Title 26 — Internal Revenue CodeRelease 119-73
§45V Credit for production of clean hydrogen
Title 26 › Subtitle Subtitle A— - Income Taxes › Chapter CHAPTER 1— - NORMAL TAXES AND SURTAXES › Subchapter Subchapter A— - Determination of Tax Liability › Part PART IV— - CREDITS AGAINST TAX › Subpart Subpart D— - Business Related Credits › § 45V
Summary
Provides a tax credit for each kilogram of “qualified clean hydrogen” a taxpayer makes at a qualifying plant during the first 10 years after the plant first starts operating. The credit is the number of kilograms made times an “applicable amount.” That amount is a share of $0.60 per kilogram (adjusted for inflation and rounded to the nearest 0.1 cent). Different percentage shares apply depending on the hydrogen’s lifecycle greenhouse gas emissions, using four emission bands (up to 4, under 2.5, under 1.5, and under 0.45 kg CO2e per kg); the lowest-emission band gets 100%. Lifecycle emissions are measured up to the point of production (well-to-gate) using the GREET model, and only hydrogen with emissions not greater than 4 kg CO2e/kg qualifies. To count, the hydrogen must be made in the United States or a U.S. possession, made in the seller’s ordinary business, for sale or use, and verified by an independent party. A qualifying plant must be owned by the taxpayer, produce qualifying hydrogen, and start construction before January 1, 2028. No credit is allowed if the same plant already got a carbon-capture credit under section 45Q. If a plant follows required wage and apprenticeship rules, the credit can be multiplied by 5. The Treasury Secretary must issue rules and guidance, including how to measure lifecycle emissions, within one year after enactment.
Full Legal Text
Title 26, §45V
Internal Revenue Code — Source: USLM XML via OLRC
(a)For purposes of section 38, the clean hydrogen production credit for any taxable year is an amount equal to the product of—
(1)the kilograms of qualified clean hydrogen produced by the taxpayer during such taxable year at a qualified clean hydrogen production facility during the 10-year period beginning on the date such facility was originally placed in service, multiplied by
(2)the applicable amount (as determined under subsection (b)) with respect to such hydrogen.
(b)(1)For purposes of subsection (a)(2), the applicable amount shall be an amount equal to the applicable percentage of $0.60. If any amount as determined under the preceding sentence is not a multiple of 0.1 cent, such amount shall be rounded to the nearest multiple of 0.1 cent.
(2)For purposes of paragraph (1), the applicable percentage shall be determined as follows:
(A)In the case of any qualified clean hydrogen which is produced through a process that results in a lifecycle greenhouse gas emissions rate of—
(i)not greater than 4 kilograms of CO2e per kilogram of hydrogen, and
(ii)not less than 2.5 kilograms of CO2e per kilogram of hydrogen,
(B)In the case of any qualified clean hydrogen which is produced through a process that results in a lifecycle greenhouse gas emissions rate of—
(i)less than 2.5 kilograms of CO2e per kilogram of hydrogen, and
(ii)not less than 1.5 kilograms of CO2e per kilogram of hydrogen,
(C)In the case of any qualified clean hydrogen which is produced through a process that results in a lifecycle greenhouse gas emissions rate of—
(i)less than 1.5 kilograms of CO2e per kilogram of hydrogen, and
(ii)not less than 0.45 kilograms of CO2e per kilogram of hydrogen,
(D)In the case of any qualified clean hydrogen which is produced through a process that results in a lifecycle greenhouse gas emissions rate of less than 0.45 kilograms of CO2e per kilogram of hydrogen, the applicable percentage shall be 100 percent.
(3)The $0.60 amount in paragraph (1) shall be adjusted by multiplying such amount by the inflation adjustment factor (as determined under section 45(e)(2), determined by substituting “2022” for “1992” in subparagraph (B) thereof) for the calendar year in which the qualified clean hydrogen is produced. If any amount as increased under the preceding sentence is not a multiple of 0.1 cent, such amount shall be rounded to the nearest multiple of 0.1 cent.
(c)For purposes of this section—
(1)(A)Subject to subparagraph (B), the term “lifecycle greenhouse gas emissions” has the same meaning given such term under subparagraph (H) of section 211(o)(1) of the Clean Air Act (42 U.S.C. 7545(o)(1)), as in effect on the date of enactment of this section.
(B)The term “lifecycle greenhouse gas emissions” shall only include emissions through the point of production (well-to-gate), as determined under the most recent Greenhouse gases, Regulated Emissions, and Energy use in Transportation model (commonly referred to as the “GREET model”) developed by Argonne National Laboratory, or a successor model (as determined by the Secretary).
(2)(A)The term “qualified clean hydrogen” means hydrogen which is produced through a process that results in a lifecycle greenhouse gas emissions rate of not greater than 4 kilograms of CO2e per kilogram of hydrogen.
