1824 
‘‘(ii) A project which commences con-
struction prior to the date of the enact-
ment of this paragraph. 
‘‘(iii) A project which satisfies the re-
quirements of paragraphs (3) and (4). 
‘‘(3) PREVAILING WAGE REQUIREMENTS.— 
‘‘(A) IN GENERAL.—The requirements de-
scribed in this subparagraph with respect to 
any qualified clean hydrogen production facility 
are that the taxpayer shall ensure that any la-
borers and mechanics employed by contractors 
and subcontractors in— 
‘‘(i) the construction of such facility, 
and 
‘‘(ii) for the 10-year period beginning 
on the date the facility was originally 
placed in service, the alteration or repair of 
such facility, 
shall be paid wages at rates not less than the 
prevailing rates for construction, alteration, or 
repair of a similar character in the locality as 
most recently determined by the Secretary of 
Labor, in accordance with subchapter IV of 
chapter 31 of title 40, United States Code. 
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‘‘(B) CORRECTION AND PENALTY RELATED 
TO
FAILURE
TO
SATISFY
WAGE
REQUIRE-
MENTS.—Rules similar to the rules of section 
45(b)(8)(B) shall apply for purposes of this 
subparagraph. 
‘‘(4) APPRENTICESHIP REQUIREMENTS.—Rules 
similar to the rules of section 45(b)(9) shall apply 
for purposes of this paragraph. 
‘‘(5) REGULATIONS AND GUIDANCE.—The Sec-
retary shall issue such regulations or other guidance 
as the Secretary determines necessary or appropriate 
to carry out the purposes of this subsection. 
‘‘(f) REGULATIONS.—Not later than 1 year after the 
date of enactment of this section, the Secretary, after con-
sultation with the Secretary of Energy and the Adminis-
trator of the Environmental Protection Agency, shall issue 
regulations or other guidance to carry out the purposes 
of this section, including regulations or other guidance— 
‘‘(1) for determining lifecycle greenhouse gas 
emissions, and 
‘‘(2) which require verification by unrelated 
third parties of the production and sale or use of 
qualified clean hydrogen with respect to which credit 
is otherwise allowed under this section.’’. 
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(2) ELECTIVE PAYMENT OF CREDIT.—Section 
6417(b), as added by the preceding provisions of 
this Act, is amended by adding at the end the fol-
lowing new paragraph: 
‘‘(9) The credit for production of clean hydro-
gen determined under section 45X.’’. 
(3) CONFORMING AMENDMENTS.— 
(A) Section 38(b) is amended— 
(i) in paragraph (38), by striking 
‘‘plus’’ at the end, 
(ii) in paragraph (39), by striking the 
period at the end and inserting ‘‘, plus’’, 
and 
(iii) by adding at the end the fol-
lowing new paragraph: 
‘‘(40) the clean hydrogen production credit de-
termined under section 45X(a).’’. 
(B) The table of sections for subpart D of 
part IV of subchapter A of chapter 1 amended 
by adding at the end the following new item: 
‘‘Sec. 45X. Credit for production of clean hydrogen.’’. 
(4) EFFECTIVE DATE.—The amendments made 
by this subsection shall apply to hydrogen placed in 
service after December 31, 2021. 
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(b) CREDIT FOR ELECTRICITY PRODUCED FROM RE-
NEWABLE RESOURCES ALLOWED
IF ELECTRICITY IS 
USED TO PRODUCE CLEAN HYDROGEN.— 
(1) IN GENERAL.—Section 45(e) is amended by 
adding at the end the following new paragraph: 
‘‘(13) SPECIAL RULE FOR ELECTRICITY USED 
AT
A
QUALIFIED
CLEAN
HYDROGEN
PRODUCTION 
FACILITY.—Electricity produced by the taxpayer 
shall be treated as sold by such taxpayer to an unre-
lated person during the taxable year if such elec-
tricity is used during such taxable year by the tax-
payer or a person related to the taxpayer at a quali-
fied clean hydrogen production facility (as defined in 
section 45X(d)(3)) to produce qualified clean hydro-
gen (as defined in section 45X(d)(2)) during the 10 
year period after such facility is placed in service. 
The Secretary shall issue such regulations or other 
guidance as the Secretary determines appropriate to 
carry out the purposes of this paragraph, including 
regulations or other guidance to require verification 
by unrelated third parties of the production and use 
of electricity to which this paragraph applies.’’. 
(2) EFFECTIVE DATE.—The amendment made 
by this subsection shall apply to electricity produced 
after December 31, 2021. 
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(c) ELECTION TO TREAT CLEAN HYDROGEN PRO-
DUCTION FACILITIES AS ENERGY PROPERTY.— 
(1) IN GENERAL.—Section 48(a) is amended by 
adding at the end the following new paragraph: 
‘‘(8) ELECTION TO TREAT CLEAN HYDROGEN 
PRODUCTION FACILITIES AS ENERGY PROPERTY.— 
‘‘(A) IN
GENERAL.—In the case of any 
qualified property (as defined in paragraph 
(5)(D)) which is part of a specified clean hydro-
gen production facility— 
‘‘(i) such property shall be treated as 
energy property for purposes of this sec-
tion, and 
‘‘(ii) the energy percentage with re-
spect to such property is— 
‘‘(I) in the case of a facility 
which is designed and reasonably ex-
pected to produce qualified clean hy-
drogen which is described in a sub-
paragraph (A) of section 45X(b)(2), 6 
percent, 
‘‘(II) in the case of a facility 
which is designed and reasonably ex-
pected to produce qualified clean hy-
drogen which is described in a sub-
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paragraph (B) of such section, 7.5 
percent, 
‘‘(III) in the case of a facility 
which is designed and reasonably ex-
pected to produce qualified clean hy-
drogen which is described in a sub-
paragraph (C) of such section, 10.2 
percent, and 
‘‘(IV) in the case of a facility 
which is designed and reasonably ex-
pected to produce qualified clean hy-
drogen which is described in a sub-
paragraph (D) of such section, 30 
percent. 
‘‘(B) DENIAL OF PRODUCTION CREDIT.— 
No credit shall be allowed under section 45X 
for any taxable year with respect to any speci-
fied clean hydrogen production facility. 
‘‘(C) SPECIFIED CLEAN HYDROGEN PRO-
DUCTION FACILITY.—For purposes of this para-
graph, the term ‘specified clean hydrogen pro-
duction facility’ means any qualified clean hy-
drogen production facility (as defined in section 
45X(d)(3)) or any portion of such facility— 
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‘‘(i) which is placed in service after 
December 31, 2021, and 
‘‘(ii) with respect to which— 
‘‘(I) no credit has been allowed 
under section 45X or 45Q, and 
‘‘(II) the taxpayer makes an ir-
revocable election to have this para-
graph apply. 
‘‘(D) QUALIFIED CLEAN HYDROGEN.—For 
purposes of this paragraph, the term ‘qualified 
clean hydrogen’ has the meaning given such 
term by section 45X(d)(2). 
‘‘(E) REGULATIONS.—The Secretary, after 
consultation with the Secretary of Energy and 
the Administrator of the Environmental Protec-
tion Agency, shall issue such regulations or 
other guidance as the Secretary determines nec-
essary or appropriate to carry out the purposes 
of this section, including regulations or other 
guidance which— 
‘‘(i) requires verification by one or 
more unrelated third parties that the facil-
ity produces hydrogen which is consistent 
with the hydrogen that such facility was 
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designed and expected to produce under 
subparagraph (A)(ii), and 
‘‘(ii) recaptures so much of any credit 
allowed under this section as exceeds the 
amount of the credit which would have 
been allowed if the expected production 
were consistent with the actual verified 
production (or all of the credit so allowed 
in the absence of such verification).’’. 
(2) EFFECTIVE DATE.—The amendments made 
by this section shall apply to periods after December 
31, 2021, under rules similar to the rules of section 
48(m) of the Internal Revenue Code of 1986 (as in 
effect on the day before the date of the enactment 
of the Revenue Reconciliation Act of 1990). 
(d) TERMINATION OF EXCISE TAX CREDIT FOR HY-
DROGEN.— 
(1) 
IN
GENERAL.—Section 
6426(d)(2) 
is 
amended by striking subparagraph (D) and by re-
designating subparagraphs (E), (F), and (G) as sub-
paragraphs (D), (E), and (F), respectively. 
(2) 
CONFORMING
AMENDMENT.—Section 
6426(e)(2) is amended by striking ‘‘(F)’’ and insert-
ing ‘‘(E)’’. 
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(3) EFFECTIVE DATE.—The amendments made 
by this subsection shall apply to fuel sold or used 
after December 31, 2021. 
PART 3—GREEN ENERGY AND EFFICIENCY 
INCENTIVES FOR INDIVIDUALS 
SEC. 136301. EXTENSION, INCREASE, AND MODIFICATIONS 
OF NONBUSINESS ENERGY PROPERTY CRED-
IT. 
(a) EXTENSION OF CREDIT.—Section 25C(g)(2) is 
amended by striking ‘‘December 31, 2021’’ and inserting 
‘‘December 31, 2031’’. 
(b) INCREASE IN CREDIT PERCENTAGE FOR QUALI-
FIED
ENERGY
EFFICIENCY
IMPROVEMENTS.—Section 
25C(a)(1) is amended by striking ‘‘10 percent’’ and insert-
ing ‘‘30 percent’’. 
(c) APPLICATION OF ANNUAL LIMITATION IN LIEU 
OF LIFETIME LIMITATION.—Section 25C(b) is amended 
to read as follows: 
‘‘(b) LIMITATIONS.— 
‘‘(1) IN GENERAL.—The credit allowed under 
this section with respect to any taxpayer for any tax-
able year shall not exceed $1,200. 
‘‘(2) WINDOWS.—The credit allowed under this 
section by reason of subsection (a)(1) with respect to 
any taxpayer for any taxable year shall not exceed— 
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‘‘(A) in the aggregate with respect to all 
exterior windows and skylights which are not 
described in subparagraph (B), $200, 
‘‘(B) in the aggregate with respect to all 
exterior windows and skylights which meet the 
standard for the most efficient certification 
under applicable Energy Star program require-
ments, the excess (if any) of $600 over the 
credit so allowed with respect to all windows 
and skylights taken into account under sub-
paragraph (A). 
‘‘(3) DOORS.—The credit allowed under this 
section by reason of subsection (a)(1) with respect to 
any taxpayer for any taxable year shall not exceed— 
‘‘(A) $250 in the case of any exterior door, 
and 
‘‘(B) $500 in the aggregate with respect to 
all exterior doors.’’. 
(d) MODIFICATIONS RELATED TO QUALIFIED EN-
ERGY EFFICIENCY IMPROVEMENTS.— 
(1) 
STANDARDS
FOR
ENERGY
EFFICIENT 
BUILDING
ENVELOPE
COMPONENTS.—Section 
25C(c)(2) is amended by striking ‘‘meets—’’ and all 
that follows through the period at the end and in-
serting the following: ‘‘meets— 
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‘‘(A) in the case of an exterior window, a 
skylight, or an exterior door, applicable Energy 
Star program requirements, and 
‘‘(B) in the case of any other component, 
the prescriptive criteria for such component es-
tablished by the most recent International En-
ergy Conservation Code standard in effect as of 
the beginning of the calendar year which is 2 
years prior to the calendar year in which such 
component is placed in service.’’. 
(2) ROOFS NOT TREATED AS BUILDING ENVE-
LOPE COMPONENTS.—Section 25C(c)(3) is amended 
by adding ‘‘and’’ at the end of subparagraph (B), by 
striking ‘‘, and’’ at the end of subparagraph (C) and 
inserting a period, and by striking subparagraph 
(D). 
(3) AIR BARRIER INSULATION ADDED TO DEFI-
NITION OF BUILDING ENVELOPE COMPONENT.—Sec-
tion 25C(c)(3)(A) is amended by striking ‘‘material 
or system’’ and inserting ‘‘material or system, in-
cluding air sealing material or system,’’. 
(e) MODIFICATION OF RESIDENTIAL ENERGY PROP-
ERTY EXPENDITURES.—Section 25C(d) is amended to 
read as follows: 
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‘‘(d) RESIDENTIAL ENERGY PROPERTY EXPENDI-
TURES.—For purposes of this section— 
‘‘(1) IN GENERAL.—The term ‘residential en-
ergy property expenditures’ means expenditures 
made by the taxpayer for qualified energy property 
which is— 
‘‘(A) installed on or in connection with a 
dwelling unit located in the United States and 
used as a residence by the taxpayer, and 
‘‘(B) originally placed in service by the tax-
payer. 
Such term includes expenditures for labor costs 
properly allocable to the onsite preparation, assem-
bly, or original installation of the property. 
‘‘(2) QUALIFIED
ENERGY
PROPERTY.—The 
term ‘qualified energy property’ means any of the 
following which meet or exceed the highest efficiency 
tier (not including any advanced tier) established by 
the Consortium for Energy Efficiency which is in ef-
fect as of the beginning of the calendar year in 
which the property is placed in service: 
‘‘(A) An electric heat pump water heater. 
‘‘(B) An electric heat pump. 
‘‘(C) A central air conditioner. 
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‘‘(D) A natural gas, propane, or oil water 
heater. 
‘‘(E) A natural gas, propane, or oil furnace 
or hot water boiler.’’. 
(f) HOME ENERGY AUDITS.— 
(1) IN GENERAL.—Section 25C(a) is amended 
by striking ‘‘and’’ at the end of paragraph (1), by 
striking the period at the end of paragraph (2) and 
inserting ‘‘, and’’, and by adding at the end the fol-
lowing new paragraph: 
‘‘(3) 30 percent of the amount paid or incurred 
by the taxpayer during the taxable year for home en-
ergy audits.’’. 
(2) LIMITATION.—Section 25C(b), as amended 
by subsection (c), is amended adding at the end the 
following new paragraph: 
‘‘(5) HOME ENERGY AUDITS.— 
‘‘(A) DOLLAR
LIMITATION.—The amount 
of the credit allowed under this section by rea-
son of subsection (a)(3) shall not exceed $150. 
‘‘(B) SUBSTANTIATION
REQUIREMENT.— 
No credit shall be allowed under this section by 
reason of subsection (a)(3) unless the taxpayer 
includes with the taxpayer’s return of tax such 
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information or documentation as the Secretary 
may require.’’. 
