Transfer Election

A transfer election allows certain taxpayers that qualify for a clean energy or advanced manufacturing tax credit to transfer all or a portion of the credit to a third-party buyer in exchange for cash.

A taxpayer that wants to transfer clean energy credits under section 6418 must register the intention to transfer the credits and receive a registration number. The taxpayer also must find an unrelated transferee taxpayer who wishes to purchase the credit(s) for cash consideration. Treasury Regulation 1.6418-2(b)(5) describes the transfer election statement that must be included in the transferor’s and transferee’s returns, respectively.

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