The proposed bill significantly amends the Sustainable Aviation Fuel Tax Credit Act by establishing a refundable tax credit for sustainable aviation fuel producers, allowing taxpayers to receive refunds if the credit exceeds their tax liability. It removes previous limitations on the number of years the credit can be claimed and the annual amount available, thereby enhancing flexibility for taxpayers involved in sustainable aviation fuel production. Additionally, the bill harmonizes various provisions within the tax code and repeals original sections of the Sustainable Aviation Fuel Tax Credit Act, ensuring the credit is recognized across different tax scenarios for both resident and nonresident estates and trusts.

Moreover, the bill introduces a refundable income tax credit for beneficiaries under the Beginning Farmer Tax Credit Act and outlines tax obligations for nonresident beneficiaries of estates or trusts. It clarifies definitions related to simple and complex trusts and specifies that nonresident grantors will be treated as beneficiaries for tax purposes. The new refundable income tax credit for sustainable aviation fuel producers will be effective for taxable years beginning on or after January 1, 2028, and is calculated based on the gallons of sustainable aviation fuel sold or used in qualified mixtures. The application process for this credit has been modified to allow approvals based on the order received, and the nonrefundable designation for the sustainable aviation fuel credit has been deleted, making it fully refundable.

Statutes affected:
Introduced: 77-2715.07, 77-2717, 77-2734.03, 77-7019