The Service s Co-Balancing Act: Final Carbon Capture Credit Regulations Target Broad Taxpayer Implementation and Administrability Friday, January 8, 2021
Amid the headline-grabbing events of 6 January 2021, the U.S. Department of Treasury released final regulations under Code
1 Section 45Q. Code Section 45Q provides for a U.S. federal income tax credit at varying rates to taxpayers that participate in various aspects of the process of sequestering carbon oxide and disposing of it in secure geologic storage, use it as a tertiary injectant in a qualified enhanced oil or natural gas recovery project, or utilize it in certain processes.
The final regulations are broadly similar to the proposed regulations published in May of 2020, with revisions focused primarily on making the credit broadly available and as flexible and useful as reasonably possible for businesses of all sizes. By tying the final regulations to industry standards and well-known and understood regulatory