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139 STAT. 269 PUBLIC LAW 119–21—JULY 4, 2025 by a prohibited foreign entity that were provided on such certification, and ‘‘(3) the inaccuracy or falsity described in paragraph (2) resulted in the disallowance of an applicable energy credit (as defined in section 6662(m)(2)) and an understatement of income tax (within the meaning of section 6662(d)(2)) for the taxable year in an amount which exceeds the lesser of— ‘‘(A) 5 percent of the tax required to be shown on the return for the taxable year, or ‘‘(B) $100,000, then such person shall pay a penalty in the amount determined under subsection (b). ‘‘(b) AMOUNT OF PENALTY.—The amount of the penalty imposed under subsection (a) on any person with respect to a certification shall be equal to the greater of— ‘‘(1) 10 percent of the amount of the underpayment (as defined in section 6664(a)) solely attributable to the inaccuracy or falsity described in subsection (a)(2), or ‘‘(2) $5,000. ‘‘(c) EXCEPTION.—No penalty shall be imposed under subsection (a) if the person establishes to the satisfaction of the Secretary that any inaccuracy or falsity described in subsection (a)(2) is due to a reasonable cause and not willful neglect. ‘‘(d) DEFINITIONS.—Any term used in this section which is also used in section 7701(a)(52) shall have the meaning given such term in such section.’’. (2) CLERICAL AMENDMENTS.— (A) Section 6696 is amended— (i) in the heading, by striking ‘‘AND 6695A’’ and inserting ‘‘6695A, AND 6695B’’, (ii) in subsections (a), (b), and (e), by striking ‘‘and 6695A’’ each place it appears and inserting ‘‘6695A, and 6695B’’, (iii) in subsection (c), by striking ‘‘or 6695A’’ and inserting ‘‘6695A, or 6695B’’, and (iv) in subsection (d)— (I) in paragraph (1), by inserting ‘‘(or, in the case of any penalty under section 6695B, 6 years)’’ after ‘‘assessed within 3 years’’, and (II) in paragraph (2), by inserting ‘‘(or, in the case of any claim for refund of an overpayment of any penalty assessed under section 6695B, 6 years)’’ after ‘‘filed within 3 years’’. (B) The table of sections for part I of subchapter B of chapter 68 is amended by inserting after item relating to section 6695A the following new item: ‘‘Sec. 6695B. Penalty for substantial misstatements on certification provided by supplier.’’. (l) EFFECTIVE DATES.— (1) IN GENERAL.—Except as provided in paragraphs (2), (3), and (4), the amendments made by this section shall apply to taxable years beginning after the date of enactment of this Act. (2) MATERIAL ASSISTANCE FROM PROHIBITED FOREIGN ENTI- TIES.—The amendments made by subsection (b)(1) shall apply to facilities for which construction begins after December 31, 2025. Applicability. 26 USC 45 note. 26 USC prec. 6671.