S1536-119

1. Short title; table of contents This Act may be cited as the Building Ships in America Act of 2025. The table of contents of this Act is as follows:

2. United States vessel investment credit Subpart E of part IV of subchapter A of chapter 1 of the Internal Revenue Code of 1986 is amended by inserting after section 48E the following new section: For purposes of section 46, the United States Vessel Investment credit for any taxable year is an amount equal to the applicable percentage of any qualified investment for such taxable year with respect to any qualified vessel. For purposes of subsection (a), the applicable percentage with respect to any qualified vessel shall be an amount equal to the sum of— 33 percent, plus in the case of any qualified vessel for which the owner of such vessel will, as part of the agreement described in subsection (d)(1)(F) and for the duration of such agreement, obtain protection and indemnity insurance with respect to such vessel from an insurance company that is domiciled and headquartered in the United States and is an underwriter that is approved by the Maritime Administrator, 5 percent, plus in the case of any qualified vessel which is classified by and designed in accordance with the rules of the American Bureau of Shipping or any other classification society headquartered in the United States and recognized by the Secretary of the department in which the Coast Guard is operating in accordance with section 3316 of title 46, United States Code, 2 percent. For purposes of subsection (a), the qualified investment with respect to any qualified vessel is equal to the amount paid or incurred by the taxpayer in connection with the construction, repowering, or reconstruction of such vessel— in a shipyard of the United States, and by an entity which is not a foreign entity of concern. For purposes of this section, the term qualified vessel means a cargo vessel— which is a United States flag vessel (as defined in section 1355), which, in the case of any repowering or reconstruction of such vessel, was originally constructed in the United States, which operates in providing transportation in the United States foreign trade (as such term is defined in section 1355(a)), which is not a passenger vessel, as defined in section 2101 of title 46, United States Code, which is— a bulk carrier vessel, a tanker vessel, a roll-on/roll-off vessel, a container vessel, a multi-purpose vessel, a cable vessel, a heavy-lift vessel, or any other type of vessel determined appropriate by the Maritime Administrator, which, pursuant to an agreement between the taxpayer and the Maritime Administrator, operates as a vessel of the United States for a period of not less than 10 years, which has entered into an emergency preparedness agreement under section 53107 or 53407 of title 46, United States Code, or a contingency agreement under section 53207 of such title, or has otherwise entered into a voluntary agreement and plan of action with the Administrator of the Maritime Administration as authorized under section 708(c) of the Defense Production Act of 1950 (50 U.S.C. 4558(c)), and the construction of which begins before January 1, 2033. The term qualified vessel shall not include a vessel which— is, or was previously, owned or operated by a foreign entity of concern, was constructed, repowered, or reconstructed in a shipyard which is owned or operated by a foreign entity of concern, or was registered as a vessel of a foreign country of concern at any time prior to being placed in service by the taxpayer. For purposes of this section— The term foreign country of concern means— a country that is a covered nation (as defined in section 4872(d) of title 10, United States Code), and any country that the Maritime Administrator, in consultation with the Secretary of Defense, the Secretary of State, the Director of National Intelligence, and the Chair of the Federal Maritime Commission, determines to be engaged in conduct that is detrimental to the national security or foreign policy of the United States. The term foreign entity— means— a government of a foreign country or a foreign political party, as those terms are defined in section 1 of the Foreign Agents Registration Act of 1938, as amended (22 U.S.C. 611), a natural person who is not a lawful permanent resident of the United States, a citizen of the United States, or any other protected individual (as such term is defined in section 274B(a)(3) of the Immigration and Nationality Act (8 U.S.C. 1324b(a)(3))), or a partnership, association, corporation, organization, or other combination of persons organized under the laws of or having its principal place of business in a foreign country, and includes— any person (including an owner or operator of a vessel) owned by, controlled by, or subject to the direction of an entity listed in subparagraph (A), any person, wherever located, who acts as an agent, representative, or employee of an entity listed in subparagraph (A), any person who acts in any other capacity at the order, request, or under the direction or control, of an entity listed in subparagraph (A), or of a person whose activities are directly or indirectly supervised, directed, controlled, financed, or subsidized in whole or in major part by an entity listed in subparagraph (A), any person who directly or indirectly through any contract, arrangement, understanding, relationship, or otherwise, owns 25 percent or more of the equity interests of an entity listed in subparagraph (A), any person with significant responsibility to control, manage, or direct an entity listed in subparagraph (A), any person, wherever located, who is a citizen or resident of a country controlled by an entity listed in subparagraph (A), or any corporation, partnership, association, or other organization organized under the laws of a country controlled by an entity listed in subparagraph (A). The term foreign entity of concern means any foreign entity that is— designated as a foreign terrorist organization by the Secretary of State under section 219 of the Immigration and Nationality Act (8 U.S.C. 1189), included on the list of specially designated nationals and blocked persons maintained by the Office of Foreign Assets Control of the Department of the Treasury, owned by, controlled by, or subject to the jurisdiction or direction of a government of a foreign country of concern, alleged by the Attorney General to have been involved in activities for which a conviction was obtained under— chapter 37 of title 18, United States Code (commonly known as the Espionage Act) (18 U.S.C. 792 et seq.), section 951 or 1030 of title 18, United States Code, chapter 90 of title 18, United States Code (commonly known as the Economic Espionage Act of 1996), the Arms Export Control Act (22 U.S.C. 2751 et seq.), section 224, 225, 226, 227, or 236 of the Atomic Energy Act of 1954 (42 U.S.C. 2274, 2275, 2276, 2277, and 2284), the Export Control Reform Act of 2018 (50 U.S.C. 4801 et seq.), or the International Emergency Economic Powers Act (50 U.S.C. 1701 et seq.), designated by the Federal Maritime Commission as a controlled carrier under chapter 407 of title 46, United States Code, found by the Federal Maritime Commission to be practicing unfavorable conditions in foreign trade under chapter 421 or 423 of title 46, United States Code, or determined by the Maritime Administrator, in consultation with the Secretary of Defense, the Secretary of State, the Director of National Intelligence, and the Chair of the Federal Maritime Commission, to be engaged in unauthorized conduct that is detrimental to the national security or foreign policy of the United States. Rules similar to the rules of subsections (c)(4) and (d) of section 46 (as in effect on the day before the date of the enactment of the Revenue Reconciliation Act of 1990) shall apply for purposes of subsection (a). The Secretary, in consultation with the Maritime Administrator, shall issue such regulations or other guidance as may be necessary or appropriate to carry out the purposes of this section, including any regulations or guidance which may be necessary or appropriate to recapture the benefit of any credit determined under this section with respect to any qualified vessel, or any increase in the applicable percentage under subsection (b) with respect to any qualified vessel, in the case of any taxpayer which fails to comply with the terms of the agreement described in subsection (d)(1)(F) with respect to such qualified vessel. Section 46 of the Internal Revenue Code of 1986, as amended by section 13702(b)(1) of Public Law 117–169, is amended— in paragraph (6), by striking and at the end, in paragraph (7), by striking the period at the end and inserting , and, and by adding at the end the following: the United States Vessel Investment credit. Section 49(a)(1)(C) of such Code, as amended by section 13702(b)(2) of Public Law 117–169, is amended— in clause (vii), by striking and at the end, in clause (viii), by striking the period at the end and inserting , and, and by adding at the end the following: with respect to any qualified vessel (as defined in section 48F(d)), the portion of the basis of such vessel attributable to amounts paid or incurred by the taxpayer in connection with the construction, repowering, or reconstruction of such vessel. The table of sections for subpart E of part IV of subchapter A of chapter 1 of such Code is amended by inserting after the item relating to section 48E the following new item: Section 50(a) of the Internal Revenue Code of 1986 is amended— in paragraph (4), by striking or any applicable transaction to which paragraph (3)(A) applies and inserting any applicable transaction to which paragraph (3)(A) applies, or any violation to which paragraph (6)(A) applies, by redesignating paragraph (6) as paragraph (7), by inserting after paragraph (5) the following new paragraph: If an applicable taxpayer violates any of the requirements of the agreement described in section 48F(d)(1)(F) during the duration of such agreement with respect to any investment credit property which is eligible for the United States Vessel Investment credit under section 48F(a), then the tax under this chapter for the taxable year in which such violation occurs shall be increased by 100 percent of the aggregate decrease in the credits allowed under section 38 for all prior taxable years which would have resulted solely from reducing to zero any credit determined under section 46 which is attributable to the United States Vessel Investment credit under section 48F(a) with respect to such property. Subparagraph (A) shall not apply if the applicable taxpayer demonstrates to the satisfaction of the Secretary and the Maritime Administrator that the taxpayer is in compliance with the agreement described in section 48F(d)(1)(F) within 30 days of a determination and notice by the Secretary. The Secretary shall issue such regulations or other guidance as the Secretary determines necessary or appropriate to carry out the purposes of this paragraph, including regulations or other guidance which provide for requirements for recordkeeping or information reporting for purposes of administering the requirements of this paragraph. in paragraph (7) (as redesignated by paragraph (2))— in subparagraph (C), by striking or (3) and inserting (3), or (4), and by striking subparagraph (E) and inserting the following: For purposes of this subsection, the term applicable taxpayer means any taxpayer who has been allowed— for purposes of paragraph (3), a credit under section 48D(a) for any prior taxable year, or for purposes of paragraph (6), a credit under section 48F(a) for any prior taxable year. Section 6417 of the Internal Revenue Code of 1986 is amended— in subsection (b), by adding at the end the following: The United States Vessel Investment credit under section 48F. in subsection (d)(1)— in subparagraph (E), by striking (C), or (D) each place it appears and inserting (C), (D), or (E), by redesignating subparagraph (E) (as amended by clause (i)) as subparagraph (F), and by inserting after subparagraph (D) the following: If a taxpayer other than an entity described in subparagraph (A) makes an election under this subparagraph with respect to any taxable year in which such taxpayer has made a qualified investment with respect to any qualified vessel (as defined in section 48F), such taxpayer shall be treated as an applicable entity for purposes of this section for such taxable year, but only with respect to the credit described in subsection (b)(13). Section 6418(f)(1)(A) of the Internal Revenue Code of 1986 is amended by adding at the end the following: The United States Vessel Investment credit under section 48F. Section 1357(c) of the Internal Revenue Code of 1986 is amended— in paragraph (1), by striking paragraph (2) and inserting paragraph (2) or (4), and by adding at the end the following: Paragraph (1) shall not apply with respect to any credit allowed to the taxpayer under section 48F. The amendments made by this section shall apply to property placed in service after December 31, 2025. 