Solar Energy Manufacturing for America Act
Bill: S.2140 | Sponsor: Sen. Ossoff, Jon (D-GA)
Policy area: Taxation

Summary:
Solar Energy Manufacturing for America Act
This bill allows a new tax credit for the production of solar property in the taxpayer's trade or business. The credit is allowed for certain solar components, including photovoltaic cells and wafers, solar grade polysilicon, and a non-integrated solar module able to generate electricity when exposed to sunlight.

To amend the Internal Revenue Code of 1986 to establish the advanced 
                 solar manufacturing production credit.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Solar Energy Manufacturing for 
America Act''.

SEC. 2. ADVANCED SOLAR MANUFACTURING PRODUCTION CREDIT.

    (a) In General.--Subpart C of part IV of subchapter A of chapter 1 
of the Internal Revenue Code of 1986 is amended by adding at the end 
the following new section:

``SEC. 36C. ADVANCED SOLAR MANUFACTURING PRODUCTION CREDIT.

    ``(a) In General.--
            ``(1) Allowance of credit.--There shall be allowed as a 
        credit against the tax imposed by this subtitle for any taxable 
        year an amount equal to the sum of the credit amounts 
        determined under subsection (b) with respect to each solar 
        component which is--
                    ``(A) produced by such taxpayer, and
                    ``(B) during the taxable year--
                            ``(i) sold by the taxpayer to--
                                    ``(I) an unrelated person, or
                                    ``(II) a related person for the use 
                                of such person in their trade or 
                                business (with the exception of any 
                                trade or business related to resale of 
                                such solar component without any 
                                subsequent modification, assembly, or 
                                integration into a project), or
                            ``(ii) placed in service or operation by 
                        the taxpayer or any other person.
            ``(2) Production and sale must be in trade or business.--
        Any solar component produced and sold by the taxpayer shall be 
        taken into account only if the production and sale described in 
        paragraph (1) is in a trade or business of the taxpayer.
    ``(b) Credit Amount.--
            ``(1) In general.--Subject to paragraph (2), the amount 
        determined under this subsection with respect to any solar 
        component shall be equal to--
                    ``(A) in the case of an integrated module, an 
                amount equal to the product of--
                            ``(i) 11 cents, multiplied by
                            ``(ii) the capacity of such module 
                        (expressed on a per direct current watt basis),
                    ``(B) in the case of a photovoltaic cell, an amount 
                equal to the product of--
                            ``(i) 4 cents, multiplied by
                            ``(ii) the capacity of such cell (expressed 
                        on a per direct current watt basis),
                    ``(C) in the case of a photovoltaic wafer, $12 per 
                square meter,
                    ``(D) in the case of solar grade polysilicon, $3 
                per kilogram, and
                    ``(E) in the case of a solar module which is not an 
                integrated module, an amount equal to the product of--
                            ``(i) 7 cents, multiplied by
                            ``(ii) the capacity of such module 
                        (expressed on a per direct current watt basis).
            ``(2) Phase out.--
                    ``(A) In general.--In the case of any solar 
                component sold after December 31, 2028, the amount 
                determined under this subsection with respect to such 
                component shall be equal to the product of--
                            ``(i) the amount determined under paragraph 
                        (1) with respect to such component, as 
                        determined without regard to this paragraph, 
                        multiplied by
                            ``(ii) the phase out percentage under 
                        subparagraph (B).
                    ``(B) Phase out percentage.--The phase out 
                percentage under this subparagraph is equal to--
                            ``(i) in the case of a solar component sold 
                        during calendar year 2029, 70 percent,
                            ``(ii) in the case of a solar component 
                        sold during calendar year 2030, 35 percent, and
                            ``(iii) in the case of a solar component 
                        sold after December 31, 2030, 0 percent.
    ``(c) Definitions and Other Rules.--In this section--
            ``(1) Solar component.--The term `solar component' means 
        any property described in paragraph (2).
            ``(2) Other definitions.--
                    ``(A) Integrated module.--The term `integrated 
                module' means a solar module produced by a single 
                manufacturer through the conversion of a photovoltaic 
                wafer or other semiconductor material into an end 
                product which is--
                            ``(i) suitable to generate electricity when 
                        exposed to sunlight, and
