The Internal Revenue Service – The IRS Guidance on Safe Harbor, releases latest & complete guidelines for the businesses to understand all basics & benefits of carbon capture credits. The latest Revenue Procedure Notice 2020-12 (PDF) contains all the answers for the business holders in the United States that will help them to understand that why claiming carbon capture credits is beneficial for them, in reference to the legislation passed in 2018. The definition of “beginning of construction” is well-defined in 2020 legislation for carbon capture credits and offers a safe harbor for partnership allocations of the credit. If you need any help on claiming carbon capture credit+ or their safe harbor access, in USA, contact Black Ink team to get best tax credit support in USA.

Carbon Capture Credits Guidelines & Safe Harbor:

  • The IRS issued carbon capture credits guidelines back in 2019 after the enactment of the Bipartisan Budget Agreement in February 2018. Notice 2019-32 by the IRS requested comments from taxpayers concerning the amendments to the carbon capture credit in the new law.
  • In the latest Notice 2020-12 for carbon capture credits, the IRS defined the guidelines after the careful evaluation of taxpayers’ comments. Now, the definition of “beginning of construction” is well-understood with more clarity.
  • The carbon capture credits Notice 2020-12 also provides with the guidance to facilitate businesses in determining when construction has initiated on a competent facility or on carbon capture equipment that may be entitled for the carbon capture credit.
  • The notice also provide broad range of guidelines to those taxpayers also who request for private letter rulings in this area.
  • As per new carbon capture credits guidance 2020, a safe harbor is also created by the IRS for allocating rules for carbon capture partnerships same as the safe harbors developed for partnerships receiving the wind energy production tax credit and the rehabilitation credit.
  • With the provision of carbon capture credits safe harbor, the application of carbon capture credit rules are simplified now to partnerships for claiming the credit from the IRS.

The IRS further acknowledges businesses to issue further guidance regarding secure geological storage for utilization, recapture of the credit for those taxpayers who claim credits for carbon capture. We will update you in the near future about further proceedings in this regard. Stay connected with Black Ink.





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