Some in Congress are advocating a proposal to establish a carbon tax on certain imports to fight climate change and protect domestic production. A more specific carbon border tax plan
Continue Reading Proposed Federal Tax on Import of Carbon-Intensive Products

On July 1, 2021, the Internal Revenue Service released Revenue Ruling 2021-13, which addresses several issues relating to qualifying for the Section 45Q carbon capture sequestration credit. This is
Continue Reading Section 45Q Revenue Ruling Released – Credit for Carbon Oxide Sequestration

On June 29, 2021, the Internal Revenue Service (IRS) released Notice 2021-41 (the “Notice”) granting additional relief for certain renewable energy projects planning to claim the U.S. federal production tax
Continue Reading Notice 2021-41: Further Extension of the Continuity Safe Harbor for Renewable Energy Projects

On Dec. 21, 2020, Congress passed a COVID-19 relief bill (the Consolidated Appropriations Act, 2021), which President Trump signed into law on Dec. 27, 2020. The bill includes the Taxpayer
Continue Reading Taxpayer Certainty and Disaster Tax Relief Act of 2020: Spotlight on the Extensions of Certain Alternative Energy Tax Credits

On Feb. 19, 2020, the IRS released Notice 2020-12 and Revenue Procedure 2020-12 (together, the “Carbon Guidance”) which provide highly anticipated clarity on the Internal Revenue Code Section 45Q credit


Continue Reading Summary of Guidance on Section 45Q Carbon Tax Credits Under 2020 Notice and Revenue Procedure

On Feb. 19, 2020, the Internal Revenue Service released partial guidance on the implementation of section 45Q tax credits related to the capture and sequestration of carbon dioxide. The section 45Q tax credit was updated on Feb. 9, 2018, as part of the Bipartisan Budget Act (Pub. L. 115-123) to increase the amount of the tax credit per ton and to broaden the applicability to include “qualified carbon oxide.” The new IRS guidance is designed to assist in implementing the modified law.

The 2018 law removed the volume cap applicable to the tax credit, expanded the definition to include not just carbon dioxide but other carbon oxides such as methane, and raised the amount of the tax credit per ton. Carbon oxides captured and used for enhanced oil recovery can now receive a tax credit of up to $35 per ton, while carbon oxides deposited in secure geological storage can receive a tax credit of up to $50 per ton.
Continue Reading IRS Takes First Steps to Implement Carbon Capture Tax Credit