Tax Credit for Domestic Production of Rare Earth Magnets and Supply Chain Security.
This legislation establishes a new tax credit for companies manufacturing rare earth magnets within the United States, components critical for advanced technologies like electric vehicles and wind turbines. The goal is to strengthen the domestic supply chain and reduce reliance on foreign sources, indirectly supporting economic stability and national security. The credit is higher if raw materials are also sourced domestically, and it is prohibited if materials originate from 'non-allied foreign nations'.
Key points
US manufacturers of rare earth magnets receive a tax credit of $20 per kilogram, increasing to $30 per kilogram if at least 90% of the raw materials are sourced domestically.
The credit is designed to boost economic security and domestic production, but it is prohibited if raw materials originate from 'non-allied foreign nations'.
The incentive program applies to taxable years starting after 2023 and will be gradually phased out beginning in 2033, ending completely after 2035.
Status:
Expired
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