Tax News & Views: Sewing Up Clean Energy

Green energy developers are looking to increase the market for energy tax credits by appealing to corporations in addition to their traditional investment bank customers.

The 2022 tax-and-climate law known as the Inflation Reduction Act allowed green energy developers to effectively sell credits for the first time. The move, plus the establishment of generous new and beefed-up tax credits, set off a wave of renewable energy development.

To cash in on the growing supply of credits, sellers will have to expand the pool of interested buyers beyond the traditional energy tax credit investors of big banks and other investment firms, since supply of the credits is now exceeding demand. Corporate buyers are gaining in interest, but for many, it’s the first time delving into the world of green energy tax credits.

Hydrogen producers should engage in long-term electric grid planning required by a transmission rule finalized last month to avoid potentially straining the power grid, a US energy regulator said Wednesday.

The Federal Energy Regulatory Commission finalized the major rule May 13 that requires 20-year assessments of the grid, including impacts from the changing power-and-demand mix and extreme weather events. FERC and state regulators are confronting an unexpected rise in demand from data centers and facing challenges in getting long-range transmission lines permitted and constructed to connect more power plants.

The IRS said that some taxpayers are receiving improper balance-due notices and that it is looking into the issue.

In a June 12 statement, the agency said it is aware that some taxpayers who paid taxes electronically for tax year 2023 are receiving CP14 notices indicating a balance due even though they have made the tax payments.

“The IRS is researching the matter and will provide an update as soon as possible,” the agency said in the statement. Affected taxpayers don’t need to respond to the notice if they paid the tax they owe on time, the IRS added.

A business group is calling on the IRS to scrap part of its proposed regulations on the stock-buyback tax, saying the agency’s efforts to fix a problem with the regulations don’t go far enough.

The IRS should eliminate the regulations’ “funding rule,” the National Foreign Trade Council said Tuesday in a comment letter. The funding rule would impose the 1% tax on foreign corporations’ stock repurchases if they are indirectly funded by US subsidiaries for the “principal purpose” of avoiding the tax.

As part of continuing efforts to protect the senior community, the Internal Revenue Service today issued a warning about the rising threat of impersonation scams

These scams are targeting older adults by pretending to be government officials, aiming to steal sensitive personal information and money. By posing as representatives from agencies such as the IRS, or other government agencies, these fraudsters use fear and deceit to exploit their victims.

Tens of thousands of businesses are determining their eligibility for a piece of Tennessee’s $1.55 billion franchise tax refund bonanza before the fast-tracked program expires at the end of November.

Tax practitioners are advising clients that paid Tennessee’s business franchise tax over the past three years to quickly file amended returns and refund claims. The state Department of Revenue sent notices to about 100,000 business taxpayers in the last month and published guidance and frequently asked questions describing the eligibility and filing requirements.

House Republicans say they are pleased with the IRS’s latest efforts to modernize its outdated information technology systems and directed the agency to build the capacity to provide real-time tax information access to the public and boost its use of artificial intelligence.

In a new House Appropriations Committee report, the panel applauded the IRS’s use of fixed-price, outcome-based contracting when it comes to hiring outside contractors to manage IT improvements and ordered the agency to expand the practice.