(3) HOME ENERGY AUDITS.— 
(A) IN GENERAL.—Section 25C, as amend-
ed by subsections (a), is amended by redesig-
nating subsections (e), (f), and (g), as sub-
sections (f), (g), and (h), respectively, and by 
inserting after subsection (d) the following new 
subsection: 
‘‘(e) HOME ENERGY AUDITS.—For purposes of this 
section, the term ‘home energy audit’ means an inspection 
and written report with respect to a dwelling unit located 
in the United States and owned or used by the taxpayer 
as the taxpayer’s principal residence (within the meaning 
of section 121) which— 
‘‘(1) identifies the most significant and cost-ef-
fective energy efficiency improvements with respect 
to such dwelling unit, including an estimate of the 
energy and cost savings with respect to each such 
improvement, and 
‘‘(2) is conducted and prepared by a home en-
ergy auditor that meets the certification or other re-
quirements specified by the Secretary (after con-
sultation with the Secretary of Energy and the Ad-
ministrator of the Environmental Protection Agency 
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and not later than 180 days after the date of the en-
actment of this subsection) in regulations or other 
guidance.’’. 
(B) CONFORMING
AMENDMENT.—Section 
1016(a)(33) is amended by striking ‘‘section 
25C(f)’’ and inserting ‘‘section 25C(g)’’. 
(4) LACK
OF
SUBSTANTIATION
TREATED
AS 
MATHEMATICAL
OR
CLERICAL
ERROR.—Section 
6213(g)(2) is amended— 
(A) in subparagraph (P), by striking 
‘‘and’’ at the end, 
(B) in subparagraph (Q), by striking the 
period at the end and inserting ‘‘, and’’, and 
(C) by adding at the end the following: 
‘‘(R) an omission of correct information or 
documentation 
required 
under 
section 
25C(b)(5)(B) (relating to home energy audits) 
to be included on a return.’’. 
(g) IDENTIFICATION NUMBER REQUIREMENT.— 
(1) IN GENERAL.—Section 25C, as amended by 
subsections (a) and (f), is amended by redesignating 
subsection (h) as subsection (i) and by inserting 
after subsection (g) the following new subsection: 
‘‘(h) PRODUCT IDENTIFICATION NUMBER REQUIRE-
MENT.— 
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‘‘(1) IN GENERAL.—No credit shall be allowed 
under subsection (a) with respect to any item of 
specified property placed in service after December 
31, 2023, unless— 
‘‘(A) such item is produced by a qualified 
manufacturer, and 
‘‘(B) the taxpayer includes the qualified 
product identification number of such item on 
the return of tax for the taxable year. 
‘‘(2) QUALIFIED
PRODUCT
IDENTIFICATION 
NUMBER.—For purposes of this section, the term 
‘qualified product identification number’ means, with 
respect to any item of specified property, the prod-
uct identification number assigned to such item by 
the qualified manufacturer pursuant to the method-
ology referred to in paragraph (3). 
‘‘(3) QUALIFIED MANUFACTURER.— 
‘‘(A) IN GENERAL.—For purposes of this 
section, the term ‘qualified manufacturer’ 
means any manufacturer of specified property 
which enters into an agreement with the Sec-
retary which provides that such manufacturer 
will— 
‘‘(i) assign a product identification 
number to each item of specified property 
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produced by such manufacturer utilizing a 
methodology that will ensure that such 
number (including any alphanumeric) is 
unique to each such item (by utilizing 
numbers or letters which are unique to 
such manufacturer or by such other meth-
od as the Secretary may provide), 
‘‘(ii) label such item with such num-
ber in such manner as the Secretary may 
provide, and 
‘‘(iii) make periodic written reports to 
the Secretary (at such times and in such 
manner as the Secretary may provide) of 
the product identification numbers so as-
signed and including such information as 
the Secretary may require with respect to 
the item of specified property to which 
such number was so assigned. 
‘‘(B) CONSULTATION
WITH
DOE
AND 
EPA.—The Secretary, after consultation with 
the Secretary of Energy and the Administrator 
of the Environmental Protection Agency, shall 
establish procedures for manufacturers and 
consumers to meet the requirements for product 
identification numbers under subparagraph (A). 
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‘‘(4) SPECIFIED PROPERTY.—For purposes of 
this subsection, the term ‘specified property’ means 
any qualified energy property and any property de-
scribed in subparagraph (B) or (C) of subsection 
(c)(3).’’. 
(2) OMISSION OF CORRECT PRODUCT IDENTI-
FICATION NUMBER TREATED AS MATHEMATICAL OR 
CLERICAL ERROR.—Section 6213(g)(2), as amended 
by the preceding provisions of this Act, is amend-
ed— 
(A) in subparagraph (Q), by striking 
‘‘and’’ at the end, 
(B) in subparagraph (R), by striking the 
period at the end and inserting ‘‘, and’’, and 
(C) by adding at the end the following: 
‘‘(S) an omission of a correct product iden-
tification number required under section 25C(h) 
(relating to credit for nonbusiness energy prop-
erty) to be included on a return.’’. 
(h) EFFECTIVE DATES.— 
(1) IN
GENERAL.—Except as otherwise pro-
vided by this subsection, the amendments made by 
this section shall apply to property placed in service 
after December 31, 2021. 
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(2) HOME ENERGY AUDITS.—The amendments 
made by subsection (f) shall apply to amounts paid 
or incurred after December 31, 2021. 
(3) IDENTIFICATION NUMBER REQUIREMENT.— 
The amendments made subsection (g) shall apply to 
property placed in service after December 31, 2023. 
SEC. 136302. RESIDENTIAL ENERGY EFFICIENT PROPERTY. 
(a) EXTENSION OF CREDIT.— 
(1) IN GENERAL.—Section 25D(h) is amended 
by striking ‘‘December 31, 2023’’ and inserting 
‘‘December 31, 2033’’. 
(2) 
APPLICATION
OF
PHASEOUT.—Section 
25D(g) is amended— 
(A) by striking ‘‘before January 1, 2023’’ 
in paragraph (2) and inserting ‘‘before January 
1, 2022’’, 
(B) by striking ‘‘and’’ at the end of para-
graph (2), 
(C) by redesignating paragraph (3) as 
paragraph (5) and by inserting after paragraph 
(2) the following new paragraphs: 
‘‘(3) in the case of property placed in service 
after December 31, 2021, and before January 1, 
2032, 30 percent, 
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‘‘(4) in the case of property placed in service 
after December 31, 2031, and before January 1, 
2033, 26 percent, and’’, and 
(D) by striking ‘‘December 31, 2022, and 
before January 1, 2024’’ in paragraph (5) (as 
so redesignated) and inserting ‘‘December 31, 
2032, and before January 1, 2034’’. 
(b) RESIDENTIAL ENERGY EFFICIENT PROPERTY 
CREDIT FOR BATTERY STORAGE TECHNOLOGY.— 
(1) IN GENERAL.—Section 25D(a) is amended 
by striking ‘‘and’’ at the end of paragraph (5) and 
by inserting after paragraph (6) the following new 
paragraph: 
‘‘(7) the qualified battery storage technology ex-
penditures,’’. 
(2) QUALIFIED
BATTERY
STORAGE
TECH-
NOLOGY EXPENDITURE.—Section 25D(d) is amend-
ed by adding at the end the following new para-
graph: 
‘‘(7) QUALIFIED
BATTERY
STORAGE
TECH-
NOLOGY
EXPENDITURE.—The term ‘qualified bat-
tery storage technology expenditure’ means an ex-
penditure for battery storage technology which— 
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‘‘(A) is installed in connection with a 
dwelling unit located in the United States and 
used as a residence by the taxpayer, and 
‘‘(B) has a capacity of not less than 3 kilo-
watt hours.’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to expenditures made after Decem-
ber 31, 2021. 
SEC. 136303. ENERGY EFFICIENT COMMERCIAL BUILDINGS 
DEDUCTION. 
(a) PLACED
IN SERVICE REQUIREMENT.—Section 
179D(c)(2) is amended by striking ‘‘the date that is 2 
years before the date that construction of such property 
begins’’ and inserting ‘‘the date that is 2 years before the 
date such property is placed into service’’. 
(b) TEMPORARY INCREASE IN DEDUCTION, ETC..— 
Section 179D is amended by adding at the end the fol-
lowing: 
‘‘(i) TEMPORARY RULES.— 
‘‘(1) PERIOD OF APPLICATION.—The provisions 
of this subsection shall apply only to taxable years 
beginning after December 31, 2021, and before Jan-
uary 1, 2032. 
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‘‘(2) MODIFICATION
OF
EFFICIENCY
STAND-
ARD.—Subsection (c)(1)(D) shall be applied by sub-
stituting ‘25’ for ‘50’. 
‘‘(3) MAXIMUM AMOUNT OF DEDUCTION.— 
‘‘(A) IN GENERAL.—The deduction under 
subsection (a) with respect to any building for 
any taxable year shall not exceed the excess (if 
any) of— 
‘‘(i) the product of— 
‘‘(I) the applicable dollar value, 
and 
‘‘(II) the square footage of the 
building, over 
‘‘(ii) the aggregate amount of the de-
ductions under subsection (a) and para-
graph (6) with respect to the building for 
the 3 taxable years immediately preceding 
such taxable year (or, in the case of any 
such deduction allowable to a person other 
than the taxpayer, for any taxable year 
ending during the 4-taxable-year period 
ending with such taxable year). 
‘‘(B) APPLICABLE
DOLLAR
VALUE.—For 
purposes of paragraph (3)(A)(i), the applicable 
dollar value shall be an amount equal to $2.50 
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increased (but not above $5.00) by $0.10 for 
each percentage point by which the total annual 
energy and power costs for the building are cer-
tified to be reduced by a percentage greater 
than 25 percent. 
‘‘(C) APPLICATION OF INFLATION ADJUST-
MENT.—Subsection (g) shall be applied— 
‘‘(i) by substituting ‘2022’ for ‘2020’, 
‘‘(ii) 
by 
substituting 
‘subsection 
(i)(3)(B)’ for ‘subsection (b) or subsection 
(d)(1)(A)’, and 
‘‘(iii) 
by 
substituting 
‘2021’ 
for 
‘2019’. 
‘‘(D) LIMITATION TO APPLY IN LIEU OF 
CURRENT
LIMITATION
AND
PARTIAL
ALLOW-
ANCE.—Subsections (b) and (d)(1) shall not 
apply. 
‘‘(4) BASE CREDIT AMOUNT AND INCREASED 
CREDIT AMOUNT FOR CERTAIN PROPERTY.— 
‘‘(A) IN
GENERAL.—In the case of any 
property which does not satisfy the require-
ments of subparagraph (B), paragraph (3)(B) 
shall be applied by substituting ‘$0.50’ for 
‘$2.50’, ‘$.02’ for ‘$.10’, and ‘$1.00’ for 
‘$5.00’. 
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‘‘(B) INCREASED
CREDIT
FOR
CERTAIN 
PROPERTY
MEETING
PROJECT
REQUIRE-
MENTS.— 
‘‘(i) 
PROJECT
REQUIREMENTS.—A 
project meets the requirements of this sub-
paragraph if it is one of the following: 
‘‘(I) A project which commences 
construction prior to the date of the 
enactment of this paragraph. 
‘‘(II) A project which commences 
construction after the date of enact-
ment of this paragraph and satisfies 
the requirements of paragraphs (5) 
and (6). 
‘‘(III) A project with respect to 
which initial construction is completed 
and building modifications are made 
as part of a qualified retrofit plan, 
and which satisfies paragraphs (5) 
and (6). 
‘‘(5) PREVAILING WAGE REQUIREMENTS.— 
‘‘(A) IN GENERAL.—The requirements de-
scribed in this subparagraph with respect to 
any project are that the taxpayer shall ensure 
that any laborers and mechanics employed by 
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contractors and subcontractors in the construc-
tion of any property or with respect to building 
modifications made as part of a qualified ret-
rofit plan shall be paid wages at rates not less 
than the prevailing rates for construction, alter-
ation, or repair of a similar character in the lo-
cality as most recently determined by the Sec-
retary of Labor, in accordance with subchapter 
IV of chapter 31 of title 40, United States 
Code. 
‘‘(B) CORRECTION AND PENALTY RELATED 
TO
FAILURE
TO
SATISFY
WAGE
REQUIRE-
MENTS.—In the case of any taxpayer which 
fails to satisfy the requirement under subpara-
graph (A) with respect to any project or any 
building modifications made as part of a quali-
fied retrofit plan, rules similar to the rules of 
section 45(b)(8)(B) shall apply for purposes of 
this paragraph. 
‘‘(6) APPRENTICESHIP
REQUIREMENTS.—The 
requirements described in this subparagraph with re-
spect to any property are as follows: 
‘‘(A) LABOR HOURS.— 
‘‘(i) PERCENTAGE OF TOTAL LABOR 
HOURS.—All contractors and subcontrac-
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tors engaged in the performance of con-
struction of a project or building modifica-
tions made as part of a qualified retrofit 
plan shall, subject to subparagraph (B), 
ensure that not less than the applicable 
percentage of the total labor hours of such 
work be performed by qualified appren-
tices. 
‘‘(ii) APPLICABLE PERCENTAGE.—For 
purposes of paragraph (1), the applicable 
percentage shall be— 
‘‘(I) in the case of any applicable 
project the construction of which be-
gins before January 1, 2023, 5 per-
cent, 
‘‘(II) in the case of any applica-
ble project the construction of which 
begins after December 31, 2022, and 
before January 1, 2024, 10 percent, 
and 
‘‘(III) in the case of any applica-
ble project the construction of which 
begins after December 31, 2023, 15 
percent. 
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1850 
‘‘(B) APPRENTICE
TO
JOURNEYWORKER 
RATIO.—The requirement under subparagraph 
(A)(i) shall be subject to any applicable require-
ments for apprentice-to-journeyworker ratios of 
the Department of Labor or the applicable 
State apprenticeship agency. 
‘‘(C) 
PARTICIPATION.—Each 
contractor 
and subcontractor who employs 4 or more indi-
viduals to perform construction, alteration, or 
repair work on an applicable project shall em-
ploy 1 or more qualified apprentices to perform 
such work. 
‘‘(D) EXCEPTION.— 
‘‘(i) IN
GENERAL.—Notwithstanding 
any other provision of this paragraph, this 
paragraph shall not apply in the case of a 
taxpayer who— 
‘‘(I) demonstrates a lack of avail-
ability of qualified apprentices in the 
geographic area of the construction, 
alteration, or repair work, and 
‘‘(II) makes a good faith effort to 
comply with the requirements of this 
paragraph. 
