IRS Updates Guidance for Energy Community Bonus Tax Credit

The IRS updated the guidance taxpayers can use to see if they qualify for the energy community bonus tax credit.

Notice 2025-31 released Monday details the requirements taxpayers must meet under the statistical area and coal closures categories to claim the credit. The energy community bonus tax credit, part of the Democrats’ 2022 climate law called the Inflation Reduction Act, increases the clean electricity production and investment tax breaks for projects in areas impacted by the transition to renewable energy.

• The notice includes five appendixes to determine eligibility for the credit. It doesn’t include requirements related to claiming the tax ...