Transferable Tax Credits

Business and individuals may be able to reduce their federal and state tax burdens and while also supporting certain historic, cultural, and community-driven causes by purchasing tax credits.

Many states, as well as the federal government, provide tax credits for certain investments in historic rehabilitation projects, low-income housing, film production, and other activities that spur economic growth and innovation, expand employment, and support progressive initiatives. These credits can be purchased by taxpayers to reduce tax rates in 30+ states and through select federal programs.

Properly selecting credits to purchase or sell, as well as overseeing the transfers, can be a complex process that consumes time and resources without guidance from professionals versed in state tax credit nuances. Matching buyers to the right sellers unable to use credits in their business is also vital to create a foundation for success.

Credit Purchase Opportunities

Transfer prices can range from $0.70 to $1.18 per dollar of credit purchased.

Credit amounts depend on if the transfer is at the federal or state level, the type of credit, the types of taxes that may be offset, and whether additional tax attributes and priority returns are passed through to the investor.

Beyond the potential to deliver a high rate of return to buyers and reduce effective tax rates, transferable tax credits can also help you:

  • Reduce your total state income tax liability
  • Diversify your investment portfolio
  • Promote the arts and film, renewable energy, historic rehabilitation, affordable housing, or other industries and causes you may support
  • Achieve sustainability goals and environmental, social, and governance requirements
  • Meet local Community Reinvestment Act requirements

Notable credit purchase opportunities also include State Historic Rehabilitation Tax Credits for restoration to facilities.

Guidance for Credit Sales and Purchases

Whether you’re buying or selling tax credits, it’s crucial to confidently navigate the process and evaluate your options. Our professionals can help you identify beneficial credits to purchase or sell, negotiate terms, claim credits and more.

Make Savvy Decisions

Determine what type of transaction is appropriate for your organization with detailed insights including:

  • Education on available credits and market pricing
  • Resources on federal and state transferable credit programs
  • Book, tax, and statutory accounting guidance for tax credit transactions

Enter Transactions Confidently

Be prepared for transactions with our professionals helping to:

  • Perform due diligence
  • Negotiate key tax terms of agreements
  • Provide incentive consulting for applications, negotiations, modeling, and certification

Seamlessly Administer Transfers

Execute transactions without major surprises when our professionals:

  • Obtain binding commitments for buying or selling credit before or after project completion
  • Supply technical memoranda and private letter rulings
  • File necessary transfer forms
  • Perform agreed-upon procedures and other incentive attestation services

Expansive Expertise for Credit Transfers

Moss Adams Statistics

Comprised of CPAs and tax attorneys, our team works closely with developers, state and federal tax credit syndicators, financial institutions, insurance companies, and corporations buying and selling credits with access to all states and markets that offer transferable credit programs—staying current on market pricing and legislative measures.

Collaboratively engaging with your organization, we provide customized options that will fit your tax goals and other long-term business initiatives. Through your transactions, our professionals work to strike an appropriate balance between delivering high tax credit returns while reducing risk.

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