How do I Buy & Sell Energy Tax Credits
It's complex, but our experts have handled tens of millions in transactions
FAQs
Which Credits Can be Sold?​
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alternative fuel vehicle refueling property (30C)
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renewable electricity production credit (45)
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carbon oxide sequestration credit(45Q)
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zero-emission nuclear power production credit (45U)
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clean hydrogen production credit (45V)
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advanced manufacturing production credit (45X)
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clean electricity production credit (45Y)
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clean fuel production credit (45Z)
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energy credit (e.g., solar, wind, geothermal, etc.) (48).
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qualifying advanced energy project credit (48C)
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clean electricity investment credit (48E)
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How are they Sold?
Deals generally involve a purchase agreement, an indemnity and insurance just in case the IRS tries to claw back the credit after it's granted
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Are the Proceeds from the Sale Taxable to the Seller?
No.
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Is the Discount Taxable Income to the Buyer?
No. The buyer does not pay income tax on the savings from purchasing the credit at a discount.
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How can Buyers Use the Credits?
Credits may be applied against the buyer's income tax liability with a 3-year carry back and 22-year carry forward
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What do I need to do to Sell?
You must register with the IRS and make a transfer election. A separate registration is required for each "credit property" that you intend to sell. The determination of what precisely qualifies as the credit property can be fairly involved. Once registered, you must submit extensive transfer election paperwork as part of your tax return filing for that tax year. (e.g., relevant source credit tax form, Form 3800, the required attached schedule, "transfer election statement" etc.)
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