Accelelerated Depreciation for Qualified Energy Property (IRC section 168(e)(3)(B)(viii))

Industry: Manufacturing

Accelerated Depreciation for Qualified Energy Property (IRC section 168(e)(3)(B)(viii))

Tax credit for carbon oxide and carbon dioxide

1,000 metric tons of CO2 per year for direct air capture (DAC) facilities

18,750 metric tons for electricity-generating facilities

Must meet carbon capture capacity of 75% of baseline Co2 production

12,500 metric tons for any other facility

Credit of:

$17 per metric ton of qualified carbon oxide captured and sequestered, $12 per metric ton for qualified carbon oxide that is injected for enhanced oil recovery or use

$26 per metric ton to $36 per metric ton for direct air capture facilities

Eligible for a booster of up to 5 times these rates if prevailing wage and apprenticeship requirements are met.

Conditions:

Construction must begin before 2033

Credit period is 12 years

sequestration coupled with permitted end-uses within the US for US facilities with minimum volumes: