HB 1265 Summary

• Establishes a tax credit for businesses using recycled or waste inputs in their operations, deductible from net income tax liability.

• Provides a 10% credit on the cost of qualifying recycled or waste inputs, with a maximum of $500,000 per taxpayer per year, or 15% ($750,000 maximum) for businesses located in rural areas.

• Requires inputs to consist of materials diverted from the waste stream (post-consumer or post-industrial), be used as raw materials in production, and be sourced from certified recycling or waste recovery facilities.

• Allows unused credits to carry forward to subsequent years until exhausted, with claims required to be filed within 12 months after the taxable year ends.

• Effective for taxable years beginning after December 31, 2025.