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material assistance cost ratio

Defined in 1 place of the United States Code.

For purposes of subparagraph (A)(i), the term “material assistance cost ratio” means the amount (expressed as a percentage) equal to the quotient of—

(I) an amount equal to—

(aa) the total direct costs to the taxpayer attributable to all manufactured products (including components) which are incorporated into the qualified facility or energy storage technology upon completion of construction, minus

(bb) the total direct costs to the taxpayer attributable to all manufactured products (including components) which are—

(AA) incorporated into the qualified facility or energy storage technology upon completion of construction, and

(BB) mined, produced, or manufactured by a prohibited foreign entity, divided by

(II) the amount described in subclause (I)(aa).

Source

For purposes of subparagraph (A)(ii), the term “material assistance cost ratio” means the amount (expressed as a percentage) equal to the quotient of—

(I) an amount equal to—

(aa) with respect to an eligible component, the total direct material costs that are paid or incurred (within the meaning of section 461 and any regulations issued under section 263A) by the taxpayer for production of such eligible component, minus

(bb) with respect to an eligible component, the total direct material costs that are paid or incurred (within the meaning of section 461 and any regulations issued under section 263A) by the taxpayer for production of such eligible component that are mined, produced, or manufactured by a prohibited foreign entity, divided by

(II) the amount described in subclause (I)(aa).

Source