48F.United States vessel investment credit(a)In generalFor purposes of section 46, the United States Vessel Investment credit for any taxable year is an amount equal to the applicable percentage of any qualified investment for such taxable year with respect to any qualified vessel.(b)Applicable percentageFor purposes of subsection (a), the applicable percentage with respect to any qualified vessel shall be an amount equal to the sum of—(1)33 percent, plus(2)in the case of any qualified vessel for which the owner of such vessel will, as part of the agreement described in subsection (d)(1)(F) and for the duration of such agreement, obtain protection and indemnity insurance with respect to such vessel from an insurance company that is domiciled and headquartered in the United States and is an underwriter that is approved by the Maritime Administrator, 5 percent, plus(3)in the case of any qualified vessel which is classified by and designed in accordance with the rules of the American Bureau of Shipping or any other classification society headquartered in the United States and recognized by the Secretary of the department in which the Coast Guard is operating in accordance with section 3316 of title 46, United States Code, 2 percent.(c)Qualified investmentFor purposes of subsection (a), the qualified investment with respect to any qualified vessel is equal to the amount paid or incurred by the taxpayer in connection with the construction, repowering, or reconstruction of such vessel—(1)in a shipyard of the United States, and(2)by an entity which is not a foreign entity of concern.(d)Qualified vessel(1)In generalFor purposes of this section, the term qualified vessel means a cargo vessel—(A)which is a United States flag vessel (as defined in section 1355),(B)which, in the case of any repowering or reconstruction of such vessel, was originally constructed in the United States,(C)which operates in providing transportation in the United States foreign trade (as such term is defined in section 1355(a)),(D)which is not a passenger vessel, as defined in section 2101 of title 46, United States Code,(E)which is—(i)a bulk carrier vessel,(ii)a tanker vessel,(iii)a roll-on/roll-off vessel,(iv)a container vessel,(v)a multi-purpose vessel,(vi)a cable vessel,(vii)a heavy-lift vessel, or(viii)any other type of vessel determined appropriate by the Maritime Administrator,(F)which, pursuant to an agreement between the taxpayer and the Maritime Administrator, operates as a vessel of the United States for a period of not less than 10 years,(G)which has entered into an emergency preparedness agreement under section 53107 or 53407 of title 46, United States Code, or a contingency agreement under section 53207 of such title, or has otherwise entered into a voluntary agreement and plan of action with the Administrator of the Maritime Administration as authorized under section 708(c) of the Defense Production Act of 1950 (50 U.S.C. 4558(c)), and(H)the construction of which begins before January 1, 2033.(2)Exclusion related to foreign entities of concernThe term qualified vessel shall not include a vessel which—(A)is, or was previously, owned or operated by a foreign entity of concern,(B)was constructed, repowered, or reconstructed in a shipyard which is owned or operated by a foreign entity of concern, or(C)was registered as a vessel of a foreign country of concern at any time prior to being placed in service by the taxpayer.(e)DefinitionsFor purposes of this section—(1)Foreign country of concernThe term foreign country of concern means—(A)a country that is a covered nation (as defined in section 4872(d) of title 10, United States Code), and(B)any country that the Maritime Administrator, in consultation with the Secretary of Defense, the Secretary of State, the Director of National Intelligence, and the Chair of the Federal Maritime Commission, determines to be engaged in conduct that is detrimental to the national security or foreign policy of the United States.(2)Foreign entityThe term foreign entity—(A)means—(i)a government of a foreign country or a foreign political party, as those terms are defined in section 1 of the Foreign Agents Registration Act of 1938, as amended (22 U.S.C. 611),(ii)a natural person who is not a lawful permanent resident of the United States, a citizen of the United States, or any other protected individual (as such term is defined in section 274B(a)(3) of the Immigration and Nationality Act (8 U.S.C. 1324b(a)(3))), or(iii)a partnership, association, corporation, organization, or other combination of persons organized under the laws of or having its principal place of business in a foreign country, and(B)includes—(i)any person (including an owner or operator of a vessel) owned by, controlled by, or subject to the direction of an entity listed in subparagraph (A),(ii)any person, wherever located, who acts as an agent, representative, or employee of an entity listed in subparagraph (A),(iii)any person who acts in any other capacity at the order, request, or under the direction or control, of an entity listed in subparagraph (A), or of a person whose activities are directly or indirectly supervised, directed, controlled, financed, or subsidized in whole or in major part by an entity listed in subparagraph (A),(iv)any person who directly or indirectly through any contract, arrangement, understanding, relationship, or otherwise, owns 25 percent or more of the equity interests of an entity listed in subparagraph (A),(v)any person with significant responsibility to control, manage, or direct an entity listed in subparagraph (A),(vi)any person, wherever located, who is a citizen or resident of a country controlled by an entity listed in subparagraph (A), or(vii)any corporation, partnership, association, or other organization organized under the laws of a country controlled by an entity listed in subparagraph (A).(3)Foreign entity of concernThe term foreign entity of concern means any foreign entity that is—(A)designated as a foreign terrorist organization by the Secretary of State under section 219 of the Immigration and Nationality Act (8 U.S.C. 1189),(B)included on the list of specially designated nationals and blocked persons maintained by the Office of Foreign Assets Control of the Department of the Treasury,(C)owned by, controlled by, or subject to the jurisdiction or direction of a government of a foreign country of concern,(D)alleged by the Attorney General to have been involved in activities for which a conviction was obtained under—(i)chapter 37 of title 18, United States Code (commonly known as the Espionage Act) (18 U.S.C. 792 et seq.),(ii)section 951 or 1030 of title 18, United States Code,(iii)chapter 90 of title 18, United States Code (commonly known as the Economic Espionage Act of 1996),(iv)the Arms Export Control Act (22 U.S.C. 2751 et seq.),(v)section 224, 225, 226, 227, or 236 of the Atomic Energy Act of 1954 (42 U.S.C. 2274, 2275, 2276, 2277, and 2284),(vi)the Export Control Reform Act of 2018 (50 U.S.C. 4801 et seq.), or(vii)the International Emergency Economic Powers Act (50 U.S.C. 1701 et seq.),(E)designated by the Federal Maritime Commission as a controlled carrier under chapter 407 of title 46, United States Code,(F)found by the Federal Maritime Commission to be practicing unfavorable conditions in foreign trade under chapter 421 or 423 of title 46, United States Code, or(G)determined by the Maritime Administrator, in consultation with the Secretary of Defense, the Secretary of State, the Director of National Intelligence, and the Chair of the Federal Maritime Commission, to be engaged in unauthorized conduct that is detrimental to the national security or foreign policy of the United States.(f)Certain progress expenditure rules made applicableRules similar to the rules of subsections (c)(4) and (d) of section 46 (as in effect on the day before the date of the enactment of the Revenue Reconciliation Act of 1990) shall apply for purposes of subsection (a).(g)RegulationsThe Secretary, in consultation with the Maritime Administrator, shall issue such regulations or other guidance as may be necessary or appropriate to carry out the purposes of this section, including any regulations or guidance which may be necessary or appropriate to recapture the benefit of any credit determined under this section with respect to any qualified vessel, or any increase in the applicable percentage under subsection (b) with respect to any qualified vessel, in the case of any taxpayer which fails to comply with the terms of the agreement described in subsection (d)(1)(F) with respect to such qualified vessel.. (8)the United States Vessel Investment credit.. (ix)with respect to any qualified vessel (as defined in section 48F(d)), the portion of the basis of such vessel attributable to amounts paid or incurred by the taxpayer in connection with the construction, repowering, or reconstruction of such vessel.. Sec. 48F. United States Vessel Investment credit.. (6) Failure to operate qualified vessel as a vessel of the United States (A) In general If an applicable taxpayer violates any of the requirements of the agreement described in section 48F(d)(1)(F) during the duration of such agreement with respect to any investment credit property which is eligible for the United States Vessel Investment credit under section 48F(a), then the tax under this chapter for the taxable year in which such violation occurs shall be increased by 100 percent of the aggregate decrease in the credits allowed under section 38 for all prior taxable years which would have resulted solely from reducing to zero any credit determined under section 46 which is attributable to the United States Vessel Investment credit under section 48F(a) with respect to such property. (B) Exception Subparagraph (A) shall not apply if the applicable taxpayer demonstrates to the satisfaction of the Secretary and the Maritime Administrator that the taxpayer is in compliance with the agreement described in section 48F(d)(1)(F) within 30 days of a determination and notice by the Secretary. (C) Regulations and guidance The Secretary shall issue such regulations or other guidance as the Secretary determines necessary or appropriate to carry out the purposes of this paragraph, including regulations or other guidance which provide for requirements for recordkeeping or information reporting for purposes of administering the requirements of this paragraph. , and (E) Applicable taxpayer For purposes of this subsection, the term applicable taxpayer means any taxpayer who has been allowed— (i) for purposes of paragraph (3), a credit under section 48D(a) for any prior taxable year, or (ii) for purposes of paragraph (6), a credit under section 48F(a) for any prior taxable year. . (13)The United States Vessel Investment credit under section 48F., and (E)Election with respect to United States vessel investment creditIf a taxpayer other than an entity described in subparagraph (A) makes an election under this subparagraph with respect to any taxable year in which such taxpayer has made a qualified investment with respect to any qualified vessel (as defined in section 48F), such taxpayer shall be treated as an applicable entity for purposes of this section for such taxable year, but only with respect to the credit described in subsection (b)(13).. (xii)The United States Vessel Investment credit under section 48F.. (4)Exception for United States vessel investment creditParagraph (1) shall not apply with respect to any credit allowed to the taxpayer under section 48F..