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‘‘(ii) GOOD FAITH EFFORT.—For pur-
poses of clause (i), a taxpayer shall be 
deemed to have satisfied the requirements 
under such paragraph with respect to an 
applicable project if such taxpayer has re-
quested qualified apprentices from a reg-
istered apprenticeship program, as defined 
in section 3131(e)(3)(B), and such request 
has been denied, provided that such denial 
is not the result of a refusal by the con-
tractors or subcontractors engaged in the 
performance of construction, alteration, or 
repair work on such applicable project to 
comply with the established standards and 
requirements of such apprenticeship pro-
gram. 
‘‘(E) DEFINITIONS.—For purposes of this 
paragraph— 
‘‘(i) LABOR HOURS.—The term ‘labor 
hours’ has the meaning given such term in 
section 45(b)(9)(E)(i). 
‘‘(ii) QUALIFIED
APPRENTICE.—The 
term ‘qualified apprentice’ has the mean-
ing 
given 
such 
term 
in 
section 
45(b)(9)(E)(ii). 
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‘‘(7) ALLOCATION OF DEDUCTION BY CERTAIN 
TAX-EXEMPT ENTITIES.— 
‘‘(A) IN
GENERAL.—A specified tax-ex-
empt entity shall be treated in the same manner 
as a Federal, State, or local government for 
purposes of applying subsection (d)(4). 
‘‘(B) SPECIFIED
TAX-EXEMPT
ENTITY.— 
For purposes of this paragraph, the term ‘spec-
ified tax-exempt entity’ means— 
‘‘(i) the United States, any State or 
political subdivision thereof, any possession 
of the United States, or any agency or in-
strumentality of any of the foregoing, 
‘‘(ii) any Indian tribal government 
(within the meaning of section 139E), and 
‘‘(iii) any organization exempt from 
tax imposed by this chapter. 
‘‘(8) ALTERNATIVE
DEDUCTION
FOR
ENERGY 
EFFICIENT RETROFIT BUILDING PROPERTY.— 
‘‘(A) IN GENERAL.—In the case of a tax-
payer which elects (at such time and in such 
manner as the Secretary, after consultation 
with the administrator of the Environmental 
Protection Agency, may provide) the application 
of this paragraph with respect to any qualified 
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building, there shall be allowed as a deduction 
for the taxable year which includes the date of 
the qualifying final certification with respect to 
the qualified retrofit plan of such building, an 
amount equal to the lesser of— 
‘‘(i) the excess described in paragraph 
(3) (determined by substituting ‘energy 
usage intensity’ for ‘total annual energy 
and power costs’ in subparagraph (B) 
thereof), or 
‘‘(ii) the aggregate adjusted basis (de-
termined after taking into account all ad-
justments with respect to such taxable year 
other than the reduction under subsection 
(e)) of energy efficient retrofit building 
property placed in service by the taxpayer 
pursuant to such qualified retrofit plan. 
‘‘(B) QUALIFIED
RETROFIT
PLAN.—For 
purposes of this paragraph, the term ‘qualified 
retrofit plan’ means a written plan prepared by 
a qualified professional which specifies modi-
fications to a building which, in the aggregate, 
are expected to reduce such building’s energy 
usage intensity by 25 percent or more in com-
parison to the baseline energy usage intensity of 
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1854 
such building. Such plan shall provide for a 
qualified professional to— 
‘‘(i) as of any date during the 1-year 
period ending on the date of the first cer-
tification described in clause (ii), certify 
the energy usage intensity of such building 
as of such date, 
‘‘(ii) certify the status of property in-
stalled pursuant to such plan as meeting 
the requirements of clauses (ii) and (iii) 
subparagraph (C), and 
‘‘(iii) as of any date that is more than 
1 year after completion of the plan, certify 
the energy usage intensity of such building 
as of such date. 
‘‘(C) 
ENERGY
EFFICIENT
RETROFIT 
BUILDING
PROPERTY.—For purposes of this 
paragraph, the term ‘energy efficient retrofit 
building property’ means property— 
‘‘(i) with respect to which depreciation 
(or amortization in lieu of depreciation) is 
allowable, 
‘‘(ii) which is installed on or in any 
qualified building, 
‘‘(iii) which is installed as part of— 
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‘‘(I) the interior lighting systems, 
‘‘(II) the heating, cooling, ven-
tilation, and hot water systems, or 
‘‘(III) the building envelope, and 
‘‘(iv) which is certified in accordance 
with subparagraph (B)(ii) as meeting the 
requirements of clauses (ii) and (iii). 
‘‘(D) QUALIFIED
BUILDING.—For pur-
poses of this paragraph, the term ‘qualified 
building’ means any building which— 
‘‘(i) is located in the United States, 
and 
‘‘(ii) was originally placed in service 
not less than 5 years before the establish-
ment of the qualified retrofit plan with re-
spect to such building. 
‘‘(E) 
QUALIFYING
FINAL
CERTIFI-
CATION.—For purposes of this paragraph, the 
term ‘qualifying final certification’ means, with 
respect to any qualified retrofit plan, the certifi-
cation described in subparagraph (B)(iii) if the 
energy usage intensity certified in such certifi-
cation is not more than 75 percent of the base-
line energy usage intensity of the building. 
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‘‘(F) BASELINE
ENERGY
USAGE
INTEN-
SITY.— 
‘‘(i) IN GENERAL.—The term ‘baseline 
energy usage intensity’ means the energy 
usage intensity certified under subpara-
graph (B)(i), as adjusted to take into ac-
count weather as compared to the energy 
usage intensity determined under subpara-
graph (B)(iii)(I). 
‘‘(ii) DETERMINATION
OF
ADJUST-
MENT.—For purposes of clause (i), the ad-
justments described in such clause shall be 
determined in such manner as the Sec-
retary, after consultation with the Admin-
istrator of the Environmental Protection 
Agency, may provide. 
‘‘(G) OTHER DEFINITIONS.—For purposes 
of this paragraph— 
‘‘(i) ENERGY USAGE INTENSITY.—The 
term ‘energy usage intensity’ means the 
site energy usage intensity determined in 
accordance with such regulations or other 
guidance as the Secretary, after consulta-
tion with the Administrator of the Envi-
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ronmental Protection Agency, may provide 
and measured in British thermal units. 
‘‘(ii) 
QUALIFIED
PROFESSIONAL.— 
The term ‘qualified professional’ means an 
individual who is a licensed architect or a 
licenced engineer and meets such other re-
quirements as the Secretary may provide. 
‘‘(H) COORDINATION
WITH
DEDUCTION 
OTHERWISE
ALLOWED
UNDER
SUBSECTION 
(a).— 
‘‘(i) IN GENERAL.—In the case of any 
building with respect to which an election 
is made under subparagraph (A), the term 
‘energy efficient commercial building prop-
erty’ shall not include any energy efficient 
retrofit building property with respect to 
which a deduction is allowable under this 
paragraph. 
‘‘(ii) CERTAIN RULES NOT APPLICA-
BLE.— 
‘‘(I) IN
GENERAL.—Except as 
provided in subclause (II), subsection 
(d) shall not apply for purposes of 
this paragraph. 
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‘‘(II) ALLOCATION
OF
DEDUC-
TION BY CERTAIN TAX-EXEMPT ENTI-
TIES.—Rules similar to subsection 
(d)(4) (determined after application of 
paragraph (5)) shall apply for pur-
poses of this paragraph.’’. 
(c) EFFECTIVE DATE.— 
(1) IN
GENERAL.—Except as otherwise pro-
vided in this subsection, the amendment made by 
this section shall apply to taxable years beginning 
after December 31, 2021. 
(2) ALTERNATIVE DEDUCTION FOR ENERGY EF-
FICIENT
RETROFIT
BUILDING
PROPERTY.—Para-
graph (6) of section 179D(i) of the Internal Revenue 
Code of 1986 (as added by this section), and any 
other provision of such section solely for purposes of 
applying such paragraph, shall apply to property 
placed in service after December 31, 2021 (in tax-
able years ending after such date) if such property 
is placed in service pursuant to qualified retrofit 
plan (within the meaning of such section) estab-
lished after such date. 
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1859 
SEC. 136304. EXTENSION, INCREASE, AND MODIFICATIONS 
OF NEW ENERGY EFFICIENT HOME CREDIT. 
(a) EXTENSION
OF CREDIT.—Section 45L(g) is 
amended by striking ‘‘December 31, 2021’’ and inserting 
‘‘December 31, 2031’’. 
(b) INCREASE
IN
CREDIT
AMOUNTS.—Section 
45L(a)(2) is amended to read as follows: 
‘‘(2) APPLICABLE AMOUNT.—For purposes of 
paragraph (1), the applicable amount is an amount 
equal to— 
‘‘(A) in the case of a dwelling unit which 
is eligible to participate in the Energy Star 
Residential New Construction Program or the 
Energy Star Manufactured New Homes pro-
gram— 
‘‘(i) that is described in subsection 
(c)(1)(A) (and not described in subsection 
(c)(1)(B)), $2,500, and 
‘‘(ii) that is described in subsection 
(c)(1)(B), $5000, and 
‘‘(B) in the case of a dwelling which are 
part of a building eligible to participate in the 
Energy Star Multifamily New Construction 
Program— 
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‘‘(i) that is described in subsection 
(c)(1)(A) (and not described in subsection 
(c)(1)(B)), $500, and 
‘‘(ii) that is described in subsection 
(c)(1)(B), $1000.’’. 
(c) MODIFICATION OF ENERGY SAVING REQUIRE-
MENTS.—Section 45L(c) is amended to read as follows: 
‘‘(c) ENERGY SAVING REQUIREMENTS.— 
‘‘(1) IN GENERAL.—A dwelling unit meets the 
energy saving requirements of this subsection if— 
‘‘(A) such dwelling unit meets the require-
ments of paragraph (2) or (3) (whichever is ap-
plicable), or 
‘‘(B) such dwelling unit is certified as a 
zero energy ready home under the zero energy 
ready home program of the Department of En-
ergy (or any successor program determined by 
the Secretary, after consultation with the Sec-
retary of Energy) as in effect on January 1, 
2022. 
‘‘(2) SINGLE-FAMILY HOME REQUIREMENTS.— 
A dwelling unit meets the requirements of this para-
graph if— 
‘‘(A) such dwelling unit meets— 
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‘‘(i) in the case of a dwelling unit ac-
quired before January 1, 2025, the Energy 
Star Single-Family New Homes National 
Program Requirements 3.1, and 
‘‘(ii) in the case of a dwelling unit ac-
quired after December 31, 2024, the En-
ergy Star Single-Family New Homes Na-
tional Program Requirements 3.2, 
‘‘(B) such dwelling unit meets the most re-
cent Energy Star Single-Family New Homes 
Program Requirements applicable to the loca-
tion of such dwelling unit (as in effect on the 
latter of January 1, 2022 or January 1 of two 
calendar years prior to the date the dwelling 
was acquired), or 
‘‘(C) such dwelling unit meets the most re-
cent Energy Star Manufactured Home National 
program requirements as in effect on the latter 
of January 1, 2022 or January 1 of two cal-
endar years prior to the date such dwelling unit 
is acquired. 
‘‘(3) MULTI-FAMILY HOME REQUIREMENTS.—A 
dwelling unit meets the requirements of this para-
graph if— 
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‘‘(A) such dwelling unit meets the most re-
cent Energy Star Multifamily New Construction 
National Program Requirements (as in effect 
on either January 1, 2022 or January 1 of 
three calendar years prior to the date the dwell-
ing was acquired, whichever is later), and 
‘‘(B) such dwelling unit meets the most re-
cent Energy Star Multifamily New Construction 
Regional Program Requirements applicable to 
the location of such dwelling unit (as in effect 
on either January 1, 2022 or January 1 of 
three calendar years prior to the date the dwell-
ing was acquired, whichever is later).’’. 
(d) PREVAILING
WAGE
REQUIREMENT.—Section 
45L is amended by redesignating subsection (g) as sub-
section (h) and by inserting after subsection (f) the fol-
lowing new subsection: 
‘‘(g) PREVAILING WAGE REQUIREMENT.— 
‘‘(1) IN GENERAL.—In the case of a qualifying 
residence described in subsection (b)(2)(B) meeting 
the prevailing wage requirements of paragraph (2), 
the credit amount allowed with respect to such resi-
dence shall be— 
‘‘(A) $2,500 in the case of a residence de-
scribed in subparagraph (A) of subsection 
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1863 
(c)(1) (and not described in subparagraph (B) 
of such subsection), and 
‘‘(B) $5,000 in the case of a residence de-
scribed in (c)(1)(B). 
‘‘(2) PREVAILING WAGE REQUIREMENTS.— 
‘‘(A) IN GENERAL.—The requirements de-
scribed in this paragraph with respect to any 
qualified residence are that the taxpayer shall 
ensure that any laborers and mechanics em-
ployed by contractors and subcontractors in the 
construction of such residence shall be paid 
wages at rates not less than the prevailing rates 
for construction, alteration, or repair of a simi-
lar character in the locality as most recently de-
termined by the Secretary of Labor, in accord-
ance with subchapter IV of chapter 31 of title 
40, United States Code. 
‘‘(B) CORRECTION AND PENALTY RELATED 
TO
FAILURE
TO
SATISFY
WAGE
REQUIRE-
MENTS.—In the case of any taxpayer which 
fails to satisfy the requirement under subpara-
graph (A) with respect to any qualified resi-
dence, rules similar to the rules of section 
45(b)(8)(B) shall apply for purposes of this 
paragraph. 
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1864 
‘‘(3) REGULATIONS AND GUIDANCE.—The Sec-
retary shall issue such regulations or other guidance 
as the Secretary determines necessary or appropriate 
to carry out the purposes of this subsection.’’. 
(e) EFFECTIVE DATES.—The amendments made by 
this section shall apply to dwelling units acquired after 
December 31, 2021. 
SEC. 136305. MODIFICATIONS TO INCOME EXCLUSION FOR 
CONSERVATION SUBSIDIES. 
