Direct Pay for Not-for-Profits
April 2, 2024
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The Inflation Reduction Act of 2022 (IRA) opened the direct pay program for not-for-profit or tax-exempt organizations to qualify for energy tax credits if they were investing in clean energy solutions. Before the IRA, there were clean energy tax credits available to tax-paying entities to take advantage of, but tax-exempt organizations couldn’t reap any benefits when choosing to invest in energy enhancements. The Internal Revenue Service (IRS) often releases new guidance on energy tax credits and incentives concerning not-for-profit and tax-exempt organizations, so it is imperative to stay updated to prevent incorrectly filed tax applications.
Host Amy Dosik, Not-For-Profit Tax Practice Leader at Cherry Bekaert is joined by special guests Martin Karamon, Tax Credits and Incentives Advisory Leader, Timothy Doran, Energy Tax Credits and Incentives Director, and David Mohimani, Tax Credits and Incentives Manager, to talk about the direct pay program for not-for-profit entities. As part of Cherry Bekaert’s Not-For-Profit podcast series, and the first episode in the energy tax credits and incentives mini-series, this episode covers:
- IRA overview
- Background on the direct pay program
- Energy tax credit eligibility
- New IRS final regulations
- Application process for energy tax credits
- Direct pay benefits
- Key discussion takeaways
Cherry Bekaert’s Energy Tax Credits and Incentives team assesses the eligibility of your organization to receive business energy tax credits and incentives, so you can receive the maximum monetary benefit allotted. If your business makes investments in clean energy advancements, then you may benefit from energy efficiency federal, state, and local energy tax credits and incentives. If you have any questions specific to your business needs, Cherry Bekaert’s Not-For-Profit group is available to discuss your situation with you.
Related Resources:
- IRS ERC Voluntary Disclosures Program
- Understanding IRS’ Voluntary Disclosures Program for Employee Retention Credit (ERC) Claims
- Analyzing the Impact: Tax Relief for American Families and Workers Act of 2024
- Factors to Consider When Seeking Cost Segregation and Section 179D Study Service Providers
- Understanding the Inflation Reduction Act and Other Energy Incentives