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Amit Kalra, PC is a partner in the Tax, Employee Benefits and Trusts and Estates Practice Group in the firm's Chicago office.

On May 28, 2020, the IRS proposed long-awaited regulations that address key areas of uncertainty in existing guidance for Internal Revenue Code Section 45Q (45Q) carbon capture and sequestration tax credits. Although some questions remain unanswered, the regulations are a significant step towards reducing regulatory uncertainty and fostering a functional market for 45Q credits. This article will focus on the regulations’ key takeaways for transaction structuring, while also highlighting technical clarifications of significant import for this nascent industry.
Continue Reading IRS Proposes Key Section 45Q Carbon Capture and Sequestration Regulations

Members of the Sheppard Mullin Energy, Infrastructure and Project Finance Team wrote an article published in the March 16, 2020 edition of Tax Notes Federal regarding the practical impacts on tax equity financing for renewable energy projects of a private letter ruling (“PLR”) published by the IRS in late 2019.  The PLR addressed normalization and loss disallowance rules applicable to public utilities.  These rules have posed significant challenges to public utilities that want to own renewable energy generation facilities, make efficient use of the tax benefits they provide (via the tax equity market) and recover their costs from ratepayers.

Continue Reading Walking the Path of Utilities’ Ownership of Wind and Solar