(B)Such term shall not include any hydrogen unless—
(i)such hydrogen is produced—
(I)in the United States (as defined in section 638(1)) or a possession of the United States (as defined in section 638(2)),
(II)in the ordinary course of a trade or business of the taxpayer, and
(III)for sale or use, and
(ii)the production and sale or use of such hydrogen is verified by an unrelated party.
(C)In the case of any hydrogen for which a lifecycle greenhouse gas emissions rate has not been determined for purposes of this section, a taxpayer producing such hydrogen may file a petition with the Secretary for determination of the lifecycle greenhouse gas emissions rate with respect to such hydrogen.
(3)The term “qualified clean hydrogen production facility” means a facility—
(A)owned by the taxpayer,
(B)which produces qualified clean hydrogen, and
(C)the construction of which begins before January 1, 2028.
(2)No credit shall be allowed under this section with respect to any qualified clean hydrogen produced at a facility which includes carbon capture equipment for which a credit is allowed to any taxpayer under section 45Q for the taxable year or any prior taxable year.
(3)Rules similar to the rule under section 45(b)(3) shall apply for purposes of this section.
(4)For purposes of subsection (a)(1), in the case of any facility which—
(A)was originally placed in service before January 1, 2023, and, prior to the modification described in subparagraph (B), did not produce qualified clean hydrogen, and
(B)after the date such facility was originally placed in service—
(i)is modified to produce qualified clean hydrogen, and
(ii)amounts paid or incurred with respect to such modification are properly chargeable to capital account of the taxpayer,
(e)(1)In the case of any qualified clean hydrogen production facility which satisfies the requirements of paragraph (2), the amount of the credit determined under subsection (a) with respect to qualified clean hydrogen described in subsection (b)(2) shall be equal to such amount (determined without regard to this sentence) multiplied by 5.
(2)A facility meets the requirements of this paragraph if it is one of the following:
(A)A facility—
(i)the construction of which begins prior to the date that is 60 days after the Secretary publishes guidance with respect to the requirements of paragraphs (3)(A) and (4), and
(ii)which meets the requirements of paragraph (3)(A) with respect to alteration or repair of such facility which occurs after such date.
(B)A facility which satisfies the requirements of paragraphs (3)(A) and (4).
(3)(A)The requirements described in this subparagraph with respect to any qualified clean hydrogen production facility are that the taxpayer shall ensure that any laborers and mechanics employed by the taxpayer or any contractor or subcontractor in—
(i)the construction of such facility, and
(ii)with respect to any taxable year, for any portion of such taxable year which is within the period described in subsection (a)(2), the alteration or repair of such facility,
(B)Rules similar to the rules of section 45(b)(7)(B) shall apply.
(4)Rules similar to the rules of section 45(b)(8) shall apply.
(5)The Secretary shall issue such regulations or other guidance as the Secretary determines necessary to carry out the purposes of this subsection, including regulations or other guidance which provides for requirements for recordkeeping or information reporting for purposes of administering the requirements of this subsection.
(f)Not later than 1 year after the date of enactment of this section, the Secretary shall issue regulations or other guidance to carry out the purposes of this section, including regulations or other guidance for determining lifecycle greenhouse gas emissions.
Legislative History
Notes & Related Subsidiaries
Editorial Notes
References in Text
The date of enactment of this section, referred to in subsecs. (c)(1)(A) and (f), is the date of enactment of Pub. L. 117–169, which was approved Aug. 16, 2022.
Amendments
2025—Subsec. (c)(3)(C). Pub. L. 119–21 substituted “
January 1, 2028” for “
January 1, 2033”. 2022—Subsec. (d)(3). Pub. L. 117–169, § 13204(a)(2), added par. (3). Subsec. (d)(4). Pub. L. 117–169, § 13204(a)(3), added par. (4).
Statutory Notes and Related Subsidiaries
Effective Date
Pub. L. 117–169, title I, § 13204(a)(5), Aug. 16, 2022, 136 Stat. 1939, provided that: “(A) In general.—The
Amendments
made by paragraphs (1) [enacting this section] and (4) [amending section 38 of this title] of this subsection shall apply to hydrogen produced after December 31, 2022. “(B) Credit reduced for tax-exempt bonds.—The amendment made by paragraph (2) [amending this section] shall apply to facilities the
Construction
of which begins after the date of enactment of this Act [Aug. 16, 2022]. “(C) Modification of existing facilities.—The amendment made by paragraph (3) [amending this section] shall apply to modifications made after December 31, 2022.”
Reference
Citations & Metadata
Citation
26 U.S.C. § 45V
Title 26 — Internal Revenue Code
Last Updated
Apr 6, 2026
Release point: 119-73