Transferable Tax Credit Handbook Version 4

Read by over 5,000 members of the transferable tax credit market

Reunion’s transferable tax credit handbook is a comprehensive, 140-page guide to buying and selling tax credits.

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Our latest version incorporates key changes from H.R.1 - One Big Beautiful Bill Act (OBBBA), including new policies related to foreign entities of concern (FEOC) and updated tax credit phase-out schedules

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The handbook covers the transferability process from start to finish, including key topics such as:

• Technical considerations for buying and selling credits: tax treatment for buyers and sellers, guidance on transfer election statements, required minimum documentation, and excessive credit transfers and associated penalties
• Impacts from the OBBBA: the OBBBA introduced significant changes to clean energy incentives, including accelerated phasedowns of certain tax credits. Corporate tax changes such as 100% bonus depreciation and full expensing of domestic R&E expenditures will also impact tax liability and tax credit purchasing plans for many buyers
• Foreign entity of concern (FEOC) restrictions: detailed discussion of taxpayer-level and project-level FEOC restrictions, including material assistance requirements for §45Y, §48E, and §48X credits
• Due diligence considerations for the major tax credits: §45 production tax credits, §45X advanced manufacturing production credits, and §48 investment tax credits
• Pricing trends: major drivers of tax credit pricing including risk, complexity, size of transaction, and terms such as payment timing, insurance, and strength of indemnity
• Cash flow considerations: detailed examples of the cash flow impact of tax credit payments, with a focus on structures where buyers can achieve the full benefit of tax credits prior to paying cash
• Risk mitigation: how buyers can protect their tax credit purchase through seller indemnity, parent guaranty, and tax credit insurance
• Tax credit transfer agreements: common points of negotiation between buyers and sellers during term sheet and definitive legal documentation
• Tax credit matrix: summary of the 12 types of tax credits that can be transferred and their characteristics, including bonus credit adders and compliance with prevailing wage and apprenticeship requirements