Elective Pay & IRA Tax Incentives Resources Page -
Another Way to Help Pay for Your Clean Energy Projects
Updated October 20, 2025
Navigating the Inflation Reduction Act (IRA) and its Elective Pay and clean energy credit provisions can feel like learning a new language. We know you have important clean energy projects to launch, and you need clear, reliable information to access these credits, and help keeping track of changes and guidance, which is why we cut through the complexity so you can focus on building your project.
This resource page provides you with straightforward and practical resources on Elective Pay and the clean energy credits - from hands-on forms and L4GG analysis, to official IRS guidance and guidance from partners - so that you have the resources and support you need to learn about Elective Pay, plan for your project to ensure you meet the requirements of the clean energy credits, or to get started with pre-filing registration and filing a tax return to secure your tax credits.
If You Need Background on Elective Pay and the Credits, Start Here
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Elective Pay (also known as Direct Pay) is a game-changer for entities that don’t owe federal income tax. Elective Pay is not a tax credit itself; it’s a mechanism that allows tax-exempt entities (including nonprofits, local governments, and schools) to receive the value of certain IRA clean energy tax credits as a direct cash payment from the IRS. This is crucial because tax-exempt organizations can access these incentives, which can significantly reduce project costs (in some cases up to 70% back) and fund more clean energy work.
Which Clean Energy Tax Credits are Eligible for Elective Pay?
The investment tax credits or “ITC” - for solar, wind, geothermal, and other projects
Clean electricity investment tax credit under Section 48E
Energy credit under Section 48
The production tax credits or “PTC” - for solar, wind, geothermal, and other projects
Clean electricity production tax credit under Section 45Y
Renewable electricity tax credit under under Section 45
Alternative fuel vehicle refueling property credit under Section 30C for electric vehicle (EV) charging, EV supply equipment, and other projects
Commercial clean vehicle credit under Section 45W for certain EV purchases (purchased before October 1, 2025)
Credit for ground-source heat pumps under Section 48
And more!
What is the Process to File Once I’ve Completed My Project?
Using Elective Pay, tax exempt-entities can receive cash after completing a geothermal, solar, wind, energy storage, or other eligible clean energy project. Once your project is placed into service, you need to follow a two-step process to receive tax credits:
Complete a mandatory Elective Pay pre-filing registration with the IRS for the project to receive a unique registration number for each property or facility.
Use that number to complete and file the appropriate tax returns and claim your clean energy tax credit.
Important Alert: The Time to Act is NOW
Recent legislation, H.R. 1 (also known as the “One Big Beautiful Bill Act,” enacted July 4, 2025), accelerates the phase out of many of the clean energy tax credits eligible for Elective Pay and adds new prohibited foreign entity rules to some of the credits that include limits on the sourcing of materials made by Chinese companies.
While Elective Pay itself remains intact after H.R. 1, the window of opportunity for tax-exempt entities to claim some of the clean energy tax credits is rapidly closing, so it is important to act before they expire.
If You Are ready to access Resources, Start here
We have organized over 100 resources into seven clearly labeled, collapsible sections. Click any heading to expand the section and view the full list of resources.
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Need to take action now? This essential section has the newest alerts, e-filing partners, and interactive navigators you need to start your project today.
Explore New Resources and Upcoming Events
10/29/2025 - Elective Pay Sprint Hub Office Hour: Let’s File! Key Steps to Pre-Filing Registration and Filing for Tax Credits.
Join the L4GG Elective Pay Sprint Hub: Need fast tracked assistance? Enroll in this structured program for targeted support to plan for your project, including financing and planning for the clean energy tax credits, and to complete pre-filing registration and tax filing steps quickly and accurately.
Check out our Elective Pay 101 Guide: Just starting out? This comprehensive guide covers the basics of Elective Pay eligibility, required forms, and how the process works, making it the ideal primer before diving into the detailed guidance below.
Explore the Clean Energy Tax Navigator: Not sure if your project qualifies? Use this interactive tool to quickly estimate your project’s eligibility for certain clean energy credits and Elective Pay and identify the specific tax credits you may be able to claim. The Navigator walks you through the requirements of the clean energy credits most commonly claimed through Elective Pay and provides helpful information.
