Section 48 ITC Due Diligence Guide

Transferable tax credits are sold at a discount to face value, providing attractive financial benefits to corporate investors. They are not without risk, however, and tax credit buyers should have a clear sense of how to identify, track, and mitigate relevant risks.

This due diligence checklist and documentation guide gives tax credit buyers, sellers, and their respective advisors a set of shared expectations on the required analysis and documentation for §48 investment tax credits.

The guide covers:

• Major deal participants
• Seller/sponsor diligence
• Structure diligence
• Qualification
• Recapture
• Prevailing wage and apprenticeship compliance/exemption
• Bonus credits
• Tax credit insurance

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