26 U.S.C. § 6695B — Penalty for substantial misstatements on certification provided by supplier

(a) Imposition. A person owes the subsection (b) penalty if the person (1) provides the certification described in section 7701(a)(52)(D)(iii)(II)(bb) for a manufactured product, eligible component, or related element, material, or subcomponent, knowing or reasonably should have known it would be used in connection with a determination under that section; (2) knows or reasonably should have known the certification is inaccurate or false about (A) whether the property was produced or manufactured by a prohibited foreign entity^* or (B) the total direct costs or total direct material costs of property not so produced that were provided on the certification; and (3) that inaccuracy or falsity causes disallowance of an applicable energy credit and an income-tax understatement exceeding the lesser of (A) 5 percent of tax required on the return or (B) $100,000. (b) Amount. The penalty is the greater of (1) 10 percent of the underpayment solely attributable to the inaccuracy or falsity or (2) $5,000. (c) Exception. No penalty applies if the person satisfies the Secretary^* that reasonable cause, not willful neglect, caused the inaccuracy or falsity. (d) Definitions. A term used here that is also used in section 7701(a)(52) has that section’s meaning.