On May 13, 2019, the Internal Revenue Service (IRS) released Notice 2019-31, which provides the 2019 inflation adjusted amounts for the section 45Q carbon oxide sequestration credit. The section 45Q carbon oxide sequestration credit provides a tax credit to taxpayers that capture qualified carbon oxide using carbon capture equipment at a qualified facility and either (i) dispose of it in secure geological storage, (ii) use it as a tertiary injectant in a qualified enhanced oil or natural gas recovery project and dispose of it in secure geological storage, or (iii) utilize it as permitted by statute or regulation. In 2019, the inflation-adjusted credit amount is $23.30 per metric ton of qualified carbon oxide captured and disposed of in secure geological storage and $11.70 per metric ton of qualified carbon oxide captured and used as a tertiary injectant or utilized by as permitted by statute or regulation. These amounts generally apply to qualified carbon oxide captured using carbon capture equipment that was placed in service before the passage of the Bipartisan Budget Act of 2018 (BBA) on February 9, 2018.

Taxpayers that capture and dispose of qualified carbon oxide using carbon capture equipment placed in service on or after February 9, 2018, are generally entitled to a section 45Q carbon oxide sequestration credit ranging from $22.66 to $50 per metric ton, based on linear interpolation. Taxpayers that capture and use as a tertiary injectant or otherwise utilize qualified carbon oxide using such equipment are entitled to a section 45Q carbon oxide sequestration credit ranging from $12.83 to $35 per metric ton, based on linear interpolation. The IRS published the annual linear interpolation amounts through 2026 in Notice 2018-93.

After 2016, the credit amounts will be $50 or $35, adjusted annually for inflation.

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