Sec. 3. Agriculture hub credit
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Subpart D of part IV of subchapter A of chapter 1 of the Internal Revenue Code of 1986 is amended by adding at the end the following new section: For purposes of section 38, the agriculture hub credit determined under this section for any taxable year is an amount equal to 25 percent of the qualified food hub expenses for the taxable year. For purposes of this section, the term qualified food hub expenses means amounts paid or incurred by the taxpayer during the taxable year— for agricultural food products from a food hub developed or expanded under section 2 of the Black Farmers and Socially Disadvantaged Farmers Increased Market Share Act , and in accordance with a contract certified by the Secretary of Agriculture under section 3(c) of the Black Farmers and Socially Disadvantaged Farmers Increased Market Share Act .
The term food hub has the meaning given such term in section 2 of the Black Farmers and Socially Disadvantaged Farmers Increased Market Share Act . This section shall not apply to taxable years beginning after the Secretary determines the grant program under section 2 of the Black Farmers and Socially Disadvantaged Farmers Increased Market Share Act has ended. . Section 38(b) of the Internal Revenue Code of 1986 is amended— in paragraph (32), by striking plus at the end, in paragraph (33), by striking the period at the end and inserting , plus , and by adding at the end the following new paragraph: the agriculture hub credit determined under section 45U(a). .
The table of sections for subpart D of part IV of subchapter A of chapter 1 of such Code is amended by adding at the end the following new item: Sec. 45U. Agriculture hub credit. . Section 280C of such Code is amended by adding at the end the following new subsection: Any deduction or other credit otherwise allowable with respect to an expense for which a credit is allowed under section 45U(a) shall be reduced by the amount of the credit under section 45U(a) with respect to such expense.
If a credit is allowed under section 45U(a) with respect to property of a kind which would properly be included in the inventory of the taxpayer if on hand at the close of the taxable year or property held by the taxpayer primarily for sale to customers in the ordinary course of the trade or business of such taxpayer, opening inventory or purchases shall be reduced by the amount of the credit so allowed. . Not later than 1 year after the date of enactment of this section, the Secretary of Agriculture shall issue regulations to establish a process to certify, at the request of entities seeking an agriculture hub credit section 45U of the Internal Revenue Code of 1986, as added by subsection (b), that a contract under which expenditures referred to in such section 45U are made— is not between related parties; is the result of arm’s length negotiations; and meets any other requirements, as determined by the Secretary of Agriculture, in consultation with the Secretary of Treasury.
The amendments made by this section shall apply to expenses paid or incurred in taxable years beginning after December 31, 2021.