WASHINGTON, D.C. — The Internal Revenue Service (IRS) has released Notice 2024-60 to provide initial guidance on the carbon oxide sequestration credit, which was significantly amended by the Inflation Reduction Act of 2022 (IRA).
This notice outlines the information required in a written document called the lifecycle analysis (LCA) report. Taxpayers must submit this report, along with necessary supporting information, to the IRS and the Department of Energy for review.
Before any tax credit can be determined, the IRS must approve the lifecycle analysis of greenhouse gas emissions documented in the LCA report. This approval process applies to carbon capture property placed in service on or after February 18, 2018.
The IRS’s approval of the LCA is a prerequisite for claiming the carbon oxide credit. This step ensures that the captured carbon meets the standards set by the IRS and Department of Energy.
For more details, taxpayers can visit the Inflation Reduction Act of 2022 page on IRS.gov.
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