Bills · HR 1496
IN COMMITTEE· 119TH CONGRESS
House BillHR 1496Taxation
Rare Earth Magnet Security Act of 2025
INTRO FEB 21· LAST ACTION FEB 21
READING
6MIN
COSPONSORS
29BIPARTISAN
READER REACTIONS0 TOTAL
NO VOTES YET · BE THE FIRST
- Introduced only
LEGISLATIVE PROGRESS
STEP 2 / 8Introduced
In Committee
Reported
Passed House
Passed Senate
Conference
To President
Became Law
WHAT THE BILL DOES
AI-writtenVoters should care about this bill because rare earth magnets are essential components in many advanced technologies, including electric vehicles, wind turbines, guided missiles, and sophisticated electronics. Currently, the U.S. heavily relies on foreign sources for both the raw materials and the finished magnets, particularly from countries that may not always align with U.S. interests.
If this bill becomes law, it aims to reduce that dependency by making it more financially attractive to produce these magnets in the U.S. This could strengthen national security by ensuring a reliable supply for defense applications and bolster the economy by creating jobs in advanced manufacturing. If it doesn't pass, the U.S. supply chain for these critical magnets would likely remain heavily dependent on foreign countries, potentially leaving the nation vulnerable to supply disruptions or geopolitical leverage.
KEY PROVISIONS
5AI-extractedPROVISION 01
Establishes a tax credit for companies that manufacture or produce high-performance rare earth magnets in the United States and sell them to an unrelated person.
This provision aims to directly incentivize and support domestic manufacturing of critical magnets, reducing reliance on foreign supply chains.
PROVISION 02
Provides a higher credit amount ($30 per kilogram) if at least 90 percent by weight of the component rare earth materials for the magnets are also produced within the United States, compared to $20 per kilogram otherwise.
This encourages a fully domestic supply chain, from raw material processing to finished magnet production, enhancing overall supply chain security.
PROVISION 03
Prohibits the credit if any component rare earth material used to manufacture the magnet is produced in a 'non-allied foreign nation,' with a temporary exception for some materials until January 1, 2027.
This measure seeks to strategically exclude materials from adversarial nations, further securing the supply chain against geopolitical risks.
PROVISION 04
Allows taxpayers to elect a direct payment from the government instead of a tax credit for the production of rare earth magnets.
This ensures that companies, even those without significant tax liabilities, can benefit from the incentive, making the program more broadly accessible.
PROVISION 05
Includes a phase-out schedule for the credit, reducing it by 70% in 2035, 35% in 2036-2037, and eliminating it after December 31, 2037.
This provides a clear timeframe for the incentive, encouraging rapid domestic industry development while limiting long-term federal costs.
SPONSORSHIP
1 + 29
R· Pennsylvania
YRS IN OFFICE
7
BILLS LED
6
COSPONSOR BREAKDOWNBIPARTISAN · 76%
DEM 18 REP 11 IND 0
ACTION TIMELINE
2 EVENTSFEB 21
Introduced in House
FEB 21
Referred to the House Committee on Ways and Means.
BILL INFO
TypeHouse Bill
NumberHR 1496
Congress119th
StatusIn Committee
IntroducedFeb 21, 2025
Last actionFeb 21, 2025
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IN COMMITTEE· 119TH CONGRESS · WAYS AND MEANS COMMITTEE · INTRODUCED FEB 21, 2025
House BillHR 1496Taxation
Rare Earth Magnet Security Act of 2025
INTRODUCED FEB 21, 2025· LAST ACTION FEB 21, 2025
PASSAGE CHANCES
—%
READING
6 min
COSPONSORS
29
COMPLEXITY
Moderate
