Section 13202 of the IRA amends section 40(b)(6)(j)(i) of the IRC to extend the second generation biofuel producer tax credit. The expiry date for the credit was extended to January 1, 2025.
The credit is available to producers of second generation biofuels that, during the taxable year, sell the credit to another person:
- for use by such other person in the production of a qualified second generation biofuel mixture in the person’s trade or business (other than casual off-farm production);
- for use by such other person as a fuel in a trade or business; or
- who sells the second generation biofuel at retail to another person and places it in the fuel tank of that third person.
A second generation biofuels producer may also claim the credit if the producer itself uses or sells the fuel for the purposes described above.
For the purposes of the credit, a “second generation biofuel” is defined as a liquid fuel that is derived by or from qualified feedstocks and meets the registration requirements for fuels and fuel additives established by the Environmental Protection Agency under section 211 of the Clean Air Act (subject to limited exceptions).