Three steps to your direct payment
Register with IRS
Pre-register your project on the IRS Energy Credits Online portal before your tax filing date. Required for all direct pay elections.
Pre-file Election
Elect direct pay on your original return (Form 990-T or applicable form). The election must be made on the original filing — amended returns are not accepted.
Claim Credit on Form
Claim the credit on the applicable IRS credit form. The IRS treats the elected credit as a payment of tax and refunds any amount above what you owe.
Check Your Eligibility
Enter your organization and project details to check eligibility and estimate your potential direct pay credit value.
Who qualifies for direct pay
Tax-exempt entities that would otherwise be unable to monetize federal tax credits.
501(c)(3) Nonprofits
Hospitals, schools, charities
State Governments
State agencies, public universities
Local Governments
Cities, counties, municipalities
Tribal Governments
Indian tribes, Alaska Native Corps
Rural Electric Co-ops
Member-owned utilities
Tennessee Valley Authority
Federal power authority
CFO Compliance Checklist
Eight items every finance team must verify before electing direct pay. Missing any one can void the election or trigger recapture.
Confirm entity qualifies as tax-exempt under IRC §501(c), state/local gov, or tribal government
Identify qualifying clean energy project type (§48E ITC, §45Y PTC, §45Q, §45V, §48C and others)
Register project on IRS Energy Credits Online portal before the election deadline
Elect direct pay on original Form 990-T or applicable return (cannot amend)
Retain all compliance documentation: prevailing wage records, domestic content certifications
Model domestic content: it earns a bonus, and for facilities of 1 MW or more that begin construction after 2025, missing it eliminates the elective payment unless an IRS exception applies
Note that for-profit entities can elect direct pay only for §45Q, §45V and §45X, and only for a limited number of years (IRC §6417(d)(1))
Coordinate with legal counsel on recapture risk if property is disposed within 5 years