                            ``(ii) ready for installation without 
                        additional manufacturing processes.
                    ``(B) Photovoltaic cell.--The term `photovoltaic 
                cell' means the smallest semiconductor element of a 
                solar module which performs the immediate conversion of 
                light into electricity.
                    ``(C) Photovoltaic wafer.--The term `photovoltaic 
                wafer' means a thin slice or sheet of semiconductor 
                material of at least 240 square centimeters produced by 
                a single manufacturer--
                            ``(i) either--
                                    ``(I) directly from molten solar 
                                grade polysilicon, or
                                    ``(II) through formation of an 
                                ingot from molten polysilicon and 
                                subsequent slicing, and
                            ``(ii) which comprises the substrate of a 
                        photovoltaic cell.
                    ``(D) Solar grade polysilicon.--The term `solar 
                grade polysilicon' means silicon which is--
                            ``(i) suitable for use in photovoltaic 
                        manufacturing, and
                            ``(ii) purified to a minimum purity of 
                        99.999999 percent silicon by mass.
                    ``(E) Solar module.--The term `solar module' means 
                the connection and lamination of photovoltaic cells 
                into an environmentally protected final assembly which 
                is--
                            ``(i) suitable to generate electricity when 
                        exposed to sunlight, and
                            ``(ii) ready for installation without an 
                        additional manufacturing process.
            ``(3) Related persons.--Persons shall be treated as related 
        to each other if such persons would be treated as a single 
        employer under the regulations prescribed under section 52(b). 
        In the case of a corporation which is a member of an affiliated 
        group of corporations filing a consolidated return, such 
        corporation shall be treated as selling components to an 
        unrelated person if such component is sold to such a person by 
        another member of such group.
            ``(4) Only production in the united states taken into 
        account.--Sales shall be taken into account under this section 
        only with respect to solar components the production of which 
        is within--
                    ``(A) the United States (within the meaning of 
                section 638(1)), or
                    ``(B) a possession of the United States (within the 
                meaning of section 638(2)).
            ``(5) Pass-thru in the case of estates and trusts.--Under 
        regulations prescribed by the Secretary, rules similar to the 
        rules of subsection (d) of section 52 shall apply.
    ``(d) Registration.--
            ``(1) In general.--The Secretary shall require any person 
        claiming tax benefits under the provisions of this section to 
        register with the Secretary at such time, in such form and 
        manner, and subject to such terms and conditions, as the 
        Secretary may by regulations prescribe. A registration under 
        this subsection may be used only in accordance with regulations 
        prescribed under this subsection.
            ``(2) Registration in event of change in ownership.--Under 
        regulations prescribed by the Secretary, a person (other than a 
        corporation the stock of which is regularly traded on an 
        established securities market) shall be required to re-register 
        under this subsection if after a transaction (or series of 
        related transactions) more than 50 percent of ownership 
        interests in, or assets of, such person are held by persons 
        other than persons (or persons related thereto) who held more 
        than 50 percent of such interests or assets before the 
        transaction (or series of related transactions).
            ``(3) Denial, revocation, or suspension of registration.--
        Rules similar to the rules of section 4222(c) shall apply to 
        registration under this section.
            ``(4) Information reporting.--The Secretary may require--
                    ``(A) information reporting by any person 
                registered under this subsection, and
                    ``(B) information reporting by such other persons 
                as the Secretary deems necessary to carry out this 
                section.''.
    (b) Conforming Amendments.--
            (1) Section 6211(b)(4)(A) of the Internal Revenue Code of 
        1986 is amended by inserting ``36C,'' after ``36B,''.
            (2) Paragraph (2) of section 1324(b) of title 31, United 
        States Code, is amended by inserting ``36C,'' after ``36B,''.
            (3) The table of sections for subpart C of part IV of 
        subchapter A of chapter 1 of the Internal Revenue Code of 1986 
        is amended by inserting after the item relating to section 36B 
        the following new item:

``Sec. 36C. Advanced solar manufacturing production credit.''.
    (c) Effective Date.--The amendments made by this section shall 
apply to components produced and sold after December 31, 2021.
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