(a) IN GENERAL.—Section 136(a) is amended— 
(1) by striking ‘‘any subsidy provided’’ and in-
serting ‘‘any subsidy— 
‘‘(1) provided’’, 
(2) by striking the period at the end and insert-
ing a comma, and 
(3) by adding at the end the following new 
paragraphs: 
‘‘(2) provided (directly or indirectly) by a public 
utility to a customer, or by a State or local govern-
ment to a resident of such State or locality, for the 
purchase or installation of any water conservation or 
efficiency measure, 
‘‘(3) provided (directly or indirectly) by a storm 
water management provider to a customer, or by a 
State or local government to a resident of such State 
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or locality, for the purchase or installation of any 
storm water management measure, or 
‘‘(4) provided (directly or indirectly) by a State 
or local government to a resident of such State or 
locality for the purchase or installation of any waste-
water management measure, but only if such meas-
ure is with respect to the taxpayer’s principal resi-
dence.’’. 
(b) CONFORMING AMENDMENTS.— 
(1) DEFINITION OF WATER CONSERVATION OR 
EFFICIENCY MEASURE AND STORM WATER MANAGE-
MENT MEASURE.—Section 136(c) is amended— 
(A) by striking ‘‘ENERGY CONSERVATION 
MEASURE’’ in the heading thereof and inserting 
‘‘DEFINITIONS’’, 
(B) by striking ‘‘IN
GENERAL’’ in the 
heading of paragraph (1) and inserting ‘‘EN-
ERGY CONSERVATION MEASURE’’, and 
(C) by redesignating paragraph (2) as 
paragraph (5) and by inserting after paragraph 
(1) the following: 
‘‘(2) WATER
CONSERVATION
OR
EFFICIENCY 
MEASURE.—For purposes of this section, the term 
‘water conservation or efficiency measure’ means any 
evaluation of water use, or any installation or modi-
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fication of property, the primary purpose of which is 
to reduce consumption of water or to improve the 
management of water demand with respect to one or 
more dwelling units. 
‘‘(3) STORM WATER MANAGEMENT MEASURE.— 
For purposes of this section, the term ‘storm water 
management measure’ means any installation or 
modification of property primarily designed to re-
duce or manage amounts of storm water with re-
spect to one or more dwelling units. 
‘‘(4) WASTEWATER MANAGEMENT MEASURE.— 
For purposes of this section, the term ‘wastewater 
management measure’ means any installation or 
modification of property primarily designed to man-
age wastewater (including septic tanks and cess-
pools) with respect to one or more dwelling units.’’. 
(2) DEFINITION OF PUBLIC UTILITY.—Section 
136(c)(5) (as redesignated by paragraph (1)(C)) is 
amended by striking subparagraph (B) and inserting 
the following: 
‘‘(B) PUBLIC UTILITY.—The term ‘public 
utility’ means a person engaged in the sale of 
electricity, natural gas, or water to residential, 
commercial, or industrial customers for use by 
such customers. 
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‘‘(C) STORM
WATER
MANAGEMENT
PRO-
VIDER.—The term ‘storm water management 
provider’ means a person engaged in the provi-
sion of storm water management measures to 
the public. 
‘‘(D) PERSON.—For purposes of subpara-
graphs (B) and (C), the term ‘person’ includes 
the Federal Government, a State or local gov-
ernment or any political subdivision thereof, or 
any instrumentality of any of the foregoing.’’. 
(3) CLERICAL AMENDMENTS.— 
(A) The heading for section 136 is amend-
ed— 
(i) by inserting ‘‘AND WATER’’ after 
‘‘ENERGY’’, and 
(ii) by striking ‘‘PROVIDED BY PUB-
LIC UTILITIES’’. 
(B) The item relating to section 136 in the 
table of sections of part III of subchapter B of 
chapter 1 is amended— 
(i) by inserting ‘‘and water’’ after 
‘‘energy’’, and 
(ii) by striking ‘‘provided by public 
utilities’’. 
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(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to amounts received after Decem-
ber 31, 2018. 
(d) NO INFERENCE.—Nothing in this Act or the 
amendments made by this Act shall be construed to create 
any inference with respect to the proper tax treatment of 
any subsidy received directly or indirectly from a public 
utility, a storm water management provider, or a State 
or local government for any water conservation measure 
or storm water management measure before January 1, 
2019. 
PART 4—GREENING THE FLEET AND 
ALTERNATIVE VEHICLES 
SEC. 136401. REFUNDABLE NEW QUALIFIED PLUG-IN ELEC-
TRIC DRIVE MOTOR VEHICLE CREDIT FOR IN-
DIVIDUALS. 
(a) IN GENERAL.—Subpart C of part IV of sub-
chapter A of chapter 1 is amended by inserting after sec-
tion 36B the following new section: 
‘‘SEC. 36C. NEW QUALIFIED PLUG-IN ELECTRIC DRIVE 
MOTOR VEHICLES. 
‘‘(a) ALLOWANCE OF CREDIT.—In the case of an in-
dividual, there shall be allowed as a credit against the tax 
imposed by this subtitle for the taxable year an amount 
equal to the sum of the credit amounts determined under 
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subsection (b) with respect to each new qualified plug-in 
electric drive motor vehicle placed in service by the tax-
payer during the taxable year. 
‘‘(b) PER VEHICLE DOLLAR LIMITATION.— 
‘‘(1) IN
GENERAL.—The amount determined 
under this subsection with respect to any new quali-
fied plug-in electric drive motor vehicle is the sum 
of the amounts determined under paragraphs (2) 
through (5) with respect to such vehicle (not to ex-
ceed 50 percent of the purchase price of such vehi-
cle). 
‘‘(2) BASE AMOUNT.—The amount determined 
under this paragraph is $4,000. 
‘‘(3) BATTERY CAPACITY.—In the case of a new 
qualified plug-in electric drive motor vehicle, the 
amount determined under this paragraph is $3,500 
if— 
‘‘(A) in the case of a vehicle placed in serv-
ice before January 1, 2027, such vehicle draws 
propulsion energy from a battery with not less 
than 40 kilowatt hours of capacity, and 
‘‘(B) in the case of a vehicle placed in serv-
ice after December 31, 2026, such vehicle 
draws propulsion energy from a battery with 
not less than 50 kilowatt hours of capacity. 
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‘‘(4) DOMESTIC ASSEMBLY.—In the case of a 
new qualified plug-in vehicle which satisfies the do-
mestic assembly qualifications, the amount deter-
mined under this paragraph is $4,500. 
‘‘(5) DOMESTIC CONTENT.—In the case of a 
new qualified plug-in vehicle which satisfies domestic 
content qualifications, the amount determined under 
this paragraph is $500. 
‘‘(c) LIMITATION BASED ON MODIFIED ADJUSTED 
GROSS INCOME.— 
‘‘(1) IN GENERAL.—The amount of the credit 
allowable under subsection (a) shall be reduced (but 
not below zero) by $200 for each $1,000 (or fraction 
thereof) by which the taxpayer’s modified adjusted 
gross income exceeds the threshold amount. For 
purposes of the preceding sentence, the term ‘modi-
fied adjusted gross income’ means adjusted gross in-
come increased by any amount excluded from gross 
income under section 911, 931, or 933. 
‘‘(2) SPECIAL RULE FOR DETERMINATION OF 
MODIFIED ADJUSTED GROSS INCOME.—The modified 
adjusted gross income of the taxpayer that is taken 
into account for purposes of paragraph (1) shall be 
the lesser of— 
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‘‘(A) the modified adjusted gross income 
for the taxable year in which the credit is 
claimed, or 
‘‘(B) the modified adjusted gross income 
for the immediately preceding taxable year. 
‘‘(3) THRESHOLD AMOUNT.—For purposes of 
paragraph (1), the term ‘threshold amount’ means— 
‘‘(A) $800,000 in the case of a joint return 
or surviving spouse (half such amount for mar-
ried filing separately), 
‘‘(B) $600,000 in the case of a head of 
household, and 
‘‘(C) $400,000 in any other case. 
‘‘(d) MANUFACTURER’S SUGGESTED RETAIL PRICE 
LIMITATION.— 
‘‘(1) IN GENERAL.—No credit shall be allowed 
under subsection (a) for a vehicle with a manufac-
turer’s suggested retail price in excess of the appli-
cable limitation. 
‘‘(2) APPLICABLE LIMITATION.—For purposes 
of paragraph (1), the applicable limitation for each 
vehicle classification is as follows: 
‘‘(A) SEDANS.—In the case of a sedan, 
$55,000. 
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‘‘(B) VANS.—In the case of a van, 
$64,000. 
‘‘(C) SPORT
UTILITY
VEHICLES.—In the 
case of a sport utility vehicle, $69,000. 
‘‘(D) PICKUP TRUCKS.—In the case of a 
pickup truck, $74,000. 
‘‘(3) REGULATIONS.—For purposes of this sub-
section, the Secretary shall prescribe regulations for 
determining vehicle classifications using criteria 
similar to that employed by the Environmental Pro-
tection Agency and the Department of Energy to de-
termine size and class of vehicles. 
‘‘(e) NEW QUALIFIED PLUG-IN ELECTRIC DRIVE 
MOTOR VEHICLE.—For purposes of this section— 
‘‘(1) IN
GENERAL.—The term ‘new qualified 
plug-in electric drive motor vehicle’ means a motor 
vehicle— 
‘‘(A) the original use of which commences 
with the taxpayer, 
‘‘(B) which is acquired for use by the tax-
payer and not for resale, 
‘‘(C) which is made by a qualified manu-
facturer, 
‘‘(D) which is treated as a motor vehicle 
for purposes of title II of the Clean Air Act, 
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‘‘(E) which has a gross vehicle weight rat-
ing of less than 14,000 pounds, 
‘‘(F) which is propelled to a significant ex-
tent by an electric motor which draws electricity 
from a battery which— 
‘‘(i) has a capacity of— 
‘‘(I) in the case of a vehicle 
placed in service in 2022 or 2023, not 
less than 7 kilowatt hours, and 
‘‘(II) in the case of a vehicle 
placed in service after 2023, not less 
than 10 kilowatt hours, and 
‘‘(ii) is capable of being recharged 
from an external source of electricity, 
‘‘(G) for which, in the case of a vehicle 
placed into service after December 31, 2026, 
final assembly is within the United States, and 
‘‘(H) is not of a character subject to an al-
lowance for depreciation. 
‘‘(2) MOTOR VEHICLE.—The term ‘motor vehi-
cle’ means any vehicle which is manufactured pri-
marily for use on public streets, roads, and highways 
(not including a vehicle operated exclusively on a rail 
or rails) and which has at least 4 wheels. 
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‘‘(3) QUALIFIED
MANUFACTURER.—The term 
‘qualified manufacturer’ means any manufacturer 
(within the meaning of the regulations prescribed by 
the Administrator of the Environmental Protection 
Agency for purposes of the administration of title II 
of the Clean Air Act (42 U.S.C. 7521 et seq.) which 
enters into a written agreement with the Secretary 
under which such manufacturer agrees— 
‘‘(A) to ensure that each vehicle manufac-
tured by such manufacturer after the later of 
the date on which such agreement takes effect 
or December 31, 2021, and that meets the re-
quirements of subparagraphs (D), (E), and (F) 
of paragraph (1) and paragraph (6) of sub-
section (e) is labeled with a unique vehicle iden-
tification number, and 
‘‘(B) to make periodic written reports to 
the Secretary (at such times and in such man-
ner as the Secretary may provide) providing 
such vehicle identification numbers and such 
other information related to such vehicle as the 
Secretary may require. 
‘‘(4) BATTERY CAPACITY.—The term ‘capacity’ 
means, with respect to any battery, the quantity of 
electricity which the battery is capable of storing, ex-
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pressed in kilowatt hours, as measured from a 100 
percent state of charge to a 0 percent state of 
charge. 
‘‘(f) SPECIAL RULES.— 
‘‘(1) BASIS REDUCTION.—For purposes of this 
subtitle, the basis of any property for which a credit 
is allowable under subsection (a) shall be reduced by 
the amount of such credit so allowed. 
‘‘(2) NO
DOUBLE
BENEFIT.—The amount of 
any deduction or other credit allowable under this 
chapter for a vehicle for which a credit is allowable 
under subsection (a) shall be reduced by the amount 
of credit allowed under such subsection for such ve-
hicle. 
‘‘(3) PROPERTY USED OUTSIDE UNITED STATES 
NOT QUALIFIED.—No credit shall be allowable under 
subsection (a) with respect to any property referred 
to in section 50(b)(1). 
‘‘(4) RECAPTURE.—The Secretary shall, by reg-
ulations, provide for recapturing the benefit of any 
credit allowable under subsection (a) with respect to 
any property which ceases to be property eligible for 
such credit. 
‘‘(5) ELECTION
NOT
TO
TAKE
CREDIT.—No 
credit shall be allowed under subsection (a) for any 
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vehicle if the taxpayer elects to not have this section 
apply to such vehicle. 
‘‘(6) INTERACTION
WITH
AIR
QUALITY
AND 
MOTOR
VEHICLE
SAFETY
STANDARDS.—A vehicle 
shall not be considered eligible for a credit under 
this section unless such vehicle is in compliance 
with— 
‘‘(A) the applicable provisions of the Clean 
Air Act for the applicable make and model year 
of the vehicle (or applicable air quality provi-
sions of State law in the case of a State which 
has adopted such provision under a waiver 
under section 209(b) of the Clean Air Act), and 
‘‘(B) the motor vehicle safety provisions of 
sections 30101 through 30169 of title 49, 
United States Code. 
‘‘(g) CREDIT ALLOWED
FOR 2 AND 3-WHEELED 
PLUG-IN ELECTRIC VEHICLES.— 
‘‘(1) IN GENERAL.—In the case of a qualified 
2- or 3-wheeled plug-in electric vehicle— 
‘‘(A) there shall be allowed as a credit 
against the tax imposed by this subtitle for the 
taxable year an amount equal to the sum of the 
applicable amount with respect to each such 
qualified 2- or 3-wheeled plug-in electric vehicle 
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placed in service by the taxpayer during the 
taxable year, and 
‘‘(B) the amount of the credit allowed 
under subparagraph (A) shall be treated as a 
credit allowed under subsection (a). 
‘‘(2) APPLICABLE AMOUNT.—For purposes of 
paragraph (1), the applicable amount is an amount 
equal to the lesser of— 
‘‘(A) 10 percent of the cost of the qualified 
2- or 3-wheeled plug-in electric vehicle, or 
‘‘(B) $2,500. 
