# How Transferable Tax Credits Are Powering the U.S. Solar Industry
The solar industry continues to grow in the United States, thanks in part to financial incentives and policies designed to support clean energy. One of the most impactful mechanisms driving this growth is **transferable tax credits**, which allow solar companies to sell tax incentives in exchange for cash.
Recently, one of the largest solar manufacturers in the Western Hemisphere **sold $857 million in Inflation Reduction Act (IRA) transferable tax credits** generated from its U.S.-based manufacturing facilities. The sale, executed through two agreements, highlights the financial boost that solar companies can receive under the IRA’s provisions.
## What Are Transferable Tax Credits?
Transferable tax credits are a financial tool that allows **solar companies** and renewable energy firms to sell their tax credits to other entities, effectively turning them into immediate cash. This provides a critical source of funding for solar manufacturers and developers investing in new projects. The ability to transfer these credits is particularly useful for companies that don’t qualify for the direct pay option under federal tax law.
According to recent financial estimates, **transferable tax credits could drive $2 trillion in capital investments and $3.8 trillion in economic activity in the U.S
Original Article: https://pv-magazine-usa.com/2025/02/24/first-solar-cashes-in-on-sale-of-inflation-reduction-act-tax-credits/
