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| 8 Apr 2026 | |
| General News |
On July 4, 2025, President Trump signed the H.R. 1 (also known as "One Big Beautiful Bill Act") into law, finalizing changes to credits eligible for Elective Pay.
Elective Pay is not a tax credit itself. Instead, it is a mechanism that allows tax-exempt entities (like nonprofits, local governments, and schools) to receive the value of certain clean energy tax credits as a direct cash payment from the IRS. Since these entities typically do not owe federal taxes, they would not benefit from a traditional tax credit. Elective Pay allows these entities to still access these incentives, helping reduce project costs or fund more clean energy work. Note that H.R. 1 did not make changes to Elective Pay, so despite changes to the underlying credits, the Elective Pay rules have not changed.
Below is a summary of the key changes to the most commonly claimed credits accessible through the Elective Pay process and a table outlining key dates for the credits based on project status. To stay informed of additional updates post guidance, subscribe here.