‘‘(3) QUALIFIED
2- OR
3-WHEELED
PLUG-IN 
ELECTRIC VEHICLE.—The term ‘qualified 2- or 3- 
wheeled plug-in electric vehicle’ means any vehicle 
which— 
‘‘(A) has 2 or 3 wheels, 
‘‘(B) meets the requirements of subpara-
graphs (A), (B), (C), (E), (F), and (G) of sub-
section (e)(1) (determined by substituting ‘2.5 
kilowatt hours’ for ‘7 kilowatt hours’ in sub-
paragraph (F)(i)(I) and by substituting ‘2.5 kil-
owatt hours’ for ‘10 kilowatt hours’ in subpara-
graph (F)(i)(II)), 
‘‘(C) is manufactured primarily for use on 
public streets, roads, and highways, and 
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‘‘(D) is capable of achieving a speed of 45 
miles per hour or greater. 
‘‘(h) VIN NUMBER REQUIREMENT.—No credit shall 
be allowed under this section with respect to any vehicle 
unless the taxpayer includes the vehicle identification 
number of such vehicle on the return of tax for the taxable 
year. 
‘‘(i) TREATMENT OF CERTAIN POSSESSIONS.— 
‘‘(1) PAYMENTS TO POSSESSIONS WITH MIRROR 
CODE TAX SYSTEMS.—The Secretary shall pay to 
each possession of the United States which has a 
mirror code tax system amounts equal to the loss (if 
any) to that possession by reason of the application 
of the provisions of this section (determined without 
regard to this subsection). Such amounts shall be 
determined by the Secretary based on information 
provided by the government of the respective posses-
sion. 
‘‘(2) PAYMENTS TO OTHER POSSESSIONS.—The 
Secretary shall pay to each possession of the United 
States which does not have a mirror code tax system 
amounts estimated by the Secretary as being equal 
to the aggregate benefits (if any) that would have 
been provided to residents of such possession by rea-
son of the provisions of this section if a mirror code 
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tax system had been in effect in such possession. 
The preceding sentence shall not apply unless the re-
spective possession has a plan which has been ap-
proved by the Secretary under which such possession 
will promptly distribute such payments to its resi-
dents. 
‘‘(3) MIRROR CODE TAX SYSTEM; TREATMENT 
OF PAYMENTS.—Rules similar to the rules of para-
graphs (4) and (5) of section 21(h) shall apply for 
purposes of this section. 
‘‘(j) ASSEMBLY AND CONTENT QUALIFICATIONS.— 
For purposes of this section— 
‘‘(1) DOMESTIC ASSEMBLY QUALIFICATIONS.— 
The term ‘domestic assembly qualifications’ means, 
with respect to any new qualified plug-in electric ve-
hicle, that the final assembly of such vehicle occurs 
at a plant, factory, or other place which is operating 
under a collective bargaining agreement negotiated 
by an employee organization (as defined in section 
412(c)(4)), determined in a manner consistent with 
section 7701(a)(46). 
‘‘(2) DOMESTIC
CONTENT
QUALIFICATIONS.— 
The term ‘domestic content qualifications’ means, 
with respect to any model of a new qualified plug- 
in electric vehicle, that vehicles of that model— 
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‘‘(A) are assembled by a manufacturer 
which utilizes not less than 50 percent domestic 
content in the component parts for final assem-
bly of such vehicles, and 
‘‘(B) are powered by battery cells which 
are manufactured in the United States (with 
suchbattery cells to be included for purposes of 
the requirement described in subparagraph 
(A)), as certified by the manufacturer, at such 
time, and in such form and manner, as the Sec-
retary may prescribe. 
‘‘(3) FINAL ASSEMBLY.—The term ‘final assem-
bly’ means the process by which a manufacturer pro-
duces a new qualified plug-in electric vehicle at, or 
through the use of, a plant, factory, or other place 
from which the vehicle is delivered to a dealer or im-
porter with all component parts necessary for the 
mechanical operation of the vehicle included with the 
vehicle, whether or not the component parts are per-
manently installed in or on the vehicle. 
‘‘(k) TERMINATION.—No credit shall be allowed 
under this section with respect to any vehicle acquired 
after December 31, 2031.’’. 
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(b) TRANSFER OF CREDIT.—Subsection (f) of section 
36C is amended by adding at the end the following new 
paragraphs: 
‘‘(7) IN GENERAL.—Subject to such regulations 
or other guidance as the Secretary determines nec-
essary or appropriate, if, with respect to the credit 
allowed under subsection (a) for any taxable year, 
the taxpayer elects the application of this subpara-
graph for such taxable year with respect to such 
credit, the eligible entity specified in such election, 
and not the taxpayer who has purchased or leased 
the vehicle, shall be treated as the taxpayer for pur-
poses of this title with respect to such credit. 
‘‘(8) ELIGIBLE ENTITY.—For purposes of this 
paragraph, the term ‘eligible entity’ means, with re-
spect to the vehicle for which the credit is allowed 
under subsection (a), the dealer which sold such ve-
hicle to the taxpayer and has— 
‘‘(A) subject to paragraph (10), registered 
with the Secretary for purposes of this para-
graph, at such time, and in such form and 
manner, as the Secretary may prescribe, 
‘‘(B) prior to the election described in 
paragraph (7), disclosed to the taxpayer pur-
chasing such vehicle— 
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‘‘(ii) such election shall not limit the 
value or use of such incentive. 
‘‘(9) TIMING.—An election described in para-
graph (7) shall be made by the taxpayer not later 
than the date on which the vehicle for which the 
credit is allowed under subsection (a) is purchased. 
‘‘(10) REVOCATION OF REGISTRATION.—Upon 
determination by the Secretary that a dealer has 
failed to comply with the requirements described in 
paragraph (8), the Secretary may revoke the reg-
istration (as described in subparagraph (A) of such 
subparagraph) of such dealer. 
‘‘(11) TAX TREATMENT OF PAYMENTS.—With 
respect to any payment described in paragraph 
(8)(C), such payment— 
‘‘(A) shall not be includible in the gross in-
come of the taxpayer, and 
‘‘(B) with respect to the dealer, shall not 
be deductible under this title. 
‘‘(12) ADVANCE
PAYMENT
TO
REGISTERED 
DEALERS.— 
‘‘(A) IN
GENERAL.—The Secretary shall 
establish a program to make advance payments 
to any eligible entity in an amount equal to the 
cumulative amount of the credits allowed under 
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subsection (a) with respect to any vehicles sold 
by such entity for which an election described 
in paragraph (1) has been made. 
‘‘(B) EXCESSIVE PAYMENTS.—Rules simi-
lar to the rules of section 6417(c)(8) shall apply 
for purposes of this subparagraph. 
‘‘(13) DEALER.—For purposes of this para-
graph, the term ‘dealer’ means a person licensed by 
a State, the District of Columbia, the Common-
wealth of Puerto Rico, any other territory or posses-
sion of the United States, or an Indian Tribe (as de-
fined in section 4 of the Indian Self-Determination 
and Education Assistance Act (25 U.S.C. 5304)) to 
engage in the sale of vehicles.’’. 
(c) REPEAL OF NONREFUNDABLE NEW QUALIFIED 
PLUG-IN ELECTRIC DRIVE MOTOR VEHICLE CREDIT.— 
Subpart B of part IV of subchapter A of chapter 1 is 
amended by striking section 30D (and by striking the item 
relating to such section in the table of sections of such 
subpart). 
(d) CONFORMING AMENDMENTS.— 
(1) Section 1016(a)(37) is amended by striking 
‘‘section 
30D(f)(1)’’ 
and 
inserting 
‘‘section 
36C(f)(1)’’. 
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(2) Section 6211(b)(4)(A) is amended by insert-
ing ‘‘36C,’’ after ‘‘36B,’’. 
(3) Section 6213(g)(2), as amended by the pre-
ceding provisions of this Act, is amended— 
(A) in subparagraph (R), by striking 
‘‘and’’ at the end, 
(B) in subparagraph (S), by striking the 
period at the end and inserting ‘‘, and’’, and 
(C) by adding at the end the following: 
‘‘(T) an omission of a correct vehicle iden-
tification number required under section 36C(f) 
(relating to credit for new qualified plug-in elec-
tric drive motor vehicles) to be included on a re-
turn.’’. 
(4) Section 6501(m) is amended by striking 
‘‘30D(e)(4)’’ and inserting ‘‘36C(f)(5)’’. 
(5) Section 166(b)(5)(A)(ii) of title 23, United 
States Code, is amended by striking ‘‘section 
30D(d)(1)’’ and inserting ‘‘section 36C(e)(1)’’. 
(6) Section 1324(b)(2) of title 31, United 
States Code, is amended by inserting ‘‘36C,’’ after 
‘‘36B,’’. 
(7) The table of sections for subpart C of part 
IV of subchapter A of chapter 1 is amended by in-
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serting after the item relating to section 36B the fol-
lowing new item: 
‘‘Sec. 36C. New qualified plug-in electric drive motor vehicles.’’. 
(e) EFFECTIVE DATES.— 
(1) The amendments made by subsections (a), 
(c), and (d) of this section shall apply to vehicles ac-
quired after December 31, 2021. 
(2) The amendments made by subsection (b) 
shall apply to vehicles purchased or leased after De-
cember 31, 2022. 
SEC. 136402. CREDIT FOR PREVIOUSLY-OWNED QUALIFIED 
PLUG-IN ELECTRIC DRIVE MOTOR VEHICLES. 
(a) IN GENERAL.—Subpart C of part IV of sub-
chapter A of chapter 1, as amended by the preceding pro-
visions of this Act, is amended by inserting after section 
36C the following new section: 
‘‘SEC. 36D. PREVIOUSLY-OWNED QUALIFIED PLUG-IN ELEC-
TRIC DRIVE MOTOR VEHICLES. 
‘‘(a) ALLOWANCE
OF CREDIT.—In the case of a 
qualified buyer who during a taxable year places in service 
a previously-owned qualified plug-in electric drive motor 
vehicle, there shall be allowed as a credit against the tax 
imposed by this subtitle for the taxable year an amount 
equal to the sum of— 
‘‘(1) $1,250, plus 
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‘‘(2) in the case of a vehicle which draws pro-
pulsion energy from a battery which exceeds 4 kilo-
watt hours of capacity (determined at the time of 
sale), the lesser of— 
‘‘(A) $1,250, and 
‘‘(B) the product of $208.50 and such ex-
cess kilowatt hours. 
‘‘(b) LIMITATIONS.— 
‘‘(1) SALE PRICE.—The credit allowed under 
subsection (a) with respect to sale of a vehicle shall 
not exceed 30 percent of the sale price. 
‘‘(2) ADJUSTED GROSS INCOME.—The amount 
which would (but for this paragraph) be allowed as 
a credit under subsection (a) shall be reduced (but 
not below zero) by $200 for each $1,000 (or fraction 
thereof) by which the taxpayer’s adjusted gross in-
come exceeds— 
‘‘(A) $150,000 in the case of a joint return 
or a surviving spouse (as defined in section 
2(a)), 
‘‘(B) $112,500 in the case of a head of 
household (as defined in section 2(b)), and 
‘‘(C) $75,000 in the case of a taxpayer not 
described in paragraph (1) or (2). 
‘‘(c) DEFINITIONS.—For purposes of this section— 
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‘‘(1) PREVIOUSLY-OWNED QUALIFIED PLUG-IN 
ELECTRIC DRIVE MOTOR VEHICLE.—The term ‘pre-
viously-owned qualified plug-in electric drive motor 
vehicle’ means, with respect to a taxpayer, a motor 
vehicle— 
‘‘(A) the model year of which is at least 2 
earlier than the calendar year in which the tax-
payer acquires such vehicle, 
‘‘(B) the original use of which commences 
with a person other than the taxpayer, 
‘‘(C) which is acquired by the taxpayer in 
a qualified sale, 
‘‘(D) registered by the taxpayer for oper-
ation in a State or possession of the United 
States, and 
‘‘(E) which meets the requirements of sub-
paragraphs (C), (D), (E), (F), and (G) of sec-
tion 36C(e)(1). 
‘‘(2) QUALIFIED
SALE.—The term ‘qualified 
sale’ means a sale of a motor vehicle— 
‘‘(A) by a seller who holds such vehicle in 
inventory (within the meaning of section 471) 
for sale or lease, 
‘‘(B) for a sale price not to exceed 
$25,000, and 
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‘‘(C) which is the first transfer since the 
date of the enactment of this section to a per-
son other than the person with whom the origi-
nal use of such vehicle commenced. 
‘‘(3) QUALIFIED BUYER.—The term ‘qualified 
buyer’ means, with respect to a sale of a motor vehi-
cle, a taxpayer— 
‘‘(A) who is an individual, 
‘‘(B) who purchases such vehicle for use 
and not for resale, 
‘‘(C) with respect to whom no deduction is 
allowable with respect to another taxpayer 
under section 151, 
‘‘(D) who has not been allowed a credit 
under this section for any sale during the 3- 
year period ending on the date of the sale of 
such vehicle, and 
‘‘(E) who possesses a certificate issued by 
the seller that certifies— 
‘‘(i) that the vehicle is a previously- 
owned qualified plug-in electric drive motor 
vehicle, 
‘‘(ii) the vehicle identification number 
of such vehicle, 
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‘‘(iii) the capacity of the battery at 
time of sale, and 
‘‘(iv) such other information as the 
Secretary may require. 
‘‘(4) MOTOR VEHICLE; CAPACITY.—The terms 
‘motor vehicle’ and ‘capacity’ have the meaning 
given such terms in paragraphs (2) and (4) of sec-
tion 36C(e), respectively. 
‘‘(d) VIN NUMBER REQUIREMENT.—No credit shall 
be allowed under subsection (a) with respect to any vehicle 
unless the taxpayer includes the vehicle identification 
number of such vehicle on the return of tax for the taxable 
year. 
‘‘(e) APPLICATION OF CERTAIN RULES.—For pur-
poses of this section, rules similar to the rules of para-
graphs (1), (2), (4), (5), (6) and (7) of section 36C(f) 
shall apply for purposes of this section. 
‘‘(f) CERTIFICATE SUBMISSION REQUIREMENT.— 
The Secretary may require that the issuer of the certifi-
cate described in subsection (c)(3)(E) submit such certifi-
cate to the Secretary at the time and in the manner re-
quired by the Secretary. 
‘‘(g) TREATMENT OF CERTAIN POSSESSIONS.— 
‘‘(1) PAYMENTS TO POSSESSIONS WITH MIRROR 
CODE TAX SYSTEMS.—The Secretary shall pay to 
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each possession of the United States which has a 
mirror code tax system amounts equal to the loss (if 
any) to that possession by reason of the application 
of the provisions of this section. Such amounts shall 
be determined by the Secretary based on information 
provided by the government of the respective posses-
sion. 