48F. United States vessel investment credit For purposes of section 46, the United States Vessel Investment credit for any taxable year is an amount equal to the applicable percentage of any qualified investment for such taxable year with respect to any qualified vessel. For purposes of subsection (a), the applicable percentage with respect to any qualified vessel shall be an amount equal to the sum of— 33 percent, plus in the case of any qualified vessel for which the owner of such vessel will, as part of the agreement described in subsection (d)(1)(F) and for the duration of such agreement, obtain protection and indemnity insurance with respect to such vessel from an insurance company that is domiciled and headquartered in the United States and is an underwriter that is approved by the Maritime Administrator, 5 percent, plus in the case of any qualified vessel which is classified by and designed in accordance with the rules of the American Bureau of Shipping or any other classification society headquartered in the United States and recognized by the Secretary of the department in which the Coast Guard is operating in accordance with section 3316 of title 46, United States Code, 2 percent. For purposes of subsection (a), the qualified investment with respect to any qualified vessel is equal to the amount paid or incurred by the taxpayer in connection with the construction, repowering, or reconstruction of such vessel— in a shipyard of the United States, and by an entity which is not a foreign entity of concern. For purposes of this section, the term qualified vessel means a cargo vessel— which is a United States flag vessel (as defined in section 1355), which, in the case of any repowering or reconstruction of such vessel, was originally constructed in the United States, which operates in providing transportation in the United States foreign trade (as such term is defined in section 1355(a)), which is not a passenger vessel, as defined in section 2101 of title 46, United States Code, which is— a bulk carrier vessel, a tanker vessel, a roll-on/roll-off vessel, a container vessel, a multi-purpose vessel, a cable vessel, a heavy-lift vessel, or any other type of vessel determined appropriate by the Maritime Administrator, which, pursuant to an agreement between the taxpayer and the Maritime Administrator, operates as a vessel of the United States for a period of not less than 10 years, which has entered into an emergency preparedness agreement under section 53107 or 53407 of title 46, United States Code, or a contingency agreement under section 53207 of such title, or has otherwise entered into a voluntary agreement and plan of action with the Administrator of the Maritime Administration as authorized under section 708(c) of the Defense Production Act of 1950 (50 U.S.C. 4558(c)), and the construction of which begins before January 1, 2033. The term qualified vessel shall not include a vessel which— is, or was previously, owned or operated by a foreign entity of concern, was constructed, repowered, or reconstructed in a shipyard which is owned or operated by a foreign entity of concern, or was registered as a vessel of a foreign country of concern at any time prior to being placed in service by the taxpayer. For purposes of this section— The term foreign country of concern means— a country that is a covered nation (as defined in section 4872(d) of title 10, United States Code), and any country that the Maritime Administrator, in consultation with the Secretary of Defense, the Secretary of State, the Director of National Intelligence, and the Chair of the Federal Maritime Commission, determines to be engaged in conduct that is detrimental to the national security or foreign policy of the United States. The term foreign entity— means— a government of a foreign country or a foreign political party, as those terms are defined in section 1 of the Foreign Agents Registration Act of 1938, as amended (22 U.S.C. 611), a natural person who is not a lawful permanent resident of the United States, a citizen of the United States, or any other protected individual (as such term is defined in section 274B(a)(3) of the Immigration and Nationality Act (8 U.S.C. 1324b(a)(3))), or a partnership, association, corporation, organization, or other combination of persons organized under the laws of or having its principal place of business in a foreign country, and includes— any person (including an owner or operator of a vessel) owned by, controlled by, or subject to the direction of an entity listed in subparagraph (A), any person, wherever located, who acts as an agent, representative, or employee of an entity listed in subparagraph (A), any person who acts in any other capacity at the order, request, or under the direction or control, of an entity listed in subparagraph (A), or of a person whose activities are directly or indirectly supervised, directed, controlled, financed, or subsidized in whole or in major part by an entity listed in subparagraph (A), any person who directly or indirectly through any contract, arrangement, understanding, relationship, or otherwise, owns 25 percent or more of the equity interests of an entity listed in subparagraph (A), any person with significant responsibility to control, manage, or direct an entity listed in subparagraph (A), any person, wherever located, who is a citizen or resident of a country controlled by an entity listed in subparagraph (A), or any corporation, partnership, association, or other organization organized under the laws of a country controlled by an entity listed in subparagraph (A). The term foreign entity of concern means any foreign entity that is— designated as a foreign terrorist organization by the Secretary of State under section 219 of the Immigration and Nationality Act (8 U.S.C. 1189), included on the list of specially designated nationals and blocked persons maintained by the Office of Foreign Assets Control of the Department of the Treasury, owned by, controlled by, or subject to the jurisdiction or direction of a government of a foreign country of concern, alleged by the Attorney General to have been involved in activities for which a conviction was obtained under— chapter 37 of title 18, United States Code (commonly known as the Espionage Act) (18 U.S.C. 792 et seq.), section 951 or 1030 of title 18, United States Code, chapter 90 of title 18, United States Code (commonly known as the Economic Espionage Act of 1996), the Arms Export Control Act (22 U.S.C. 2751 et seq.), section 224, 225, 226, 227, or 236 of the Atomic Energy Act of 1954 (42 U.S.C. 2274, 2275, 2276, 2277, and 2284), the Export Control Reform Act of 2018 (50 U.S.C. 4801 et seq.), or the International Emergency Economic Powers Act (50 U.S.C. 1701 et seq.), designated by the Federal Maritime Commission as a controlled carrier under chapter 407 of title 46, United States Code, found by the Federal Maritime Commission to be practicing unfavorable conditions in foreign trade under chapter 421 or 423 of title 46, United States Code, or determined by the Maritime Administrator, in consultation with the Secretary of Defense, the Secretary of State, the Director of National Intelligence, and the Chair of the Federal Maritime Commission, to be engaged in unauthorized conduct that is detrimental to the national security or foreign policy of the United States. Rules similar to the rules of subsections (c)(4) and (d) of section 46 (as in effect on the day before the date of the enactment of the Revenue Reconciliation Act of 1990) shall apply for purposes of subsection (a). The Secretary, in consultation with the Maritime Administrator, shall issue such regulations or other guidance as may be necessary or appropriate to carry out the purposes of this section, including any regulations or guidance which may be necessary or appropriate to recapture the benefit of any credit determined under this section with respect to any qualified vessel, or any increase in the applicable percentage under subsection (b) with respect to any qualified vessel, in the case of any taxpayer which fails to comply with the terms of the agreement described in subsection (d)(1)(F) with respect to such qualified vessel.

