New IRS Guidance on Advanced Manufacturing Production Tax Credit Under the Inflation Reduction Act

Manufacturers are eligible for tax credits aimed at supporting manufacturing under IRC Section 45X. Recently, the IRS issued proposed regulations for claiming the Section 45X Advanced Manufacturing Production Tax Credit for producing specific components within the United States. Tax professionals must understand key provisions of the recent guidance, the interplay between 45X MPTC with other credits, and key considerations when determining which tax credit to utilize for manufacturers in light of the recent guidance.

The Inflation Reduction Act of 2022 established 45X MPTC and the "direct pay" option for tax credits under certain circumstances, the tax credit transfer regime, and other key items. The 45X MPTC provides tax credits for each eligible component domestically produced. However, projects cannot claim both the 45X MPTC and 48C credit, making the determination of which should be used a critical component to financing a project.

Listen as our panel discusses eligibility under Section 45X, recent IRS guidance and requirements, and other key items in determining the use of the Section 45X tax credit in light of recent IRS guidance.

1. Inflation Reduction Act of 2022 and impact on manufacturers
   1. In depth discussion of the various types of eligible components
2. Section 45X MPTC requirements and limitations
3. Key provisions of recent IRS guidance
   1. General rules and definitions
   2. Sales to unrelated persons
   3. Eligible components and credit values
   4. How the proposed regulations treat contract manufacturing arrangements
   5. Credits for critical minerals
   6. Direct pay
4. 45X vs. 48C; determining which is best under certain circumstances

The panel will discuss these and other key issues:

• Recent IRS guidance and key considerations and challenges for the Section 45X tax credit
• Areas of focus in determining the use of 45X MPTC vs. 48C ITC
• Navigating the application process
• Best practices for manufacturers

Learning Objectives

After completing this course, you will be able to:

• Recognize key tax provisions of the Inflation Reduction Act and the impact on manufacturers
• Understand the requirements and limitations of Section 45X MPTC
• Ascertain key considerations in determining the best circumstances for utilizing Section 45X vs. Section 48C tax credits
• Identify key issues and pitfalls to avoid when claiming the Section 45X MTPC

• Field of Study: Taxes
• Level of Knowledge: Intermediate
• Advance Preparation: None
• Teaching Method: Seminar/Lecture
• Delivery Method: Group-Internet (via computer)
• Attendance Monitoring Method: Attendance is monitored electronically via a participant's PIN and through a series of attendance verification prompts displayed throughout the program
• Prerequisite: Three years plus business or public firm experience at mid-level within the organization, preparing complex tax forms and schedules, supervising other preparers/accountants. Specific knowledge and understanding of practical guidance to avoid the most common and costly risk areas in corporate tax compliance, exemptions, deductions, net operating losses, utilizing various tax credits, and tax compliance.

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IRS Approved Provider

Strafford is an IRS-approved continuing education provider offering certified courses for Enrolled Agents (EA) and Tax Return Preparers (RTRP).