after December 31, 2028. . (b) Credit allowed as part of general business credit Section 38(b) of such Code is amended by striking plus at the end of paragraph (40), by striking the period at the end of paragraph (41) and inserting , plus , and by adding at the end the following new paragraph: (42) the mechanical insulation labor costs credit determined under section 45BB(a). . (c) Conforming amendments (1) Section 280C of such Code is amended by adding at the end the following new subsection: (i) Mechanical insulation labor costs credit (1) In general No deduction shall be allowed for that portion of the mechanical insulation labor costs (as defined in section 45BB(b)) otherwise allowable as deduction for the taxable year which is equal to the amount of the credit determined for such taxable year under section 45BB(a). (2) Similar rule where taxpayer capitalizes rather than deducts expenses If— (A) the amount of the credit determined for the taxable year under section 45BB(a), exceeds (B) the amount of allowable as a deduction for such taxable year for mechanical insulation labor costs (determined without regard to paragraph (1)), the amount chargeable to capital account for the taxable year for such costs shall be reduced by the amount of such excess. . (2) The table of sections for subpart D of part IV of subchapter A of chapter 1 of such Code is amended by adding at the end the following new item: Sec. 45BB. Labor costs of installing mechanical insulation property. . (d) Effective date The amendments made by this section shall apply to amounts paid or incurred after December 31, 2023, in taxable years ending after such date.