I 
117TH CONGRESS 
1ST SESSION H. R. 2688 
To amend the Internal Revenue Code of 1986 to permanently allow a tax 
deduction for the mining, reclaiming, or recycling of critical minerals 
and metals from the United States, and to support the development 
of domestic supply chains for rare earth elements and other critical 
materials essential to United States technology, manufacturing, energy, 
healthcare and advanced medical devices, broadband infrastructure, 
transportation, and national defense. 
IN THE HOUSE OF REPRESENTATIVES 
APRIL 20, 2021 
Mr. GOODEN of Texas (for himself and Mr. VICENTE GONZALEZ of Texas) 
introduced the following bill; which was referred to the Committee on 
Ways and Means, and in addition to the Committee on Natural Re-
sources, for a period to be subsequently determined by the Speaker, in 
each case for consideration of such provisions as fall within the jurisdic-
tion of the committee concerned 
A BILL 
To amend the Internal Revenue Code of 1986 to permanently 
allow a tax deduction for the mining, reclaiming, or 
recycling of critical minerals and metals from the United 
States, and to support the development of domestic sup-
ply chains for rare earth elements and other critical 
materials essential to United States technology, manufac-
turing, energy, healthcare and advanced medical devices, 
broadband infrastructure, transportation, and national 
defense. 
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Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. PERMANENT FULL EXPENSING FOR PROPERTY 
USED TO EXTRACT CRITICAL MINERALS AND 
METALS WITHIN THE UNITED STATES. 
(a) IN GENERAL.—Section 168(k) of the Internal 
Revenue Code of 1986 is amended by adding at the end 
the following: 
‘‘(11) SPECIAL RULE FOR PROPERTY USED FOR 
MINING OF CRITICAL MINERALS AND METALS WITH-
IN THE UNITED STATES.— 
‘‘(A) IN
GENERAL.—In the case of any 
qualified property which is substantially in-
volved in the mining, reclaiming, or recycling of 
critical minerals and metals from deposits in 
the United States— 
‘‘(i) paragraph (2)(A)(iii) shall not 
apply, and 
‘‘(ii) the applicable percentage shall be 
100 percent. 
‘‘(B) CRITICAL MINERALS AND METALS.— 
For purposes of this paragraph, the term ‘crit-
ical minerals and metals’ means cerium, cobalt, 
dysprosium, erbium, europium, gadolinium, 
graphite, holmium, lanthanum, lithium, lute-
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tium, manganese, neodymium, praseodymium, 
promethium, samarium, scandium, terbium, 
thulium, vanadium, ytterbium, and yttrium.’’. 
(b) EFFECTIVE DATE.—The amendment made by 
this section shall apply to property placed in service after 
December 31, 2020. 
SEC. 2. PERMANENT FULL EXPENSING FOR NONRESIDEN-
TIAL REAL PROPERTY USED FOR MINING OF 
CRITICAL MINERALS AND METALS WITHIN 
THE UNITED STATES. 
(a) IN GENERAL.—Section 168 of the Internal Rev-
enue Code of 1986 is amended by adding at the end the 
following new subsection: 
‘‘(n) SPECIAL ALLOWANCE FOR NONRESIDENTIAL 
REAL PROPERTY USED FOR MINING OF CRITICAL MIN-
ERALS AND METALS WITHIN THE UNITED STATES.— 
‘‘(1) NEW STRUCTURES.—In the case of any 
qualified real property— 
‘‘(A)(i) if such property is placed in service 
on or after the date of enactment of this sub-
section, the depreciation deduction provided by 
section 167(a) for the taxable year in which 
such property is placed in service shall include 
an allowance equal to 100 percent of the ad-
justed basis of such property, or 
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‘‘(ii) if such property was placed in service 
before the date of enactment of this subsection, 
the depreciation deduction provided by section 
167(a) for the first taxable year beginning after 
such date shall include an allowance equal to 
100 percent of the adjusted basis of such prop-
erty, and 
‘‘(B) the adjusted basis of such property 
shall be reduced by the amount of such deduc-
tion before computing the amount otherwise al-
lowable as a depreciation deduction under this 
chapter for such taxable year and any subse-
quent taxable year. 
‘‘(2) QUALIFIED
REAL
PROPERTY.—For pur-
poses of this subsection, the term ‘qualified real 
property’ means any nonresidential real property 
which is substantially involved in the mining, re-
claiming, or recycling of critical minerals and metals 
(as defined in subsection (k)(11)(B)) from deposits 
in the United States.’’. 
