The IRS and the Treasury Department have proposed new regulations for the clean fuel production credit under the One Big Beautiful Bill Act (OBBBA), aimed at supporting domestic clean transportation fuel producers. The 45Z credit offers businesses a tax credit for clean fuel produced after December 31st 2024, and sold by December 31st 2029. Key changes include limiting feedstocks to those from the U.S., Mexico, or Canada, and adding anti-abuse provisions. A Treasury official stated: “The tax credit will continue U.S. leadership in the transportation and aviation industries while lowering costs for consumers.” The guidance will be open for public comment for 60 days, with a public hearing scheduled for further discussion.
