A joint resolution providing for congressional disapproval under chapter 8 of title 5, United States Code, of the rule submitted by the Internal Revenue Service relating to "Beginning of Construction Requirements for Purposes of the Termination of Clean Electricity Production Credits and Clean Electricity Investment Credits for Applicable Wind and Solar Facilities".

Bill Number

S.J.Res. 107

Origin Chamber

Senate

Congress

119th Congress, Session 2

Policy Area

Taxation

Status

Introduced

Latest Action

2026-03-25: Motion to proceed to consideration of measure rejected in Senate by Yea-Nay Vote. 47 - 53. Record Vote Number: 70.

Last Updated

2026-04-14T01:40:51Z

AI-Generated Summary

Purpose

This joint resolution (S.J. Res. 107) aims to disapprove a specific rule issued by the Internal Revenue Service (IRS), preventing it from taking effect. The rule in question sets requirements for when construction on wind and solar energy facilities is considered to have begun, which determines eligibility for federal tax credits related to clean electricity production and investment. By disapproving the rule, Congress seeks to block its implementation under the Congressional Review Act (a law allowing Congress to review and overturn certain federal agency rules).

Key Provisions

• Disapproval of IRS Rule: The resolution explicitly disapproves IRS Notice 2025-42, titled "Beginning of Construction Requirements for Purposes of the Termination of Clean Electricity Production Credits and Clean Electricity Investment Credits for Applicable Wind and Solar Facilities."
• No Force or Effect: Once passed, the rule would be nullified and could not be enforced by the IRS.
• Procedural Path: Introduced on February 12, 2026, by Senators Cortez Masto, Schumer, Wyden, Whitehouse, and Kim; referred to the Senate Finance Committee but discharged by petition under 5 U.S.C. 802(c) and placed on the Senate calendar on March 19, 2026.

Significant Changes to Existing Law

• This resolution does not amend statutes but invokes the Congressional Review Act to override an agency interpretation of existing tax laws, specifically those under the Inflation Reduction Act of 2022 that provide clean electricity tax credits (Sections 45Y and 48E of the Internal Revenue Code).
• It reverses the IRS's attempt to define "beginning of construction" more strictly for wind and solar projects, potentially reverting to prior, less restrictive IRS guidance or leaving the definition open to future clarification.
• No new laws are created; instead, it prevents the IRS rule from altering how tax credits are terminated based on construction timelines.

Potential Impacts

• On Government Agencies: The IRS would be barred from enforcing the rule, possibly requiring it to issue new guidance or rely on older interpretations, which could increase administrative workload and litigation risks.
• On Citizens and Businesses: Renewable energy developers (especially for wind and solar facilities) may benefit by retaining easier access to tax credits, encouraging more projects and investments in clean energy. Taxpayers in the energy sector could see reduced compliance burdens, but uncertainty might arise if no replacement rule is issued.
• On International Relations: Minimal direct impact, though it could indirectly support U.S. clean energy goals under international climate agreements (e.g., Paris Agreement) by sustaining incentives for renewable projects, potentially enhancing U.S. leadership in global green technology.

Main Stakeholders Affected

• Renewable Energy Industry: Wind and solar developers and investors, who rely on these tax credits to make projects financially viable.
• Internal Revenue Service (IRS): As the agency issuing the rule, it faces constraints on rulemaking authority in tax policy.
• Taxpayers and Environmental Groups: Broader public benefiting from clean energy transitions; groups advocating for climate action may support or oppose based on how the rule affects credit availability.
• Energy Sector Competitors: Fossil fuel interests might be indirectly affected if easier access to credits boosts renewables over traditional energy sources.

Notable Legal, Constitutional, or Political Implications

• Legal: Relies on the Congressional Review Act (5 U.S.C. Chapter 8), which gives Congress a 60-day window to disapprove rules with a simple majority vote (no filibuster in Senate). If enacted, it prevents the IRS from reissuing a "substantially similar" rule without new congressional authorization, strengthening legislative oversight of executive agencies.
• Constitutional: Aligns with separation of powers by allowing Congress to check agency actions interpreting tax laws, but could raise questions about Congress micromanaging tax administration (a delegated executive function under Article I).
• Political: Introduced by Democratic senators, it reflects partisan divides on energy policy and IRS rulemaking; passage would require bicameral approval and presidential signature (or veto override), potentially signaling congressional pushback against perceived restrictive regulations on green incentives.

This summary was generated by AI and may contain inaccuracies. Refer to the official source document for the authoritative text.

Sponsor

Sen. Cortez Masto, Catherine [D-NV]

Cosponsors (4)

Sen. Schumer, Charles E. [D-NY], Sen. Wyden, Ron [D-OR], Sen. Whitehouse, Sheldon [D-RI], Sen. Kim, Andy [D-NJ]

Recent Actions

• 2026-03-25: Motion to proceed to consideration of measure rejected in Senate by Yea-Nay Vote. 47 - 53. Record Vote Number: 70. (Roll call 70)
• 2026-03-25: Motion to proceed to consideration of measure made in Senate. (CR S1599)
• 2026-03-19: Placed on Senate Legislative Calendar under General Orders. Calendar No. 363.
• 2026-03-19: Senate Committee on Finance discharged, by petition, pursuant to 5 U.S.C. 802(c).
• 2026-03-19: Senate Committee on Finance discharged, by petition, pursuant to 5 U.S.C. 802(c).
• 2026-02-12: Read twice and referred to the Committee on Finance.
• 2026-02-12: Introduced in Senate

Bill Versions

• Providing for congressional disapproval under chapter 8 of title 5, United States Code, of the rule submitted by the Internal Revenue Service relating to Beginning of Construction Requirements for Purposes of the Termination of Clean Electricity Production Credits and Clean Electricity Investment Credits for Applicable Wind and Solar Facilities. — issued 2026-02-12 — PDF (2 pages)
• Providing for congressional disapproval under chapter 8 of title 5, United States Code, of the rule submitted by the Internal Revenue Service relating to Beginning of Construction Requirements for Purposes of the Termination of Clean Electricity Production Credits and Clean Electricity Investment Credits for Applicable Wind and Solar Facilities. — issued 2026-03-19 — PDF (4 pages)