Tax Court disallows part of a taxpayer’s Sec. 245A dividends-received deduction and holds post–Sec. 965(c) amount must be included in formula to determine Sec. 245A(d)(1) foreign tax credit disallowance.
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Credits
R&D credits and the computer rental rules time forgot
Although computing has transformed radically in the past 45 years, the computer rental rules of Sec. 41 and regulations continue to reflect technology as it existed 1980s.
Sec. 280E bars claim for refundable portion of ERC
The employee retention credit is among those prohibited under the section for taxpayers trafficking in federally controlled substances, the Tax Court held, finding against a marijuana dispensary business.
Navigating safe-harbor rules for solar and wind Sec. 48E facilities
Early termination of the clean energy investment credits for solar and wind under the law known as the One Big Beautiful Bill Act means projects must start construction by July 4, 2026.
IRS generally eliminates 5% safe harbor for determining beginning of construction for wind and solar projects
A notice limits methods of meeting a key deadline for project eligibility for two clean energy credits, which recent legislation terminated after 2027.
R&D tax credits: A new era of disclosure and documentation
The IRS’s increased documentation requirements for Sec. 41 claims require taxpayers to specifically identify applicable business components and their costs and why their development is qualified research.
The R&D tax credit for architects and engineers
Architecture and engineering firms often face challenges when seeking to claim the Sec. 41 research-and-development tax credit for their work on building and construction projects, as two recent court cases illustrate. However, by understanding the requirements to claim the credit and carefully planning, executing, and substantiating a project, they may be able to qualify for it.
Impact of ‘beginning of construction’ on Inflation Reduction Act credits
Taxpayers may be able to claim the PWA multiplier for certain credits if a project’s “beginning of construction date” is before Jan. 30, 2023.
Clean fuel production credit: Regulatory roadblocks ahead
Early guidance for the new Sec. 45Z clean fuel production credit raises concerns regarding the eligibility of fuel sales to wholesalers.
CHIPS Act final regs. offer many taxpayer-friendly provisions
Congress incentivized domestic manufacturing of semiconductors and semiconductor manufacturing equipment as part of the Creating Helpful Incentives to Produce Semiconductors (CHIPS) Act of 2022.
Placing in service the benefits of the Inflation Reduction Act
Determining when energy property is eligible for a tax credit or deduction hinges on when it is first placed in service, which can be controversial.
Legacy clean-energy credits evolve into tech-neutral credits
The transition beginning in 2025 entails certain new requirements but also opportunities.
FTR notification requirement for taxpayers under LB&I examination
A foreign tax redetermination may require taxpayers under Large Business and International Division examination to notify the IRS, which will redetermine the U.S. tax owed.
The research credit: Business-component requirement
The Fifth Circuit’s decision in Grigsby, 86 F.4th 602 (5th Cir. 2023), emphasizes the need for taxpayers to clearly define business components when preparing and documenting their Sec. 41 credit.
Tax Court declines to limit discovery for sampled research credit claims
In two cases, the court rebuffed taxpayers’ attempts to restrict its inquiry to a selected subset of the projects for which they claimed the Sec. 41 credit.
Employee retention credit updates
Practitioners need an understanding of claim disallowance appeals and requests for additional
information, as well as insight into how the voluntary disclosure program may affect practitioners themselves.
The Inflation Reduction Act’s prevailing wage and apprenticeship requirements
Taxpayers engaging in certain clean energy activities are eligible for increased credits or deductions for qualifying if they adhere to the Inflation Reduction Acts prevailing wage and apprenticeship requirements.
Overlapping expenses affect multiple tax credit calculations
The Fourt Circuit affirmed the Tax Court’s decision that a taxpayer could not ignore the coordination rule in Sec. 45C(c)(2) when calculating the Sec. 41 research credit for a tax year in which the taxpayer claimed the Sec. 45C orphan drug credit for qualified clinical testing expenses that also were qualified research expenses for purposes of the research credit.
The CHIPS Act’s advantageous direct-pay election
This article summarizes the key features of the direct-pay election for the advanced manufacturing credit, which allows taxpayers to treat the credit as a direct payment against their federal income tax.
ERC supplemental claim process opened for third-party payroll companies
The IRS announced that it will open a supplemental claim process to help third-party payers and their clients resolve incorrect claims for the employee retention credit. The deadline is Nov. 22.
INDIVIDUALS
Current Developments in Taxation of Individuals: Part 1
This update surveys recent federal tax developments involving individuals, including court cases, rulings, and guidance issued during the six months ending October 2025.
