To: GBI Community
From: Jenna Hamilton, GBI Vice President, National Affairs
Date: 7/3/2025
GBI Community,
Last night and this morning, the U.S. House of Representatives considered and passed the final package of provisions for the One Big Beautiful Bill Act, known more casually as the reconciliation bill. After several long days of voting and debate, the House passed the bill by a vote of 218-214. It will now go to the president for signature, which the White House indicates is presently anticipated to occur during the morning of Friday, July 4, 2025. We wanted to share with you the status of a number of key items that we believe may impact members of our community. The items contained below represent programs, tax credits, and deductions that GBI has been monitoring (often, since their initial inception in the Inflation Reduction Act.) Given the type of process used in the House to finalize the bill, no changes were made from the provisions finalized in the Senate late last week, upon which the information in this memo is based. If you have any questions about the key items contained in this memo, or about other provisions, please contact Jenna Hamilton at hamilton@thegbi.org and she will work to address your questions.
TAX DEDUCTIONS
179d: Energy Efficient Commercial Buildings Deduction
Current law: Permanent in law.
Senate final language: Terminated for property whose construction begins after June 30, 2026.
TAX CREDITS
25C: Energy Efficient Home Improvement Credit
Current law: available through December 31, 2032
Senate final language: Eliminated for property Placed in Service after 12/31/2025
25D: Residential Solar, other home energy systems credits
Current law: Expires after December 31, 2034, with a gradual phase down beginning in 2033.
Senate final language: Eliminated for expenditures made after 12/31/2025
25E: Used Clean Vehicle Credit
Current law: Expires 12/31/2032
Senate final language: Eliminated immediately, by 9/30/2025
30C: Alternative Fuel Refueling Property Credit
Current law:
Individual: must be placed in service at primary home by 12/31/2033
Business/Tax Exempt organizations: must be placed in service at a business by 12/31/2032
Senate final language: Eliminated for property placed in service after 06/30/26.
30D: New Clean Vehicle Credit
Current law: eliminated after 12/31/2032
Senate final language: Eliminated immediately, by 9/30/2025
45L: New Energy Efficient Homes Credit
Current law: available through December 31, 2032
Senate final language: Eliminated for homes acquired after 6/30/2026
45Q: Carbon Sequestration Credit
Current law: Beginning of construction must be before 2033; credit available for 12 years after facility is Placed in Service.
Senate final language: No change, but language added to indicate that the credit value will be equal whether the CO2 is stored, vs used and then stored. This change applies to facilities placed in service after date of enactment.
45U: Nuclear Tax Credit
Current law: Elimination and phaseout based on market price thresholds; expires 12/31/2032
Senate final language: Maintains current law. Additional requirement effective after 2027: adds restrictions around using fuel produced by “covered nations,” (unless contract began before 2023). This addresses concerns about certain nations having too much influence/input into our nuclear programs. Also adds additional “Foreign Entity of Concern” (FEOC) requirements, at immediately for specified foreign entities, and within 2 years of enactment for other prohibited foreign entities.
45V: Clean Hydrogen Production Credit
Current law: Beginning of Construction must be before 2033; credit available for 10 yrs after the facility is Placed in Service.
Senate final language: Beginning of Construction now must be before 2028.
45W: Commercial Clean Vehicle Credit
Current law: eliminated after 12/31/2025
Senate final language: Eliminated immediately, by 9/30/2025
45X: Advanced Manufacturing Credits
Current law: Eliminated in 2033*
Phase out – reduced by*:
- 25% (2030)
- 50% (2031)
- 75% (2032)
- 2033: no credit
*does not apply to critical minerals
Senate final language: Critical minerals phase-out begins 2031.
Phase out – reduced by:
- 25% in 2031
- 50% in 2032
- 75% in 2033
- 2034: no credit
- Wind components no longer eligible after 2027.
- Adds metallurgical coal to list of eligible critical minerals (ends after 2029).
- Restores credit eligibility for integrated components.
All other phase-out timelines are maintained by current law (Elim in 2033; phaseout begins in 2030)
45Y/48E: Clean Electricity Production Credit /Clean Electricity Investment Credit
Current law: Credit ends in 2032, or at certain GHG emissions levels, whichever is later, and thereafter phases out by 25% in the second year after target it met, or 2033. Phases out by 50% in the 3rd year, or 2034. After the third year, no credit is available.
Senate final language: Wind/solar must begin construction within one year of bill’s enactment and be placed in service by 12/31/27. No phase-out*
*Exception for energy storage technology associated w/ wind/solar projects
For all other qualifying facilities, phase-out begins 2034.
