Details of Public Law 119-21, section 70514 , One Big Beautiful Bill Act

The provision modifies the sale of integrated components requirement under the advanced manufacturing production credit. To be considered an eligible component, the secondary component must be produced in the same facility as the primary component and sold to an unrelated person during the taxable year. The provision also requires that at least 65 percent of the total direct material costs paid or incurred by the taxpayer to produce the secondary component come from the primary components that were mined, produced, or manufactured in the United States. The credit is also disallowed for a specified foreign entity or a foreign-influenced entity.

The provision adds a phase out of the advanced manufacturing production credit based on applicable critical minerals other than metallurgical coal produced after December 31, 2030. The provision terminates the advanced manufacturing credit for wind energy components produced and sold after December 31, 2027. Additionally, the provision terminates the credit for metallurgical coal produced after December 31, 2029.

The provision adds metallurgical coal to the list of applicable critical minerals. The provision also modifies the definition of battery module.

California does not conform to advanced manufacturing production credit. As a result, California does not conform to the changes made by this provision.