3. Certain payments for maritime security excluded from gross income Part III of subchapter B of chapter 1 of the Internal Revenue Code of 1986 is amended by inserting after section 139I the following new subsection: Gross income shall not include any payment made pursuant to— section 53106 of title 46, United States Code, section 53206 of such title, section 53406 of such title, section 54101 of such title, or section 54301 of such title. No deduction or credit shall be allowed for, or by reason of, any expenditure to the extent of the amount excluded under subsection (a) for any payment which was provided with respect to such expenditure. The adjusted basis of any property shall be reduced by the amount excluded under subsection (a) which was provided with respect to such property. The table of sections for part III of subchapter B of chapter 1 of such Code is amended by inserting after the item relating to section 139I the following new item: The amendments made by this section shall apply to taxable years beginning after the date of the enactment of this Act. 139J.Maritime security payments(a)In generalGross income shall not include any payment made pursuant to—(1)section 53106 of title 46, United States Code,(2)section 53206 of such title,(3)section 53406 of such title,(4)section 54101 of such title, or(5)section 54301 of such title.(b)Denial of double benefitNo deduction or credit shall be allowed for, or by reason of, any expenditure to the extent of the amount excluded under subsection (a) for any payment which was provided with respect to such expenditure. The adjusted basis of any property shall be reduced by the amount excluded under subsection (a) which was provided with respect to such property.. Sec. 139J. Maritime security payments..