Phase out – reduced by:
- 25% (BOC in 2034)
- 50% (BOC in 2035)
- BOC after 2035: no credit
Prohibits leasing arrangements for residential solar/wind credit eligibility. (This may dramatically impact some of the programs in place in California which have relied on leasing arrangements to meet the mandatory solar requirements in the state.)
45Z: Clean Fuel Production Credit
Current law: Eliminated in 2028
Senate final language: Extends credit to the end of 2029; amends emissions rates.
PROGRAMMATIC FUNDING RESCISSIONS IN THE OBBB
Unobligated funds from the following programs are rescinded, effectively terminating the programs. All unobligated funds will be remitted to the U.S. Treasury’s general fund.
Greenhouse Gas Reduction Fund (Section 60103 of the Inflation Reduction Act) Provided funding for deploy technology innovations that reduce greenhouse gas emissions. This program also created a Green Bank system.
American Innovation and Manufacturing Act (AIM) (Section 60109 of the Inflation Reduction Act). Provided funding focused on phasing down the production and consumption of hydrofluorocarbons contained in refrigerant; also included grants to develop HFC reclamation and destruction technologies.
Greenhouse Gas Corporate Reporting Fund (Section 60111 of the Inflation Reduction Act.) This program provided funding to enhance standardization and tracking of corporate commitments and plans to reduce greenhouse gas emissions.
Environmental Product Declaration Assistance Fund (Section 60112 of the Inflation Reduction Act.) This program provided funding to develop and implement an environmental product declaration program advertising the environmental impact of products.
Greenhouse Gas Air Pollution Plans and Implementation Grants (Section 60114 of the Inflation Reduction Act.) Provided funding to states, local governments, and Tribes to develop and implement “Climate Change Action Plans” and environmental justice initiatives.
Low-Embodied Carbon Labeling for Construction Materials Program (Section 60116 of the Inflation Reduction Act.) Provided funding for the EPA, in consultation with the Federal Highway Administration (FHWA) and the General Services Administration (GSA), to establish a program to identify and label construction materials and products with lower embodied carbon levels from industry standards to be used in transportation projects and for federal buildings.
Environmental and Climate Data Collection Fund (Section 60401 of the Inflation Reduction Act.) Provided funding for data collection efforts on the disproportionate harms and cumulative impacts resulting from pollution and climate change.
Federal Building Assistance Fund (Section 60502 of the Inflation Reduction Act.) Provided funding to convert GSA facilities to green buildings.
Low-Carbon Materials for Federal Buildings Program Fund (Section 60503 of the Inflation Reduction Act.) Provided funding for the GSA to acquire building materials with lower levels of embodied GHG emissions related to the materials’ entire lifecycles from production to disposal.
GSA Emerging and Sustainable Technologies Fund (Section 60504 of the Inflation Reduction Act.) Provided funding to the GSA “for emerging and sustainable technologies, and related sustainability and environmental programs.”
Low-Carbon Transportation Materials Grants (Section 60506 of the Inflation Reduction Act.) Provided funds to the Federal Highway Administration (FHWA) to establish a program that encourages the use of construction materials with substantially lower levels of embodied GHG emissions.
BROAD TAX PROVISIONS INCLUDED
Extension of the individual income tax rate reductions from the 2017 Tax Cuts and Jobs Act to make these permanent. Makes the increased standard deduction amount permanent, adjusting it annually for inflation.
Section 199a Qualified Business Income (QBI) deduction. Is made permanent at a deduction rate of 20%.
Section 179 expensing. Increases the maximum amount a taxpayer may expense under Section 179 to $2.5 million, reduced by the amount by which the cost of qualifying property exceeds $4 million.
Alternative Minimum Tax Exemption. Permanently extends the AMT exemption provided in the 2017 TCJA, but reverts the phaseout thresholds to their 2018 limits of $500,000 individual and $1 million for a joint return.
Mortgage Interest Deduction. Permanently extends limiting the Sec. 163 qualified residence interest deduction to the first $750,000 in home mortgage acquisition debt. Treats certain mortgage insurance premiums on acquisition indebtedness as qualified residential interest.
Limitation on Business Interest. Reinstates the EBITDA limitation found under Sec. 163(j), beginning on January 1, 2025. Adjusted taxable income would be computed without regard for amortization, depreciation or depletion.
Advanced Manufacturing Investment Credit. The rate is increased to 35% for property Placed in Service beginning on January 1, 2026 and beyond.
Opportunity Zones are made permanent, but the definition of “low-income community” is narrowed. Effective date of January 1, 2027.
New Markets Tax Credit. Makes the Sec 45D credit permanent.