HR5441-119

What This Bill Does

The Fusion Advanced Manufacturing Parity Act uses the tax code to support domestic fusion-energy manufacturing. It amends section 45X of the Internal Revenue Code so qualified fusion energy components receive an advanced manufacturing production credit equal to 25 percent of the component sales price. The credit phases down for components sold after 2031: 75 percent in 2032, 50 percent in 2033, 25 percent in 2034, and no credit after 2034. The bill defines covered components broadly, including high-temperature superconducting magnets, fusion chambers, plasma vacuum vessels, blanket systems, HTS tape and wire, high-energy lasers, heating systems, capacitors, plasma compression systems, switches, insulators, fuel processing and storage, cooling components, fusion targets, dielectric systems, and control equipment used in a fusion energy machine under the Atomic Energy Act.

Who Benefits and How

Fusion component manufacturers benefit because qualifying sales receive a 25 percent section 45X production credit before the phaseout. Fusion energy developers benefit because the bill lowers after-tax costs for key machine components and domestic supply-chain inputs. Advanced manufacturing suppliers benefit because the definition covers specialized magnets, lasers, capacitors, insulators, cooling equipment, and fuel systems. Fusion commercialization investors benefit from clearer tax support for manufacturing facilities serving fusion machines.

Who Bears the Burden and How

Internal Revenue Service examiners must administer a new category of section 45X component credit and apply detailed component definitions. Treasury tax guidance staff must interpret which fusion components qualify and how the phaseout applies after 2031. Federal taxpayers bear the revenue cost of adding a 25 percent production credit for fusion components. Manufacturers outside the defined fusion component categories do not receive the new parity treatment.

Key Provisions

• Adds fusion energy components to the section 45X advanced manufacturing production credit.
• Provides a 25 percent credit amount based on the sales price of qualified fusion components.
• Limits the credit with a 2032 through 2034 phaseout and no credit after 2034.
• Defines covered fusion components such as superconducting magnets, plasma vessels, lasers, blanket systems, capacitors, and cooling systems.