What tax incentives encourage alternatives to fossil fuels? Q.What tax incentives encourage alternatives to fossil fuels? A.The federal tax code includes a range of incentives for alternatives to fossil fuels. These provisions support electricity production from solar, wind, and other renewable sources and from nuclear facilities. They also support alternative transportation fuels, especially electricity, and encourage energy efficiency in homes and commercial buildings. The Inflation Reduction Act of 2022 greatly expanded and redesigned tax incentives for alternative energy sources. Read more about What tax incentives encourage alternatives to fossil fuels?
What tax incentives encourage energy production from fossil fuels? Q.What tax incentives encourage energy production from fossil fuels? A.Provisions of the federal income tax that subsidize domestic production of fossil fuels include the expensing of exploration, development, and intangible drilling costs; the use of percentage depletion instead of cost depletion to recover drilling and development costs of oil and gas wells and coal mines; and numerous smaller incentives for production and distribution of oil, coal, and natural gas. Read more about What tax incentives encourage energy production from fossil fuels?
What is a carbon tax? Q.What is a carbon tax? A.Emissions of carbon dioxide and other greenhouse gases are changing the climate. A carbon tax puts a price on those emissions, encouraging people, businesses, and governments to produce less of them. A carbon tax’s burden would fall most heavily on energy-intensive industries and lower-income households. Policymakers could use the resulting revenue to offset those impacts, lower individual and corporate taxes, reduce the budget deficit, invest in clean energy and climate adaptation, or for other uses. Read more about What is a carbon tax?