Law tax

Podesta and IRS get to work on climate law tax incentives

The IRS wants your opinion.

The Treasury Department and the IRS announced on Wednesday that they want the public to intervene on the climate-related and renewable energy tax incentives included in the massive climate law signed into law in August.

The bulk of the climate and energy-related spending included in this law — $270 billion out of a total of nearly $370 billion — will be provided through tax incentives. That means the Treasury Department and the IRS — agencies not always associated with climate policy — will be at the center of implementing the law.

“While our agency has experience with existing tax credits for many clean energy activities, the Cut Inflation Act requires a large amount of innovative work in a short period of time,” Deputy Treasury Secretary Wally Adeyemo said Wednesday.

The ministry is preparing to roll out guidance and rules in the coming months “to implement tax revisions that will enable the transformation needed to make these investments happen,” he added, noting that it will be a sprint for the agency complies. .

“It’s a big responsibility, and the Treasury is ready to take it on,” Adeyemo said.

The Treasury Department’s request for comment on Wednesday covers issues such as incentives for power generation, homes and buildings; consumer car loans; and manufacturing credits, depending on a White House fact sheet.

“We’re asking the public questions that will ensure that these tax incentives will work for them,” said John Podesta, senior adviser to President Joe Biden who recently joined the White House to lead the implementation of the climate law.

Podesta outlined some of the questions the Biden administration wants to answer.

“If you are shopping for a used electric vehicle, how can you easily know if it is eligible for a tax credit?” he said. “Do we have the right tools in place to know that clean energy projects like solar and wind projects can get more support when they use materials made in the United States? And how can we ensure that legislated credit enhancements create good jobs by incentivizing promoters to pay the going wage and use registered apprenticeship programs? »

Getting answers, Podesta added, will require conversations with “people who don’t typically engage in detailed tax policy issues, including families, workers, new clean energy industries, and people living in communities of environmental justice”.

Podesta said the administration plans to reach specific communities, including disadvantaged communities, that could benefit from the law.

The administration hopes to get public comments by Nov. 4; the IRS fact sheet plans to review subsequent comments “to the extent possible.”

Correction: This story originally included an incorrect date for the enactment of the Climate Law.