Phase-out of credit for certain energy property

(a) Phase-out Section 48(a) is amended— (1) in paragraph (3)(vii), by striking the construction of which begins before January 1, 2035 and inserting the construction of which begins before January 1, 2032, and (2) by striking paragraph (7) and inserting the following new paragraph: (7) Phase-out for certain energy property In the case of any energy property described in clause (vii) of paragraph (3)(A), the energy percentage determined under paragraph (2) shall be equal to— (A) in the case of any property the construction of which begins before January 1, 2030, and which is placed in service after December 31, 2021, 6 percent, (B) in the case of any property the construction of which begins after December 31, 2029, and before January 1, 2031, 5.2 percent, and (C) in the case of any property the construction of which begins after December 31, 2030, and before January 1, 2032, 4.4 percent.. (b) Restrictions relating to prohibited foreign entities Section 48(a) is amended by redesignating paragraph (16) as paragraph (17) and by inserting after paragraph (15) the following new paragraph: (16) Restrictions relating to prohibited foreign entities (A) In general No credit determined under this subsection for energy property described in paragraph (3)(A)(vii) shall be allowed under section 38 for any taxable year beginning after the date of enactment of this paragraph if the taxpayer is a specified foreign entity (as defined in section 7701(a)(51)(B)). (B) Other prohibited foreign entities No credit determined under this subsection for energy property described in paragraph (3)(A)(vii) shall be allowed under section 38 for any taxable year beginning after the date which is 2 years after the date of enactment of this paragraph if the taxpayer is a foreign-influenced entity (as defined in section 7701(a)(51)(D)).. (c) Repeal of transferability Section 6418(f)(1)(A)(iv), 6418(f)(1)(A)(iii), as redesignated by section 112014, is amended by inserting (except so much of the credit as is determined under paragraph (3)(A)(vii) of such section) after section 48. (d) Effective dates (1) In general Except as provided in paragraph (2), the amendments made by this section shall apply to taxable years beginning after the date of the enactment of this Act. (2) Repeal of transferability The amendments made by subsection (c) shall apply to property the construction of which begins after the date that is 2 years after the date of enactment of this Act.