(b) EFFECTIVE DATE.—The amendment made by 
this section shall apply to taxable years beginning after 
December 31, 2020. 
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SEC. 3. DEDUCTION FOR PURCHASE OF CRITICAL MIN-
ERALS AND METALS EXTRACTED WITHIN THE 
UNITED STATES. 
(a) IN GENERAL.—Part VI of subchapter B of chap-
ter 1 of the Internal Revenue Code of 1986 is amended 
by inserting after section 176 the following new section: 
‘‘SEC. 177. DEDUCTION FOR PURCHASE OF CRITICAL MIN-
ERALS AND METALS EXTRACTED WITHIN THE 
UNITED STATES. 
‘‘(a) ALLOWANCE OF DEDUCTION.—There shall be 
allowed as a deduction for the taxable year an amount 
equal to 200 percent of the cost paid or incurred by the 
taxpayer for the purchase or acquisition of critical min-
erals and metals (as defined in section 168(k)(11)(B)) 
which have been extracted from deposits in the United 
States. 
‘‘(b) APPLICATION WITH OTHER DEDUCTIONS.—No 
deduction shall be allowed under any other provision of 
this chapter with respect to any expenditure with respect 
to which a deduction is allowed or allowable under this 
section to the taxpayer.’’. 
(b) CONFORMING AMENDMENT.—The table of sec-
tions for part VI of subchapter B of chapter 1 of the Inter-
nal Revenue Code of 1986 is amended by inserting after 
the item relating to section 176 the following new item: 
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‘‘Sec. 177. Deduction for purchase of critical minerals and metals extracted 
within the United States.’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to amounts paid or incurred after 
December 31, 2020. 
SEC. 4. INCREASE IN RATE OF PERCENTAGE DEPLETION 
FOR CRITICAL MINERALS AND METALS FROM 
DEPOSITS IN THE UNITED STATES. 
(a) IN GENERAL.—Section 613(b)(1) of the Internal 
Revenue Code of 1986 is amended by striking ‘‘and’’ at 
the end of subparagraph (A), by striking the period at 
the end of subparagraph (B) and inserting ‘‘; and’’, and 
by adding at the end the following new subparagraph: 
‘‘(C) critical minerals and metals (as de-
fined in section 168(k)(11)(B)) from deposits in 
the United States.’’. 
(b) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years beginning after 
December 31, 2020. 
SEC. 5. GRANT PROGRAM FOR DEVELOPMENT OF CRITICAL 
MINERALS AND METALS. 
(a) ESTABLISHMENT.—The Secretary of the Interior 
shall establish a grant program to finance pilot projects 
for the development of critical minerals and metals in the 
United States. 
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(b) LIMITATION
ON
GRANT
AWARDS.—A grant 
awarded 
under 
subsection 
(a) 
may 
not 
exceed 
$10,000,000. 
(c) ECONOMIC
VIABILITY.—In awarding grants 
under subsection (a), the Secretary of the Interior shall 
give priority to projects the Secretary determines are likely 
to be economically viable over the long term. 
(d) SECONDARY RECOVERY.—In awarding grants 
under subsection (a) during a fiscal year, the Secretary 
of the Interior shall seek to award not less than 30 percent 
of the total amount of grants awarded during that fiscal 
year for projects relating to secondary recovery of critical 
minerals and metals. 
(e) AUTHORIZATION
OF APPROPRIATIONS.—There 
are authorized to be appropriated to the Secretary of the 
Interior $50,000,000 for each of fiscal years 2022 through 
2025 to carry out the grant program established under 
subsection (a). 
(f) DEFINITIONS.—In this section: 
(1) CRITICAL
MINERALS
AND
METALS.—The 
term ‘‘critical minerals and metals’’ means cerium, 
cobalt, dysprosium, erbium, europium, gadolinium, 
graphite, holmium, lanthanum, lithium, lutetium, 
manganese, 
neodymium, 
praseodymium, 
pro-
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methium, samarium, scandium, terbium, thulium, 
vanadium, ytterbium, and yttrium. 
(2) SECONDARY
RECOVERY.—The term ‘‘sec-
ondary recovery’’ means the recovery of minerals 
and metals from discarded end-use products or from 
waste products produced during the metal refining 
and manufacturing process, including from mine 
waste piles, acid mine drainage sludge, or byprod-
ucts produced through legacy mining and metallurgy 
activities. 
Æ 
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