The 45Q Repeal Act of 2025 would eliminate the federal tax credit for carbon oxide sequestration, a financial incentive that currently allows companies to claim tax credits for capturing and storing carbon dioxide or using it in industrial processes. The bill repeals Section 45Q of the Internal Revenue Code entirely and makes conforming changes to related tax provisions that reference the credit, though it preserves certain carbon capture definitions for other clean energy tax incentives. The changes would take effect for tax years beginning after December 31, 2025, meaning the credit would no longer be available to new or existing projects starting in 2026. This repeal would remove a significant financial incentive for carbon capture projects, which are used by power plants, industrial facilities, and direct air capture companies to reduce greenhouse gas emissions. The bill was introduced on a bipartisan basis in March 2025 and is currently under review by the House Committee on Ways and Means.
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