The Inflation Reduction Act: Transferability of ITCs – Timeline and key considerations for REITs

Insights and Analysis

The Inflation Reduction Act: Transferability of ITCs – Timeline and key considerations for REITs

13 October 2024

The Inflation Reduction Act’s transferability regime ushered in a new method for monetizing tax credits generated from renewable energy projects. Although real estate investment trusts (REITs) historically have not been able to use investment tax credits at the entity-level, the new transferability rules allow REITs to sell investment tax credits to third parties, opening up a new opportunity for REITs to cash in on the development of renewable energy projects at their properties.

Linked below is a one-page guide to summarize the standard timeline of transferring tax credits and the key considerations relevant to REITs.

Reach out to your Hogan Lovells contact to discuss further details of investment tax credits transferability and the impact on your business.