[Congressional Bills 118th Congress]
[From the U.S. Government Publishing Office]
[S. 4005 Introduced in Senate (IS)]

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118th CONGRESS
  2d Session
                                S. 4005

   To amend the Internal Revenue Code of 1986 to allow an investment 
 credit for certain domestic infant formula manufacturing projects and 
   to allow a domestic production credit for certain infant formula.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                             March 20, 2024

Mr. Casey (for himself and Mr. Heinrich) introduced the following bill; 
     which was read twice and referred to the Committee on Finance

_______________________________________________________________________

                                 A BILL


 
   To amend the Internal Revenue Code of 1986 to allow an investment 
 credit for certain domestic infant formula manufacturing projects and 
   to allow a domestic production credit for certain infant formula.

    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 ``Infant Formula Made in America Act 
of 2024''.

SEC. 2. DOMESTIC INFANT FORMULA MANUFACTURING INVESTMENT CREDIT.

    (a) In General.--Subpart E of part IV of subchapter A of chapter 1 
of the Internal Revenue Code of 1986 is amended by inserting after 
section 48E the following new section:

``SEC. 48F. DOMESTIC INFANT FORMULA MANUFACTURING INVESTMENT CREDIT.

    ``(a) In General.--For purposes of section 46, in the case of an 
eligible taxpayer, the domestic infant formula manufacturing credit for 
any taxable year is an amount equal to 30 percent of the qualified 
investment for such taxable year.
    ``(b) Qualified Investment.--
            ``(1) In general.--For purposes of this section, the 
        qualified investment for any taxable year is the basis of 
        eligible property placed in service by the taxpayer during such 
        taxable year which is part of a qualifying infant formula 
        manufacturing project.
            ``(2) Certain qualified progress expenditures rules made 
        applicable.--Rules similar to the rules of subsections (c)(4) 
        and (d) of section 46 (as in effect on the day before the 
        enactment of the Revenue Reconciliation Act of 1990) shall 
        apply for purposes of this section.
            ``(3) Limitation.--The amount which is treated as the 
        qualified investment for all taxable years with respect to any 
        qualifying infant formula manufacturing project shall not 
        exceed the amount designated by the Secretary as eligible for 
        the credit.
    ``(c) Definitions.--For purposes of this section--
            ``(1) Eligible taxpayer.--
                    ``(A) In general.--For purposes of this section, 
                the term `eligible taxpayer' means a taxpayer if such 
                taxpayer's total global revenue for the calendar year 
                that precedes the calendar year in which the taxpayer 
                submits an application under subsection (d)(1)(A) does 
                not exceed $750,000,000.
                    ``(B) Aggregation rules.--For purposes of this 
                paragraph, all persons which are treated as a single 
                employer under subsections (a) and (b) of section 52 
                shall be treated as a single taxpayer.
            ``(2) Qualifying infant formula manufacturing project.--The 
        term `qualifying infant formula manufacturing project' means a 
        project, any portion of the qualified investment of which is 
        certified by the Secretary under subsection (d) as eligible for 
        a credit under this section, which re-equips, expands, or 
        establishes a facility for the manufacture of eligible infant 
        formula.
            ``(3) Eligible property.--The term `eligible property' 
        means any property--
                    ``(A) which is necessary for the manufacture of 
                eligible infant formula,
                    ``(B) which is--
                            ``(i) tangible personal property, or
                            ``(ii) other tangible property (not 
                        including a building or its structural 
                        components), but only if such property is used 
                        as an integral part of a facility described in 
                        paragraph (2), and
                    ``(C) with respect to which depreciation (or 
                amortization in lieu of depreciation) is allowable.
            ``(4) Eligible infant formula.--The term `eligible infant 
        formula' means infant formula that--
                    ``(A) may lawfully be sold in the United States, 
                and
                    ``(B) is manufactured in the United States.
    ``(d) Certification.--
            ``(1) In general.--
                    ``(A) Establishment.--Not later than 180 days after 
                the date of the enactment of this section, the 
                Secretary shall establish a qualifying infant formula 
                manufacturing project program to consider and award 
                certifications for qualified investments eligible for 
                credits under this section to qualifying infant formula 
                manufacturing projects.
                    ``(B) Application period.--Each applicant for 
                certification under this paragraph shall submit an 
                application--
                            ``(i) certifying that not less than 50 
                        percent of the eligible infant formula 
                        manufactured using the eligible property to 
                        which such application relates during the 1-
                        year period beginning on the date on which the 
                        qualifying infant formula manufacturing project 
                        is placed in service shall be sold for use in 
                        the United States, and
                            ``(ii) containing such information as the 
                        Secretary shall require.
                    ``(C) Time to meet criteria for certification.--
                Each applicant for certification shall have 1 year from 
                the date of acceptance by the Secretary of the 
                application during which to provide to the Secretary 
                evidence that the requirements of the certification 
                have been met.
                    ``(D) Period of issuance.--An applicant which 
                receives a certification shall have 3 years from the 
                date of issuance of the certification in order to place 
                the project in service and if such project is not 
                placed in service by that time period, then the 
                certification shall no longer be valid.
            ``(2) Limitations.--
                    ``(A) Project amount.--The amount of credit that 
                may be allocated under paragraph (1) shall not exceed 
                $150,000,000.
                    ``(B) Aggregate amount.--The total amount of 
