IRS to Create Process for Exempt Groups to File for Tax Credits

The IRS plans to develop a filing process for governments and tax-exempt organizations that plan to use the direct-pay tax credit option included in President Joe Biden’s tax-and-climate law, an official said Tuesday.

State and local governments and exempt organizations will be able to monetize tax credits starting in 2023 by electing to treat specific tax credits as refundable payments.

The agency is working to create a filing regime for groups that choose direct pay, Edward Killen, deputy commissioner of the Tax Exempt & Government Entities division at the IRS, said at a conference hosted by the American Institute of ...