Geothermal Tax Parity Act
Summary
What This Bill Does
The bill amends the Internal Revenue Code in two places. First, it adds geothermal deposits to section 167(h), letting taxpayers amortize geological and geophysical expenditures for geothermal exploration or development under the same rule used for oil and gas. Second, it adds geothermal working interests to the section 469(c)(3) exception from passive activity loss limits, allowing qualifying active investors to use geothermal working-interest losses in the same way oil and gas working-interest losses are treated. Both changes apply to taxable years beginning after enactment.
Who Benefits and How
Geothermal developers, geothermal project investors, renewable-energy financiers, and utilities seeking geothermal power benefit from faster cost recovery and more favorable loss treatment that can make exploration and development projects easier to finance.
Who Bears the Burden and How
Treasury Department tax policy staff and IRS exam staff must administer new geothermal tax treatment, while federal taxpayers bear revenue loss and oil and gas producers may face more tax-equal competition for energy investment.
Key Provisions
- Amends section 167(h) to add geothermal deposits to geological and geophysical expenditure amortization.
- Expands the section 469 working-interest passive-loss exception to geothermal properties.
- Provides tax parity with oil and gas for geothermal projects beginning after enactment.
Evidence Chain:
This summary is generated from the full bill text using AI analysis. Expand "Detailed Analysis" below for identified beneficiaries/burden bearers with clause-level evidence links.
At a Glance
What This Bill Does
Gives geothermal exploration and working interests the same federal tax treatment as oil and gas for geological expenditures and passive-loss rules.
Key Policy Areas
Energy, Taxpayers, Government, Utilities
Primary Purpose
Gives geothermal exploration and working interests the same federal tax treatment as oil and gas for geological expenditures and passive-loss rules.
Policy Domains
Substantive provisions
Identified Gains
- Geothermal developers
- Geothermal project investors
- Renewable-energy financiers
- Utilities seeking geothermal power
Identified Costs
- Treasury Department tax policy staff
- IRS exam staff
- Federal taxpayers
- Oil and gas producers
Sponsors
Legislative Progress
In CommitteeMs. Maloy (for herself, Mr. Garamendi, Mr. Moore of Utah, …
Referred to the House Committee on Ways and Means.
Introduced in House
Stakeholder Effects
cui bono?How this legislation distributes effects. Mention counts reflect frequency, not effect magnitude.
Geothermal developers, Geothermal project investors, Geothermal working interest investors
Bill Structure & Actor Mappings
Who is "The Secretary" in each section?
We use a combination of our own taxonomy and classification in addition to large language models to assess meaning and potential beneficiaries. High confidence means strong textual evidence. Always verify with the original bill text.
Learn more about our methodology