‘‘(2) PAYMENTS TO OTHER POSSESSIONS.—The 
Secretary shall pay to each possession of the United 
States which does not have a mirror code tax system 
amounts estimated by the Secretary as being equal 
to the aggregate benefits (if any) that would have 
been provided to residents of such possession by rea-
son of the provisions of this section if a mirror code 
tax system had been in effect in such possession. 
The preceding sentence shall not apply unless the re-
spective possession has a plan which has been ap-
proved by the Secretary under which such possession 
will promptly distribute such payments to its resi-
dents. 
‘‘(3) MIRROR CODE TAX SYSTEM; TREATMENT 
OF PAYMENTS.—Rules similar to the rules of para-
graphs (4) and (5) of section 21(h) shall apply for 
purposes of this section. 
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‘‘(h) TERMINATION.—No credit shall be allowed 
under this section with respect to any vehicle acquired 
after December 31, 2031.’’. 
(b) CONFORMING AMENDMENTS.— 
(1) Section 6211(b)(4)(A), as amended by the 
preceding provisions of this Act, is amended by in-
serting ‘‘36D,’’ after ‘‘36C,’’. 
(2) Section 6213(g)(2), as amended by the pre-
ceding provisions of this Act, is amended— 
(A) in subparagraph (S), by striking 
‘‘and’’ at the end, 
(B) in subparagraph (T), by striking the 
period at the end and inserting ‘‘, and’’, and 
(C) by adding at the end the following: 
‘‘(U) an omission of a correct vehicle iden-
tification 
number 
required 
under 
section 
36D(d) (relating to credit for previously-owned 
qualified plug-in electric drive motor vehicles) to 
be included on a return.’’. 
(3) Paragraph (2) of section 1324(b) of title 
31, United States Code, as amended by the pre-
ceding provisions of this Act, is amended by insert-
ing ‘‘36D,’’ after ‘‘36C,’’. 
(c) CLERICAL AMENDMENT.—The table of sections 
for subpart C of part IV of subchapter A of chapter 1, 
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as amended by the preceding provisions of this Act, is 
amended by inserting after the item relating to section 
36C the following new item: 
‘‘Sec. 36D. Previously-owned qualified plug-in electric drive motor vehicles.’’. 
(d) EFFECTIVE DATE.—The amendments made by 
this section shall apply to vehicles acquired after Decem-
ber 31, 2021. 
SEC. 136403. QUALIFIED COMMERCIAL ELECTRIC VEHI-
CLES. 
(a) IN GENERAL.—Subpart D of part IV of sub-
chapter A of chapter 1 is amended by adding at the end 
the following new section: 
‘‘SEC. 45Y. CREDIT FOR QUALIFIED COMMERCIAL ELEC-
TRIC VEHICLES. 
‘‘(a) IN GENERAL.—For purposes of section 38, the 
qualified commercial electric vehicle credit for any taxable 
year is an amount equal to the sum of the credit amounts 
determined under subsection (b) with respect to each 
qualified commercial electric vehicle placed in service by 
the taxpayer during the taxable year. 
‘‘(b) PER VEHICLE AMOUNT.—The amount deter-
mined under this subsection with respect to any qualified 
commercial electric vehicle shall be equal to 30 percent 
of the basis of such vehicle. 
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‘‘(c) QUALIFIED
COMMERCIAL
ELECTRIC
VEHI-
CLE.—For purposes of this section, the term ‘qualified 
commercial electric vehicle’ means any vehicle which— 
‘‘(1) meets the requirements of subparagraphs 
(A) and (C) of section 36C(e)(1) without regard to 
any gross vehicle weight rating, and is acquired for 
use or lease by the taxpayer and not for resale, 
‘‘(2) either— 
‘‘(A) meets the requirements of subpara-
graph (D) of section 36C(e)(1), or 
‘‘(B) is mobile machinery, as defined in 
section 4053(8), 
‘‘(3) is primarily propelled by an electric motor 
which draws electricity from a battery which— 
‘‘(A) has a capacity of not less than 30 kil-
owatt hours, 
‘‘(B) is capable of being recharged from an 
external source of electricity, 
‘‘(C) is not powered or charged by an in-
ternal combustion engine, or 
‘‘(D) is a new qualified fuel cell motor ve-
hicle described in subparagraphs (A) and (B) of 
section 30B(b)(3), and 
‘‘(4) is of a character subject to the allowance 
for depreciation. 
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‘‘(d) SPECIAL RULES.— 
‘‘(1) IN GENERAL.—Rules similar to the rules 
under subsection (f) of section 36C shall apply for 
purposes of this section. 
‘‘(2) PROPERTY USED BY TAX-EXEMPT ENTI-
TY.—In the case of a vehicle the use of which is de-
scribed in paragraph (3) or (4) of section 50(b) and 
which is not subject to a lease, the person who sold 
such vehicle to the person or entity using such vehi-
cle shall be treated as the taxpayer that placed such 
vehicle in service, but only if such person clearly dis-
closes to such person or entity in a document the 
amount of any credit allowable under subsection (a) 
with respect to such vehicle. 
‘‘(e) VIN NUMBER REQUIREMENT.—No credit shall 
be determined under subsection (a) with respect to any 
vehicle unless the taxpayer includes the vehicle identifica-
tion number of such vehicle on the return of tax for the 
taxable year. 
‘‘(f) TERMINATION.—No credit shall be determined 
under this section with respect to any vehicle acquired 
after December 31, 2031.’’. 
(b) CONFORMING AMENDMENTS.— 
(1) Section 38(b) is amended by striking para-
graph (30) and inserting the following: 
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‘‘(30) the qualified commercial electric vehicle 
credit determined under section 45Y,’’. 
(2) Section 6213(g)(2), as amended by the pre-
ceding provisions of this Act, is amended— 
(A) in subparagraph (T), by striking 
‘‘and’’ at the end, 
(B) in subparagraph (U), by striking the 
period at the end and inserting ‘‘, and’’, and 
(C) by adding at the end the following: 
‘‘(V) an omission of a correct vehicle iden-
tification number required under section 45Y(e) 
(relating to commercial electric vehicle credit) 
to be included on a return.’’. 
(3) The table of sections for subpart D of part 
IV of subchapter A of chapter 1 is amended by add-
ing at the end the following new item: 
‘‘Sec. 45Y. Qualified commercial electric vehicle credit.’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to vehicles acquired after Decem-
ber 31, 2021. 
SEC. 136404. QUALIFIED FUEL CELL MOTOR VEHICLES. 
(a) IN GENERAL.—Section 30B(k)(1) is amended by 
striking ‘‘December 31, 2021’’ and inserting ‘‘December 
31, 2031’’. 
(b) NEW QUALIFIED FUEL CELL MOTOR VEHI-
CLE.—Section 30B(b) is amended by striking ‘‘and’’ at 
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the end of subparagraph (D), by striking the period at 
the end of subparagraph (E) and inserting ‘‘, and’’, and 
by adding at the end the following new subparagraph: 
‘‘(F) which is not property of a character 
subject to an allowance for depreciation.’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to property placed in service after 
December 31, 2021. 
SEC. 136405. ALTERNATIVE FUEL REFUELING PROPERTY 
CREDIT. 
(a) IN GENERAL.—Section 30C(g) is amended by 
striking ‘‘December 31, 2021’’ and inserting ‘‘December 
31, 2031’’. 
(b) ADDITIONAL CREDIT FOR CERTAIN ELECTRIC 
CHARGING PROPERTY.— 
(1) IN GENERAL.—Section 30C(a) is amend-
ed— 
(A) by striking ‘‘equal to 30 percent’’ and 
inserting the following: ‘‘equal to the sum of— 
‘‘(1) 30 percent’’, 
(B) by striking the period at the end and 
inserting ‘‘, plus’’, and 
(C) by adding at the end the following new 
paragraph: 
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‘‘(2) 20 percent of so much of such cost as ex-
ceeds the limitation under subsection (b)(1) that 
does not exceed the amount of cost attributable to 
qualified alternative vehicle refueling property (de-
termined without regard to subsection (c)(1) and as 
if only electricity, and fuel at least 85 percent of the 
volume of which consists of hydrogen, were treated 
as clean-burning fuels for purposes of section 
179A(d)) which— 
‘‘(A) is intended for general public use 
with no associated fee or payment arrangement, 
‘‘(B) is intended for general public use and 
accepts payment via a credit card reader, in-
cluding 
a 
credit 
card 
reader 
that 
uses 
contactless technology, or 
‘‘(C) is intended for use exclusively by 
fleets of commercial or governmental vehicles.’’. 
(2) 
CONFORMING
AMENDMENT.—Section 
30C(b) is amended— 
(A) by striking ‘‘The credit allowed under 
subsection (a)’’ and inserting ‘‘The amount of 
cost taken into account under subsection 
(a)(1)’’, 
(B) by striking ‘‘$30,000’’ and inserting 
‘‘$100,000’’, and 
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(C) by striking ‘‘$1,000’’ and inserting 
‘‘$3,333.33’’. 
(3) BIDIRECTIONAL CHARGING EQUIPMENT IN-
CLUDED AS QUALIFIED ALTERNATIVE FUEL VEHI-
CLE
REFUELING
PROPERTY.—Section 30C(c) is 
amended— 
(A) by striking ‘‘For purposes of this sec-
tion, the term’’ and inserting ‘‘For purposes of 
this section— 
‘‘(1) IN GENERAL.—The term’’, and 
(B) by adding at the end the following new 
paragraph: 
‘‘(2) BIDIRECTIONAL CHARGING EQUIPMENT.— 
Property shall not fail to be treated as qualified al-
ternative vehicle refueling property solely because 
such property— 
‘‘(A) is capable of charging the battery of 
a motor vehicle propelled by electricity, and 
‘‘(B) allows discharging electricity from 
such battery to an electric load external to such 
motor vehicle.’’. 
(c) CERTAIN ELECTRIC CHARGING STATIONS IN-
CLUDED AS QUALIFIED ALTERNATIVE FUEL VEHICLE 
REFUELING PROPERTY.—Section 30C is amended by re-
designating subsections (f) and (g) as subsections (g) and 
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(h), respectively, and by inserting after subsection (e) the 
following: 
‘‘(f) SPECIAL RULE FOR ELECTRIC CHARGING STA-
TIONS FOR CERTAIN VEHICLES WITH 2 OR 3 WHEELS.— 
For purposes of this section— 
‘‘(1) IN GENERAL.—The term ‘qualified alter-
native fuel vehicle refueling property’ includes any 
property described in subsection (c) for the re-
charging of a motor vehicle described in paragraph 
(2) that is propelled by electricity, but only if the 
property— 
‘‘(A) meets the requirements of subsection 
(a)(2), and 
‘‘(B) is of a character subject to deprecia-
tion. 
‘‘(2) MOTOR VEHICLE.—A motor vehicle is de-
scribed in this paragraph if the motor vehicle— 
‘‘(A) is manufactured primarily for use on 
public streets, roads, or highways (not including 
a vehicle operated exclusively on a rail or rails), 
and 
‘‘(B) has at least 2, but not more than 3, 
wheels.’’. 
(d) WAGE AND APPRENTICESHIP REQUIREMENTS.— 
Section 30C, as amended by this section, is further 
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amended by redesignating subsections (g) and (h) as sub-
sections (h) and (i) and by inserting after subsection (f) 
the following new subsection: 
‘‘(g) 
WAGE
AND
APPRENTICESHIP
REQUIRE-
MENTS.— 
‘‘(1) BASE CREDIT AMOUNT AND INCREASED 
CREDIT AMOUNT.— 
‘‘(A) IN
GENERAL.—In the case of any 
qualified alternative fuel vehicle refueling prop-
erty which does not satisfy the requirements of 
subparagraph (B), the amount of the credit de-
termined under subsection (a) shall be 20 per-
cent of such amount (determined without re-
gard to this sentence). 
‘‘(B) INCREASED
CREDIT
FOR
CERTAIN 
QUALIFIED
ALTERNATIVE
FUEL
VEHICLE
RE-
FUELING
PROPERTY
MEETING
PROJECT
RE-
QUIREMENTS.— 
‘‘(i) IN GENERAL.—In the case of any 
qualified alternative fuel vehicle refueling 
property which meets the project require-
ments of this subparagraph, subparagraph 
(A) shall not apply. 
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‘‘(ii) PROJECT
REQUIREMENTS.—A 
project meets the requirements of this sub-
paragraph if it is one of the following: 
‘‘(I) A project which commences 
construction prior to the date of the 
enactment of this paragraph. 
‘‘(II) A project which satisfies 
the requirements of paragraphs (2) 
and (3). 
‘‘(2) PREVAILING WAGE REQUIREMENTS.— 
‘‘(A) IN GENERAL.—The requirements de-
scribed in this subparagraph with respect to 
any qualified alternative fuel vehicle refueling 
property are that the taxpayer shall ensure that 
any laborers and mechanics employed by con-
tractors and subcontractors in the construction 
of such property shall be paid wages at rates 
not less than the prevailing rates for construc-
tion, alteration, or repair of a similar character 
in the locality as most recently determined by 
the Secretary of Labor, in accordance with sub-
chapter IV of chapter 31 of title 40, United 
States Code. 
‘‘(B) CORRECTION AND PENALTY RELATED 
TO
FAILURE
TO
SATISFY
WAGE
REQUIRE-
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MENTS.—In the case of any taxpayer which 
fails to satisfy the requirement under subpara-
graph (A) with respect to such qualified alter-
native fuel vehicle refueling property, rules 
similar to the rules of section 45(b)(8)(B) shall 
apply for purposes of this paragraph. 
‘‘(3) APPRENTICESHIP
REQUIREMENTS.—The 
requirements described in this subparagraph with re-
spect to the construction of any qualified alternative 
fuel vehicle refueling property are as follows: 
‘‘(A) LABOR HOURS.— 
‘‘(i) PERCENTAGE OF TOTAL LABOR 
HOURS.—All contractors and subcontrac-
tors engaged in the performance of con-
struction on any project shall, subject to 
subparagraph (B), ensure that not less 
than the applicable percentage of the total 
labor hours of such work be performed by 
qualified apprentices. 
