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Inflation Reduction Act 2022 Energy Tax Incentive Considerations
The Inflation Reduction Act of 2022 (P.L. 117-169; 8/16/22) could easily have been named the Energy Incentives Act of 2022. Over 20 provisions in the Act provide tax credits or special deductions to encourage the production and use of clean energy. The cost of these energy provisions over ten years is about $271 billion. In contrast, the ten-year revenue projection for the corporate AMT and one percent excise tax on certain stock buybacks is about $296 billion. Most of the energy credits are for businesses and are specialized such as for the production of clean hydrogen or sustainable aviation fuel or zero-emission nuclear power production. Four credits are designed for individuals including three revised credits and one entirely new one (§25E, Previously-owned clean vehicle credit). This article highlights key aspects of the credits and special energy provisions as a whole, offers tips for dealing with the complexities that exist in these IRA 2022 rules, and provides suggestions to help individuals obtain the greatest tax savings from the new and revised energy credits and rebates. A few charts are included to aid in understanding these credits.
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CURRENT EDITION
Leaving the United States, Part III: Dual Citizenship
In Part I of this three-part series, we discussed the implications and taxes for American expatriates. In Part II we turned our attention to renouncing citizenship. Here in Part III, we will consider the halfway point of dual citizenship. And as you would expect, taxes are a serious consideration.
Reflecting On Rothing
I have been dissatisfied with most of the articles that I have read about what I call Rothing, i.e. foregoing a deduction for retirement savings with the prospect of tax-free distributions in the future or taking the tax hit on a deferred account to convert it to a tax-free account. The articles generally have a pro-Roth bias. Suze Orman, for example, swears by Roths. They also tend to not have numbers in them. What I am going to do here is to reflect on the idea of Rothing and discuss what I see as some key numbers. I’m not going to dive deep into technical issues.
Considering a Historic Building for Your Business? These Tax Credits are Good News
Historic buildings make a beautiful location for doing business. Unfortunately, many of them may seem out of the price range of small business owners. But, that’s not necessarily the case. The state and federal governments have an interest in preserving these properties, and they are willing to give you tax credits for buying and restoring a historic building. The credits reimburse a large proportion of your restoration costs. This really is a great incentive to go for a building that will give your company a unique and professional feel.
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