Rule2023-12797
Pre-Filing Registration Requirements for Certain Tax Credit Elections
Primary source
Metadata and text below are from the Federal Register, a public-domain U.S. government work. Always verify the official published version before relying on it for any legal matter.
Published
June 21, 2023
Effective
June 21, 2023
Issuing agencies
Treasury DepartmentInternal Revenue Service
Abstract
This document contains temporary regulations setting forth mandatory information and registration requirements for taxpayers planning to make an elective payment election under the Inflation Reduction Act of 2022 and the CHIPS Act of 2022 to treat the amount of certain tax credits as a payment of Federal income tax, or in the case of a partnership or S corporation, to receive a payment in the amount of such credits. This document also contains temporary regulations setting forth mandatory information and registration requirements for taxpayers planning to make an election to transfer certain Federal income tax credits under the Inflation Reduction Act of 2022. These temporary regulations affect tax-exempt organizations, State and local governments, Indian tribal governments, Alaska Native Corporations, the Tennessee Valley Authority, rural electric cooperatives, and, in the case of three credits, certain taxpayers eligible to elect the elective payment of credit amounts in a taxable year under section 6417 of the Internal Revenue Code (Code). These temporary regulations also affect taxpayers eligible to make an elective payment election instead of claiming the advanced manufacturing investment credit under section 48D of the Code. These temporary regulations further affect taxpayers eligible to elect to transfer certain Federal income tax credits under section 6418 of the Code.
Full Text
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<title>Federal Register, Volume 88 Issue 118 (Wednesday, June 21, 2023)</title>
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[Federal Register Volume 88, Number 118 (Wednesday, June 21, 2023)]
[Rules and Regulations]
[Pages 40086-40095]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2023-12797]
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DEPARTMENT OF THE TREASURY
Internal Revenue Service
26 CFR Part 1
[TD 9975]
RIN 1545-BQ76
Pre-Filing Registration Requirements for Certain Tax Credit
Elections
AGENCY: Internal Revenue Service (IRS), Treasury.
ACTION: Temporary regulations.
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SUMMARY: This document contains temporary regulations setting forth
mandatory information and registration requirements for taxpayers
planning to make an elective payment election under the Inflation
Reduction Act of 2022 and the CHIPS Act of 2022 to treat the amount of
certain tax credits as a payment of Federal income tax, or in the case
of a partnership or S corporation, to receive a payment in the amount
of such credits. This document also contains temporary regulations
setting forth mandatory information and registration requirements for
taxpayers planning to make an election to transfer certain Federal
income tax credits under the Inflation Reduction Act of 2022. These
temporary regulations affect tax-exempt organizations, State and local
governments, Indian tribal governments, Alaska Native Corporations, the
Tennessee Valley Authority, rural electric cooperatives, and, in the
case of three credits, certain taxpayers eligible to elect the elective
payment of credit amounts in a taxable year under section 6417 of the
Internal Revenue Code (Code). These temporary regulations also affect
taxpayers eligible to make an elective payment election instead of
claiming the advanced manufacturing investment credit under section 48D
of the Code. These temporary regulations further affect taxpayers
eligible to elect to transfer certain Federal income tax credits under
section 6418 of the Code.
DATES:
Effective date: This temporary regulation is effective on June 21,
2023.
Applicability date: For dates of applicability, see Sec. Sec.
1.48D-6T(j), 1.6417-5T(d), and 1.6418-4T(d).
FOR FURTHER INFORMATION CONTACT: Concerning these temporary
regulations, Lani M. Sinfield at (202) 317-5871 (not a toll free
number).
SUPPLEMENTARY INFORMATION:
Background
I. Overview
This document amends the Income Tax Regulations (26 CFR part 1) to
add temporary regulations providing information and registration
requirements that must be completed before elections available under
sections 48D(d), 6417, and 6418 of the Code may be made.
In accordance with section 7805(e)(1) of the Code, concurrent with
the publication of this Treasury Decision, the Department of the
Treasury (Treasury Department) and the IRS are publishing in the
Proposed Rules section of this issue of the Federal Register three
notices of proposed
[[Page 40087]]
rulemaking that contain proposed regulations under Sec. Sec. 1.48D-6,
1.6417-5, and 1.6418-4, the text of which is identical to the text of
Sec. Sec. 1.48D-6T, 1.6417-5T, and 1.6418-4T of the temporary
regulations. REG-105595-23 provides proposed regulations under section
48D(d). REG-101607-23 provides proposed regulations under sections 6241
and 6417. REG-101610-23 provides proposed regulations under section
6418.
Interested persons are directed to the ADDRESSES and COMMENTS AND
PUBLIC HEARING sections of the preambles to REG-105595-23, REG-101607-
23, and REG-101610-23 for information on submitting public comments or
the public hearings for the proposed regulations.
II. Sections 48D(d), 6417, and 6418
A notice of proposed rulemaking (REG-105595-23) in the Proposed
Rules section in this issue of the Federal Register provides a
background description of section 48D. A notice of proposed rulemaking
(REG-101607-23) in the Proposed Rules section in this issue of the
Federal Register provides a background description of section 6417. A
notice of proposed rulemaking (REG-101610-23) in the Proposed Rules
section in this issue of the Federal Register provides a background
description of section 6418.
Explanation of Provisions
I. Pre-Filing Registration Requirements Under Section 48D(d)
Temp. Reg. Sec. 1.48D-6T(b)(1) provides the mandatory pre-filing
registration process that, except as provided in guidance, a taxpayer
must complete as a condition of, and prior to, any amount being treated
as a payment against the tax imposed under Sec. 1.48D-6(a)(1), or an
amount paid to a partnership or S corporation pursuant to Sec. 1.48D-
6(d)(2)(ii)(A). A taxpayer is required to use the pre-filing
registration process to register each qualified investment in an
advanced manufacturing facility. A taxpayer that does not obtain a
registration number or report the registration number on its annual tax
return with respect to an advanced manufacturing facility is ineligible
to receive any elective payment amount with respect to the amount of
any section 48D credit determined with respect to that advanced
manufacturing facility. However, completion of the pre-filing
registration requirements and receipt of a registration number does
not, by itself, mean that the taxpayer is eligible to receive a payment
with respect to the section 48D credits determined with respect to the
advanced manufacturing facility.
The pre-filing registration requirements are that a taxpayer:
(1) must complete the registration process electronically through
the IRS electronic portal and in accordance with the instructions
provided therein, unless otherwise provided in guidance;
(2) must satisfy the registration requirements and receive a
registration number prior to making a section 48D(d)(1) elective
payment election on the taxpayer's tax return for the taxable year at
issue;
(3) is required to obtain a registration number for each qualified
investment in an advanced manufacturing facility with respect to which
a section 48D credit will be determined and for which the taxpayer
wishes to make a section 48D(d)(1) elective payment election; and
(4) must provide the specific information required to be provided
as part of the pre-filing registration process. The provision of such
information, which includes information about the taxpayer and about
the qualified investment in an advanced manufacturing facility, would
allow the IRS to prevent duplication, fraud, improper payments, or
excessive payments under section 48D. For example, verifying
information about the taxpayer would allow the IRS to mitigate the risk
of fraud or improper payments to entities that are not eligible
taxpayers. Information about the taxpayer's taxable year would allow
the IRS to ensure that an elective payment election is timely made on
the entity's annual tax return. Information about the advanced
manufacturing facility, including its address and coordinates
(longitude and latitude), supporting documentation, beginning of
construction date, and placed in service date would allow the IRS to
mitigate the risk of duplication, fraud, and improper payments for
properties that are not advanced manufacturing facilities.
Temp. Reg. Sec. 1.48D-6T(b)(7)(i) provides that, after a taxpayer
completes pre-filing registration with respect to each qualified
investment in an advanced manufacturing facility with respect to which
the taxpayer intends to elect a section 48D(d) elective payment
election for the taxable year, the IRS will review the information
provided and will issue a separate registration number for each
qualified investment for which the taxpayer provided sufficient
verifiable information.
Temp. Reg. Sec. 1.48D-6T(b)(7)(ii) provides that a registration
number is valid only for the taxable year for which it is obtained.
Temp. Reg. Sec. 1.48D-6T(b)(7)(iii) provides that, if an elective
payment election will be made with respect to a qualified investment in
an advanced manufacturing facility for a taxable year for which a
registration number under this section has been obtained for a prior
taxable year, the taxpayer must renew the registration each subsequent
year in accordance with applicable guidance, including attesting that
all the facts previously provided are still correct or updating any
facts that are relevant in calculating the amount of the section 48D
credit. Temp. Reg. Sec. 1.48D-6T(b)(7)(iv) provides that, if facts
change with respect to the qualified investment in an advanced
manufacturing facility for which a registration number has been
previously obtained, the taxpayer must amend the registration to
reflect these new facts. The regulations provide, for example, that if
the facility previously registered for an elective payment election
undergoes a change of ownership (incident to a corporate reorganization
or an asset sale) such that the new owner has a different employer
identification number (EIN) than the owner who obtained the original
registration, the original owner would be required to amend the
original registration to disassociate its EIN from the advanced
manufacturing facility and the new owner must submit an original
registration (or if the new owner previously registered other advanced
manufacturing facilities, must amend its original registration) to
associate the new owner's EIN with the previously registered advanced
manufacturing facility.
Lastly, Temp. Reg. Sec. 1.48D-6(b)(7)(v) provides that the
taxpayer is required to include the registration number of the advanced
manufacturing facility on the taxpayer's annual return for the taxable
year for an election under Temp. Reg. Sec. 1.48D-6(a)(1). The IRS will
treat an elective payment election as ineffective with respect to any
section 48D credit determined with respect to the advanced
manufacturing facility for which the taxpayer does not include a valid
registration number on the annual tax return.
II. Pre-Filing Registration Requirements and Additional Information
Under Section 6417
Section 6417(d)(5) provides that, as a condition of, and prior to,
any amount being treated as a payment that is made by the taxpayer
under section 6417(a) or any payment being made pursuant to section
6417(c), the Secretary may require such information or registration as
the Secretary deems necessary or appropriate for purposes of preventing
[[Page 40088]]
duplication, fraud, improper payments, or excessive payments.
In general, stakeholders requested additional information about
this provision and requested that the regulations balance the need to
prevent fraud and abuse with the burden on taxpayers. Stakeholders
recommended that the information required to be provided to the IRS
should be provided in a manner that facilitates automated procedures to
help catch potential fraud, discourages abusive or otherwise
illegitimate claims, and allows efficient and prompt review (both
before payment and through audits). Stakeholders recommended that all
required documents and information should be able to be submitted
easily via an online portal. Stakeholders recommended that information
or registration should be as consistent as possible across sections
48D(d)(1), 6417(d)(5), and 6418(g)(1).
Temp. Reg. Sec. 1.6417-5T provides the mandatory pre-filing
registration process. Temp. Reg. Sec. 1.6417-5T(a) provides an
overview of this process and requires an applicable entity or electing
taxpayer to satisfy the pre-filing registration requirements as a
condition of, and prior to, making an elective payment election. An
applicable entity or electing taxpayer is required to use the pre-
filing registration process to register itself as intending to make the
elective payment election, to list all applicable credits it intends to
claim, and to list each applicable credit property that contributed to
the determination of such credits as part of the pre-filing submission
(or amended submission). An applicable entity or electing taxpayer that
does not obtain a registration number and report the registration
number on its annual tax return with respect to an applicable credit
property is ineligible to make an elective payment election to treat
any elective payment amount with respect to the amount of any credit
determined with respect to that applicable credit property as a payment
of tax. However, completion of the pre-filing registration requirements
and receipt of a registration number does not, by itself, mean that the
applicable entity or electing taxpayer will receive a payment with
respect to the applicable credits determined with respect to the
applicable credit property.
Temp. Reg. Sec. 1.6417-5T(b) provides the following pre-filing
registration requirements.
First, an applicable entity or electing taxpayer must complete the
pre-filing registration process electronically through an IRS
electronic portal in accordance with the instructions provided therein,
unless otherwise provided in guidance. If the election is by a member
of a consolidated group, the member must complete the pre-filing
registration process as a condition of, and prior to, making an
elective payment election. See Sec. 1.1502-77 (providing rules
regarding the status of the common parent as agent for its members).
Second, an applicable entity or electing taxpayer must satisfy the
registration requirements and receive a registration number prior to
making an elective payment election on the applicable entity's tax
return for the taxable year at issue.
Third, an applicable entity or electing taxpayer is required to
obtain a registration number for each applicable credit property with
respect to which an applicable credit will be determined and for which
the applicable entity or electing taxpayer intends to make an elective
payment election.
Finally, an applicable entity or electing taxpayer must provide the
specific information required to be provided as part of the pre-filing
registration process. The provision of such information, which includes
information about the taxpayer, about the applicable credits, and about
the applicable credit property, will allow the IRS to prevent
duplication, fraud, improper payments, or excessive payments under
section 6417. For example, verifying information about the taxpayer
will allow the IRS to mitigate the risk of fraud or improper payments
to entities that are not applicable entities or electing taxpayers.
Information about the taxpayer's taxable year will allow the IRS to
ensure that an elective payment election is timely made on the entity's
annual tax return. Information about applicable credit properties,
including their address and coordinates (longitude and latitude),
supporting documentation, beginning of construction date, and placed in
service date will allow the IRS to mitigate the risk of duplication,
fraud, and improper payments for properties that are not applicable
credit properties. Information about whether an investment tax credit
property was acquired using any Restricted Tax Exempt Amounts will
allow the IRS to prevent improper payments.
Temp. Reg. Sec. 1.6417-5T(c) provides information about the
required registration number. Temp. Reg. Sec. 1.6417-5T(c)(1) provides
that, after an applicable entity or electing taxpayer completes the
pre-filing registration process as provided in proposed Sec. 1.6417-
5(b) for the applicable credit properties with respect to which the
entity intends to make an elective payment election in the taxable
year, the IRS will review the information provided and will issue a
separate registration number for each applicable credit property for
which the applicable entity or electing taxpayer provided sufficient
verifiable information, as provided in guidance.
Temp. Reg. Sec. 1.6417-5T(c)(2) provides that a registration
number is valid only for the taxable year for which it is obtained.
Temp. Reg. Sec. 1.6417-5T(c)(3) provides that, if an elective payment
election will be made with respect to an applicable credit property for
which a registration number under proposed Sec. 1.6417-5 has been
previously obtained, the applicable entity or electing taxpayer will be
required to renew the registration each year in accordance with
applicable guidance, including attesting that all the facts previously
provided are still correct or updating any facts. Temp. Reg. Sec.
1.6417-5T(c)(4) provides that, if specified changes occur with respect
to one or more applicable credit properties for which a registration
number has been previously obtained, an applicable entity or electing
taxpayer is required to amend the registration (or may need to submit a
new registration) to reflect these new facts. For example, one
stakeholder asked that, if a taxpayer becomes a party to an internal
reorganization under section 368(a) (such as a merger or distribution
in a nonrecognition transaction) during the election period, the
elective payment election should carry over to the successor entity.
The temporary regulations provide that if a facility previously
registered for an elective payment election undergoes a change of
ownership (incident to a corporate reorganization or an asset sale)
such that the new owner has a different employer identification number
(EIN) than the owner who obtained the original registration, the
original owner is required to amend the original registration to
disassociate its EIN from the credit property and the new owner must
submit an original registration (or if the new owner previously
registered other credit properties, must amend its original
registration) to associate the new owner's EIN with the previously
registered credit property.
Lastly, Temp. Reg. Sec. 1.6417-5T(c)(5) provides that the
applicable entity or electing taxpayer is required to include the
registration number of the applicable credit property on their annual
tax return for the taxable year. The IRS will treat an elective payment
election as ineffective with respect to the portion of a credit
determined with
[[Page 40089]]
respect to an applicable credit property for which the applicable
entity or electing taxpayer does not include a valid registration
number on the annual tax return.
III. Pre-Filing Registration Requirements and Additional Information
Under Section 6418
Section 6418(g)(1) provides that as a condition of, and prior to,
any transfer of any portion of an eligible credit under section 6418,
the Secretary may require such information (including, in such form or
manner as is determined appropriate by the Secretary, such information
returns) or registration as the Secretary deems necessary for purposes
of preventing duplication, fraud, improper payments, or excessive
payments under this section.
In general, consistent with section 6417, stakeholders requested
additional information about this provision and requested that the
regulations balance the need to prevent fraud and abuse with the burden
on taxpayers. Stakeholders recommended a registration system that
assigns a transfer number to an eligible taxpayer that can be used by
transferee taxpayers to claim transferred credits and allows the IRS to
track transfers of eligible credits. Stakeholders also recommended that
information or registration requirements should be as consistent as
possible across sections 48D(d)(1), 6417(d)(5), and 6418(g)(1). In
order to meet the purpose of section 6418(g)(1), the Treasury
Department and the IRS have determined that it is necessary to
establish a mandatory registration process that is in place before the
end of the 2023 calendar year, which is the first full taxable year
during which a transfer election under section 6418 is available.
Temp. Reg. Sec. 1.6418-4T generally provides rules requiring that
eligible taxpayers register before filing the return on which a
transfer election is made and provide information related to each
eligible credit property for which the eligible taxpayer intends to
transfer a specified credit portion. Temp. Reg. Sec. 1.6418-4T(a),
consistent with section 6418(g)(1), requires that, as a condition of,
and prior to, making an election to transfer a specified credit
portion, an eligible taxpayer satisfy the pre-filing registration
requirements in Temp. Reg. Sec. 1.6418-4T(b). After the required pre-
filing registration process is successfully completed, an eligible
taxpayer will receive a unique registration number from the IRS for
each registered eligible credit property for which the eligible
taxpayer intends to transfer a specified credit portion. The Treasury
Department and the IRS intend for this pre-filling registration process
to occur through an IRS electronic portal (unless otherwise allowed in
guidance). An eligible taxpayer that does not obtain a registration
number and report the registration number on its return with respect to
an eligible credit property is ineligible to make a transfer election.
However, completion of the pre-filing registration requirements and
receipt of a registration number does not, by itself, mean the eligible
taxpayer is eligible to transfer any specified credit portion
determined with respect to the eligible credit property. The
registration number also must be reported on the eligible taxpayer's
return.
Temp. Reg. Sec. 1.6418-4T(b) provides the following pre-filing
registration requirements.
First, an eligible taxpayer must complete the pre-filing
registration process electronically through an IRS electronic portal in
accordance with the instructions provided therein, unless otherwise
provided in guidance. If the election is by a member of a consolidated
group, the member must complete the pre-filing registration process as
a condition of, and prior to, making an elective payment election. See
Sec. 1.1502-77 (providing rules regarding the status of the common
parent as agent for its members).
Second, an eligible taxpayer must satisfy the registration
requirements and receive a registration number prior to making a
transfer election for a specified credit portion on the eligible
taxpayer's return for the taxable year at issue.
Third, an eligible taxpayer is required to obtain a registration
number for each eligible credit property with respect to which a
transfer election of a specified credit portion is made.
Finally, an eligible taxpayer must provide the specific information
required to be provided as part of the pre-filing registration process.
The provision of such information, which includes information about the
taxpayer, about the eligible credits, and about the eligible credit
property, will allow the IRS to prevent duplication, fraud, improper
payments, or excessive transfers under section 6418. For example,
verifying information about the taxpayer will allow the IRS to mitigate
the risk of fraud or improper transfers. Information about eligible
credit properties, including their address and coordinates (longitude
and latitude), supporting documentation, beginning of construction
date, and placed in service date will allow the IRS to mitigate the
risk of duplication, fraud, and improper transfers for properties that
are not eligible credit properties.
Temp. Reg. Sec. 1.6418-4T(c) provides rules related to the
registration number that is obtained after the IRS has reviewed and
approved the taxpayer's submitted information. First, these rules
provide that a registration number is valid for an eligible taxpayer
only for the taxable year for which it is obtained, and for a
transferee taxpayer's taxable year in which the specified credit
portion is taken into account. Second, Temp. Reg.Sec. 1.6418-4T(c)
provides rules for the renewal of a registration number that has been
previously obtained. The eligible taxpayer is required to renew the
registration with respect to an eligible credit property each year in
accordance with guidance, including attesting that all the facts are
still correct or updating any facts. Third, the temporary regulations
provide that, if facts change with respect to an eligible credit
property for which a registration number has been previously obtained,
an eligible taxpayer is required to amend the registration to reflect
these new facts. Lastly, the temporary regulations provide that an
eligible taxpayer is required to include the registration number of the
eligible credit property on the eligible taxpayer's return for the
taxable year, as provided in Temp. Reg. Sec. 1.6418-2T(b), for an
election to be effective with respect to any eligible credit determined
with respect to any eligible credit property. The IRS will treat a
transfer election as ineffective with respect to an eligible credit
determined with respect to an eligible credit property for which the
eligible taxpayer does not include a valid registration number on its
return.
A transferee taxpayer is also required to report the registration
number received from an eligible taxpayer on its return for the taxable
year that the transferee taxpayer takes the transferred eligible credit
into account.
Applicability Dates
The temporary regulations under Sec. 1.48D-6T apply to taxable
years ending on or after June 21, 2023. The temporary regulations under
Sec. 1.48D-6T expire on June 12, 2026.
The temporary regulations under Sec. 1.6417-5T apply to taxable
years ending on or after June 21, 2023. The temporary regulations under
Sec. 1.6417-5T expire on June 12, 2026.
The temporary regulations under Sec. 1.6418-4T apply to taxable
years ending on or after June 21, 2023. The temporary regulations under
Sec. 1.6418-4T expire on June 12, 2026.
[[Page 40090]]
Special Analyses
I. Good Cause
The Administrative Procedure Act (5 U.S.C. Subchapter II) provides
an exception to generally applicable rulemaking requirements when an
agency makes a finding of good cause (and incorporates the finding and
a brief statement of reasons therefor in the rules issued).
The Treasury Department and the IRS find that good cause exists for
making these temporary regulations immediately effective without notice
and comment. The pre-filing registration process is critical to the
implementation of sections 48D, 6417, and 6418. As expressly authorized
by statute to prevent duplication, fraud, and improper or excessive
payments, the temporary regulations condition elective payment and
transferability on pre-registration with the IRS.\1\ Section 48D
applies to property placed in service after December 31, 2022, and
sections 6417 and 6418 each apply to taxable years beginning after that
date. This means that filers will be able take advantage of these
provisions for their 2023 tax years.
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\1\ Sections 48D(d)(2)(E) and 6417(d)(5) authorize the Secretary
to require such information or registration as the Secretary deems
necessary or appropriate for purposes of preventing duplication,
fraud, improper payments, or excessive payments as a condition of,
and prior to, any amount being treated as a payment made by or to
the taxpayer. Section 6418(g)(1) states that, as a condition of, and
prior to, any transfer of any portion of an eligible credit pursuant
to section 6418(a), the Secretary may require such information
(including, in such form or manner as is determined appropriate by
the Secretary, such information returns) or registration as the
Secretary deems necessary for purposes of preventing duplication,
fraud, improper payments, or excessive payments under section 6418.
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The Treasury Department and the IRS believe it is important to
immediately put into effect these pre-registration requirements. The
pre-registration process collects critical information to minimize
fraudulent elections and prevent duplication and improper or excessive
payments by ensuring basic eligibility requirements for eligible
credits before the election is made. Validating certain information
before the annual tax return process will result in more accurate
review of the veracity of the information and fewer duplicate,
fraudulent, improper, or excessive transfers or payments. In addition,
the pre-filing registration requirement is expected to reduce the need
for recovering erroneous payments and adjusting return positions via
costly, burdensome, and inefficient examination, appeals, and
litigation processes (which, in the case of section 6418, could
potentially be needed with respect to both parties to the credit
transfer transaction). Immediate implementation of these safeguards is
important because it is anticipated that there will be an immediate and
significant increase in utilization of the tax incentives described in
sections 48D(d), 6417, and 6418 by entities that have not historically
had return-filing obligations, increasing the risk of the duplicative,
fraudulent, and improper or excessive payments that the pre-
registration process is intended to mitigate.
The Treasury Department and the IRS find that good cause exists for
making these temporary regulations effective without notice and comment
because failure to do so would be contrary to the public interest.
Without these temporary regulations, the IRS may not be able to timely
and effectively develop and implement a pre-filing registration system.
Lack of a pre-registration process would create risk for the public
fisc by increasing the likelihood of duplicate, fraudulent, improper,
or excessive payments or transfers. The pre-filing registration system
also must be developed sufficiently in advance of the filing season for
taxpayers to have time to gather the necessary information and complete
the registration process and for the IRS to be able to review the
submitted information and issue registration numbers. Failing to pre-
register taxpayers who have never before filed a tax return with the
IRS could significantly delay the processing of those taxpayers'
returns because procedures to allow them to file an annual tax return
would need to be taken during the middle of filing season. Such delay
would harm taxpayers and also potentially result in the IRS owing
interest on any refunds due, further damaging the public fisc.
Additionally, it is in the public interest to have certainly
regarding the requirements for pre-registration as far before the 2023
filing season as possible to ensure the ability to timely and
accurately fulfill the requirements. This certainty is particularly
crucial for those filers already or soon to be engaged in an activity
that would qualify them to make an elective payment or transfer
election. Taxpayer certainty is also especially important for
particular populations of affected taxpayers such as entities that have
not historically had return-filing obligations because they may need
significant time to review and understand the underlying tax law and
the pre-filing registration requirements.
The Treasury Department and the IRS also find that good cause
exists for making these temporary regulations immediately effective
because it would be impracticable to comply with the notice and
comments process. The processes established in sections 48D, 6417, and
6418 are novel and complex. Determining how these processes interact
with established tax procedures is complicated and in some aspects very
difficult to reconcile. The elections under sections 6417 and 6418
apply to numerous credits, each of which contain different substantive
eligibility and other requirements, which had to be separately analyzed
to understand what information should be collected as part of the pre-
filing registration process. Developing a previously nonexistent
registration process, new filing portal, and determining the necessary
elements to protect the fisc has been time consuming. The Treasury
Department and the IRS have moved quickly to understand these complex
Code sections and determine technological elements needed to create the
pre-filing registration process and portal.
To accomplish the purpose of the pre-filing registration process,
the electronic portal must open by Fall 2023. The Treasury Department
and the IRS understand the need to carefully consider all public
comments and provide robust responses to all relevant comments. The few
months available between the publication of proposed regulations and
the opening of the electronic portal is insufficient time to receive,
review, and meaningfully respond to public comments. Furthermore, there
would not be sufficient time after all comments are considered to then
make corresponding changes to the electronic portal, which would
require technological development and user testing.
Comments are being solicited in the cross-referenced notices of
proposed rulemaking that are in the Proposed Rules section in this
issue of the Federal Register. Any comments will be considered before
final regulations are issued.
II. Paperwork Reduction Act
The collection of information contained in these temporary
regulations has been submitted to the Office of Management and Budget
for review in accordance with the Paperwork Reduction Act. Commenters
are strongly encouraged to submit public comments electronically.
Submit electronic submissions for the proposed information collection
to the IRS via email at <a href="/cdn-cgi/l/email-protection#1f6f6d7e317c7072727a716b6c5f766d6c31787069"><span class="__cf_email__" data-cfemail="413133206f222e2c2c242f3532012833326f262e37">[email protected]</span></a> (indicate REG-101607-23 on
the Subject line). Comments on the collection of information should be
received by August 14, 2023. Comments are specifically requested
concerning:
[[Page 40091]]
Whether the proposed collection of information is necessary for the
proper performance of the functions of the IRS, including whether the
information will have practical utility;
The accuracy of the estimated burden associated with the proposed
collection of information (see below);
How the quality, utility, and clarity of the information to be
collected may be enhanced;
How the burden of complying with the proposed collection of
information may be minimized, including through the application of
automated collection techniques or other forms of information
technology; and
Estimates of capital or start-up costs and costs of operation,
maintenance, and purchase of services to provide information.
The collections of information in these temporary regulations
contain reporting and recordkeeping requirements. The recordkeeping
requirements are considered general tax records under Section 1.6001-
1(e). These records are required for IRS to validate that taxpayers
have met the regulatory requirements and are entitled to transfer the
credits. For PRA purposes, general tax records are already approved by
OMB under 1545-0047 for tax-exempt organizations and government
entities; under 1545-0074 for individuals; and under 1545-0123 for
business entities.
These reporting requirements include a requirement to register with
IRS to make the elective payment election or the transfer election in
Sec. Sec. 1.48D-6T, 1.6417-5T, 1.6418-4T. This pre-filing registration
requirement is being submitted to OMB and will be processed in
accordance with the PRA as required by 5 CFR 1320.10. This collection
of information is necessary to prevent duplication, fraud, improper
payments, or excessive payments under sections 48D, 6417 and 6418 of
the Code. The IRS is seeking a new OMB control number (1545-NEW) for
the pre-registration requirements. The respondents are:
(1) Under section 48D, taxpayers eligible to elect the elective
payment election of the advanced manufacturing investment credit.
Estimated total annual reporting burden is 271 hours.
Estimated average annual burden per respondent is 5.41 hours.
Estimated number of respondents is 50.
(2) Under section 6417, tax-exempt organizations, State and local
governments, Indian tribal governments, Alaska Native Corporations, the
Tennessee Valley Authority, rural electric cooperatives, and certain
taxpayers eligible to elect the elective payment of applicable credits
in a taxable year.
Estimated total annual reporting burden is 126,200 hours.
Estimated average annual burden per respondent is 6.31 hours.
Estimated number of respondents is 20,000.
(3) Under section 6418, eligible taxpayers that elect to transfer
eligible credits in a taxable year.
Estimated total annual reporting burden is 308,000 hours.
Estimated average annual burden per respondent is 6.16 hours.
Estimated number of respondents is 50,000.
An agency may not conduct or sponsor, and a person is not required
to respond to, a collection of information unless it displays a valid
control number assigned by the Office of Management and Budget. Books
or records relating to a collection of information must be retained if
their contents may become material in the administration of any
internal revenue law. Generally, tax returns and tax return information
are confidential, as required by section 6103. The IRS anticipates
opening the electronic portal for pre-filing registration in Fall 2023,
after approval of the collection of information under the Paperwork
Reduction Act.
III. Regulatory Flexibility Act
For applicability of the Regulatory Flexibility Act, please refer
to the cross-reference notices of proposed rulemaking (REG-105595-23,
REG-101607-23, and REG-101610-23) published elsewhere in this issue of
the Federal Register.
IV. Section 7805(f)
Pursuant to section 7805(f), these temporary regulations will be
submitted to the Chief Counsel for Advocacy of the Small Business
Administration for comment on their impact on small business.
V. Unfunded Mandates Reform Act
Section 202 of the Unfunded Mandate Reform Act of 1995 requires
that agencies assess anticipated costs and benefits and take certain
other actions before issuing a final rule that includes any Federal
mandate that may result in expenditures in any one year by a state,
local, or tribal government, in the aggregate, or by the private
sector, of $100 million in 1995 dollars (updated annually for
inflation). These temporary regulations do not include any Federal
mandate that may result in expenditures by state, local, or tribal
governments, or by the private sector in excess of that threshold.
VI. Executive Order 13132: Federalism
Executive Order 13132 (Federalism) prohibits an agency from
publishing any rule that has federalism implications if the rule either
imposes substantial, direct compliance costs on state and local
governments, and is not required by statute, or preempts state law,
unless the agency meets the consultation and funding requirements of
section 6 of the Executive Order. These temporary regulations do not
have federalism implications and do not impose substantial, direct
compliance costs on state and local governments or preempt state law
within the meaning of the Executive Order.
VII. Executive Order 12866
Pursuant to the Memorandum of Agreement, Review of Treasury
Regulations under Executive Order 12866 (June 9, 2023), tax regulatory
actions issued by the IRS are not subject to the requirements of
section 6 of Executive Order 12866, as amended. Therefore, a regulatory
impact assessment is not required.
VIII. Congressional Review Act
Pursuant to the Congressional Review Act (5 U.S.C. 801 et seq.),
the Office of Information and Regulatory Affairs designated this rule
as a major rule as defined by 5 U.S.C. 804(2). For good cause pursuant
to 5 U.S.C. 808(2), see part I of this Special Analyses section.
Drafting Information
The principal author of this temporary regulation is Lani M.
Sinfield, Office of the Associate Chief Counsel (Passthroughs and
Special Industries), IRS. However, other personnel from the Treasury
Department and the IRS participated in their development.
List of Subjects in 26 CFR Part 1
Income taxes, Reporting and recordkeeping requirements.
Amendments to the Regulations
Accordingly, the Treasury Department and the IRS amend 26 CFR part
1 as follows:
PART 1--INCOME TAXES
0
Paragraph. 1. The authority citation for part 1 is amended by adding
the following entries in numerical order to read in part as follows:
Authority: 26 U.S.C. 7805 * * *
* * * * *
[[Page 40092]]
Section 1.48D-6T also issued under 26 U.S.C. 48D(d)(2)(E) and
(6) * * *
* * * * *
Section 1.6417-5T also issued under 26 U.S.C. 6417(d)(5) and (h)
* * *
Section 1.6418-4T also issued under 26 U.S.C. 6418(g)(1) and (h)
* * *
* * * * *
0
Par. 2. Section 1.48D-6T is added to read as follows:
Sec. 1.48D-6T Elective payment election.
(a) [Reserved]
(b) Pre-filing registration required--(1) In general. Pre-filing
registration by any taxpayer (including a partnership or an S
corporation) in accordance with this paragraph (b) is a condition that
must be successfully completed prior to making an elective payment
election under section 48D(d)(1) and this section with respect to
qualified property placed in service by the taxpayer as part of an
advanced manufacturing facility of an eligible taxpayer. An elective
payment election will not be effective with respect to the section 48D
credit determined with respect to any such qualified property placed in
service by any taxpayer unless the taxpayer received a valid
registration number for the taxpayer's qualified investment in the
advanced manufacturing facility of an eligible taxpayer in accordance
with this paragraph (b) and provided the registration number for each
qualified investment in each advanced manufacturing facility on its
Form 3800, General Business Credit, attached to the tax return in
accordance with guidance. For purposes of this section, the term
guidance means guidance published in the Federal Register or Internal
Revenue Bulletin, as well as administrative guidance such as forms,
instructions, publications, or other guidance on the <a href="http://IRS.gov">IRS.gov</a> website.
See Sec. Sec. 601.601 and 601.602 of this chapter. However, completion
of the pre-filing registration requirements and receipt of a
registration number does not, by itself, mean the taxpayer is eligible
to receive a payment with respect to any section 48D credit determined
with respect to the qualified property.
(2) Manner of registration. Unless otherwise provided in guidance,
a taxpayer must complete the pre-filing registration process
electronically through the IRS electronic portal and in accordance with
the instructions provided therein.
(3) Members of a consolidated group. A member of a consolidated
group is required to complete pre-filing registration as a condition
of, and prior to, making an elective payment election. See Sec.
1.1502-77 (providing rules regarding the status of the common parent as
agent for its members).
(4) Timing of pre-filing registration. A taxpayer must satisfy the
pre-filing registration requirements of this paragraph (b) and receive
a registration number under paragraph (b)(6) of this section prior to
making any elective payment election under this section on the
taxpayer's tax return for the taxable year at issue.
(5) Each qualified investment in an advanced manufacturing facility
must have its own registration number. A taxpayer must obtain a
registration number for each qualified investment in an advanced
manufacturing facility of an eligible taxpayer with respect to which an
elective payment election is made.
(6) Information required to complete the pre-filing registration
process. Unless modified in future guidance, a taxpayer must provide
the following information to the IRS to complete the pre-filing
registration process:
(i) The taxpayer's general information, including its name,
address, taxpayer identification number, and type of legal entity;
(ii) Any additional information required by the IRS electronic
portal;
(iii) The taxpayer's taxable year, as determined under section 441
of the Code;
(iv) The type of annual return(s) normally filed by the taxpayer
with the IRS;
(v) A list of each qualified investment in an advanced
manufacturing facility that the taxpayer intends to use to determine a
section 48D credit for which the taxpayer intends to make an elective
payment election;
(vi) For each qualified investment in an advanced manufacturing
facility listed in paragraph (b)(5)(v) of this section, any further
information required by the IRS electronic portal, such as--
(A) The type of qualified investment in the advanced manufacturing
facility;
(B) Physical location (that is, address and coordinates (longitude
and latitude) of the advanced manufacturing facility);
(C) Any supporting documentation relating to the construction,
reconstruction or acquisition of the advanced manufacturing facility
(such as, State and local government permits to operate the advanced
manufacturing facility, certifications, and evidence of ownership that
ties to the land deed, lease, or other documented right to use and
access any land upon which the advanced manufacturing facility is
constructed or housed);
(D) The beginning of construction date and the placed in service
date of any qualified property that is part of the advanced
manufacturing facility;
(E) The source of funds the taxpayer used to acquire the qualified
property with respect to which the qualified investment was made; and
(F) Any other information that the taxpayer or entity believes will
help the IRS evaluate the registration request;
(vii) The name of a contact person for the taxpayer. The contact
person is the person whom the IRS may contact if there is an issue with
the registration. The contact person must either possess legal
authority to bind the taxpayer or must provide a properly executed
power of attorney on Form 2848, Power of Attorney and Declaration of
Representative;
(viii) A penalties of perjury statement, effective for all
information submitted as a complete application, and signed by a person
with personal knowledge of the relevant facts that is authorized to
bind the registrant; and
(ix) Any other information the IRS deems necessary for purposes of
preventing duplication, fraud, improper payments, or excessive payments
under this section that is provided in guidance.
(7) Registration number--(i) In general. The IRS will review the
information provided and will issue a separate registration number for
each qualified investment in an advanced manufacturing facility of an
eligible taxpayer for which the taxpayer making the registration
provided sufficient verifiable information.
(ii) Registration number is only valid for one year. A registration
number is valid only with respect to the taxpayer that obtained the
registration number under this section and only for the taxable year
for which it is obtained.
(iii) Renewing registration numbers. If an elective payment
election will be made with respect to any section 48D credit determined
with respect to a qualified investment in an advanced manufacturing
facility for a taxable year after a registration number under this
section has been obtained, the taxpayer must renew the registration for
that subsequent year in accordance with applicable guidance, including
attesting that all the facts previously provided are still correct or
updating any facts.
(iv) Amendment of previously submitted registration information if
a change occurs before the registration number is used. As provided in
instructions to the pre-filing registration portal, if specified
changes occur with respect to a qualified investment in an advanced
manufacturing facility for which a registration number has been
previously obtained, a taxpayer must
[[Page 40093]]
amend the registration (or may need to submit a new registration) to
reflect these new facts. For example, if an eligible taxpayer that is
the owner of an advanced manufacturing facility previously registered
for an elective payment election for a section 48D credit determined
with respect to that advanced manufacturing facility and the advanced
manufacturing facility undergoes a change of ownership (incident to a
corporate reorganization or an asset sale) such that the new owner has
a different employer identification number (EIN) than the owner who
obtained the original registration, the original owner of the advanced
manufacturing facility must amend the original registration to
disassociate its EIN from the advanced manufacturing facility and the
new owner must submit separately an original registration (or if the
new owner previously registered other qualified investments or advanced
manufacturing facilities, must amend its original registration) to
associate the new owner's EIN with the previously registered advanced
manufacturing facility.
(v) Registration number is required to be reported on the return
for the taxable year of the elective payment election. The taxpayer
must include the registration number of the qualified investment in the
advanced manufacturing facility on the taxpayer's return as provided in
paragraph (b) of this section for the taxable year. The IRS will treat
an elective payment election as ineffective with respect to a section
48D credit determined with respect to a qualified investment in an
advanced manufacturing facility for which the taxpayer does not include
a valid registration number on the annual return.
(c)-(i) [Reserved]
(j) Applicability date for pre-filing registration requirements.
The requirements of paragraph (b) of this section apply to property
placed in service on or after December 31, 2022, and during a taxable
year ending on or after June 21, 2023.
(k) Expiration date. The applicability of paragraph (b) of this
section expires on June 12, 2026.
0
Par. 3. Section 1.6417-5T is added to read as follows:
Sec. 1.6417-5T Additional information and registration.
(a) Pre-filing registration and election. An applicable entity or
electing taxpayer is required to satisfy the pre-filing registration
requirements in paragraph (b) of this section as a condition of, and
prior to, making an elective payment election. An applicable entity or
electing taxpayer must use the pre-filing registration process to
register itself as intending to make the elective payment election, to
list all applicable credits it intends to claim, and to list each
applicable credit property that contributed to the determination of
such credits as part of the pre-filing submission (or amended
submission). An applicable entity or electing taxpayer that does not
obtain a registration number under paragraph (c)(1) of this section or
report the registration number on its annual tax return, as defined in
Sec. 1.6417-1(b), pursuant to paragraph (c)(5) of this section with
respect to an otherwise applicable credit property, is ineligible to
receive any elective payment amount with respect to the amount of any
credit determined with respect to that applicable credit property.
However, completion of the pre-filing registration requirements and
receipt of a registration number does not, by itself, mean the
applicable entity or electing taxpayer is eligible to receive a payment
with respect to the applicable credits determined with respect to the
applicable credit property.
(b) Pre-filing registration requirements--(1) Manner of pre-filing
registration. Unless otherwise provided in guidance, an applicable
entity or electing taxpayer must complete the pre-filing registration
process electronically through the IRS electronic portal and in
accordance with the instructions provided therein.
(2) Pre-filing registration and election for members of a
consolidated group. A member of a consolidated group is required to
complete pre-filing registration as a condition of, and prior to,
making an elective payment election. See Sec. 1.1502-77 (providing
rules regarding the status of the common parent as agent for its
members).
(3) Timing of pre-filing registration. An applicable entity or
electing taxpayer must satisfy the pre-filing registration requirements
of this paragraph (b) and receive a registration number under paragraph
(c) of this section prior to making an elective payment election under
Sec. 1.6417-2(b) on the applicable entity's or electing taxpayer's
annual tax return for the taxable year at issue.
(4) Each applicable credit property must have its own registration
number. An applicable entity or electing taxpayer must obtain a
registration number for each applicable credit property with respect to
which it intends to make an elective payment election.
(5) Information required to complete the pre-filing registration
process. Unless modified in future guidance, an applicable entity or
electing taxpayer must provide the following information to the IRS to
complete the pre-filing registration process:
(i) The applicable entity's or electing taxpayer's general
information, including its name, address, taxpayer identification
number, and type of legal entity.
(ii) Any additional information required by the IRS electronic
portal, such as information regarding the taxpayer's exempt status
under section 501(a) of the Code; that the applicable entity is a
political subdivision of a State, the District of Columbia, an Indian
Tribal government, or a U.S territory; or that the applicable entity is
an agency or instrumentality of a State, the District of Columbia, an
Indian Tribal government, or a U.S. territory.
(iii) The taxpayer's taxable year, as determined under section 441
of the Code.
(iv) The type of annual tax return(s) normally filed by the
applicable entity or electing taxpayer, or that the applicable entity
or electing taxpayer does not normally file an annual tax return with
the IRS.
(v) The type of applicable credit(s) for which the applicable
entity or electing taxpayer intends to make an elective payment
election.
(vi) For each applicable credit, each applicable credit property
that the applicable entity or electing taxpayer intends to use to
determine the credit for which the applicable entity or electing
taxpayer intends to make an elective payment election.
(vii) For each applicable credit property listed in paragraph
(b)(4)(vi) of this section, any further information required by the IRS
electronic portal, such as--
(A) The type of applicable credit property;
(B) Physical location (that is, address and coordinates (longitude
and latitude) of the applicable credit property);
(C) Any supporting documentation relating to the construction or
acquisition of the applicable credit property (such as State, District
of Columbia, Indian Tribal, U.S. territorial, or local government
permits to operate the applicable credit property; certifications;
evidence of ownership that ties to a land deed, lease, or other
documented right to use and access any land or facility upon which the
applicable credit property is constructed or housed; U.S. Coast Guard
registration numbers for offshore wind vessels; and the vehicle
identification number of an
[[Page 40094]]
eligible clean vehicle with respect to which a section 45W credit is
determined);
(D) The beginning of construction date and the placed in service
date of the applicable credit property;
(E) If an investment-related credit property (as defined Sec.
1.6417-2(c)(3)), the source of funds the taxpayer used to acquire the
property; and
(F) Any other information that the applicable entity or electing
taxpayer believes will help the IRS evaluate the registration request.
(viii) The name of a contact person for the applicable entity or
electing taxpayer. The contact person is the person whom the IRS may
contact if there is an issue with the registration. The contact person
must either possess legal authority to bind the applicable entity or
electing taxpayer or must provide a properly executed power of attorney
on Form 2848, Power of Attorney and Declaration of Representative.
(ix) A penalties of perjury statement, effective for all
information submitted as a complete application, and signed by a person
with personal knowledge of the relevant facts that is authorized to
bind the registrant.
(x) Any other information the IRS deems necessary for purposes of
preventing duplication, fraud, improper payments, or excessive payments
under this section that is provided in guidance.
(c) Registration number--(1) In general. The IRS will review the
information provided and will issue a separate registration number for
each applicable credit property for which the applicable entity or
electing taxpayer provided sufficient verifiable information.
(2) Registration number is only valid for one taxable year. A
registration number is valid only with respect to the applicable entity
or electing taxpayer that obtained the registration number under this
section and only for the taxable year for which it is obtained.
(3) Renewing registration numbers. If an elective payment election
will be made with respect to an applicable credit property for a
taxable year after a registration number under this section has been
obtained, the applicable entity or electing taxpayer must renew the
registration for that subsequent taxable year in accordance with
applicable guidance, including attesting that all the facts previously
provided are still correct or updating any facts.
(4) Amendment of previously submitted registration information if a
change occurs before the registration number is used. As provided in
instructions to the pre-filing registration portal, if specified
changes occur with respect to one or more applicable credit properties
for which a registration number has been previously obtained but not
yet used, an applicable entity or electing taxpayer must amend the
registration (or may need to submit a new registration) to reflect
these new facts. For example, if the owner of a facility previously
registered for an elective payment election for applicable credits
determined with respect to that facility and the facility undergoes a
change of ownership (incident to a corporate reorganization or an asset
sale) such that the new owner has a different employer identification
number (EIN) than the owner who obtained the original registration, the
original owner of the facility must amend the original registration to
disassociate its EIN from the applicable credit property and the new
owner must submit separately an original registration (or if the new
owner previously registered other credit properties, must amend its
original registration) to associate the new owner's EIN with the
previously registered applicable credit property.
(5) Registration number is required to be reported on the return
for the taxable year of the elective payment election. The applicable
entity or electing taxpayer must include the registration number of the
applicable credit property on its annual tax return as provided in
Sec. 1.6417-2(b) for the taxable year. The IRS will treat an elective
payment election as ineffective with respect to an applicable credit
determined with respect to an applicable credit property for which the
applicable entity or electing taxpayer does not include a valid
registration number on the annual tax return.
(d) Applicability date. This section applies to taxable years
ending on or after June 21, 2023.
(e) Expiration date. The applicability of this section expires on
June 12, 2026.
0
Par. 4. Section 1.6418-4T is added to read as follows:
Sec. 1.6418-4T Additional information and registration.
(a) Pre-filing registration and election. As a condition of, and
prior to, any specified credit portion being transferred by an eligible
taxpayer to a transferee taxpayer pursuant to an election under Sec.
1.6418-2, or a specified credit portion being transferred by a
partnership or S corporation pursuant to Sec. 1.6418-3, the eligible
taxpayer is required to satisfy the pre-filing registration
requirements in paragraph (b) of this section. An eligible taxpayer
that does not obtain a registration number under paragraph (c)(1) of
this section, and report the registration number on its return pursuant
to paragraph (c)(5) of this section, is ineligible to make a transfer
election for a specified credit portion under Sec. 1.6418-2 or Sec.
1.6418-3, with respect to the eligible credit determined with respect
to the specific eligible credit property for which the eligible
taxpayer has failed to obtain and report a registration number.
However, completion of the pre-filing registration requirements and
receipt of a registration number does not, by itself, mean the eligible
taxpayer is eligible to transfer any specified credit portion
determined with respect to the eligible credit property.
(b) Pre-filing registration requirements--(1) Manner of pre-filing
registration. Unless otherwise provided in guidance, eligible taxpayers
must complete the pre-filing registration process electronically
through an IRS electronic portal and in accordance with the
instructions provided therein.
(2) Pre-filing registration and election for members of a
consolidated group. A member of a consolidated group is required to
complete pre-filing registration to transfer any eligible credit
determined with respect to the member. See Sec. 1.1502-77 (providing
rules regarding the status of the common parent as agent for its
members).
(3) Timing of pre-filing registration. An eligible taxpayer must
satisfy the pre-filing registration requirements of this paragraph (b)
and receive a registration number under paragraph (c) of this section
prior to making a transfer election under Sec. 1.6418-2 or Sec.
1.6418-3 for a specified credit portion on the taxpayer's return for
the taxable year at issue.
(4) Each eligible credit property must have its own registration
number. An eligible taxpayer must obtain a registration number for each
eligible credit property with respect to which a transfer election of a
specified credit portion is made.
(5) Information required to complete the pre-filing registration
process. Unless modified in future guidance, an eligible taxpayer is
required to provide the following information to the IRS to complete
the pre-filing registration process:
(i) The eligible taxpayer's general information, including its
name, address, taxpayer identification number, and type of legal
entity;
(ii) Any additional information required by the IRS electronic
portal,
[[Page 40095]]
such as information establishing that the entity is an eligible
taxpayer;
(iii) The taxpayer's taxable year, as determined under section 441;
(iv) The type of annual tax return(s) normally filed by the
eligible taxpayer, or that the eligible taxpayer does not normally file
an annual tax return with the IRS;
(v) The type of eligible credit(s) for which the eligible taxpayer
intends to make a transfer election;
(vi) Each eligible credit property that the eligible taxpayer
intends to use to determine a specified credit portion for which the
eligible taxpayer intends to make a transfer election;
(vii) For each eligible credit property listed in paragraph
(b)(4)(vi) of this section, any further information required by the IRS
electronic portal, such as--
(A) The type of eligible credit property;
(B) Physical location (that is, address and coordinates (longitude
and latitude) of the eligible credit property);
(C) Any supporting documentation relating to the construction or
acquisition of the eligible credit property (such as State, Indian
Tribal, or local government permits to operate the eligible credit
property, certifications, evidence of ownership that ties to a land
deed, lease, or other documented right to use and access any land or
facility upon which the eligible credit property is constructed or
housed, and U.S. Coast Guard registration numbers for offshore wind
vessels);
(D) The beginning of construction date, and the placed in service
date of the eligible credit property; and
(E) Any other information that the eligible taxpayer believes will
help the IRS evaluate the registration request;
(viii) The name of a contact person for the eligible taxpayer. The
contact person is the person whom the IRS may contact if there is an
issue with the registration. The contact person must either possess
legal authority to bind the eligible taxpayer, or must provide a
properly executed power of attorney on Form 2848, Power of Attorney and
Declaration of Representative;
(ix) A penalties of perjury statement, effective for all
information submitted as a complete application, and signed by a person
with personal knowledge of the relevant facts that is authorized to
bind the registrant; and
(x) Any other information the IRS deems necessary for purposes of
preventing duplication, fraud, improper payments, or excessive payments
under this section that is provided in guidance.
(c) Registration number--(1) In general. The IRS will review the
registration information provided and will issue a separate
registration number for each eligible credit property for which the
eligible taxpayer provided sufficient verifiable information.
(2) Registration number is only valid for one taxable year. A
registration number is valid to an eligible taxpayer only for the
taxable year in which the credit is determined for the eligible credit
property for which the registration is completed, and for a transferee
taxpayer's taxable year in which the eligible credit is taken into
account under Sec. 1.6418-2(f).
(3) Renewing registration numbers. If an election to transfer an
eligible credit will be made with respect to an eligible credit
property for a taxable year after a registration number under this
section has been obtained, the eligible taxpayer must renew the
registration for that subsequent taxable year in accordance with
applicable guidance, including attesting that all the facts previously
provided are still correct or updating any facts.
(4) Amendment of previously submitted registration information if a
change occurs before the registration number is used. As provided in
instructions to the pre-filing registration portal, if specified
changes occur with respect to one or more applicable credit properties
for which a registration number has been previously obtained but not
yet used, an eligible taxpayer must amend the registration (or may need
to submit a new registration) to reflect these new facts. For example,
if the owner of a facility previously registered for a transfer
election under Sec. 1.6418-2 or Sec. 1.6418-3 for eligible credits
determined with respect to that facility and the facility undergoes a
change of ownership (incident to a corporate reorganization or an asset
sale) such that the new owner has a different employer identification
number (EIN) than the owner who obtained the original registration, the
original owner of the facility must amend the original registration to
disassociate its EIN from the eligible credit property and the new
owner must submit separately an original registration (or if the new
owner previously registered other credit properties, must amend its
original registration) to associate the new owner's EIN with the
previously registered eligible credit property.
(5) Reporting of registration number by an eligible taxpayer and a
transferee taxpayer--(i) Eligible taxpayer reporting. As part of making
a valid transfer election under Sec. 1.6418-2 or Sec. 1.6418-3, an
eligible taxpayer must include the registration number of the eligible
credit property on the eligible taxpayer's return (as provided in Sec.
1.6418-2(b) or Sec. 1.6418-3(d)) for the taxable year the specified
credit portion was determined. The IRS will treat an election as
ineffective if the eligible taxpayer does not include a valid
registration number on the return.
(ii) Transferee taxpayer reporting. A transferee taxpayer must
report the registration number received (as part of the transfer
election statement as described in Sec. 1.6418-2(b) or otherwise) from
a transferor taxpayer on the Form 3800, General Business Credit, as
part of the return for the taxable year that the transferee taxpayer
takes the transferred specified credit portion into account. The
specified credit portion will be disallowed to the transferee taxpayer
if the transferee taxpayer does not include the registration number on
the return.
(d) Applicability date. This section applies to taxable years
ending on or after June 21, 2023.
(e) Expiration date. The applicability of this section expires on
June 12, 2026.
Douglas W. O'Donnell,
Deputy Commissioner for Services and Enforcement.
Approved: June 5, 2023.
Lily Batchelder,
Assistant Secretary of the Treasury (Tax Policy).
[FR Doc. 2023-12797 Filed 6-14-23; 11:15 am]
BILLING CODE 4830-01-P
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</html>Indexed from Federal Register on June 21, 2023.
This is legal information, not legal advice. Laws vary by jurisdiction and change frequently. Always verify current law with official sources and consult a licensed attorney in your jurisdiction for advice on your specific situation.