# Prop. Treas. Reg. § 1.56A-12: AFSI adjustments with respect to certain tax credits.

Proposed regulation, not in force. REG-112129-23, 89 FR 75062, published 2024-09-13 <https://www.federalregister.gov/documents/2024/09/13/2024-20089/corporate-alternative-minimum-tax-applicable-after-2022>. Interprets 26 U.S.C. § 56A.

Par. 9. Sections 1.56A-0 through 1.56A-27 are added to read as follows:

(a) Overview. This section provides rules under section 56A(c)(9) of the Code for adjusting AFSI with regard to amounts described in section 56A(c)(9) and certain other amounts related to credits to which sections 48D, 6417, and 6418 of the Code apply. Paragraph (b) of this section provides rules for adjusting AFSI with regard to proceeds from credits to which sections 48D, 6417, and 6418 apply. Paragraph (c) of this section provides rules for adjusting the AFSI of a CAMT entity that acquires a credit to which section 6418 applies. Paragraph (d) of this section provides rules for adjusting AFSI with regard to amounts recaptured under sections 6417 and 6418. Paragraph (e) of this section provides the applicability date of this section.

(b) Proceeds from certain credits excluded from AFSI. AFSI is adjusted to disregard the following amounts, provided that any such amount (or portion thereof) is not otherwise disregarded under § 1.56A-8—

(1) Any amount treated as a payment against the tax imposed by subtitle A pursuant to an election under section 48D(d) or 6417;

(2) Any amount received from the transfer of an eligible credit, as defined in section 6418(f)(1)(A), that is not includible in the gross income of the CAMT entity by application of section 6418(b) or that is treated as tax exempt income under section 6418(c)(1)(A); and

(3) Any amount received pursuant to an election under section 48D(d)(2) or 6417(c) that is treated as tax exempt income under section 48D(d)(2)(A)(i)(III) or 6417(c)(1)(C).

(c) Treatment of transferee taxpayer. If a transferee taxpayer, as defined in section 6418(a), is a CAMT entity, AFSI is adjusted to disregard—

(1) Any amount paid by the transferee taxpayer to the eligible taxpayer, as defined in section 6418(f)(2), as consideration for the transfer of the eligible credit, as defined in section 6418(f)(1)(A), provided that the amount is not otherwise disregarded under § 1.56A-8; and

(2) Any increase in the transferee taxpayer's FSI resulting from the utilization of the eligible credit, provided that the increase is not otherwise disregarded under § 1.56A-8.

(d) Recapture disregarded as expense in determining AFSI. AFSI is adjusted to disregard any decrease in FSI resulting from an increase in tax under section 48D(d)(5), 50(a)(3), 6417(g), or 6418(g)(3) of the Code, provided that the decrease in FSI is not otherwise disregarded under § 1.56A-8.

(e) Applicability date. This section applies to taxable years ending after [DATE OF PUBLICATION OF FINAL RULE IN THE Federal Register ].