139J. Maritime security payments Gross income shall not include any payment made pursuant to— section 53106 of title 46, United States Code, section 53206 of such title, section 53406 of such title, section 54101 of such title, or section 54301 of such title. No deduction or credit shall be allowed for, or by reason of, any expenditure to the extent of the amount excluded under subsection (a) for any payment which was provided with respect to such expenditure. The adjusted basis of any property shall be reduced by the amount excluded under subsection (a) which was provided with respect to such property.

4. Elimination of 30-day limitation on domestic operations Section 1355 of the Internal Revenue Code of 1986 is amended— in subsection (f), by striking paragraph (4), and in subsection (g)(2), by striking subparagraph (D). The amendments made by this section shall apply to taxable years beginning after the date of enactment of this Act.

5. Qualifying shipping activities Section 1356(b) of the Internal Revenue Code of 1986 (relating to qualifying shipping activities) is amended by striking activities in operating and inserting the carriage of goods (as defined in section 1 of the Carriage of Goods by Sea Act (46 U.S.C. 30701 note)) by.

6. Qualifying vessel Section 1355(a) of the Internal Revenue Code of 1986 is amended— by striking paragraph (4) and inserting the following: The term qualifying vessel means a vessel which is— self-propelled (or a combination self-propelled and non-self-propelled), a United States flag vessel or a United States-owned foreign flag vessel, either— a vessel designed primarily for use on the high seas which has a draft of more than 12 feet, or not less than 6,000 deadweight tons, and used exclusively in the United States foreign trade during the period that the election under this subchapter is in effect. by adding at the end the following: The term United States-owned foreign flag vessel means any vessel which— is documented under the laws of a country (other than the United States) or a foreign registry which is not a foreign country of concern (as defined in section 48F(e)), is owned by a person which— is a citizen of the United States (as determined under section 50501 of title 46, United States Code), or is controlled (within the meaning of section 954(d)(3)) by a citizen of the United States (as so determined), and owns a fleet of United States flag vessels, is strategically and commercially managed from within the United States, and has entered into an emergency preparedness agreement under section 53107 or 53407 of title 46, United States Code, or a contingency agreement under section 53207 of such title, or has otherwise entered into a voluntary agreement and plan of action with the Maritime Administrator as authorized under section 708(c) of the Defense Production Act of 1950 (50 U.S.C. 4558(c)). (4)Qualifying vesselThe term qualifying vessel means a vessel which is—(A)self-propelled (or a combination self-propelled and non-self-propelled),(B)a United States flag vessel or a United States-owned foreign flag vessel,(C)either—(i)a vessel designed primarily for use on the high seas which has a draft of more than 12 feet, or(ii)not less than 6,000 deadweight tons, and (D)used exclusively in the United States foreign trade during the period that the election under this subchapter is in effect., and (8)United States-owned foreign flag vesselThe term United States-owned foreign flag vessel means any vessel which—(A)is documented under the laws of a country (other than the United States) or a foreign registry which is not a foreign country of concern (as defined in section 48F(e)),(B)is owned by a person which—(i)(I)is a citizen of the United States (as determined under section 50501 of title 46, United States Code), or(II)is controlled (within the meaning of section 954(d)(3)) by a citizen of the United States (as so determined), and(ii)owns a fleet of United States flag vessels, (C)is strategically and commercially managed from within the United States, and(D)has entered into an emergency preparedness agreement under section 53107 or 53407 of title 46, United States Code, or a contingency agreement under section 53207 of such title, or has otherwise entered into a voluntary agreement and plan of action with the Maritime Administrator as authorized under section 708(c) of the Defense Production Act of 1950 (50 U.S.C. 4558(c))..

