Tax Leaders Weigh Post-Election Policy Risk
A recent survey of corporate tax professionals points to two distinct concerns shaping 2024 election-year planning: strategic tax leaders are focused on potential changes to Inflation Reduction Act (IRA) renewable energy credits, while tax tacticians are more focused on potential changes to federal corporate income tax rates.
Renewable Energy Credits
IRA credits — production tax credits, investment tax credits, advanced manufacturing credits, and the related transferability mechanisms — have materially improved project economics in renewables and clean manufacturing. Any rollback or modification would directly affect project IRRs, financing structures, and tax equity market capacity. Companies with active development pipelines face meaningful scenario-planning work.
Federal Corporate Rate
A change to the federal corporate tax rate flows through almost every line of corporate forecasting: effective tax rate modeling, deferred tax asset and liability remeasurement, transfer pricing positions, and the valuation of NOL carryforwards. Tax tacticians responsible for compliance and planning have every reason to model multiple rate scenarios ahead of year-end.
Expert Commentary
Practitioners interviewed for the survey emphasize both the sustainability implications of renewable credit changes and the broad corporate planning impact of rate changes. Both groups indicate they are monitoring developments and preparing alternative strategies.
Implications
CFOs and tax directors should treat 2024 election-related tax risk as a two-track planning exercise: asset-class-specific scenarios for IRA-dependent investments, and firm-wide scenarios for corporate rate changes. The planning work done before November pays off in the execution speed available after.