Tax Planning
Navigating the U.S.’s Corporate AMT & Energy Tax Credit Changes Under Notice 2026-11
Understand recent IRS guidance on the Corporate Alternative Minimum Tax and rules for clean energy tax credits—key for business tax planning in 2026-27.
By NomadicTax Research Team • 5-8 min read • March 22, 2026
## Introduction
In March 2026, the IRS issued *Notice 2026-7* and *Notice 2026-16* as part of **Internal Revenue Bulletin 2026-11**, introducing critical guidance on the Corporate Alternative Minimum Tax (CAMT) and clean energy incentives. These rulings are essential reading for large corporations, renewable energy developers, and tax advisers seeking stability in their 2026-27 fiscal planning. ([irs.gov](https://www.irs.gov/irb/2026-11_IRB?utm_source=openai))
## What's New: CAMT & Energy Credits
| Area | Key Updates |
|---|---|
| **CAMT guidance (Notice 2026-7)** | Clarifies adjustments to *Adjusted Financial Statement Income* (AFSI), rules for financially troubled companies, and anti-abuse of intangible property transactions. Applies to large corporations subject to CAMT. ([irs.gov](https://www.irs.gov/irb/2026-11_IRB?utm_source=openai))|
| **Energy tax credits (Notice 2026-15)** | New guidance under IRC §§ 45X, 45Y, 48E on how to compute “material assistance cost ratio” (MACR) to ensure compliance when eligible facilities or components may have foreign involvement. Requests comments on defining “prohibited foreign entity”—likely relevant for clean energy projects with international supply chains. ([irs.gov](https://www.irs.gov/irb/2026-11_IRB?utm_source=openai))|
| **Special depreciation (Notice 2026-16)** | Interim rules under the One, Big, Beautiful Bill (P.L. 119-21): defines “qualified production property,” special rules for depreciation recapture, and election procedures related to qualified production activity. ([irs.gov](https://www.irs.gov/irb/2026-11_IRB?utm_source=openai))|
## Actionable Strategies for Tax Planning
- **Update projections** for companies expecting to be in CAMT scope. The adjustments to AFSI may increase taxable corporate incomes or shift timing of income recognition. Include intangible property transactions in your review.
- **Audit supply chains**: Energy projects should assess suppliers for “prohibited foreign entities” to avoid disqualification of credits. Early documentation of material assistance cost ratios is critical.
- **Consider making elections**: For property likely to be “qualified production property,” ensure that necessary elections under the special depreciation rules are filed timely.
- **Use interim guidance in good faith**: Where final regulations are not yet issued, taxpayers should follow the guidance in these notices to avoid penalties.
## Compliance Implications
- Record-keeping will need to support both financial statement basis and tax basis for property, intangibles, and production activity.
- Large corporations must monitor changes in statute and forthcoming regulations—given the anti-abuse components and potential audit exposure.
## Case Example
Consider a U.S. manufacturer with a large intangible asset—say, proprietary software—for which AFS basis and tax basis diverge. Under CAMT guidance, if they dispose of that intangible, they’ll need to use CAMT basis rather than simply AFS basis to compute gain. Failing to do so could cause unexpected CAMT liability.
## Conclusion
These IRS updates tighten the rules for CAMT, expand due diligence around clean energy tax incentives, and clarify depreciation mechanics under recent law. Businesses affected should review their asset portfolios, supply chain arrangements, and depreciation elections immediately—incorporating these changes into pricing, investment, and budgeting decisions.