(a), Nov. 5, 1990, 104 Stat. 1388–558, provided that: ‘‘Except as otherwise pro- vided in this part, the amendments made by this part [part I (§§ 11801–11821) of subtitle H of title XI of Pub. L. 101–508, see Tables for classification] shall take effect on the date of the enactment of this Act [Nov. 5, 1990].’’ EFFECTIVE DATE OF 1986 AMENDMENT Amendment by section 701(c)(3) of Pub. L. 99–514 ap- plicable to taxable years beginning after Dec. 31, 1986, with certain exceptions and qualifications, see section 701(f) of Pub. L. 99–514, set out as an Effective Date note under section 55 of this title. Pub. L. 99–514, title XVIII, § 1879(c)(2), Oct. 22, 1986, 100 Stat. 2906, provided that: ‘‘The amendment made by paragraph (1) [amending this section] shall take effect as if included in the amendments made by section 231 of Public Law 96–223 [see Effective Date note below].’’ EFFECTIVE DATE OF 1984 AMENDMENT Amendment by section 474(h) of Pub. L. 98–369 appli- cable to taxable years beginning after Dec. 31, 1983, and to carrybacks from such years, see section 475(a) of Pub. L. 98–369, set out as a note under section 21 of this title. Amendment by section 612(e)(1) of Pub. L. 98–369 ap- plicable to interest paid or accrued after Dec. 31, 1984, on indebtedness incurred after Dec. 31, 1984, see section 612(g) of Pub. L. 98–369, set out as an Effective Date note under section 25 of this title. Pub. L. 98–369, title VII, § 722(d)(3), July 18, 1984, 98 Stat. 974, provided that: ‘‘The amendments made by this subsection [amending this section] shall apply to taxable years ending after December 31, 1979.’’ EFFECTIVE DATE OF 1983 AMENDMENT Amendment by Pub. L. 97–448 effective, except as oth- erwise provided, as if it had been included in the provi- sion of the Crude Oil Windfall Profit Tax Act of 1980, Pub. L. 96–223 to which such amendment relates, see section 203(a) of Pub. L. 97–448, set out as a note under section 6652 of this title. EFFECTIVE DATE OF 1982 AMENDMENT Amendment by Pub. L. 97–354 applicable to taxable years beginning after Dec. 31, 1982, see section 6(a) of Pub. L. 97–354, set out as an Effective Date note under section 1361 of this title. EFFECTIVE DATE OF 1981 AMENDMENT Pub. L. 97–34, title VI, § 611(b), Aug. 13, 1981, 95 Stat. 339, provided that: ‘‘The amendment made by this sec- tion [amending this section] shall apply to taxable years ending after December 31, 1979.’’ EFFECTIVE DATE Pub. L. 96–223, title II, § 231(c), Apr. 2, 1980, 94 Stat. 272, provided that: ‘‘The amendments made by this sec- tion [enacting this section and amending section 6096 of this title] shall apply to taxable years ending after De- cember 31, 1979.’’ SAVINGS PROVISION Pub. L. 101–508, title XI, § 11821(b), Nov. 5, 1990, 104 Stat. 1388–558, provided that: ‘‘If— ‘‘(1) any provision amended or repealed by this part [part I (§§ 11801–11821) of subtitle H of title XI of Pub. L. 101–508, see Tables for classification] applied to— ‘‘(A) any transaction occurring before the date of the enactment of this Act [Nov. 5, 1990], ‘‘(B) any property acquired before such date of en- actment, or ‘‘(C) any item of income, loss, deduction, or credit taken into account before such date of enactment, and ‘‘(2) the treatment of such transaction, property, or item under such provision would (without regard to the amendments made by this part) affect liability for tax for periods ending after such date of enact- ment, nothing in the amendments made by this part shall be construed to affect the treatment of such transaction, property, or item for purposes of determining liability for tax for periods ending after such date of enact- ment.’’ APPLICABILITY OF CERTAIN AMENDMENTS BY PUB. L. 99–514 IN RELATION TO TREATY OBLIGATIONS OF UNITED STATES For applicability of amendment by section 701(c)(3) of Pub. L. 99–514 notwithstanding any treaty obligation of the United States in effect on Oct. 22, 1986, with provi- sion that for such purposes any amendment by title I of Pub. L. 100–647 be treated as if it had been included in the provision of Pub. L. 99–514 to which such amend- ment relates, see section 1012(aa)(2), (4) of Pub. L. 100–647, set out as a note under section 861 of this title. PLAN AMENDMENTS NOT REQUIRED UNTIL JANUARY 1, 1989 For provisions directing that if any amendments made by subtitle A or subtitle C of title XI [§§ 1101–1147 and 1171–1177] or title XVIII [§§ 1800–1899A] of Pub. L. 99–514 require an amendment to any plan, such plan amendment shall not be required to be made before the first plan year beginning on or after Jan. 1, 1989, see section 1140 of Pub. L. 99–514, as amended, set out as a note under section 401 of this title. INFLATION ADJUSTED ITEMS AND REFERENCE PRICE FOR CERTAIN YEARS Provisions relating to inflation adjustment of items in this section and reference price for certain years were contained in the following: 2023—Internal Revenue Notice 2024–51. 2022—Internal Revenue Notice 2023–49. 2021—Internal Revenue Notice 2022–17. 2020—Internal Revenue Notice 2021–29. 2019—Internal Revenue Notice 2020–28. 2018—Internal Revenue Notice 2019–28. 2017—Internal Revenue Notice 2018–32. 2016—Internal Revenue Notice 2017–24. 2015—Internal Revenue Notice 2016–43. 2014—Internal Revenue Notice 2015–45. 2013—Internal Revenue Notice 2014–25. 2012—Internal Revenue Notice 2013–25. 2011—Internal Revenue Notice 2012–30. 2010—Internal Revenue Notice 2011–30. 2009—Internal Revenue Notice 2010–31. 2008—Internal Revenue Notice 2009–32. 2007—Internal Revenue Notice 2008–44. 2006—Internal Revenue Notice 2007–38. § 45L. New energy efficient home credit (a) Allowance of credit (1) In general For purposes of section 38, in the case of an eligible contractor, the new energy efficient