Credit Purchase Savings

The economics of purchasing transferable clean-energy credits under Section 6418 at a discount to face value.

Inputs

Projected federal tax liability ($)

Share of liability to cover with credits (%)

Purchase price (cents per $1 of credit)

Transaction and diligence costs (% of purchase)

Estimate

Updates as you type. Simplified estimate; assumptions below.

Credits purchased (face value)-

Cash paid for credits-

Transaction costs-

Net saving vs. paying tax in cash-

Return on cash deployed-

Assumptions and limits. Assumes the full credit is usable against your liability in the year purchased. For individuals, passive activity rules can restrict credits from passive sources to passive income; absorption must be confirmed before purchase. Ignores recapture risk (typically covered by seller indemnity and tax insurance), timing of estimated payments, and state taxes. Estimates are educational, not advice or a projection. State taxes, alternative minimum tax, phase-outs, and individual facts can change results materially.

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The real model includes your state, basis lots, AMT position, and the strategies interacting with each other.

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