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Sustainable Aviation Fuel (SAF) Credit Guidance


Check out the latest development in sustainable aviation: the new Sustainable Aviation Fuel (SAF) Credit outlined in Notice 2024-37, jointly issued by the Department of Treasury and the Internal Revenue Service.


This guidance offers clarity on the application of the SAF credit, effective for certain sales or uses between Dec. 31, 2022, and Jan. 1, 2025.


Credit Details

Under this credit, $1.25 is allocated for each gallon of sustainable aviation fuel within a qualified mixture, provided the fuel demonstrates a minimum 50% reduction in lifecycle greenhouse gas emissions. Furthermore, there's a supplemental credit of one cent for every percent beyond the 50% threshold, up to a maximum increase of $0.50.


What's New

Today's notice introduces additional safe harbors, utilizing the 40BSAF-GREET 2024 model, developed in collaboration with the Department of Energy and other federal bodies. These safe harbors assist in calculating emissions reduction percentages and unrelated party certifications necessary for claiming the SAF credit.


Moreover, the notice extends a safe harbor for leveraging the USDA Climate Smart Agriculture Pilot Program to further reduce emissions from domestic soybean and corn feedstocks, along with certifying related requirements. This move underscores the government's commitment to fostering innovation and sustainability in the aviation sector.



 

Disclaimer: This article is for informational and educational purposes only and does not constitute legal tax advice. Advanced Tax Solutions is not liable or responsible for any damages resulting from or related to your use of this information. It is your responsibility to refer to official IRS documentation for information regarding any tax laws or tax information shown here.

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