Treasury, IRS provide guidance for certain energy tax credits regarding material assistance provided by prohibited foreign entities under the One, Big, Beautiful Bill

IR-2026-23, Feb. 12, 2026

WASHINGTON — The Department of the Treasury and the Internal Revenue Service today issued a notice providing guidance for determining whether electricity-producing qualified facilities, energy storage technologies, or eligible components are receiving material assistance from a prohibited foreign entity (PFE) and would be ineligible for certain energy tax credits.

The One, Big, Beautiful Bill added new restrictions to clean electricity credits under Internal Revenue Code Sections 45Y and 48E, and the advanced manufacturing production credit under Section 45X to determine eligibility for credits when there is material assistance from a PFE.

Notice 2026-15 PDF provides that Treasury and IRS intend to propose regulations with respect to the definition of a PFE and the calculation of the material assistance cost ratio that taxpayers must use to determine whether there was material assistance from a PFE. The notice also details how to use interim safe harbors authorized by the OBBB and provides example calculations under those safe harbors.

The notice also provides that Treasury and IRS intend to propose regulations and other further guidance with respect to the definition of a PFE and the material assistance rules, including new safe harbor tables as authorized in the OBBB.

The notice explains that a taxpayer may rely on the rules provided in the notice to calculate the material assistance cost ratio for:

• any Section 45Y or 48E qualified facility or energy storage technology the construction of which begins after Dec. 31, 2025, until 60 days after the publication of the forthcoming safe harbor tables.
• any Section 45X eligible components sold in taxable years beginning after July 4, 2025, the date of the OBBB’s enactment, until the date that the forthcoming safe harbor tables are published.

Finally, the notice requests comments 45 days from the date of publication regarding definitional, anti-circumvention, and other issues for future guidance.

For more information, visit One, Big, Beautiful Bill provisions on IRS.gov.