ENERGY CREDITS

The Federal Investment Tax Credit (ITC) is a significant financial incentive for businesses investing in renewable energy projects. This tax credit allows businesses to deduct a substantial percentage of their investment costs in solar, wind, and other renewable energy installations from their federal tax obligations. 

At Carbonex, we specialize in assisting energy project developers in planning and tracking these investments to ensure optimal utilization of the ITC. Our services include comprehensive project planning to align with IRS requirements, detailed record-keeping to accurately track investment costs, and expert guidance on proper filing procedures. By partnering with us, developers can streamline the complex process of claiming the ITC, reducing administrative burdens and enhancing financial returns.

We provide tailored solutions that facilitate the technical aspects of tax filing and maximize the financial benefits of the ITC. Our team ensures that every eligible cost is accounted for, helping businesses achieve the maximum possible deduction and supporting a smoother path to sustainable energy solutions.

The Inflation Reduction Act created new opportunities for tax credit monetization. Starting in 2023 eligible taxpayers now have the option to transfer all or a portion of their earned ITC credits to an unrelated taxpayer. This opportunity for transferability allows those who have generated tax credits, but do not have sufficient tax liability to utilize them fully, to sell these credits for cash.

To initiate a transfer, taxpayers must register with IRS and make an irrevocable election by the due date of their tax return for the year in which the credit is claimed. This process permits the seller to monetize the credits while enabling the buyer to offset their tax liabilities directly. Importantly, the proceeds from the sale of the credits are not considered taxable income for the seller.

Carbonex provides expert services to help clients navigate these new provisions. We ensure proper documentation and compliance, facilitating the legal and efficient transfer of tax credits. Additionally, Carbonex can assist in the selling of the credits, helping to match sellers with interested parties to ensure successful transactions.