USPublished: 13 February 2026

[Regulatory Update] US IRS issues interim guidance on determining "material assistance" from prohibited foreign entities (PFEs) — clarifying supply-chain requirements for clean-energy tax credits

Source:Internal Revenue Service (IRS)

The US Treasury Department and the IRS published Notice 2026-15 on 12 February 2026. The Notice sets out an interim interpretation and calculation method for certain restrictions on energy tax credits relating to prohibited foreign entities (PFEs), which were introduced under the One, Big, Beautiful Bill Act (OBBBA), enacted in July 2025. The credits covered include sections 45X, 45Y and 48E, among others, and the Notice offers a safe harbour for determining whether "material assistance" has been provided by a PFE. The definition of PFE and the treatment of material assistance are also subject to forthcoming proposed regulations, so the February 2026 Notice does not settle the final form of the regime on its own.

Editor's View

Under US clean-energy tax credits, eligibility increasingly depends not simply on whether manufacturing takes place domestically, but on the structure of component and material procurement. Companies supplying batteries, energy storage systems, power-generation equipment and related components to the US market need to understand their supply-chain data — not only the attributes of their suppliers but the cost composition of materials and components; in US industrial policy, the supply chain itself is becoming the data on which tax-credit eligibility is judged.

※ This article is based on official public information from an external source (Internal Revenue Service (IRS)) and has been analyzed and organized for practical use.

Primary Source (Official)

Related Regulation Information

U.S. Inflation Reduction Act (IRA) Clean Energy Tax Incentives — Accelerated Reduction Under the One Big Beautiful Bill Act

The U.S. Inflation Reduction Act (IRA), enacted in August 2022, established a suite of tax credits (including the Section 30D Clean Vehicle Tax Credit and the Section 45X Advanced Manufacturing Production Tax Credit) designed to accelerate clean energy manufacturing—EVs, batteries, solar, wind, and critical minerals—within North America. However, the "One Big Beautiful Bill Act" (OBBBA), enacted on July 4, 2025, brought forward the termination or reduction of many of these clean energy tax credits. In particular, the Section 30D Clean Vehicle Tax Credit was terminated early as of December 31, 2025, and the Section 45X Advanced Manufacturing Production Tax Credit begins phasing down starting in 2027. As a result, the framework supporting U.S. clean energy investment and manufacturing is undergoing fundamental restructuring.

See this regulation's full analysis (timeline & business impact)

💡 The overview and schedule for the regulation related to this article can also be found on the Regulatory Gateway Database page.