The IRS today released an advance version of Notice 2019-32 that includes a request for comments concerning the carbon oxide sequestration credit under section 45Q.
Notice 2019-32 [PDF 44 KB] reports that the Treasury Department and IRS anticipate issuing regulations and other guidance to implement certain provisions of section 45Q (as amended by the Bipartisan Budget Act of 2018 (BBA), Pub. L. No. 115-123 (February 9, 2018)). This notice is a request for comments concerning this future guidance.
Comments are due by a date that is 45 days after this notice is published in the Internal Revenue Bulletin.
The IRS issued Announcement 2019-06 [PDF 8 KB] to clarify that the comment due-date is July 4, 2019.
In anticipation of the future regulations, Notice 2019-32 specifically requests comments on certain issues arising under section 45Q—including comments concerning the secure geological storage and measurement of qualified carbon oxide and the recapture of the benefit of the credit for carbon oxide sequestration.
Comments are specifically requested concerning the following questions or issues:
Notice 2019-32 explains that under section 45Q(f)(3)(A), the credit is attributable to the person that captures and physically or contractually provides for the disposal, utilization, or use of the qualified carbon oxide as a tertiary injectant. The IRS and Treasury are seeking comments on the types of contractual arrangements that investors anticipate with parties who capture or dispose or utilize qualified carbon oxide (CO).
Other questions for consideration and presented in the notice include:
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