                credits that may be allocated under paragraph (1) shall 
                not exceed $750,000,000.
                    ``(C) Sunset.--The Secretary may not allocate any 
                credit dollar amount with respect to any project that 
                commences construction after the date that is 10 years 
                after the date of the enactment of this section.
            ``(3) Review and redistribution.--
                    ``(A) Review.--Not later than 4 years after the 
                date of enactment of this section, the Secretary shall 
                review the credits allocated under this section as of 
                such date.
                    ``(B) Redistribution.--The Secretary may reallocate 
                credits awarded under this section if the Secretary 
                determines that--
                            ``(i) there is an insufficient quantity of 
                        qualifying applications for certification 
                        pending at the time of the review, or
                            ``(ii) any certification made pursuant to 
                        paragraph (1) has been revoked pursuant to 
                        paragraph (1)(B) because the project subject to 
                        the certification has been delayed as a result 
                        of third party opposition or litigation to the 
                        proposed project.
                    ``(C) Reallocation.--If the Secretary determines 
                that credits under this section are available for 
                reallocation pursuant to the requirements set forth in 
                subparagraph (B), the Secretary is authorized to 
                conduct an additional program for applications for 
                certification.
            ``(4) Disclosure of allocations.--The Secretary shall, upon 
        making a certification under this subsection, publicly disclose 
        the identity of the applicant and the amount of the credit with 
        respect to such applicant.
    ``(e) Recapture.--
            ``(1) In general.--If during the recapture period there is 
        a recapture event, then the tax imposed by this chapter for the 
        taxable year in which such recapture period ends shall be 
        increased by the sum of--
                    ``(A) the aggregate decrease in the credits allowed 
                to the taxpayer under section 38 for all prior taxable 
                years which would have resulted if no credit had been 
                determined under this section with respect to the 
                qualifying infant formula manufacturing project, plus
                    ``(B) interest at the underpayment rate established 
                under section 6621 on the amount determined under 
                subparagraph (A) for each prior taxable year for the 
                period beginning on the due date for filing the return 
                for the prior taxable year involved.
            ``(2) Recapture event.--For purposes of this subsection, 
        the term `recapture event' means--
                    ``(A) a failure by the taxpayer to meet the 
                requirements of the certification made by the taxpayer 
                under subsection (d)(1)(A)(i), or
                    ``(B) any property with respect to which an 
                allocation was made under this section ceases to be 
                eligible property which is part of a qualifying infant 
                formula manufacturing project.
            ``(3) Recapture period.--For purposes of this subsection, 
        the term `recapture period' means the 1-year period beginning 
        on the date on which a qualifying infant formula manufacturing 
        project with respect to which an allocation is made under this 
        section is placed in service.
            ``(4) No deduction for interest.--No deduction shall be 
        allowed under this chapter for interest described in paragraph 
        (1)(B).
            ``(5) Special rules.--
                    ``(A) Tax benefit rule.--The tax for the taxable 
                year shall be increased under paragraph (1) only with 
                respect to credits allowed by reason of this section 
                which were used to reduce tax liability. In the case of 
                credits not so used to reduce tax liability, the 
                carryforwards and carrybacks under section 39 shall be 
                appropriately adjusted.
                    ``(B) No credits against tax.--Any increase in tax 
                under this subsection shall not be treated as a tax 
                imposed by this chapter for purposes of determining the 
                amount of any credit under this chapter or for purposes 
                of section 55.
    ``(f) Coordination With Rehabilitation Credit.--The qualified 
investment with respect to any qualifying infant formula manufacturing 
project for any taxable year shall not include that portion of the 
basis of any project which is attributable to qualified rehabilitation 
expenditures (as defined in section 47(c)(2)).
    ``(g) Regulations.--The Secretary shall issue such regulations or 
other guidance as may be necessary or appropriate to carry out the 
purposes of this section, including regulations providing for the 
appropriate conversion of quantities of liquid concentrate eligible 
infant formula to pounds of dry eligible formula.''.
    (b) Inclusion in Investment Credit.--Section 46 of such Code is 
amended in paragraph (6) by striking ``and'', in paragraph (7) by 
striking the period and inserting ``, and'', and by adding at the end 
the following new paragraph:
            ``(8) the domestic infant formula manufacturing investment 
        credit.''.
    (c) Credit Made Transferable.--Section 6418(f)(1) of such Code is 
amended by adding at the end the following new clause:
                            ``(xii) The domestic infant formula 
                        manufacturing investment credit determined 
                        under section 48F.''.
    (d) Elective Payment of Credit.--Section 6417(b) of such Code is 
amended by adding at the end the following new paragraph:
            ``(13) The domestic infant formula manufacturing investment 
        credit determined under section 48F.''.
    (e) Certain Nonrecourse Financing Excluded From Credit Base.--
Section 49(a)(1)(C) of such Code is amended by striking ``and'' at the 
end of clause (vii), by striking the period at the end of clause (viii) 
and inserting ``, and'', and by adding at the end the following new 
clause:
                            ``(ix) the basis of any eligible property 
                        (as defined in section 48F(c)(3)) which is part 
                        of a qualifying infant formula manufacturing 
                        project under section 48F.''.
    (f) Clerical Amendment.--The table of sections for subpart E of 
part IV of subchapter A of chapter 1 of such Code is amended by 
inserting after the item relating to section 48E the following new 
item:

