What is the Low-Income Communities Bonus Credit? The Low-Income Communities Bonus Credit available through the Inflation Reduction Act of 2022 (IRA) is designed to increase the siting of, and access to renewable energy…
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/ Energy & Utilities, Environmental Law, Taxation
What is the purpose of the Energy Community Bonus Credit? The Inflation Reduction Act (IRA) introduced the Energy Community Bonus Credit to encourage renewable energy project developers to locate their facilities and energy…
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/ Energy & Utilities, Environmental Law, Taxation
What is the purpose of the Domestic Content Bonus Credit? The Inflation Reduction Act (IRA) introduced the Domestic Content Bonus Credit to provide an additional credit amount to taxpayers that meet its requirements. The purpose…
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/ Energy & Utilities, Environmental Law, Taxation
Why did Congress provide bonus credits to a facility or a project that pays its workers “prevailing wages” and hires apprentices? Congress viewed the Inflation Reduction Act (IRA) as a way to not only move the United States…
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/ Energy & Utilities, Environmental Law, Labor & Employment Law, Taxation
Why did the Inflation Reduction Act (IRA) reduce the base amounts of the energy tax credits? The IRA reduced base credit amounts from their pre-IRA levels to encourage energy projects to meet Congressional policy objectives. An…
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/ Energy & Utilities, Environmental Law, Taxation
What is a Production Tax Credit (PTC)?
A Production Tax Credit (PTC) is a per kilowatt-hour (kWh) tax credit for electricity generated by solar and other qualifying clean technologies for the first 10 years of a system’s…
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/ Energy & Utilities, Environmental Law, Taxation
Signed into law on August 16, 2022, the Inflation Reduction Act (IRA) is the most significant long-term commitment made by the U.S. government to encourage and support a clean energy future. The IRA modifies and revises the…
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/ Energy & Utilities, Environmental Law, Taxation
What is a hedged executory contract? A “hedged executory contract” is another type of transaction that is eligible for integration under Code Section 988(d). A hedged executory contract results when a taxpayer enters into an…
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/ Business Organizations, Commercial Law & Contracts, Finance & Banking, International Law & Trade, Taxation
Are there special hedging provisions for section 988 transactions? Yes. In addition to the business hedging rules I address in our earlier Q&A with Andie series, a special hedging provision is available at Code section 988(d)…
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/ Finance & Banking, International Law & Trade, Taxation
Which transactions qualify as section 988 transactions?
In section 988 transactions, the taxpayer makes payments or receipts denominated in or determined by reference to one or more nonfunctional currency…
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/ Finance & Banking, International Law & Trade, Taxation, Wills, Trusts, & Estate Planning
Are all foreign currency gains taxable?
No. Under a de minimis exemption individual taxpayers with foreign currency gains of $200 or less on a “personal transaction” do not need to report them…
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/ Finance & Banking, International Law & Trade, Taxation
Navigating the federal taxation of foreign currency can be compared to trying to cross a perilous sea. Both involve unexpected rough patches, serious difficulties, and frustrating complexity…
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/ Finance & Banking, International Law & Trade, Taxation
Do the tax hedge rules apply to consolidated tax groups? Yes. The Treasury Regulations treat members of a consolidated corporate group as divisions of a single entity. As a single entity, the risks and positions of all group…
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/ Business Organizations, Commercial Law & Contracts, Finance & Banking, Taxation
What are the tax accounting rules for hedges? Whether or not a qualified tax hedge is properly identified, it must be tax accounted for under a method that clearly reflects income. The timing of gains and losses on hedges must…
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/ Business Organizations, Commercial Law & Contracts, Finance & Banking, Taxation
When must a hedge be identified and accounted for tax purposes? Taxpayers must identity each hedging transaction and the item it hedges. A taxpayer must clearly identify a hedging transaction “before the close of the day on…
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/ Business Organizations, Commercial Law & Contracts, Finance & Banking, Taxation
