On June 14, the Treasury Department (Treasury) and the Internal Revenue Service (IRS) issued proposed regulations and temporary regulations on tax credit transfers pursuant to Section 6418 of the Internal Revenue Code of 1986, as amended (Code), which was enacted by the Inflation Reduction Act. Section 6418 allows eligible taxpayers to elect to transfer certain tax credits, including the ITC and PTC, to unrelated taxpayers rather than using the credits against their federal income tax liabilities. The IRS also issued regulations on direct payments pursuant to Section 6417, which we will address in a subsequent update.
Mitchell advises a wide range of clients on federal, state, and local tax matters. He regularly assists tax equity investors and developers of renewable energy projects (including wind, solar, and battery facilities) in structuring transactions, such as partnership flips and sale-leasebacks, and qualifying for tax incentives. His practice also includes advising on mergers and acquisitions, private equity transactions, and various transactions involving partnerships, LLCs, and other pass-through entities.