Tax News Update    Email this document    Print this document  

December 1, 2023

IRS issues guidance on excluded entity provision for clean vehicle credits

The Treasury Department and IRS have issued two pieces of guidance related to clean vehicle credits under IRC Section 30D. Under the excluded entity provision, clean vehicles do not qualify for the IRC Section 30D credit if the battery contains (1) components manufactured or assembled by a foreign entity of concern (FEOC) or (2) applicable critical minerals extracted, processed or recycled by an FEOC. The proposed regulations (REG-118492-23) would give definitions and other guidance to allow manufactures to determine whether the critical minerals or components contained in the battery comply with IRC Section 30D requirements. Revenue Procedure 2023-38 updates the procedures for qualified manufacturers to comply with reporting, certification and attestation requirements regarding the excluded entity provision.

Published by NTD’s Tax Technical Knowledge Services group; Andrea Ben-Yosef, legal editor