Can you sell tax credits?

Yes, businesses can sell most federal clean energy and manufacturing tax credits for cash under Section 6418 of the tax code. The seller makes a one-time election to transfer the credit to an unrelated buyer, usually at a discount of 7 to 9 cents on the dollar. Homeowners can't sell their credits this way.

The Inflation Reduction Act created this option for tax years beginning after 2022, and the One Big Beautiful Bill Act kept it. The Section 6418 statute treats the buyer as the taxpayer for the credit it purchases. That helps owners who earn more credits than they can use. For the legal detail behind each rule, see our Section 6418 guide.

Which tax credits can you sell?

You can sell 12 federal credits listed in Section 6418, including the Investment Tax Credit (ITC) under Sections 48 and 48E, the Production Tax Credit (PTC) under Sections 45 and 45Y, and credits for manufacturing, carbon capture, hydrogen, clean fuels, nuclear power and EV charging. Other federal credits aren't eligible.

• Solar, wind and storage: Sections 48, 48E, 45 and 45Y.

• Manufacturing: Sections 45X and 48C.

• Fuels and carbon: Sections 45Q, 45V, 45Z and the small agri-biodiesel producer credit.

• Nuclear and EV charging: Sections 45U and 30C.

Some things can't be sold even when the credit type qualifies. Carryforwards and carrybacks are excluded, a buyer can't resell a purchased credit, and the IRS says a bonus adder can't be sold separately from the rest of the credit.

Who can sell tax credits, and who can't?

Any taxpayer that earns an eligible credit can sell it unless it's a tax-exempt or government entity. Corporations, LLCs, partnerships and S corporations qualify. Nonprofits, governments, tribes and rural electric co-ops can't sell, but they can often use elective pay. Homeowners can't sell the residential solar credit.

Partnerships and S corporations make the election at the entity level, so a partner or shareholder can't sell a share alone. The IRS lists the excluded entities in its transferability FAQ, and they can review elective pay instead.

The homeowner rule answers one of the most common searches on this topic. The residential credit under Section 25D isn't on the Section 6418 list, and it ended for expenditures after 2025. If a solar company owns a rooftop system and leases it to you, that company earns a commercial credit and may be able to sell it.

How much do tax credits sell for?

Clean energy tax credits sold for an average of $0.913 per dollar for 2026 ITCs and $0.930 per dollar for 2026 PTCs in the first half of 2026, according to Crux. After insurance and fees, a seller may keep closer to $0.86 to $0.90, depending on deal size, seller credit quality and foreign entity exposure.

Crux's 2026 mid-year data shows credits subject to prohibited foreign entity rules sold for about 1.5 cents (ITC) to 2 cents (PTC) less than exempt credits. In 2025, investment-grade sellers earned a premium of about 3 cents. Crux's worked example starts at $0.90, subtracts 2.75% for insurance and 1.25% for a broker, and nets $0.86.

Smaller deals still draw interest. Crux found credits under $10 million received two to three bids per listing, in line with larger deals, though insurance runs 2% to 5% of the deal rather than 1.5% to 3%. Our credit pricing guide covers what moves the number.

How do you sell a tax credit, step by step?

To sell a tax credit, earn the credit, complete IRS pre-filing registration, find an unrelated buyer, sign a transfer agreement, collect cash and attach a transfer election statement to your tax return. The buyer attaches the same statement to its return. You must file by the return due date, including extensions.

If you're learning how to sell tax credits for the first time, start with registration. The IRS FAQ says it can start once you have all the required information, including the placed-in-service date. IRS Publication 5884 recommends registering at least 120 days before you plan to file your return. See our registration walkthrough and Form 3800 guide for the filing detail. Solar owners can also use our pre-market checklist.

You can split one credit among several buyers, and each buyer uses the same registration number. Payment must be cash, which the regulations define as U.S. dollars paid by check, wire or similar means, starting on the first day of the seller's tax year.

How long does it take to sell a tax credit?

Tax credit sales facilitated by Crux close in about three months on average, though Crux's sample timeline runs three to eight months depending on diligence and internal approvals. Owners with a cost segregation report, insurance quotes and complete project records ready before going to market usually move faster.

Timing also affects price. Crux's analysis of PTC deals found an average 2% price increase from January to December. The market is also active: PV Tech reported a record $14.9 billion of sales in the second quarter of 2026.

Is the money from selling a tax credit taxable?

No. Under Section 6418, cash from a qualifying sale isn't included in the seller's gross income, and the buyer can't deduct what it paid. For a partnership or S corporation, the proceeds count as tax-exempt income and flow to owners based on their share of the credit.

The seller keeps depreciation because depreciation doesn't transfer with the credit. It also reduces the project's tax basis for ITC property as if it had claimed the credit itself. If you can use the credit against your own tax bill, compare that value with the sale price using our tax credit price calculator.

What are the risks of selling tax credits?

The buyer takes on recapture and any excessive credit transfer tax under the law, but sellers usually carry that risk by contract through an indemnity. Crux found 55.3% of 2024 deals used a parent indemnity rather than full or partial insurance, so a seller can still owe money after closing.

• Indemnity: Crux's 2024 data shows most deals rely on a parent guarantee, so check what your agreement covers.

• Recapture: The IRS says the buyer bears recapture, and the seller must notify the buyer. See our guide to ITC recapture.

• An overstated credit: If the IRS reduces the credit below what was sold, the buyer's tax rises by the excess plus 20%, unless it shows reasonable cause. Tax credit insurance can cover this.

• Foreign entity rules: You can't sell certain credits to a specified foreign entity, and FEOC rules can affect both eligibility and price.

If you're also weighing partnerships, our comparison of tax equity and transferability shows when each one makes sense.

Sources

• Cornell Legal Information Institute, 26 U.S. Code § 6418, Transfer of certain credits

• Cornell Legal Information Institute, 26 U.S. Code § 25D, Residential clean energy credit

• Cornell Legal Information Institute, 26 CFR § 1.6418-1, Definitions

• IRS, Elective pay and transferability FAQs: Transferability

• IRS, Publication 5884, Pre-filing registration user guide

• Crux, Takeaways from the 2026 Mid-Year Market Intelligence Report

• Crux, An ultimate guide to transferable tax credits

• Crux, 4 ways developers can prepare to sell smaller tax credits

• Crux, Inside Crux's 1Q2026 Market Update

• PV Tech, US clean energy tax credit transfers up to US$21 billion in H1 2026