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139 STAT. 281 PUBLIC LAW 119–21—JULY 4, 2025 SEC. 70523. INTANGIBLE DRILLING AND DEVELOPMENT COSTS TAKEN INTO ACCOUNT FOR PURPOSES OF COMPUTING ADJUSTED FINANCIAL STATEMENT INCOME. (a) IN GENERAL.—Section 56A(c)(13) is amended— (1) by striking subparagraph (A) and inserting the fol- lowing: ‘‘(A) reduced by— ‘‘(i) depreciation deductions allowed under section 167 with respect to property to which section 168 applies to the extent of the amount allowed as deduc- tions in computing taxable income for the year, and ‘‘(ii) any deduction allowed for expenses under sec- tion 263(c) (including any deduction for such expenses under section 59(e) or 291(b)(2)) with respect to prop- erty described therein to the extent of the amount allowed as deductions in computing taxable income for the year, and’’, and (2) by striking subparagraph (B)(i) and inserting the fol- lowing: ‘‘(i) to disregard any amount of— ‘‘(I) depreciation expense that is taken into account on the taxpayer’s applicable financial statement with respect to such property, and ‘‘(II) depletion expense that is taken into account on the taxpayer’s applicable financial statement with respect to the intangible drilling and development costs of such property, and’’. (b) EFFECTIVE DATE.—The amendments made by this section shall apply to taxable years beginning after December 31, 2025. SEC. 70524. INCOME FROM HYDROGEN STORAGE, CARBON CAPTURE, ADVANCED NUCLEAR, HYDROPOWER, AND GEO- THERMAL ENERGY ADDED TO QUALIFYING INCOME OF CERTAIN PUBLICLY TRADED PARTNERSHIPS. (a) IN GENERAL.—Section 7704(d)(1)(E) is amended— (1) by striking ‘‘income and gains derived from the explo- ration’’ and inserting the following: ‘‘income and gains derived from— ‘‘(i) the exploration’’. (2) by inserting ‘‘or’’ before ‘‘industrial source’’, and (3) by striking ‘‘or the transportation or storage’’ and all that follows and inserting the following: ‘‘(ii) the transportation or storage of— ‘‘(I) any fuel described in subsection (b), (c), (d), (e), or (k) of section 6426, or any alcohol fuel defined in section 6426(b)(4)(A) or any biodiesel fuel as defined in section 40A(d)(1) or sustainable aviation fuel as defined in section 40B(d)(1), or ‘‘(II) liquified hydrogen or compressed hydrogen, ‘‘(iii) in the case of a qualified facility (as defined in section 45Q(d), without regard to any date by which construction of the facility or equipment is required to begin) not less than 50 percent of the total carbon oxide production of which is qualified carbon oxide (as defined in section 45Q(c))— 26 USC 56A note.