26 C.F.R. § 1.45Q-0

Current through September 30, 2024

Section 1.45Q-0 - Table of Contents

This section lists the captions contained in §§ 1.45Q-1 through 1.45Q-5 .

§ 1.45Q-1 Credit for Carbon Oxide Sequestration.

(a) In general.

(b) Credit amount for carbon capture equipment originally placed in service before February 9, 2018.

(1) In general.

(2) Inflation adjustment.

(c) Credit amount for carbon capture equipment originally placed in service on or after February 9, 2018.

(d) Applicable dollar amount.

(1) Applicable dollar amount for any taxable year beginning in a calendar year after 2016 and before 2027 for qualified carbon oxide not used as a tertiary injectant or utilized.

(2) Applicable dollar amount for any taxable year beginning in a calendar year after 2026 for qualified carbon oxide not used as a tertiary injectant or utilized.

(3) Applicable dollar amount for any taxable year beginning in a calendar year after 2016 and before 2027 for qualified carbon oxide used as a tertiary injectant or utilized.

(4) Applicable dollar amount for any taxable year beginning in a calendar year after 2026 for qualified carbon oxide used as a tertiary injectant or utilized.

(e) Election to apply the $10 and $20 credit amounts in lieu of the applicable dollar amounts.

(f) Application of section 45Q for certain carbon capture equipment placed in service before February 9, 2018.

(g) Installation of additional carbon capture equipment.

(1) Allocation of section 45Q credits for facilities installing additional carbon capture equipment.

(2) Additional carbon capture equipment.

(3) New carbon capture equipment.

(4) Examples.

(i) Example 1.

(ii) Example 2.

(iii) Example 3.

(h) Eligibility for the section 45Q credit.

(1) Person to whom the section 45Q credit is attributable.

(i) Equipment placed in service before February 9, 2018.

(ii) Equipment placed in service on or after February 9, 2018.

(iii) Reporting.

(2) Contractually ensuring capture and disposal, injection, or utilization of qualified carbon oxide.

(i) Binding written contract.

(ii) Multiple binding written contracts permitted.

(iii) Contract provisions.

(iv) Pre-existing contracts.

(v) Reporting of contract information.

(vi) Relationship with election to allow section 45Q credit.

(3) Election to allow the section 45Q credit to another taxpayer.

(i) Example.

(ii) Time and manner of making election.

(iii) Annual election.

(iv) Required information.

(v) Requirements for section 45Q credit claimant.

(vi) Failure to satisfy reporting requirements.

(i) Applicability date.

§ 1.45Q-2 Definitions for Purposes of §§ 1.45Q-1 through 1.45Q-5 .

(a) Qualified carbon oxide.

(b) Recycled carbon oxide.

(c) Carbon capture equipment.

(1) Use of carbon capture equipment.

(2) Carbon capture equipment components.

(3) Single process train.

(d) Industrial facility.

(1) Exclusion.

(2) Industrial source.

(3) Manufacturing process.

(4) Examples.

(i) Example 1.

(ii) Example 2.

(e) Electricity generating facility.

(f) Direct air capture facility.

(g) Qualified facility.

(1) Emissions and capture requirements.

(2) Examples.

(i) Example 1.

(ii) Example 2.

(iii) Example 3.

(iv) Example 4.

(v) Example 5.

(3) Annualization of first-year and last-year qualified carbon oxide emission and/or capture amounts.

(i) In general.

(ii) Calculation.

(iii) Consequences.

(4) Election for applicable facilities.

(i) Applicable facility.

(ii) Time and manner of making election.

(iii) Retroactive credit revocations.

(5) Retrofitted qualified facility or carbon capture equipment (80/20 Rule).

(h) Qualified enhanced oil or natural gas recovery project.

(1) Application of §§ 1.43-2 and 1.43-3 .

(2) Required certification.

(3) Natural gas.

(4) Timely filing of petroleum engineer's certification.

(5) Carbon oxide injected in oil reservoir.

(6) Tertiary injectant.

(i) Section 45Q credit.

(j)Form 8933.

(k) Applicability date.

§ 1.45Q-3 Secure Geological Storage.

(a) In general.

(b) Requirements for secure geological storage.

(c) Documentation.

(d) Certification.

(e) Failure to submit complete documentation or certification.

(f) Applicability date.

§ 1.45Q-4 Utilization of Qualified Carbon Oxide.

(a) In general.

(b) Amount utilized.

(1) In general.

(2) Limitation.

(c) Lifecycle greenhouse gas emissions and lifecycle analysis (LCA).

(1) In general.

(2) LCA verification.

(3) Standards of adequate lifecycle analysis.

(4) Third-party independent review of LCA.

(5) Submission of the LCA.

(6) LCA review.

(d) Commercial market.

(e) Applicability date.

§ 1.45Q-5 Recapture of Credit.

(a) Recapture event.

(b) Ceases to be disposed of in secure geological storage or used as a tertiary injectant.

(c) Leaked amount of qualified carbon oxide.

(d) Qualified carbon oxide subject to recapture.

(e) Recapture amount.

(f) Recapture period.

(g) Application of recapture.

(1) In general.

(2) Calculation.

(3) Multiple units.

(4) Multiple taxpayers.

(i) In general.

(ii) Partnerships.

(A) General rule.

(B) Terminated partnerships.

(5) Reporting.

(6) Examples.

(i) Example 1.

(ii) Example 2.

(iii) Example 3.

(iv) Example 4.

(v) Example 5.

(vi) Example 6.

(h) Recapture in the event of deliberate removal from storage.

(1) In general.

(2) Recycled qualified carbon oxide.

(i) Limited exceptions.

(j) Applicability date.

26 C.F.R. §1.45Q-0

T.D. 9944, 86 FR 4760, Jan. 15, 2021

T.D. 9944, 86 FR 4760, 1/15/2021