The Internal Revenue Service (IRS) released Notice 2023-38, which provides more details around domestic content requirements for taxpayers who qualify for bonus energy credit incentives. The additional tax credits are associated with investments in and the production of clean energy under Sections 45, 45Y, 48 and 48E. Dependent on the facilities and equipment used to make clean energy, the domestic content rules are fulfilled when a taxpayer verifies that a qualified facility meets two specific requirements.

On this episode of the Industrial Manufacturing Podcast, Jason Hodell, Industrial Manufacturing Leader, and Ron Wainwright, Energy Tax Credits & Incentives Leader, discuss key Inflation Reduction Act of 2022 (IRA) provisions that will help clients maximize their tax credits.

This conversation includes:

• Energy tax credits under the IRA
• IRA’s new credits and bonus credits
• Increase in tax credit amounts for domestic content
• Whatto look for in an energy credit provider
• New requirements to qualify for bonus energy credit incentives

Related Guidance

• Take Advantage of New Section 45L Tax Credit Opportunities Under IRA
• Form 7205: What A&E Firms Need To Know To Claim the Section 179D Tax Deduction
• Energy Savings Revolution – Section 179D for Commercial Buildings
• Notice 2022-61: Initial Guidance on Prevailing Wage and Apprenticeship Requirements for IRA Clean Energy Tax Credits

The conversation continues with Matt Brady, Cherry Bekaert’s Industrial Industry Leader, and Ron Wainwright, Strategic Tax Partner in our Tax Credits and Incentives Advisory group, as they unpack how to capitalize on industrial energy credits. Tune in for the fifth installment of Cherry Bekaert’s Deeper Dive Into New Ways to Monetize Energy Credits for the Industrial Industry regarding industry credit updates and best practices

In this podcast episode, our knowledgeable team takes a closer look at the American Manufacturing Credit and Manufacturing Production Credit within the CHIPS Act. Listen in to learn more about:

• CHIPS Act and IRA background
• Implications to Manufacturers – Investment Tax Credit (48C) and Production Tax Credit (45X)
• New Direct Pay Option and Eligible Credits
• Transferable Credits
• Direct Pay and Transferable Credits

Related Guidance

• CHIPS Act Deep Dive Part 1: New Federal Funding for the Industrial Manufacturing Industry
• CHIPS Act Deep Dive Part 2: Advanced Manufacturing Investment Tax Credit
• CHIPS Act Deep Dive Part 3: American Manufacturing Credit and Manufacturing Production Credit
• CHIPS Act Deep Dive Part 4: Unpacking the Complexities of the Many Tax Credits Under the CHIPS Act and the IRA of 2022

As we wrap up the CHIPS Act Series, we briefly cover the Inflation Reduction Act of 2022 (IRA) and credits associated with CHIPS and IRA and their many impacts on the manufacturing industry. The focus of the discussion centers on a high-level view of the New Advanced Manufacturing Credit, Section 45X – the Advanced Manufacturing Production Credit, which take effect in 2023 and will provide a tax credit for eligible components.

Listen in as Matt Brady, our Industrial Manufacturing Industry Leader, and Ron Wainwright, a Partner in our Tax Credits and Incentives Advisory practice, unpack the fourth and final installment of Cherry Bekaert’s Creating Helpful Incentives to Produce Semiconductors (CHIPS) Act podcast series.

Wainwright also covers the advanced energy project credit, which falls under Section 48C, an investment credit with a base credit of 6%, with a potential increase up to 30% if the qualifying wage requirements are met.

Given the intricacies of the legislation and tax credits and provisions, our industry advisors plan to expand the series to address how industrial manufacturers can find new ways to monetize energy credits, dive into the 45Q credit around carbon oxide sequestrated and examine the “Technology Neutral” credits that may impact the industry.

See our previous podcasts in this series that you may have missed:

• CHIPS Act Deep Dive Part 1: New Federal Funding for the Industrial Manufacturing Industry
• CHIPS Act Deep Dive Part 2: Advanced Manufacturing Investment Tax Credit
• CHIPS Act Deep Dive Part 3: American Manufacturing Credit and Manufacturing Production Credit