Credit for certain expenses of moving manufacturing equipment from China to the United States

(a)

In general

Subpart D 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:

45U.

Manufacturing reshoring credit

(a)

In general

For purposes of section 38, the manufacturing reshoring credit for any taxable year is the applicable percentage of the eligible reshoring expenses paid or incurred by the taxpayer during such taxable year.(b)

Limitation

The credit determined under subsection (a) with respect to any taxpayer for any taxable year shall not exceed $25,000,000.(c)

Applicable percentage

For purposes of this section, the term applicable percentage means—(1)in the case of any taxable year beginning in 2021 or 2022, 100 percent,(2)in the case of any taxable year beginning in 2023, 80 percent, and(3)in the case of any taxable year beginning in 2024, 60 percent.(d)

Eligible reshoring expenses

For purposes of this section—(1)

In general

The term eligible reshoring expenses means, with respect to any taxpayer, amounts paid or incurred by such taxpayer for the transportation (including any import duties, fees, or tariffs imposed with respect to such transportation) of qualified manufacturing equipment from China to the United States.(2)

Qualified manufacturing equipment

The term qualified manufacturing equipment means, with respect to any taxpayer, manufacturing equipment owned by such taxpayer which—(A)before the transportation referred to in paragraph (1) was used by such taxpayer to manufacture tangible property in China, and(B)after the transportation referred to in paragraph (1) is used by such taxpayer to manufacture tangible property in the United States.(e)

Recapture

If any qualified manufacturing equipment with respect to which a credit was allowed under this section is transported outside the United States (after transportation to the United States as described in subsection (d)) during the 3-year period beginning on the date (after such transportation) on which such property is placed in service by the taxpayer in the United States, the tax imposed under this chapter on such taxpayer for the taxable year which includes the date on which such property is so transported outside the United States shall be increased by the amount of the credit determined under this section with respect to such property.(f)

Special rules

(1)

Denial of double benefit

Any deduction or credit allowed under this title (other than this section) with respect to any eligible reshoring expenses shall be reduced by the amount of the credit determined under this section.(2)

Aggregation rule

For purposes of the dollar limitation imposed under subsection (b), all members of the same controlled group of corporations (within the meaning of section 267(f)) and all persons under common control (within the meaning of section 52(b) but determined by treating an interest of more than 50 percent as a controlling interest) shall be treated as 1 person and such dollar limitation shall be allocated in such manner as the Secretary may provide.(3)

Election to not have section apply

No credit shall be determined under subsection (a) with respect to any taxpayer for any taxable year if such taxpayer make an election under this paragraph (at such time and in such manner as the Secretary may provide) to have such subsection not apply for such taxable year.(g)

Termination

No credit shall be determined under this section for any taxable year beginning after December 31, 2024.

(b)

Credit allowed as part of general business credit

Section 38(b) of such Code is amended by striking plus at the end of paragraph (32), by striking the period at the end of paragraph (33) and inserting , plus, and by adding at the end the following new paragraph:

(34)the manufacturing reshoring credit determined under section 45U(a).

(c)

Clerical amendment

The table of sections for subpart D of part IV of subchapter A of chapter 1 of such Code is amended by adding at the end the following new item:

Sec. 45U. Manufacturing reshoring credit.

(d)

Effective date

The amendments made by this section shall apply to amounts paid or incurred after the date of the enactment of this Act, in taxable years ending after such date.