7. Credit for construction of shipyard facilities Subpart E of part IV of subchapter A of chapter 1 of the Internal Revenue Code of 1986, as amended by section 2(a), is amended by inserting after section 48F the following new section: For purposes of section 46, the shipyard investment tax credit for any taxable year is an amount equal to 25 percent of the qualified investment for such taxable year with respect to any qualified shipyard facility of a taxpayer described in section 48D(c)(1). For purposes of subsection (a), the qualified investment with respect to any qualified shipyard facility for any taxable year is the basis of any qualified property placed in service by the taxpayer during such taxable year which is part of a qualified shipyard facility. The term qualified property shall have the same meaning given such term in section 48D(b)(2), except that subparagraph (A)(iv) of such section shall be applied by substituting qualified shipyard facility for advanced manufacturing facility. For purposes of this section, the term qualified shipyard facility means a facility— which is located within the United States (including any territory or possession of the United States), and for which the primary purpose is— constructing or repairing commercial or military oceangoing vessels, manufacturing components which are critical (as determined by the Secretary, in consultation with the Secretary of the Navy and the Maritime Administrator) to the operation of commercial or military oceangoing vessels, or manufacturing equipment which is used to produce or repair commercial or military oceangoing vessels. Rules similar to the rules of subsections (c)(4) and (d) of section 46 (as in effect on the day before the date of the enactment of the Revenue Reconciliation Act of 1990) shall apply for purposes of subsection (a). This section shall not apply to any property placed in service by the taxpayer during the taxable year if a credit was allowed under section 48F to such taxpayer during such taxable year. The Secretary shall issue such regulations or other guidance as may be necessary or appropriate to carry out the purposes of this section. The credit allowed under this section shall not apply to property placed in service after December 31, 2032. Section 46 of the Internal Revenue Code of 1986, as amended by section 2(b)(1), is amended— in paragraph (7), by striking and at the end, in paragraph (8), by striking the period at the end and inserting , and, and by adding at the end the following: the shipyard investment tax credit. Section 49(a)(1)(C) of such Code, as amended by section 2(b)(2), is amended— in clause (viii), by striking and at the end, in clause (ix), by striking the period at the end and inserting , and, and by adding at the end the following: the basis of any qualified property (as defined in subsection (b)(2) of section 48G) which is part of a qualified shipyard facility (as defined in subsection (b)(3) of such section). Section 50(a)(2)(E) of such Code, as amended by section 13702(b) of Public Law 117–169, is amended by striking or 48E(e) and inserting 48E(e), or 48G(b)(4). The table of sections for subpart E of part IV of subchapter A of chapter 1 of such Code, as amended by section 2(b)(3), is amended by inserting after the item relating to section 48F the following new item: Section 6417 of the Internal Revenue Code of 1986, as amended by section 2, is amended— in subsection (b), by adding at the end the following: The shipyard investment tax credit under section 48G. in subsection (d)(1)— in subparagraph (F), by striking (D), or (E) each place it appears and inserting (D), (E), or (F), by redesignating subparagraph (F) (as amended by clause (i)) as subparagraph (G), and by inserting after subparagraph (E) the following: If a taxpayer other than an entity described in subparagraph (A) makes an election under this subparagraph with respect to any taxable year in which such taxpayer has placed in service any qualified property which is part of a qualified shipyard facility (as defined in section 48G), such taxpayer shall be treated as an applicable entity for purposes of this section for such taxable year, but only with respect to the credit described in subsection (b)(14). Section 6418(f)(1)(A) of the Internal Revenue Code of 1986, as amended by section 2, is amended by adding at the end the following: The shipyard investment tax credit under section 48G. Paragraph (4) of section 1357(c) of the Internal Revenue Code of 1986, section 2(e), is amended to read as follows: Paragraph (1) shall not apply with respect to any credit allowed to the taxpayer under section 48F or 48G. The amendments made by this section shall apply to property placed in service after December 31, 2025. 48G.Credit for construction of shipyard facilities(a)In generalFor purposes of section 46, the shipyard investment tax credit for any taxable year is an amount equal to 25 percent of the qualified investment for such taxable year with respect to any qualified shipyard facility of a taxpayer described in section 48D(c)(1).(b)Qualified investment(1)In generalFor purposes of subsection (a), the qualified investment with respect to any qualified shipyard facility for any taxable year is the basis of any qualified property placed in service by the taxpayer during such taxable year which is part of a qualified shipyard facility.(2)Qualified propertyThe term qualified property shall have the same meaning given such term in section 48D(b)(2), except that subparagraph (A)(iv) of such section shall be applied by substituting qualified shipyard facility for advanced manufacturing facility.(3)Qualified shipyard facilityFor purposes of this section, the term qualified shipyard facility means a facility—(A)which is located within the United States (including any territory or possession of the United States), and(B)for which the primary purpose is—(i)constructing or repairing commercial or military oceangoing vessels,(ii)manufacturing components which are critical (as determined by the Secretary, in consultation with the Secretary of the Navy and the Maritime Administrator) to the operation of commercial or military oceangoing vessels, or(iii)manufacturing equipment which is used to produce or repair commercial or military oceangoing vessels.(4)Certain progress expenditure rules made applicableRules similar to the rules of subsections (c)(4) and (d) of section 46 (as in effect on the day before the date of the enactment of the Revenue Reconciliation Act of 1990) shall apply for purposes of subsection (a).(c)Denial of double benefitThis section shall not apply to any property placed in service by the taxpayer during the taxable year if a credit was allowed under section 48F to such taxpayer during such taxable year.(d)RegulationsThe Secretary shall issue such regulations or other guidance as may be necessary or appropriate to carry out the purposes of this section.(e)Termination of creditThe credit allowed under this section shall not apply to property placed in service after December 31, 2032.. (9)the shipyard investment tax credit.. (x)the basis of any qualified property (as defined in subsection (b)(2) of section 48G) which is part of a qualified shipyard facility (as defined in subsection (b)(3) of such section).. Sec. 48G. Shipyard investment tax credit.. (14)The shipyard investment tax credit under section 48G., and (F)Election with respect to the shipyard investment tax creditIf a taxpayer other than an entity described in subparagraph (A) makes an election under this subparagraph with respect to any taxable year in which such taxpayer has placed in service any qualified property which is part of a qualified shipyard facility (as defined in section 48G), such taxpayer shall be treated as an applicable entity for purposes of this section for such taxable year, but only with respect to the credit described in subsection (b)(14).. (xiii)The shipyard investment tax credit under section 48G.. (4)Exception for United States vessel investment credit and shipyard investment tax creditParagraph (1) shall not apply with respect to any credit allowed to the taxpayer under section 48F or 48G..

48G. Credit for construction of shipyard facilities For purposes of section 46, the shipyard investment tax credit for any taxable year is an amount equal to 25 percent of the qualified investment for such taxable year with respect to any qualified shipyard facility of a taxpayer described in section 48D(c)(1). For purposes of subsection (a), the qualified investment with respect to any qualified shipyard facility for any taxable year is the basis of any qualified property placed in service by the taxpayer during such taxable year which is part of a qualified shipyard facility. The term qualified property shall have the same meaning given such term in section 48D(b)(2), except that subparagraph (A)(iv) of such section shall be applied by substituting qualified shipyard facility for advanced manufacturing facility. For purposes of this section, the term qualified shipyard facility means a facility— which is located within the United States (including any territory or possession of the United States), and for which the primary purpose is— constructing or repairing commercial or military oceangoing vessels, manufacturing components which are critical (as determined by the Secretary, in consultation with the Secretary of the Navy and the Maritime Administrator) to the operation of commercial or military oceangoing vessels, or manufacturing equipment which is used to produce or repair commercial or military oceangoing vessels. Rules similar to the rules of subsections (c)(4) and (d) of section 46 (as in effect on the day before the date of the enactment of the Revenue Reconciliation Act of 1990) shall apply for purposes of subsection (a). This section shall not apply to any property placed in service by the taxpayer during the taxable year if a credit was allowed under section 48F to such taxpayer during such taxable year. The Secretary shall issue such regulations or other guidance as may be necessary or appropriate to carry out the purposes of this section. The credit allowed under this section shall not apply to property placed in service after December 31, 2032.