``Sec. 48F. Domestic infant formula manufacturing investment credit.''.
    (g) Effective Date.--The amendments made by this section shall 
apply to projects the construction of which commences after the date of 
the enactment of this Act.

SEC. 3. INFANT FORMULA PRODUCTION CREDIT.

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

``SEC. 45BB. INFANT FORMULA PRODUCTION CREDIT.

    ``(a) In General.--In the case of a qualified taxpayer, for 
purposes of section 38, the infant formula production credit for any 
taxable year is an amount equal to the product of--
            ``(1) the amount in pounds (determined consistent with 
        regulations issued under section 48F(g) with respect to liquid 
        concentrate) of eligible infant formula manufactured by such 
        taxpayer and sold for use in the United States during such 
        taxable year, multiplied by
            ``(2) $2.
    ``(b) Qualified Taxpayer.--For purposes of this section, the term 
`qualified taxpayer' means, with respect to a taxable year--
            ``(1) a taxpayer if such taxpayer's total global revenue 
        for the preceding taxable year does not exceed $750,000,000, or
            ``(2) a taxpayer to whom a credit was allowed under this 
        section in the preceding taxable year.
    ``(c) Eligible Infant Formula Defined.--For purposes of this 
section, the term `eligible infant formula' has the meaning given such 
term in section 48F.
    ``(d) Limitations.--
            ``(1) Maximum amount of formula.--For purposes of 
        determining the amount of the credit under subsection (a), the 
        amount of eligible infant formula determined under subsection 
        (a) with respect to any taxable year shall not exceed 
        18,000,000 pounds.
            ``(2) 5-year limitation.--No credit shall be allowed under 
        subsection (a) to a taxpayer for a taxable year unless--
                    ``(A) no credit has been allowed to such taxpayer 
                in any prior taxable year, or
                    ``(B) such taxable year occurs during the 5 taxable 
                year period beginning on the first day of the first 
                taxable year for which a credit was allowed under 
                subsection (a) to such taxpayer.
    ``(e) Aggregation Rules.--For purposes of this section, all persons 
which are treated as a single employer under subsections (a) and (b) of 
section 52 shall be treated as a single taxpayer.
    ``(f) Coordination With Investment Credit.--Infant formula produced 
at a facility with respect to which a credit was allowed under section 
48F shall not be taken into account for purposes of subsection (a).''.
    (b) Credit Made Transferable.--Section 6418(f)(1) of such Code (as 
amended by section 2) is amended by adding at the end the following new 
clause:
                            ``(xiii) The infant formula production 
                        credit determined under section 45BB.''.
    (c) Elective Payment of Credit.--Section 6417(b) of such Code (as 
amended by section 2) is amended by adding at the end the following new 
paragraph:
            ``(14) The infant formula production credit determined 
        under section 45BB.''.
    (d) Credit Allowed as Part of General Business Credit.--Section 
38(b) of such Code is amended by striking ``plus'' at the end of 
paragraph (40), by striking the period at the end of paragraph (41) and 
inserting ``, plus'', and by adding at the end the following new 
paragraph:
            ``(42) the infant formula production credit determined 
        under section 45BB(a).''.
    (e) Clerical Amendment.--The table of sections for subpart D of 
part IV of subchapter A of the Internal Revenue Code of 1986 is amended 
by adding at the end the following new item:

``Sec. 45BB. Infant formula production credit.''.
    (f) Effective Date.--The amendments made by this section shall 
apply to formula manufactured after the date of the enactment of this 
Act.
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