- Notice 2026-53 supplies the official 2026 emissions rate table used to determine credit amounts based on lifecycle greenhouse gas emissions.
- Guidance includes distinct rates for dairy and swine manure, a safe harbor for 2025 production, and transition relief for used cooking oil and other feedstocks under WFTC changes.
- Eligibility remains limited to fuels derived exclusively from feedstocks grown or produced in the United States, Mexico or Canada, with emissions calculations excluding indirect land use change.
Overview of IRS Guidance on the 45Z Credit
On September 8, 2026, the Internal Revenue Service released Notice 2026-53 to provide the 2026 emissions rate table and additional technical instructions for calculating the Section 45Z Clean Fuels Production Tax Credit. This follows the Working Families Tax Cuts (WFTC) amendments that extended and modified the credit.
The IRS attributes the notice to supporting domestic biofuel production and American agriculture by giving farmers, ranchers and fuel producers greater certainty when accessing the biofuels market. According to the IRS, the guidance helps reflect low-carbon practices and specific farm conditions in emissions calculations.
The Clean Fuel Production Tax Credit, as modified by the WFTC, applies to eligible clean transportation fuels—including sustainable aviation fuel—produced in the United States and sold in a qualified sale. Credit amounts vary based on the fuel's lifecycle greenhouse gas emissions rate, with lower-emission fuels receiving larger credits.
Key Changes Introduced by the WFTC and Addressed in the Notice
The WFTC made several statutory changes that required updates to the 45ZCF-GREET model and annual emissions rate tables. Among these, emissions rates must exclude indirect land use change, eligible fuels must be derived exclusively from feedstocks produced or grown in the United States, Mexico or Canada, negative emissions rates are generally prohibited except for certain animal manure fuels, and distinct emissions rates are required for fuels from specific animal manure feedstocks.
Notice 2026-53 supplies technical modeling language for implementing WFTC-mandated updates related to manure-derived fuels. It also outlines how producers should use the emissions rate table and allowed models when methodologies have not yet been fully updated. The Department of Energy is developing corresponding updates to the 45ZCF-GREET model.
For regenerative agricultural practices, the notice provides a safe harbor available for 2025 clean fuel production. This follows the U.S. Department of Agriculture finalizing its rules on June 29, 2026. The guidance allows qualifying low-carbon agricultural practices consistent with USDA technical guidelines and the 45Z-specific Feedstock Carbon Intensity Calculator.
Manure-Derived Fuels and Farm-Specific Considerations
The 2026 emissions rate table published in the notice includes dairy manure and swine manure as primary feedstocks. Treasury and the IRS anticipate that the 45ZCF-GREET model will be updated later in 2026 to incorporate poultry manure and beef manure.
The guidance permits farm-specific prior manure management practices to be taken into account in certain circumstances. This provision is intended to allow emissions calculations to more accurately reflect conditions on individual farms. It also provides transition relief for fuel produced in 2025 and 2026 from certain nutrient budget requirements before nutrients are applied.
Transition rules are included for applying WFTC changes when an allowed methodology has not yet been updated, covering used cooking oil and other feedstocks.
Questions Readers Should Verify and Next Steps
Taxpayers and producers should review the specific emissions rates, safe harbor conditions, and transition rules in Notice 2026-53 to determine how they apply to their operations. The notice does not alter basic eligibility requirements or credit calculation mechanics beyond the technical guidance provided.
Because the 45Z proposed regulations issued February 4, 2026, remain under final consideration, affected parties may need to monitor for additional updates from the IRS and Treasury Department. The Department of Energy's forthcoming model revisions and any further USDA integration will also be relevant.
Republic Tax Relief offers a free, no-obligation initial consultation for individuals and businesses facing separate IRS or state tax debt issues. Those with existing tax-resolution questions unrelated to the 45Z credit can contact the firm to evaluate suitability, scope, fees and availability of private assistance communicating with the IRS.
Announcement covered: Sep 8, 2026.
General information only, not individual tax, legal, or financial advice. Rules, deadlines, and eligibility depend on your circumstances. Check current official guidance or consult a qualified professional.
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