8. Tax incentives relating to merchant marine capital construction funds Section 7518 of the Internal Revenue Code of 1986 is amended— in subsection (a)— by striking paragraph (1) and inserting the following: The amount deposited in a fund established under chapter 535 of title 46 of the United States Code (hereinafter in this section referred to as a capital construction fund) for a taxable year may not exceed the amount specified in the agreement under section 53503(a) of such title, which shall be an amount that is related to a commitment to invest the revenue from the capital construction fund into funding the construction of new vessels or funding cargo handling equipment. in paragraph (2), by striking paragraph (1)(B) each place it appears and inserting paragraph (1), and by adding at the end the following new paragraph: For the purposes of paragraph (1), the revenue from the capital construction fund may include— income attributable to the operation of any agreement vessel in foreign commerce or domestic trade or fisheries or the operation of a marine terminal in the United States, the net proceeds from the disposition of an agreement vessel or cargo handling equipment or insurance or indemnity attributable to the vessel or cargo handling equipment, the receipts from the investment or reinvestment of amounts held in the fund, and the amount allowable as a deduction under section 167 for the taxable year with respect to the agreement vessels or cargo handling equipment. in subsection (b)(2), by striking Amounts in any capital construction fund and all that follows through (not in excess of 60 percent) and inserting An agreed percentage, in subsection (e)— by striking paragraph (1) and inserting the following: A qualified withdrawal from the fund is one made in accordance with the terms of the agreement but only if it is for— the acquisition, construction, repowering, or reconstruction of— a qualified vessel or a barge or container that is part of the complement of a qualified vessel, or cargo handling equipment, or the payment of the principal on indebtedness incurred in the acquisition, construction, repowering, or reconstruction of— a qualified vessel or a barge or container that is part of the complement of a qualified vessel, or cargo handling equipment. by redesignating paragraph (2) as paragraph (4), and by inserting after paragraph (1) the following: No withdrawals may be made from a capital construction fund to purchase fully automated cargo handling equipment that is remotely operated or remotely monitored with or without the exercise of human intervention or control, if the Secretary determines such equipment would result in a net loss of jobs within a marine terminal. No withdrawals may be made from a capital construction fund to purchase cranes manufactured in the People's Republic of China. in subsection (f)— in paragraph (2), by inserting cargo handling equipment, after barge, both places the term appears, in paragraph (3), by inserting cargo handling equipment, after barge, both places the term appears, and in paragraph (4), by inserting cargo handling equipment, after barges,, in subsection (g)— in the flush matter at the end of paragraph (2), by inserting cargo handling equipment, after advanced, and in paragraph (5)(A)— in the heading, by striking 25 years and inserting 15 years, by striking 26th, 27th, 28th, 29th, or 30th taxable year and inserting following specified taxable year, and by striking the table contained therein and inserting the following: in subsection (i), by striking as in effect on the date of the enactment of this section. The amendments made by this section shall apply to taxable years beginning after December 31, 2025. (1)In generalThe amount deposited in a fund established under chapter 535 of title 46 of the United States Code (hereinafter in this section referred to as a capital construction fund) for a taxable year may not exceed the amount specified in the agreement under section 53503(a) of such title, which shall be an amount that is related to a commitment to invest the revenue from the capital construction fund into funding the construction of new vessels or funding cargo handling equipment., (4)RevenueFor the purposes of paragraph (1), the revenue from the capital construction fund may include—(A)income attributable to the operation of any agreement vessel in foreign commerce or domestic trade or fisheries or the operation of a marine terminal in the United States,(B)the net proceeds from the disposition of an agreement vessel or cargo handling equipment or insurance or indemnity attributable to the vessel or cargo handling equipment,(C)the receipts from the investment or reinvestment of amounts held in the fund, and(D)the amount allowable as a deduction under section 167 for the taxable year with respect to the agreement vessels or cargo handling equipment., (1)In generalA qualified withdrawal from the fund is one made in accordance with the terms of the agreement but only if it is for—(A)the acquisition, construction, repowering, or reconstruction of—(i)a qualified vessel or a barge or container that is part of the complement of a qualified vessel, or(ii)cargo handling equipment, or(B)the payment of the principal on indebtedness incurred in the acquisition, construction, repowering, or reconstruction of—(i)a qualified vessel or a barge or container that is part of the complement of a qualified vessel, or(ii)cargo handling equipment.Except to the extent provided in regulations prescribed by the Secretary, subparagraph (A), and so much of subparagraph (B) as relates only to barges and containers, shall apply only with respect to barges and containers constructed in the United States., (2)Fully automated cargo handling equipmentNo withdrawals may be made from a capital construction fund to purchase fully automated cargo handling equipment that is remotely operated or remotely monitored with or without the exercise of human intervention or control, if the Secretary determines such equipment would result in a net loss of jobs within a marine terminal.(3)Prohibition on people's republic of china cranesNo withdrawals may be made from a capital construction fund to purchase cranes manufactured in the People's Republic of China., If the amount remains in the fund at the close of the-The applicable percentage is-16th taxable year20 percent17th taxable year40 percent18th taxable year60 percent19th taxable year80 percent20th taxable year100 percent, and

9. Exemption of student incentive payment agreements from gross income Part III of subchapter B of chapter 1 of the Internal Revenue Code of 1986, as amended by section 3, is further amended by inserting after section 139J the following new section: In the case of an individual who has entered into an agreement described in section 51509 of title 46, United States Code, gross income does not include any student incentive payments made to such individual pursuant to such agreement. The table of sections for part III of subchapter B of chapter 1 of the Internal Revenue Code of 1986, as amended by section 3, is further amended by inserting after the item relating to section 139J the following new item: The amendments made by this section shall apply with respect to payments made after December 31, 2025. 139K.Student incentive payment agreementsIn the case of an individual who has entered into an agreement described in section 51509 of title 46, United States Code, gross income does not include any student incentive payments made to such individual pursuant to such agreement.. Sec. 139K. Student incentive payment agreements..

139K. Student incentive payment agreements In the case of an individual who has entered into an agreement described in section 51509 of title 46, United States Code, gross income does not include any student incentive payments made to such individual pursuant to such agreement.

10. Maritime fuel tax parity Section 4041(g) of the Internal Revenue Code of 1986 is amended by adding at the end the following new sentence: For purposes of subsection (a)(2), the exemption under paragraph (1) shall also apply to fuel sold for use or used by a vessel which is both described in section 4042(c)(1) and actually engaged in trade between the Atlantic or Pacific ports of the United States (including any territory or possession of the United States).. The amendment made by this section shall apply to fuel sold for use or used after December 31, 2025.

