This CLE course will guide energy counsel on key tax considerations and planning methods for solar energy facilities and developments. The panel will discuss federal and state tax issues, Inflation Reduction Act (IRA) issues impacting the solar industry, claiming the investment tax credit (ITC), depreciation and offsetting taxable income, ownership structuring issues, and other tax planning considerations.
Solar energy financing and development hinges on practical analysis of ownership structure and available tax planning techniques. Tax incentives create planning issues for developers and investors, requiring energy counsel to address various federal and state tax issues when advising clients.
Federal legislation incentivizes commercial and residential solar investment and development with the existing ITC. Maximizing the benefits of the ITC and other tax incentives is critical to solar energy transactions impacting an investor's desired return and exit along with amounts to be paid to developers. To reap these federal tax benefits, energy counsel must have in-depth knowledge of ITC requirements, the impact on a tax basis, depreciation rules, and fundamental ownership structures yielding the best tax benefits.
In addition to federal income tax issues, solar energy projects also raise state and local tax issues to consider. State tax incentives can be significant to the ownership structure, financing, and development of a solar energy project. Each state's tax system is different, especially concerning available incentives for renewable energy. Counsel must consider issues and challenges relating to choice of entity, sales and use taxes, property taxes, and excise taxes imposed by a state.
Listen as our panel discusses the federal and state tax issues facing solar energy financing and development, deal structures, and other tax planning considerations.