‘‘(ii) APPLICABLE PERCENTAGE.—For 
purposes of paragraph (1), the applicable 
percentage shall be— 
‘‘(I) in the case of any applicable 
project the construction of which be-
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gins before January 1, 2023, 5 per-
cent, 
‘‘(II) in the case of any applica-
ble project the construction of which 
begins after December 31, 2022, and 
before January 1, 2024, 10 percent, 
and 
‘‘(III) in the case of any applica-
ble project the construction of which 
begins after December 31, 2023, 15 
percent. 
‘‘(B) APPRENTICE
TO
JOURNEYWORKER 
RATIO.—The requirement under subparagraph 
(A)(i) shall be subject to any applicable require-
ments for apprentice-to-journeyworker ratios of 
the Department of Labor or the applicable 
State apprenticeship agency. 
‘‘(C) 
PARTICIPATION.—Each 
contractor 
and subcontractor who employs 4 or more indi-
viduals to perform construction, alteration, or 
repair work on an applicable project shall em-
ploy 1 or more qualified apprentices to perform 
such work. 
‘‘(D) EXCEPTION.— 
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‘‘(i) IN
GENERAL.—Notwithstanding 
any other provision of this paragraph, this 
paragraph shall not apply in the case of a 
taxpayer who— 
‘‘(I) demonstrates a lack of avail-
ability of qualified apprentices in the 
geographic area of the construction, 
alteration, or repair work, and 
‘‘(II) makes a good faith effort to 
comply with the requirements of this 
paragraph. 
‘‘(ii) GOOD FAITH EFFORT.—For pur-
poses of clause (i), a taxpayer shall be 
deemed to have satisfied the requirements 
under such paragraph with respect to an 
applicable project if such taxpayer has re-
quested qualified apprentices from a reg-
istered apprenticeship program, as defined 
in section 3131(e)(3)(B), and such request 
has been denied, provided that such denial 
is not the result of a refusal by the con-
tractors or subcontractors engaged in the 
performance of construction, alteration, or 
repair work on such applicable project to 
comply with the established standards and 
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requirements of such apprenticeship pro-
gram. 
‘‘(E) DEFINITIONS.—For purposes of this 
paragraph— 
‘‘(i) LABOR HOURS.—The term ‘labor 
hours’ has the meaning given such term in 
section 45(b)(9)(E)(i). 
‘‘(ii) QUALIFIED
APPRENTICE.—The 
term ‘qualified apprentice’ has the mean-
ing 
given 
such 
term 
in 
section 
45(b)(9)(E)(ii). 
‘‘(4) REGULATIONS AND GUIDANCE.—The Sec-
retary shall issue such regulations or other guidance 
as the Secretary determines necessary or appropriate 
to carry out the purposes of this subsection.’’. 
(e) EFFECTIVE DATE.—The amendment made by 
this section shall apply to property placed in service after 
December 31, 2021. 
SEC. 136406. REINSTATEMENT AND EXPANSION OF EM-
PLOYER-PROVIDED FRINGE BENEFITS FOR 
BICYCLE COMMUTING. 
(a) REPEAL OF SUSPENSION OF EXCLUSION FOR 
QUALIFIED BICYCLE COMMUTING BENEFITS.—Section 
132(f) is amended by striking paragraph (8). 
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(b) EXPANSION
OF BICYCLE COMMUTING BENE-
FITS.—Section 132(f)(5)(F) is amended to read as fol-
lows: 
‘‘(F) DEFINITIONS RELATED TO BICYCLE 
COMMUTING BENEFITS.— 
‘‘(i) QUALIFIED BICYCLE COMMUTING 
BENEFIT.—The term ‘qualified bicycle 
commuting benefit’ means, with respect to 
any calendar year— 
‘‘(I) any employer reimbursement 
during the 15-month period beginning 
with the first day of such calendar 
year for reasonable expenses incurred 
by the employee during such calendar 
year for the purchase (including asso-
ciated finance charges), lease, rental 
(including a bikeshare), improvement, 
repair, or storage of qualified com-
muting property, or 
‘‘(II) the provision by the em-
ployer to the employee during such 
calendar year of the use (including a 
bikeshare), improvement, repair, or 
storage of qualified commuting prop-
erty, 
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if the employee regularly uses such quali-
fied commuting property for travel between 
the employee’s residence, place of employ-
ment, or a mass transit facility that con-
nects the employee to their residence or 
place of employment. 
‘‘(ii) QUALIFIED
COMMUTING
PROP-
ERTY.—The term ‘qualified commuting 
property’ means— 
‘‘(I) any bicycle (other than a bi-
cycle equipped with any motor), 
‘‘(II) any electric bicycle which 
meets the requirements of section 
36E(c)(5), 
‘‘(III) any 2- or 3-wheel scooter 
(other than a scooter equipped with 
any motor), and 
‘‘(IV) any 2- or 3-wheel scooter 
propelled by an electric motor if such 
motor does not provide assistance if 
the speed of such scooter exceeds 20 
miler per hour (or if the speed of such 
scooter is not capable of exceeding 20 
miles per hour) and the weight of 
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such scooter does not exceed 100 
pounds. 
‘‘(iii) 
BIKESHARE.—The 
term 
‘bikeshare’ means a rental operation at 
which qualified commuting property is 
made available to customers to pick up and 
drop off for point-to-point use within a de-
fined geographic area.’’. 
(c) 
LIMITATION
ON
EXCLUSION.—Section 
132(f)(2)(C) is amended to read as follows: 
‘‘(C) 30 percent of the dollar amount in ef-
fect under subparagraph (B) per month in the 
case of any qualified bicycle commuting ben-
efit.’’. 
(d) NO CONSTRUCTIVE RECEIPT.—Section 132(f)(4) 
is amended by striking ‘‘(other than a qualified bicycle 
commuting reimbursement)’’. 
(e) 
CONFORMING
AMENDMENT.—Section 
132(f)(1)(D) is amended by striking ‘‘reimbursement’’ 
and inserting ‘‘benefit’’. 
(f) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years beginning after 
December 31, 2021. 
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SEC. 136407. CREDIT FOR CERTAIN NEW ELECTRIC BICY-
CLES. 
(a) IN GENERAL.—Subpart C of part IV of sub-
chapter A of chapter 1, as amended by the preceding pro-
visions of this Act, is amended by inserting after section 
36D the following new section: 
‘‘SEC. 36E. ELECTRIC BICYCLES. 
‘‘(a) ALLOWANCE OF CREDIT.—There shall be al-
lowed as a credit against the tax imposed by this chapter 
for the taxable year an amount equal to 15 percent of the 
cost of each qualified electric bicycle placed in service by 
the taxpayer during such taxable year. 
‘‘(b) LIMITATIONS.— 
‘‘(1) LIMITATION ON COST PER ELECTRIC BICY-
CLE
TAKEN
INTO
ACCOUNT.—The amount taken 
into account under subsection (a) as the cost of any 
qualified electric bicycle shall not exceed $5,000. 
‘‘(2) BICYCLE LIMITATION WITH RESPECT TO 
CREDIT.— 
‘‘(A) LIMITATION
ON
NUMBER
OF
PER-
SONAL-USE BICYCLES.—In the case of any tax-
payer for any taxable year, the number of per-
sonal-use bicycles taken into account under sub-
section (a) shall not exceed the excess (if any) 
of— 
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‘‘(i) 1 (2 in the case of a joint return), 
reduced by 
‘‘(ii) the aggregate number of bicycles 
taken into account by the taxpayer under 
subsection (a) for the 2 preceding taxable 
years. 
‘‘(B) PHASEOUT BASED ON MODIFIED AD-
JUSTED GROSS INCOME.—So much of the credit 
allowed under subsection (a) to any taxpayer 
for any taxable year as would (but for this sub-
paragraph) be treated under subsection (c)(2) 
as a credit allowable under subpart C shall be 
reduced by $200 for each $1,000 (or fraction 
thereof) by which the taxpayer’s modified ad-
justed gross income exceeds— 
‘‘(i) $150,000 in the case of a joint 
return or a surviving spouse (as defined in 
section 2(a)), 
‘‘(ii) $112,500 in the case of a head 
of household (as defined in section 2(b)), 
and 
‘‘(iii) $75,000 in the case of a tax-
payer not described in clause (i) or (ii). 
‘‘(C) MODIFIED
ADJUSTED
GROSS
IN-
COME.—For purposes of subparagraph (B), the 
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term ‘modified adjusted gross income’ means 
adjusted gross income increased by any amount 
excluded from gross income under section 911, 
931, or 933. 
‘‘(D) SPECIAL RULE FOR DETERMINATION 
OF MODIFIED ADJUSTED GROSS INCOME.—The 
modified adjusted gross income of the taxpayer 
that is taken into account for purposes of this 
paragraph shall be the lesser of— 
‘‘(i) the modified adjusted gross in-
come for the taxable year in which the 
credit is claimed, or 
‘‘(ii) the modified adjusted gross in-
come for the immediately preceding taxable 
year. 
‘‘(c) QUALIFIED ELECTRIC BICYCLE.—For purposes 
of this section, the term ‘qualified electric bicycle’ means 
a bicycle— 
‘‘(1) the original use of which commences with 
the taxpayer, 
‘‘(2) which is acquired for use by the taxpayer 
and not for resale, 
‘‘(3) which is made by a qualified manufacturer 
and is labeled with the qualified vehicle identification 
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number assigned to such bicycle by such manufac-
turer, 
‘‘(4) with respect to which the aggregate 
amount paid for such acquisition does not exceed 
$8,000, and 
‘‘(5) which is equipped with— 
‘‘(A) fully operable pedals, 
‘‘(B) a saddle or seat for the rider, and 
‘‘(C) an electric motor of less than 750 
watts which is designed to provided assistance 
in propelling the bicycle and— 
‘‘(i) does not provide such assistance 
if the bicycle is moving in excess of 20 
miler per hour, or 
‘‘(ii) if such motor only provides such 
assistance when the rider is pedaling, does 
not provide such assistance if the bicycle is 
moving in excess of 28 miles per hour. 
‘‘(d) VIN NUMBER REQUIREMENT.— 
‘‘(1) IN GENERAL.—No credit shall be allowed 
under subsection (a) with respect to any qualified 
electric bicycle unless the taxpayer includes the 
qualified vehicle identification number of such bicy-
cle on the return of tax for the taxable year. 
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‘‘(2) 
QUALIFIED
VEHICLE
IDENTIFICATION 
NUMBER.—For purposes of this section, the term 
‘qualified vehicle identification number’ means, with 
respect to any bicycle, the vehicle identification num-
ber assigned to such bicycle by a qualified manufac-
turer pursuant to the methodology referred to in 
paragraph (3). 
‘‘(3) QUALIFIED
MANUFACTURER.—For pur-
poses of this section, the term ‘qualified manufac-
turer’ means any manufacturer of qualified electric 
bicycles which enters into an agreement with the 
Secretary which provides that such manufacturer 
will— 
‘‘(A) assign a vehicle identification number 
to each qualified electric bicycle produced by 
such manufacturer utilizing a methodology that 
will ensure that such number (including any al-
phanumeric) is unique to such bicycle (by uti-
lizing numbers or letters which are unique to 
such manufacturer or by such other method as 
the Secretary may provide), 
‘‘(B) label such bicycle with such number 
in such manner as the Secretary may provide, 
and 
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‘‘(C) make periodic written reports to the 
Secretary (at such times and in such manner as 
the Secretary may provide) of the vehicle identi-
fication numbers so assigned and including 
such information as the Secretary may require 
with respect to the qualified electric bicycle to 
which such number was so assigned. 
‘‘(e) SPECIAL RULES.— 
‘‘(1) BASIS REDUCTION.—For purposes of this 
subtitle, the basis of any property for which a credit 
is allowable under subsection (a) shall be reduced by 
the amount of such credit so allowed (determined 
without regard to subsection (c)). 
‘‘(2) NO
DOUBLE
BENEFIT.—The amount of 
any deduction or other credit allowable under this 
chapter for a qualified electric bicycle for which a 
credit is allowable under subsection (a) shall be re-
duced by the amount of credit allowed under such 
subsection for such vehicle (determined without re-
gard to subsection (c)). 
‘‘(3) PROPERTY USED OUTSIDE UNITED STATES 
NOT QUALIFIED.—No credit shall be allowable under 
subsection (a) with respect to any property referred 
to in section 50(b)(1). 
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‘‘(4) RECAPTURE.—The Secretary shall, by reg-
ulations, provide for recapturing the benefit of any 
credit allowable under subsection (a) with respect to 
any property which ceases to be property eligible for 
such credit. 
‘‘(5) ELECTION
NOT
TO
TAKE
CREDIT.—No 
credit shall be allowed under subsection (a) for any 
bicycle if the taxpayer elects to not have this section 
apply to such bicycle. 
‘‘(f) TREATMENT OF CERTAIN POSSESSIONS.— 
‘‘(1) PAYMENTS TO POSSESSIONS WITH MIRROR 
CODE TAX SYSTEMS.—The Secretary shall pay to 
each possession of the United States which has a 
mirror code tax system amounts equal to the loss (if 
any) to that possession by reason of the application 
of the provisions of this section (determined without 
regard to this subsection). Such amounts shall be 
determined by the Secretary based on information 
provided by the government of the respective posses-
sion. 
‘‘(2) PAYMENTS TO OTHER POSSESSIONS.—The 
Secretary shall pay to each possession of the United 
States which does not have a mirror code tax system 
amounts estimated by the Secretary as being equal 
to the aggregate benefits (if any) that would have 
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been provided to residents of such possession by rea-
son of the provisions of this section if a mirror code 
tax system had been in effect in such possession. 
The preceding sentence shall not apply unless the re-
spective possession has a plan which has been ap-
proved by the Secretary under which such possession 
will promptly distribute such payments to its resi-
dents. 
‘‘(3) MIRROR CODE TAX SYSTEM; TREATMENT 
OF PAYMENTS.—Rules similar to the rules of para-
graphs (4) and (5) of section 21(h) shall apply for 
purposes of this section. 
‘‘(g) TERMINATION.—This section shall not apply to 
bicycles placed in service after December 31, 2031.’’. 
(b) CONFORMING AMENDMENTS.— 
(1) Section 38(b) is amended by striking ‘‘plus’’ 
at the end of paragraph (39), by striking the period 
at the end of paragraph (40) and inserting ‘‘, plus’’, 
and by adding at the end the following new para-
graph: 
‘‘(41) the portion of the electric bicycles credit 
to which section 36E(c)(1) applies.’’. 