11. Treatment of maritime prosperity zones as opportunity zones Subchapter Z of chapter 1 of the Internal Revenue Code of 1986 is amended by adding at the end the following new section: A maritime prosperity zone shall be treated as a qualified opportunity zone. In applying this subchapter to any maritime prosperity zone which is a qualified opportunity zone solely by reason of this section— For purposes of determining— whether any property which would not be qualified opportunity fund business property without regard to this section is qualified opportunity fund business property, and whether any corporation or partnership which is not a qualified opportunity fund business without regard to this section is a qualified opportunity fund business, The modifications described in this paragraph are as follows: Subparagraphs (B)(i)(I), (C)(i), and (D)(i)(I) of section 1400Z–2(d)(2) shall each be applied by substituting the date of the enactment of the Building Ships in America Act of 2025 for December 31, 2017. Property shall not be treated as qualified opportunity zone business property unless such property is substantially used in an industry which is assigned a code under the North American Industrial Classification System which is described in paragraph (3). A trade or business shall not be treated as a qualified opportunity zone business unless such trade or business operates in an industry which is assigned a code under the North American Industrial Classification System which is described in paragraph (3). The following codes under the North American Industrial Classification System are the codes described in this paragraph: 48311 (deep sea freight transportation). 483113 (coastal and Great Lakes freight transportation). 483211 (inland water freight transportation). 4883 (support activities for water transportation). 3366 (ship and boat building). For purposes of this chapter— The term maritime prosperity zone means any population census tract that— contains or is determined by the Maritime Administrator to be a viable site for— a shipyard of the United States, a port, or a harbor facility, and is designated as a maritime prosperity zone under paragraph (2). A population census tract is designated as a maritime prosperity zone under this paragraph if— the Maritime Administrator, in consultation with the Secretary of the Navy, nominates the tract for designation as a maritime prosperity zone and notifies the Secretary in writing of such nomination, and the Secretary certifies such nomination and designates such tract as a qualified maritime prosperity zone. Not more than 100 population census tracts may be designated as maritime prosperity zone. Except as provided in paragraph (2), a designation as a maritime prosperity zone shall remain in effect for the period— beginning on the date of the designation, and ending at the close of the 5th calendar year beginning on or after such date of designation. The table of sections for subchapter Z of chapter 1 of such Code is amended by adding at the end the following new item: The amendments made by this section shall take effect on the date of the enactment of this Act. 1400Z–3.Treatment of maritime prosperity zones as opportunity zones(a)In generalA maritime prosperity zone shall be treated as a qualified opportunity zone.(b)Special rulesIn applying this subchapter to any maritime prosperity zone which is a qualified opportunity zone solely by reason of this section—(1)In generalFor purposes of determining—(A)whether any property which would not be qualified opportunity fund business property without regard to this section is qualified opportunity fund business property, and(B)whether any corporation or partnership which is not a qualified opportunity fund business without regard to this section is a qualified opportunity fund business,section 1400Z–2(d) shall be applied with the modifications described in paragraph (2).(2)ModificationsThe modifications described in this paragraph are as follows:(A)Start dateSubparagraphs (B)(i)(I), (C)(i), and (D)(i)(I) of section 1400Z–2(d)(2) shall each be applied by substituting the date of the enactment of the Building Ships in America Act of 2025 for December 31, 2017.(B)Qualified business propertyProperty shall not be treated as qualified opportunity zone business property unless such property is substantially used in an industry which is assigned a code under the North American Industrial Classification System which is described in paragraph (3).(C)Qualified businessA trade or business shall not be treated as a qualified opportunity zone business unless such trade or business operates in an industry which is assigned a code under the North American Industrial Classification System which is described in paragraph (3).(3)Eligible north American industrial classification system codesThe following codes under the North American Industrial Classification System are the codes described in this paragraph:(A)48311 (deep sea freight transportation).(B)483113 (coastal and Great Lakes freight transportation).(C)483211 (inland water freight transportation).(D)4883 (support activities for water transportation).(E)3366 (ship and boat building).(c)Maritime prosperity zoneFor purposes of this chapter—(1)In generalThe term maritime prosperity zone means any population census tract that—(A)contains or is determined by the Maritime Administrator to be a viable site for—(i)a shipyard of the United States,(ii)a port, or(iii)a harbor facility, and(B)is designated as a maritime prosperity zone under paragraph (2).(2)DesignationA population census tract is designated as a maritime prosperity zone under this paragraph if—(A)the Maritime Administrator, in consultation with the Secretary of the Navy, nominates the tract for designation as a maritime prosperity zone and notifies the Secretary in writing of such nomination, and(B)the Secretary certifies such nomination and designates such tract as a qualified maritime prosperity zone.(3)Number of population census tracts designatedNot more than 100 population census tracts may be designated as maritime prosperity zone.(4)Period for which designation is in effectExcept as provided in paragraph (2), a designation as a maritime prosperity zone shall remain in effect for the period—(A)beginning on the date of the designation, and(B)ending at the close of the 5th calendar year beginning on or after such date of designation.. Sec. 1400Z–3. Treatment of maritime prosperity zones as opportunity zones..

1400Z–3. Treatment of maritime prosperity zones as opportunity zones A maritime prosperity zone shall be treated as a qualified opportunity zone. In applying this subchapter to any maritime prosperity zone which is a qualified opportunity zone solely by reason of this section— For purposes of determining— whether any property which would not be qualified opportunity fund business property without regard to this section is qualified opportunity fund business property, and whether any corporation or partnership which is not a qualified opportunity fund business without regard to this section is a qualified opportunity fund business, The modifications described in this paragraph are as follows: Subparagraphs (B)(i)(I), (C)(i), and (D)(i)(I) of section 1400Z–2(d)(2) shall each be applied by substituting the date of the enactment of the Building Ships in America Act of 2025 for December 31, 2017. Property shall not be treated as qualified opportunity zone business property unless such property is substantially used in an industry which is assigned a code under the North American Industrial Classification System which is described in paragraph (3). A trade or business shall not be treated as a qualified opportunity zone business unless such trade or business operates in an industry which is assigned a code under the North American Industrial Classification System which is described in paragraph (3). The following codes under the North American Industrial Classification System are the codes described in this paragraph: 48311 (deep sea freight transportation). 483113 (coastal and Great Lakes freight transportation). 483211 (inland water freight transportation). 4883 (support activities for water transportation). 3366 (ship and boat building). For purposes of this chapter— The term maritime prosperity zone means any population census tract that— contains or is determined by the Maritime Administrator to be a viable site for— a shipyard of the United States, a port, or a harbor facility, and is designated as a maritime prosperity zone under paragraph (2). A population census tract is designated as a maritime prosperity zone under this paragraph if— the Maritime Administrator, in consultation with the Secretary of the Navy, nominates the tract for designation as a maritime prosperity zone and notifies the Secretary in writing of such nomination, and the Secretary certifies such nomination and designates such tract as a qualified maritime prosperity zone. Not more than 100 population census tracts may be designated as maritime prosperity zone. Except as provided in paragraph (2), a designation as a maritime prosperity zone shall remain in effect for the period— beginning on the date of the designation, and ending at the close of the 5th calendar year beginning on or after such date of designation.