Watch recorded trainings and slides on how to use the Clean Energy Tax Navigator| Watch L4GG and our partners walk through how to use the interactive tool. These training materials help you maximize the value of the Clean Energy Tax Navigator without any guesswork
E-File through Giraffe Financial: Ready to apply for your Elective Pay pre-filing registration? Or ready to electronically file your tax return to claim your credits? Access our trusted partners’ streamlined service to help you manage the required IRS submission process accurately and efficiently. Giraffe Financial can help you with all stages of the process.
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Cut through the complexity with our summaries. L4GG’s legal team translates dense regulations into clear, actionable fact sheets and guidance briefs.
Explore our Fact Sheets & Guidance Briefs:
Updates to Certain Elective Pay Eligible Credits under HR1 - (Current as of July 14, 2025)
Overview of the changes H.R. 1 made to the clean energy tax credits most commonly claimed through Elective Pay. Includes new termination dates and other changes.
Elective Pay Blueprints - (Current as of April 2025)
Easily digestible best practice guidelines to walk you through Elective Pay and the most commonly claimed clean energy credits (Sections 48, 48E, 45, 45Y, 45W, and 30C), written with our partners the Electrification Coalition, GFOA, and the World Resources Institute (WRI). This document also discusses the prevailing wage and apprenticeship requirements, the domestic content requirements, and the energy efficient commercial buildings deduction under Section 179D.
Note that it has not been updated for H.R. 1 changes.
Opportunities for State Agencies to Cut Costs with Federal Elective Pay Clean Energy Tax Credits - (Current as of June 20, 2025)
Best practices for states, discussing how to claim clean energy tax credits through Elective Pay, produced in collaboration with the Government Finance Officers Association (GFOA) and State Support Center (SSC)
Guidance Brief: Prohibited Foreign Entity Restrictions on Clean Energy Credits - (Current as of September 3, 2025).
Overview of the new prohibited foreign entity (PFE) restrictions imposed by H.R. 1 for the ITC and PTC under Sections 48E and 45Y, which look at whether the entity or project has certain ties to China, Russia, Iran, or North Korea. Entities are disallowed these credits if (1) they are deemed to be controlled or influenced by Chinese companies or various other kinds of foreign entities (the entity-level rules); (2) in the prior year they make certain payments to a specified foreign entity (the payment rules); or (3) they source a certain percentage of materials used in the facility or property from a PFE (the material assistance rules).
Guidance Brief: Beginning of Construction for the 48E & 45Y Tax Credits - (Current as of August 20, 2025)
Overview of the beginning of construction safe harbors and how they apply to the ITC and PTC under Sections 48E and 45Y, including the safe harbors for ensuring that your project begins construction in time for the new accelerated phase-out schedules for wind and solar under H.R. 1.
Guidance Brief: Beginning of Construction for Energy Credits Generally - (Current as of September 19, 2025)
Overview of the beginning of construction safe harbors generally for the clean energy credits.
Guidance Brief: Code Section 45W Credit for Qualified Commercial Clean Vehicles - (Current as of July 24, 2025)
Overview of the guidance for claiming the qualified commercial clean vehicle credit, which can be claimed for electric vehicle (EV) purchases.
Note that the qualified commercial clean vehicle credit is not available for vehicles purchased after October 1, 2025.
Guidance Brief: When is a Lease Actually Financing? (Current as of June 7, 2024)
Overview of financed EV ownership and eligibility for the qualified commercial clean vehicle credit.
Guidance Brief: PTC and ITC (Current as of July 1, 2024)
Overview and comparison of the PTC and ITC.
Overview of Bonus Incentives for ITC/PTC (Current as of July 12, 2024)
PTC/ITC-Eligible Technologies (Current as of July 1, 2024) and ITC-Eligible Projects (Current as of May 24, 2024)
Guidance Brief: Municipal Bond Haircuts (Current as of July 1, 2024)
Overview of the “municipal bond haircut” which is a reduction of the total credit amount of ITC or PTC if tax-exempt bonds are used to pay for the facility or property.
Guidance Brief: “No Excess Benefit” Rule (Current as of June 29, 2024) and Restricted vs. Unrestricted Funds (Current as of July 1, 2024)
Overview of the “no excess benefit” rule which provides that for certain investment credits (including ITC, Section 30C credit, and Section 45W credit) the amount of the restricted funds plus the clean energy tax credit cannot exceed the cost of the facility or property.
Also an overview of when funds are “restricted.”
Guidance Brief: Low-Income Communities Bonus (LICB) 2025 - (Current as of January 14, 2025)
Overview of the LICB, which is a bonus credit or “adder” that can increase the amount of your ITC. Unlike other credits, you have to apply for a LICB allocation award before the project is placed in service.
2025 Program Year applications open as of January 16, 2025 (9am ET)
Program capacity dashboard will be available after February 14, 2025
Guidance Brief: Prevailing Wage & Apprenticeship (PWA) Requirements (Current as of August 27, 2024)
Overview of the PWA requirements that apply to most clean energy credits and how to comply, including practical guidance and best practices.
Guidance Brief: RFP Language for Prevailing Wage and Domestic Content (Current as of December 12, 2024)
Assists entities with drafting Requests for Proposal/Requests for Qualification that account for the PWA and domestic content requirements imposed on certain clean energy credits.
Guidance Brief: Identifying Filing Deadlines & Applicable Tax Year - (Current as of June 25, 2025)
Overview of determining your taxable year (fiscal year vs. calendar year) and Elective Pay tax return filing deadlines.
Alert: May 15 Filing Deadline and Extension Process - (Current as of September 23, 2025)
Overview of the May 15 filing deadline for calendar year entities and the process to request a 6-month filing extension for your Elective Pay tax returns.
Guidance Brief: E-Filing vs. Paper Filing (Current as of October 28, 2024)
Discusses electronic filing and paper filing (when available) options for filing Elective Pay tax returns.
Guidance Brief: Elective Pay Refund Status - (Current as of February 21, 2025)
Information on how to contact the IRS about the status of your Elective Pay refund.
Guidance Brief: Elective Pay Documentation Checklist (Current as of September 16, 2024)
High level overview with examples of the types of documents that entities should retain to substantiate clean energy credits claimed through Elective Pay.
Guidance Brief: Executive Orders and Protecting Your Federal Funding - (Current as of January 29, 2025)
Overview of the impact of Executive Orders on grants and tax credits and steps entities can take to protect themselves
Guidance Brief: 501(c)(3) Tax Exempt Status Protection - (Current as of April 21, 2025)
Overview of how to protect your section 501(c)(3) status and what the process looks like if your organization’s section 501(c)(3) status is questioned.
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Access Annotated Tax Forms (link to Annotated Tax Forms)
Use the Electric Vehicle Purchases Worksheet
Complete the Electric Vehicle Infrastructure Worksheet (non-urban and low-income only)
View the EV Infrastructure Map - 30C Tax Credit Eligibility Locator Map from DOE
Use the ITC/PTC Project Worksheets
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Prefer to learn by watching? Dive into our full archive of recorded video trainings, slide decks, and detailed Q&A sessions from L4GG and its partners.
Note that webinar videos and slides created before July 2025 have not been updated with changes from H.R. 1.
L4GG & Partners Moving Forward with Elective Pay After H.R.1 - July 30, 2025
Access the slide deck and Q&A here.
L4GG/WRI/GFOA Integrating Elective Pay Tax Credits into Government Procurement and RFPs - December 10, 2024
Slide deck (hosted by WRI)
L4GG/WRI/GFOA/USDN Webinar: Demystifying the Elective Pay Process (video) - April 18, 2024
Slide deck (with hyperlinks to resources)
L4GG’s accredited Continuing Legal Education (CLE): Maximizing Elective Pay Payments to Cities Under the Inflation Reduction Act
Free with the purchase code 2024L4GG
CPCC w/ L4GG: Cash for Communities (video) - May 9, 2024
L4GG/WRI/GFOA/USDN/SSDN: Slide decks for SSDN - May 1, 2024
L4GG/WRI/GFOA/USDN Demystifying the Elective Pay Process (video) - April 18, 2024
Slide deck (with hyperlinks to resources)
L4GG/CAP/NLC/BGA How Cities Can Take Advantage of Direct Pay (video) - Jan. 2024
Slide deck (with hyperlinks to resources)
L4GG’s Direct Pay Overview Webinar - August 2023
L4GG/Sabin Center Presentation to Local Governments - October 24, 2023
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Looking for peer-tested advice? Find high-quality insights and legal analysis from trusted partner organizations and industry experts.
