---
kind: "section"
citation: "26 U.S.C. § 40B"
title: "26"
title_heading: "Internal Revenue Code"
number: "40B"
heading: "Sustainable aviation fuel credit"
release: "119-102"
url: "https://uscodex.org/usc/26/40B"
units:
  - "Subtitle A — Income Taxes"
  - "Chapter 1 — Normal Taxes and Surtaxes"
  - "Subchapter A — Determination of Tax Liability"
  - "Part IV — Credits Against Tax"
  - "Subpart D — Business Related Credits"
---

# §40B. Sustainable aviation fuel credit

- (a) **In general—** For purposes of [section 38](/usc/26/38.md), the [sustainable aviation fuel](#d-1) credit determined under this section for the [taxable year](/usc/26/441.md?p=b) is, with respect to any sale or use of a [qualified mixture](#c) which occurs during such [taxable year](/usc/26/441.md?p=b), an amount equal to the product of—
  - (1) the number of gallons of [sustainable aviation fuel](#d-1) in such mixture, multiplied by
  - (2) the sum of—
    - (A) $1.25, plus
    - (B) the applicable supplementary amount with respect to such [sustainable aviation fuel](#d-1).
- (b) **Applicable supplementary amount—** For purposes of this section, the term “applicable supplementary amount” means, with respect to any [sustainable aviation fuel](#d-1), an amount equal to $0.01 for each percentage point by which the [lifecycle greenhouse gas emissions reduction percentage](#e) with respect to such fuel exceeds 50 percent. In no event shall the applicable supplementary amount determined under this subsection exceed $0.50.
- (c) **Qualified mixture—** For purposes of this section, the term “qualified mixture” means a mixture of [sustainable aviation fuel](#d-1) and kerosene if—
  - (1) such mixture is produced by the [taxpayer](/usc/26/1313.md?p=b) in the [United States](/usc/26/638.md?p=1),
  - (2) such mixture is used by the [taxpayer](/usc/26/1313.md?p=b) (or sold by the [taxpayer](/usc/26/1313.md?p=b) for use) in an aircraft,
  - (3) such sale or use is in the ordinary course of a [trade or business](/usc/26/7701.md?p=a-26) of the [taxpayer](/usc/26/1313.md?p=b), and
  - (4) the transfer of such mixture to the fuel tank of such aircraft occurs in the [United States](/usc/26/638.md?p=1).
- (d) **Sustainable aviation fuel—**
  - (1) **In general—** For purposes of this section, the term “sustainable aviation fuel” means liquid fuel, the portion of which is not kerosene, which—
    - (A) meets the requirements of—
      - (i) ASTM International Standard D7566, or
      - (ii) the Fischer Tropsch provisions of ASTM International Standard D1655, Annex A1,
    - (B) is not derived from coprocessing an [applicable material](#d-2-A) (or materials derived from an [applicable material](#d-2-A)) with a feedstock which is not [biomass](#d-2-B),
    - (C) is not derived from palm fatty acid distillates or petroleum, and
    - (D) has been certified in accordance with [subsection (e)](#e) as having a [lifecycle greenhouse gas emissions reduction percentage](#e) of at least 50 percent.
  - (2) **Definitions—** In this subsection—
    - (A) **Applicable material—** The term “applicable material” means—
      - (i) monoglycerides, diglycerides, and triglycerides,
      - (ii) free fatty acids, and
      - (iii) fatty acid esters.
    - (B) **Biomass—** The term “biomass” has the same meaning given such term in [section 45K(c)(3)](/usc/26/45K.md?p=c-3).
- (e) **Lifecycle greenhouse gas emissions reduction percentage—** For purposes of this section, the term “lifecycle greenhouse gas emissions reduction percentage” means, with respect to any [sustainable aviation fuel](#d-1), the percentage reduction in lifecycle greenhouse gas emissions achieved by such fuel as compared with petroleum-based jet fuel, as defined in accordance with—
  - (1) the most recent Carbon Offsetting and Reduction Scheme for International Aviation which has been adopted by the International Civil Aviation Organization with the agreement of the [United States](/usc/26/638.md?p=1), or
  - (2) any similar methodology which satisfies the criteria under section 211(o)(1)(H) of the Clean Air Act ([42 U.S.C. 7545(o)(1)(H)](/usc/42/7545.md?p=o-1-H)), as in effect on the date of enactment of this section.
- (f) **Registration of sustainable aviation fuel producers—** No credit shall be allowed under this section with respect to any [sustainable aviation fuel](#d-1) unless the producer or importer of such fuel—
  - (1) is registered with the [Secretary](/usc/26/7701.md?p=a-11-B) under [section 4101](/usc/26/4101.md), and
  - (2) provides—
    - (A) certification (in such form and manner as the [Secretary](/usc/26/7701.md?p=a-11-B) shall prescribe) from an unrelated party demonstrating compliance with—
      - (i) any general requirements, supply chain traceability requirements, and information transmission requirements established under the Carbon Offsetting and Reduction Scheme for International Aviation described in [paragraph (1)](#e-1) of subsection (e), or
      - (ii) in the case of any methodology established under [paragraph (2)](#f-2) of such subsection, requirements similar to the requirements described in [clause (i)](#f-2-A-i), and
    - (B) such other information with respect to such fuel as the [Secretary](/usc/26/7701.md?p=a-11-B) may require for purposes of carrying out this section.
- (g) **Coordination with credit against excise tax—** The amount of the credit determined under this section with respect to any [sustainable aviation fuel](#d-1) shall, under rules prescribed by the [Secretary](/usc/26/7701.md?p=a-11-B), be properly reduced to take into account any benefit provided with respect to such [sustainable aviation fuel](#d-1) solely by reason of the application of section [6426](/usc/26/6426.md) or [6427(e)](/usc/26/6427.md?p=e).
- (h) **Termination—** This section shall not apply to any sale or use after December 31, 2024.

## Source credit

(Added Pub. L. 117–169, title I, § 13203(a), Aug. 16, 2022, 136 Stat. 1932.)

## Notes

### Editorial Notes

### References in Text

The date of enactment of this section, referred to in subsec. (e)(2), is the date of enactment of Pub. L. 117–169, which was approved Aug. 16, 2022.

### Statutory Notes and Related Subsidiaries

### Effective Date

Pub. L. 117–169, title I, § 13203(f), Aug. 16, 2022, 136 Stat. 1935, provided that: “The amendments made by this section [enacting this section and amending sections 38, 40A, 87, 4101, 6426, and 6427 of this title] shall apply to fuel sold or used after December 31, 2022.”