Local Food Recycling and Regenerative Opportunities Act
The Local Food Recycling and Regenerative Opportunities Act creates a new personal income tax credit (Sec. 25F) to encourage households to divert wasted food from landfills. The credit is 30% of eligible costs related to at-home food recycling and local organic waste collection services, with specific per-item caps. Specifically, homeowners can claim 30% of: (1) the cost of a qualified residential food recycling appliance placed in service in their primary residence, and (2) amounts paid for qualified residential organic waste services during the tax year. There are yearly caps ($300 per appliance and a combined $120 for all organic waste services) and anti-double-dipping rules (no deduction or additional credit for the same expenses, and basis in property may be reduced by the credit). The definitions cover electric appliances that help separate and pre-process food waste for diversion from landfills, and local services that collect and manage organic waste. The credit applies to tax years beginning after December 31, 2025 and ends for qualified purchases or services after December 31, 2031.
Key Points
- 1Creates a new Section 25F in the Internal Revenue Code: a personal tax credit for diversion of wasted food.
- 2Credit amount: 30% of eligible costs for two categories (qualified residential food recycling appliances and qualified residential organic waste services).
- 3Caps: up to $300 credit per qualified appliance; up to $120 aggregate credit for all qualified residential organic waste services in a tax year.
- 4Definitions:
- 5- Qualified residential food recycling appliance = an electric appliance placed in a taxpayer’s principal residence that facilitates source separation of food waste and pre-processes it (dehydration and size-reduction) to divert waste from landfills.
- 6- Qualified residential organic waste service = a service to collect locally generated organic waste (including pre-processed waste) from the residence for local management and landfill diversion.
- 7Denial of double benefit: no deduction or credit for the same expenses to the extent of the credit, and the cost basis of related property may be reduced by the amount of the credit.
- 8Termination and effective date: no credits for appliances or services placed in service after December 31, 2031; applies to taxable years beginning after December 31, 2025 (i.e., starting in 2026).