Bill > S1979

This bill establishes a tax credit to incentivize the domestic production of high-performance rare earth magnets, which are critical components in many advanced technologies like electric vehicles, wind turbines, and defense systems. The bill provides a $20 per kilogram tax credit for rare earth magnets manufactured in the United States, with an increased credit of $30 per kilogram if at least 90% of the component rare earth materials are produced domestically. The credit applies to specific types of magnets with high magnetic strength, including neodymium-iron-boron and samarium-cobalt alloys. To qualify, manufacturers must produce the magnets in the ordinary course of business and cannot use component materials from non-allied foreign nations, with a temporary exemption for certain rare earth materials until January 1, 2027. The tax credit will gradually phase out, reducing to 70% in 2035, 35% in 2036-2037, and expiring completely after 2037. The bill also includes provisions for an elective payment option and allows some flexibility for manufacturers working on national security-related magnet production. The goal is to strengthen domestic supply chains for these strategically important materials and reduce reliance on foreign sources.

Budget and Finance

https://www.congress.gov/bill/119th-congress/senate-bill/1979/all-info