EGG SAVE Act of 2025
This bill creates a new nonrefundable business tax credit (the layer operation efficiency equipment credit) under Section 45BB of the Internal Revenue Code. The credit is equal to a percentage of qualified expenditures for equipment used to identify the sex of avian embryos before hatch (in-ovo sex identification) at US commercial egg hatcheries, plus installation and related facility modifications. The applicable credit rate is 50% for property placed in service in 2026, 40% for 2027, and 30% for 2028. Expenditures are only valid if the equipment is placed in service by the taxpayer and located at a commercial egg hatchery facility in the United States with at least 95% accuracy and otherSecretary-prescribed requirements. The credit reduces the taxpayer’s basis in the property, is subject to recapture if eligibility ends, and is treated as part of the general business credit (nonrefundable, with carryforward/carryback rules). The program terminates for property placed in service after December 31, 2028, and the bill applies to property placed in service after December 31, 2025. The short title given is the Efficiency Gains through Grading Standards And Viable Enhancement Act of 2025 (EGG SAVE Act of 2025).
Key Points
- 1New tax credit: Section 45BB adds a layer operation efficiency equipment credit equal to a percentage of qualified expenditures for eligible equipment and installations.
- 2Eligible years and rates: 50% (2026), 40% (2027), 30% (2028) of qualified expenditures, for property placed in service in those years.
- 3Qualified expenditures: costs for the purchase of qualified in-ovo sex identification equipment, its installation, and necessary facility modifications to operate the equipment.
- 4Qualifications for equipment: must use optical or non-optical tech to determine the sex of avian embryos before hatch, be placed in service at a U.S. commercial egg hatchery facility, achieve at least 95% accuracy, and meet any additional requirements the Secretary may set.
- 5Property placed in service requirement: expenditures count only if the equipment is placed in service by the taxpayer.
- 6General business credit integration: the credit is part of the general business credit (nonrefundable and subject to carryover/carryback rules under Section 50).
- 7Recapture and basis rules: if the credit is claimed, the property basis is reduced by the credit; if recapture occurs, basis is adjusted accordingly.
- 8Geographic and use limitations: no credit for property used predominantly outside the United States (with some exceptions), and rules similar to Section 50 apply.
- 9Termination and effective date: the credit applies to property placed in service after December 31, 2025, and the provision expires for property placed in service after December 31, 2028.