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Issue Number: IR-2023-186
Inside This Issue
IRS issues guidance for the transfer of clean vehicle credits and updates frequently asked questions
WASHINGTON — The Internal Revenue Service today issued proposed regulations, Revenue Procedure 2023-33 and frequently asked questions for the transfer of new and previously owned clean vehicle credits from the taxpayer to an eligible entity for vehicles placed in service after Dec. 31, 2023.
The Inflation Reduction Act provides taxpayers with credits for qualified new and previously owned clean vehicles acquired and placed in service during the taxable year. Beginning Jan. 1, 2024, in certain situations, taxpayers will be able to transfer the new and previously owned clean vehicle credits to eligible entities.
Today’s guidance clarifies how taxpayers can elect to transfer new and previously owned clean vehicle credits to dealers who are eligible to receive advance payments of either credit. The proposed regulations and revenue procedure also provide guidance for dealers to become eligible entities to receive advance payments of new or previously owned clean vehicle credits.
The proposed regulations also provide guidance for the recapturing of the credit.
The revenue procedure includes procedures for how a dealer would register with the IRS to be eligible to receive the credit transfers from taxpayers and provides details on the registration process through IRS Energy Credits Online.
It also provides procedures for the revocation and suspension of a registration if a dealer fails to comply with the program’s requirements, and for the establishment of an advanced payment program to eligible entities. Finally, the revenue procedure provides new information for the timing and manner of submission of seller reports, as well as providing updated information on submission of written agreements by manufacturers to the IRS to be considered qualified manufacturers and on the method of submission of monthly reports by qualified manufacturers.
As a result of this guidance, the IRS updated the frequently-asked-questions (FAQs) for the clean vehicle credits.
Fact Sheet 2023-22 updates FAQs related to new, previously owned and qualified commercial clean vehicles.
The FAQs revisions are as follows:
These FAQs are being issued to provide general information to taxpayers and tax professionals as expeditiously as possible.
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