In 2022, President Biden signed into law the Inflation Reduction Act (IRA). IRA provides up to $1.2 trillion in tax credits to accelerate the transition to clean energy technologies. This includes $380 billion in tax credits for companies, agencies and individuals purchasing electric vehicles and installing electric charging equipment.
The IRA also included two key innovations:
Transferability - taxpayers can sell tax credits for cash to entities with tax obligations.
Direct Pay - Tax-exempt entities can receive the value of the tax credits as a direct payment from the IRS.