In the Headlines
October 29, 2024
Investments in Energy Tax Credit Boom Could Draw IRS' Eye
Law360
Tax attorneys Daniel Strickland and Lee Meyercord were mentioned in a Law360 article about the potential Internal Revenue Service (IRS) scrutiny of investments in energy tax credits following the 2022 Inflation Reduction Act (IRA). The article discussed how the surge in green energy development projects sparked by the new tax incentives could draw increased attention from the IRS, similar to its crackdowns on other areas with generous tax benefits. Mr. Strickland and Ms. Meyercord provided insights on the IRS' potential approach to auditing these new transactions and the complexities involved in clean energy tax credit structures.
"The expectation is that some version of those playbooks will be utilized in scrutinizing" the clean energy tax credit transactions, said Mr. Strickland.
Ms. Meyercord commented on the role of partnerships, which are often used to finance large-scale renewable energy projects. She said a new approach known as a T-flip allows "flexibility while providing the tax equity investor additional optionality in the event they can't use all of the tax credits and decide to monetize some or all through a transfer."
READ: Investments in Energy Tax Credit Boom Could Draw IRS' Eye (Subscription required)
"The expectation is that some version of those playbooks will be utilized in scrutinizing" the clean energy tax credit transactions, said Mr. Strickland.
Ms. Meyercord commented on the role of partnerships, which are often used to finance large-scale renewable energy projects. She said a new approach known as a T-flip allows "flexibility while providing the tax equity investor additional optionality in the event they can't use all of the tax credits and decide to monetize some or all through a transfer."
READ: Investments in Energy Tax Credit Boom Could Draw IRS' Eye (Subscription required)