Tax Trading ๐Ÿš—โšก

Table of Contents

Tax Trading

One of the main incentives for EV companies right now is the tax credits they receive from the government. With the switch to renewables on the mind of the current administration, theyโ€™ve provided EV businesses with what they need to take the next step when it comes to innovation, but they can do unique things with these tax credits that will open a new market in the economy.

In the Inflation Reduction Act, there was a clause stating that tax credits can be transferred between companies, and this makes for an interesting dynamic between companies, whether they are small or big. The Inflation Reduction Act brings increased taxes on large corporations but many believe that this tax trading method could create another loophole for those companies. Economists believe that large companies with no investment in renewables would buy tax credits to keep their profits high and taxes low, which defeats the purpose. This can also be common in the renewable space itself, where companies who donโ€™t use up all their tax credits end up selling it to larger companies who could use it, and it boosts profit for both. Itโ€™s an idea with setbacks and drawbacks, but Senator Joe Manchin stressed that it needed to be included in the deal. Banks will also have to adjust in order to facilitate these deals, but there are many unknowns like pricing and how exactly the market moves considering liquidity doesnโ€™t exist. Starting next year, the effect of this tax credit market will be shown in corporate earnings, giving us something to wait for.

I am not a financial advisor and my comments should never be taken as financial advice. Investments come with risk, so always do your research and analysis beforehand.

Share:
More Posts
Get your daily Invstr Crunch

Get the market news and updates you need, delivered to your inbox or available on our daily podcast.

Risk Disclosure:

Invstr is not a bank and banking services are provided by Vast Bank, N.A.

Brokerage and Banking services are currently only available to U.S. residents.

Invstr app and web services are provided by Invstr Ltd. Advisory services are provided by Invstr Financial LLC, an investment adviser registered with the Securities Exchange Commission (SEC) details of which can be obtained here. Securities brokerage and custody services are provided by Apex Clearing, a broker dealer registered with the SEC and a member of FINRA and SIPC. There is no bank guarantee on securities and securities may lose value.

Investing involves risk and can lead to losses. Past performance does not guarantee future results.

Invstr app and web services are provided by Invstr Ltd. Invstr+ advisory services are provided by Invstr Financial LLC, an investment adviser registered with the Securities Exchange Commission (SEC). Securities brokerage and custody services are provided by Apex Clearing, a broker dealer registered with the SEC and a member of FINRA and SIPC. There is no bank guarantee on securities and securities may lose value. Vast Bank N.A. a nationally chartered bank and member of the FDIC, provides the banking products, including the products and services related to digital asset accounts. As with any asset, the value of Digital assets can go up or down and there can be a substantial risk that you lose money buying or holding digital assets. You should carefully consider whether trading or holding Digital assets is suitable for you in light of your financial condition. Your digital account does not support wallet to wallet transferring of your digital assets (i.e. cryptocurrencies) outside the platform. Any Digital Assets in your digital asset account are not insured by any government entities, including but not limited to FDIC or SIPC. The Invstr Visaยฎ Debit Card is issued by Vast Bank, N.A. pursuant to a license from Visa U.S.A Inc and may be used everywhere Visa debit cards are accepted. Invstr Ltd, Invstr Financial LLC and Invstr Securities Ltd are subsidiaries of Marketspringpad Holdings (collectively “Invstr”) and Invstr is solely responsible for the application services and website content.

Watchlists provided when users first access the service are not a recommendation to invest. Instead they are provided to help users better navigate the service. Users are free to edit and create their own watchlists. From time to time, Invstr will suggest instruments solely based on an individual’s interest and the interest levels of the Invstr community. The statistical and portfolio builder models generated by Invstr do not reflect actual investment results and are not guarantees of future results. Comments provided by Invstr leaders, influencers or members of the Invstr Community are not recommendations and should not be construed as such. Invstr does not endorse the content or the positions posted by them. Their investment approach, and that of the models provided by Invstr, may be different from yours and may not be appropriate for you.