(2) Section 1016(a) is amended by striking 
‘‘and’’ at the end of paragraph (37), by striking the 
period at the end of paragraph (38) and inserting ‘‘, 
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1918 
and’’, and by adding at the end the following new 
paragraph: 
‘‘(39) to the extent provided in section 
36E(f)(1).’’. 
(3) Section 6211(b)(4)(A) of such Code is 
amended by inserting ‘‘36E by reason of subsection 
(c)(2) thereof,’’ before ‘‘32,’’. 
(4) Section 6213(g)(2), as amended by the pre-
ceding provisions of this Act, is amended— 
(A) in subparagraph (U), by striking 
‘‘and’’ at the end, 
(B) in subparagraph (V), by striking the 
period at the end and inserting ‘‘, and’’, and 
(C) by adding at the end the following: 
‘‘(W) an omission of a correct vehicle iden-
tification number required under section 36E(e) 
(relating to electric bicycles credit) to be in-
cluded on a return.’’. 
(5) Section 6501(m) is amended by inserting 
‘‘36E(f)(4),’’ after ‘‘35(g)(11),’’. 
(6) Section 1324(b)(2) of title 31, United 
States Code, is amended by inserting ‘‘36E,’’ after 
‘‘36B,’’. 
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(c) CLERICAL AMENDMENT.—The table of sections 
for subpart B of part IV of subchapter A of chapter 1 
is amended by adding at the end the following new item: 
‘‘Sec. 36E. Electric bicycles.’’. 
(d) EFFECTIVE DATE.—The amendments made by 
this section shall apply to property placed in service after 
the date of the enactment of this Act, in taxable years 
ending after such date. 
PART 5—INVESTMENT IN THE GREEN 
WORKFORCE 
SEC. 136501. EXTENSION OF THE ADVANCED ENERGY 
PROJECT CREDIT. 
(a) EXTENSION OF CREDIT.—Section 48C is amend-
ed by redesignating subsection (e) as subsection (f) and 
by inserting after subsection (d) the following new sub-
section: 
‘‘(e) ADDITIONAL ALLOCATIONS.— 
‘‘(1) IN GENERAL.—Not later than 180 days 
after the date of enactment of this subsection, the 
Secretary, after consultation with the Secretary of 
Energy, shall establish a program to consider and 
award certifications for qualified investments eligible 
for credits under this section to qualifying advanced 
energy project sponsors. 
‘‘(2) ANNUAL LIMITATION.— 
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‘‘(A) IN GENERAL.—The amount of credits 
that may be allocated under this subsection 
during any calendar year shall not exceed the 
annual credit limitation with respect to such 
year. 
‘‘(B) ANNUAL CREDIT LIMITATION.— 
‘‘(i) IN
GENERAL.—For purposes of 
this subsection, the term ‘annual credit 
limitation’ means $2,500,000,000 for each 
of calendar years 2022 through 2031, and 
zero thereafter. 
‘‘(ii) AMOUNT SET ASIDE FOR AUTO-
MOTIVE COMMUNITIES.— 
‘‘(I) IN GENERAL.—For purposes 
of clause (i), $400,000,000 of the an-
nual credit limitation for each of cal-
endar years 2022 through 2031 shall 
be allocated to qualified investments 
located within automotive commu-
nities. 
‘‘(II) 
AUTOMOTIVE
COMMU-
NITIES.—For purposes of this clause, 
the term ‘automotive communities’ 
means a census tract and any directly 
adjoining census tract, including a no- 
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population census tract, that has ex-
perienced major job losses in the auto-
motive manufacturing sector since 
January 1, 1994, as determined by 
the Secretary after consultation with 
the Secretary of Energy and Secretary 
of Labor. 
‘‘(C) CARRYOVER
OF
UNUSED
LIMITA-
TION.—If the annual credit limitation for any 
calendar year exceeds the aggregate amount 
designated for such year under this subsection, 
such limitation for the succeeding calendar year 
shall be increased by the amount of such excess. 
No amount may be carried under the preceding 
sentence to any calendar year after 2036. 
‘‘(3) CERTIFICATIONS.— 
‘‘(A) APPLICATION REQUIREMENT.—Each 
applicant for certification under this subsection 
shall submit an application at such time and 
containing such information as the Secretary 
may require. 
‘‘(B) TIME TO MEET CRITERIA FOR CER-
TIFICATION.—Each applicant for certification 
shall have 2 years from the date of acceptance 
by the Secretary of the application during 
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which to provide to the Secretary evidence that 
the requirements of the certification have been 
met. 
‘‘(C) PERIOD OF ISSUANCE.—An applicant 
which receives a certification shall have 2 years 
from the date of issuance of the certification in 
order to place the project in service and to no-
tify the Secretary that such project has been so 
placed in service, and if such project is not 
placed in service (and the Secretary so notified) 
by that time period, then the certification shall 
no longer be valid. If any certification is re-
voked under this subparagraph, the amount of 
the annual credit limitation under paragraph 
(2) for the calendar year in which such certifi-
cation is revoked shall be increased by the 
amount of the credit with respect to such re-
voked certification. 
‘‘(4) SELECTION CRITERIA.—Selection criteria 
similar to those in subsection (d)(3) shall apply, ex-
cept that in determining designations under this 
subsection, the Secretary, after consultation with the 
Secretary of Energy, shall— 
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‘‘(A) in addition to the factors described in 
subsection (d)(3)(B), take into consideration 
which projects— 
‘‘(i) will provide the greatest net im-
pact in avoiding or reducing anthropogenic 
emissions of greenhouse gases, as deter-
mined by the Secretary after consultation 
with the Administrator of the Environ-
mental Protection Agency, 
‘‘(ii) will provide the greatest domestic 
job creation (both direct and indirect) dur-
ing the credit period, 
‘‘(iii) will provide the greatest job cre-
ation within the vicinity of the project, par-
ticularly with respect to— 
‘‘(I) low-income communities (as 
described in section 45D(e)), and 
‘‘(II) dislocated workers who 
were previously employed in manufac-
turing, coal power plants, or coal min-
ing, and 
‘‘(iv) will provide the greatest job cre-
ation in areas with a population that is at 
risk of experiencing higher or more adverse 
human health or environmental effects and 
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a significant portion of such population is 
comprised of communities of color, low-in-
come communities, Tribal and Indigenous 
communities, or individuals formerly em-
ployed in the fossil fuel industry, and 
‘‘(B) give the highest priority to projects 
which— 
‘‘(i) manufacture (other than pri-
marily assembly of components) property 
described in a subclause of subsection 
(c)(1)(A)(i) (or components thereof), and 
‘‘(ii) have the greatest potential for 
commercial deployment of new applica-
tions. 
‘‘(5) DISCLOSURE OF ALLOCATIONS.—The Sec-
retary shall, upon allocating a credit under this sub-
section, publicly disclose the identity of the appli-
cant, the amount of the credit with respect to such 
applicant, and the project location for which such 
credit was allocated. 
‘‘(6) CREDIT CONDITIONED UPON WAGE AND 
APPRENTICESHIP REQUIREMENTS.—No credit shall 
be allocated for a project under this subsection un-
less the project meets the prevailing wage require-
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ments of paragraph (7) and the apprenticeship re-
quirements of paragraph (8). 
‘‘(7) PREVAILING WAGE REQUIREMENTS.— 
‘‘(A) IN GENERAL.—The requirements de-
scribed in this paragraph with respect to a 
project are that the taxpayer shall ensure that 
any laborers and mechanics employed by con-
tractors and subcontractors in the re-equipping, 
expansion, or establishment of an industrial or 
manufacturing facility shall be paid wages at 
rates not less than the prevailing rates for con-
struction, alteration, or repair of a similar char-
acter in the locality as most recently determined 
by the Secretary of Labor, in accordance with 
subchapter IV of chapter 31 of title 40, United 
States Code. 
‘‘(B) CORRECTION AND PENALTY RELATED 
TO
FAILURE
TO
SATISFY
WAGE
REQUIRE-
MENTS.— 
‘‘(i) IN GENERAL.—In the case of any 
taxpayer which fails to satisfy the require-
ment under subparagraph (A) with respect 
to any project— 
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‘‘(I) rules similar to the rules of 
section 45(b)(8)(B) shall apply for 
purposes of this paragraph, and 
‘‘(II) if the failure to satisfy the 
requirement under subparagraph (A) 
is not corrected pursuant to the rules 
described in subclause (I), the certifi-
cation with respect to the re-equip-
ping, expansion, or establishment of 
an industrial or manufacturing facility 
shall no longer be valid. 
‘‘(8) APPRENTICESHIP
REQUIREMENTS.—The 
requirements described in this subparagraph with re-
spect to a project are as follows: 
‘‘(A) LABOR HOURS.— 
‘‘(i) PERCENTAGE OF TOTAL LABOR 
HOURS.—All contractors and subcontrac-
tors engaged in the performance of con-
struction, alteration, or repair work on any 
project shall, subject to subparagraph (B), 
ensure that not less than the applicable 
percentage of the total labor hours of such 
work be performed by qualified appren-
tices. 
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‘‘(ii) APPLICABLE PERCENTAGE.—For 
purposes of paragraph (1), the applicable 
percentage shall be— 
‘‘(I) in the case of any applicable 
project the construction of which be-
gins before January 1, 2023, 5 per-
cent, 
‘‘(II) in the case of any applica-
ble project the construction of which 
begins after December 31, 2022, and 
before January 1, 2024, 10 percent, 
and 
‘‘(III) in the case of any applica-
ble project the construction of which 
begins after December 31, 2023, 15 
percent. 
‘‘(B) APPRENTICE
TO
JOURNEYWORKER 
RATIO.—The requirement under subparagraph 
(A)(i) shall be subject to any applicable require-
ments for apprentice-to-journeyworker ratios of 
the Department of Labor or the applicable 
State apprenticeship agency. 
‘‘(C) 
PARTICIPATION.—Each 
contractor 
and subcontractor who employs 4 or more indi-
viduals to perform construction, alteration, or 
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repair work on an applicable project shall em-
ploy 1 or more qualified apprentices to perform 
such work. 
‘‘(D) EXCEPTION.— 
‘‘(i) IN
GENERAL.—Notwithstanding 
any other provision of this paragraph, this 
paragraph shall not apply in the case of a 
taxpayer who— 
‘‘(I) demonstrates a lack of avail-
ability of qualified apprentices in the 
geographic area of the construction, 
alteration, or repair work, and 
‘‘(II) makes a good faith effort to 
comply with the requirements of this 
paragraph. 
‘‘(ii) GOOD FAITH EFFORT.—For pur-
poses of clause (i), a taxpayer shall be 
deemed to have satisfied the requirements 
under such paragraph with respect to an 
applicable project if such taxpayer has re-
quested qualified apprentices from a reg-
istered apprenticeship program, as defined 
in section 3131(e)(3)(B), and such request 
has been denied, provided that such denial 
is not the result of a refusal by the con-
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tractors or subcontractors engaged in the 
performance of construction, alteration, or 
repair work on such applicable project to 
comply with the established standards and 
requirements of such apprenticeship pro-
gram. 
‘‘(E) DEFINITIONS.—For purposes of this 
paragraph— 
‘‘(i) LABOR HOURS.—The term ‘labor 
hours’ has the meaning given such term in 
section 45(b)(9)(E)(i). 
‘‘(ii) QUALIFIED
APPRENTICE.—The 
term ‘qualified apprentice’ has the mean-
ing 
given 
such 
term 
in 
section 
45(b)(9)(E)(ii).’’. 
(b) MODIFICATION OF QUALIFYING ADVANCED EN-
ERGY PROJECTS.— 
(1) INCLUSION OF WATER AS A RENEWABLE 
RESOURCE.—Section 48C(c)(1)(A)(i)(I) is amended 
by inserting ‘‘water,’’ after ‘‘sun,’’. 
(2) 
ENERGY
STORAGE
SYSTEMS.—Section 
48C(c)(1)(A)(i)(II) is amended by striking ‘‘an en-
ergy storage system for use with electric or hybrid- 
electric motor vehicles’’ and inserting ‘‘energy stor-
age systems and components’’. 
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(3) MODIFICATION OF QUALIFYING ELECTRIC 
GRID
PROPERTY.—Section 48C(c)(1)(A)(i)(III) is 
amended to read as follows: 
‘‘(III) electric grid modernization 
equipment or components,’’. 
(4) USE
OF
CAPTURED
CARBON.—Section 
48C(c)(1)(A)(i)(IV) is amended by striking ‘‘seques-
ter’’ and insert ‘‘use or sequester’’. 
(5) ELECTRIC
AND
FUEL
CELL
VEHICLES.— 
Section 48C(c)(1)(A)(i)(VI) is amended— 
(A) by striking ‘‘new qualified plug-in elec-
tric drive motor vehicles (as defined by section 
30D)’’ and inserting ‘‘vehicles described in sec-
tion 36C, 45Y, and 36E’’, and 
(B) and striking ‘‘and power control units’’ 
and inserting ‘‘power control units, and equip-
ment used for charging or refueling’’. 
(6) PROPERTY
FOR
PRODUCTION
OF
HYDRO-
GEN.—Section 48C(c)(1)(A)(i) is amended by strik-
ing ‘‘or’’ at the end of subclause (VI), by redesig-
nating subclause (VII) as subclause (VIII), an by in-
serting after subclause (VI) the following new sub-
clause: 
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‘‘(VII) property designed to be 
used to produce qualified clean hydro-
gen (as defined in section 45X), or’’. 
(7) RECYCLING OF ADVANCED ENERGY PROP-
ERTY.—Section 48C(c)(1) is amended by adding at 
the end the following new subparagraph: 
‘‘(C) SPECIAL RULE FOR CERTAIN RECY-
CLING
FACILITIES.—A facility which recycles 
batteries or similar energy storage property de-
scribed in subparagraph (A)(i) shall be treated 
as part of a manufacturing facility described in 
such subparagraph.’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall take effect on the date of the enactment 
of this Act. 
SEC. 136502. LABOR COSTS OF INSTALLING MECHANICAL 
INSULATION PROPERTY. 
(a) IN GENERAL.—Subpart D of part IV of sub-
chapter A of chapter 1, as amended by the preceding pro-
visions of this Act, is further amended by adding at the 
end the following new section: 
‘‘SEC. 45Z. LABOR COSTS OF INSTALLING MECHANICAL IN-
SULATION PROPERTY. 
‘‘(a) IN GENERAL.—For purposes of section 38, the 
mechanical insulation labor costs credit determined under 
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