Articles from L4GG Partners
Analysis of Final Rule on Transferability - Tax Law Center at NYU
Analysis of §48/ITC Proposed Regulations - Wilson Sonsini
Domestic Content - Linklaters
Energy Communities Bonus - Linklaters
Low-Income Communities Bonus - Linklaters
Partner Resources
BlueGreen Alliance - Domestic Content Guidance for Developers
C40 Cities & Partners - Greenhouse Gas Reduction Fund Guidebook for Local Governments
Center for American Progress - Overview on Direct Pay and Transferability
Center for Public Enterprise - Tax Credit “Chaining” Brief
Clean Energy Group - Direct Pay Guide for Non-Profits, ITC for Non-Profits, Applying for IRA Bonuses, & Bonus Fact Sheets
Clean Energy States Alliance - Build America Buy America and Domestic Content: A Primer for the Greenhouse Gas Reduction Fund Solar for All Program
Clean Energy States Alliance - Low-Income Communities Bonus
Congressional Progressive Caucus Center - Livable Futures and Elective Pay Resources
Electrification Coalition - Elective Pay Resources
Government Finance Officers Association - IRA Implementation Resources
NYU School of Law - Making Cents of the IRA
Sabin Center - Proposed Regulations for Direct Pay Under the Inflation Reduction Act - Guidelines for Cities
Stanford Law School Lawyers for a Sustainable Economy
Initiative that matches nonprofits and startups working in the field of environmental sustainability with law firms providing pro bono legal services.
State Support Center - Direct Pay & Project Finance Memo for States, April 3, 2024
Wilson Sonsini - IRA Legal Resources
Wilson Sonsini - IRA Guidance Implementation Tracker
WRI - Bonus Mapper
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Ready for the law, straight from the source? Here are the final rules, official user guides, and FAQs issued directly by the IRS and U.S. Treasury.
IRS Office Hours for Elective Pay & Transferability of Clean Energy Credits through 2026.
Watch the IRS Video Walk-Through of Pre-Filing Registration Portal(web.archive.org version of defunct irs.gov page) | See a step-by-step video demonstration from the IRS showing exactly how to navigate and use the mandatory Pre-Filing Registration Portal.
Review the Pre-Filing Registration Tool User Guide (with screenshots), IRS Publication 5884 | Find detailed instructions on how to successfully complete the pre-filing registration required before claiming your credits.
Consult theIRS Energy Credits Online Permission Management User Guide (with screenshots), IRS Publication 5902 | Understand how to delegate access and manage permissions for consultants or third parties assisting with your filing.
Utilize the IRS Secure Messaging User Guide, IRS Publication 6025| Learn how to use the official secure channel provided by the IRS to safely exchange confidential information and receive official response to your filing questions.
Secure Messaging is recommended for questions on existing Pre-Filing Registrations as of Oct. 2024
You can also use secure messaging in the portal to ask about the refund status of a filed return.
Email for requesting technical assistance without a Pre-Filing Registration login: irs.elective.payment.or.transfer.of.credit@irs.gov
Review the IRS website (irs.gov) page covering a particular topic, including the following:
Clean fuel production credit under Section 45Z
And more! Use the search function on irs.gov to search for a particular topic or Form
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Financing is the first step. These databases and financial tools will help you find the capital and build a strong funding strategy for your project.
Explore our Federal Funding Resources Page
Use Center for Public Enterprises’ Interactive Financial Modeling Tool
Visit U.S. Department of Energy’s State Energy Financing Institutions (SEFI) Funding for State Programs
Access Wilson Sonsini’s Clean Energy Federal Funding Database and also check out their Climate Funding White Paper.
Explore the Greenhouse Gas Reduction Fund: Greenbanks, CDFIs, other Grant recipients under the Greenhouse Gas Reduction Fund (Solar for All Competition is currently open); 43 states have filed NOIs
Check Out EPA’s Climate Pollution Reduction Grant