U.S. businesses will be able to take advantage of a change in tax policy to trade unused clean energy tax credits for tax-free cash under new rules announced on Thursday.The new rules, announced by the Internal Revenue Service and Treasury Department on April 25, mean that renewable energy developers and owners can now choose to transfer all or a portion of a range of eligible tax credits to unrelated taxpayers in exchange for cash payments.
The new rules create an 'avenue for companies seeking tax savings, offering them the option to engage in a growing tax credit market instead of committing to a long-term renewable energy investment with a sponsor,' Brandon Hill, tax principal at Clifton Larson Allen LLP, wrote in an article for Thomson Reuters.Newsweek has contacted the IRS for comment via email outside of normal working hours.In an example used by the IRS, the process is laid out.