S. 1806 – Biodiesel Tax Credit Extension Act of 2021

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Updated February 8, 2026 at 3:29 AM UTC

The Biodiesel Tax Credit Extension Act of 2021 updates the tax code to keep federal tax incentives for biodiesel and renewable diesel in place through the end of 2025. It extends both the income tax credit and related excise tax benefits, affecting producers and sellers of these fuels. The changes apply to fuel sold or used after December 31, 2022.

Key Provisions

Extends the biodiesel income tax credit (Section 40A(g)) from its previous expiration on Dec. 31, 2022 to Dec. 31, 2025.
Extends the excise tax incentives for biodiesel and renewable diesel (Sections 6426(c)(6) and 6427(e)(6)(B)) to Dec. 31, 2025.
Both extensions become effective for fuel sold or used after Dec. 31, 2022.

Legislative Activity

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1 earlier action

SenateIntro Referral Latest Action

Read twice and referred to the Committee on Finance.

Finance Committee

May 25, 2021

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SenateIntro Referral

Introduced in Senate

May 25, 2021

SenateIntro Referral

Read twice and referred to the Committee on Finance.

Finance Committee

May 25, 2021

Bill Text

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Introduced in SenateIssued May 25, 2021

II

117th CONGRESS

1st Session

S. 1806

IN THE SENATE OF THE UNITED STATES

May 25, 2021

Mr. Grassley (for himself, Ms. Cantwell, Ms. Ernst, Ms. Klobuchar, Mr. Marshall, Mrs. Shaheen, Mrs. Fischer, Mrs. Murray, Mr. Rounds, Ms. Smith, and Ms. Hirono) introduced the following bill; which was read twice and referred to the Committee on Finance

A BILL

To amend the Internal Revenue Code of 1986 to extend tax incentives for biodiesel and renewable diesel.

1.

Short title

This Act may be cited as the Biodiesel Tax Credit Extension Act of 2021.

2.

Extension of tax incentives for biodiesel and renewable diesel

(a)

Income tax credit

(1)

In general

Section 40A(g) is amended by striking December 31, 2022 and inserting December 31, 2025.

(2)

Effective date

The amendment made by this subsection shall apply to fuel sold or used after December 31, 2022.

(b)

Excise tax incentives

(1)

Termination

(A)

In general

Section 6426(c)(6) is amended by striking December 31, 2022 and inserting December 31, 2025.

(B)

Payments

Section 6427(e)(6)(B) is amended by striking December 31, 2022 and inserting December 31, 2025.

(2)

Effective date

The amendments made by this subsection shall apply to fuel sold or used after December 31, 2022.