During the webinar, Partners Phil Tingle and Heather Cooper and Associate John Zhang of McDermott Will & Schulte discussed the IRS’s recently issued FEOC guidance (Notice 2026-15), focusing on how the “material assistance” framework applies to clean energy credits and what developers, investors, and manufacturers should be doing now.

Top takeaways included:

1. Notice 2026-15 is largely a “material assistance” notice for the tech-neutral PTC (45Y), ITC (48E), and the 45X manufacturing credit. It provides meaningful direction on material assistance mechanics but leaves FEOC ownership and broader effective control questions mostly for future guidance.
2. Taxpayers still have two compliance paths: safe harbors or direct cost accounting. The notice largely confirms the statutory framework and aligns with the approach many market participants have been using.
3. Three safe harbors anchor the practical compliance playbook. The guidance organizes material assistance into (i) identification (what to test), (ii) cost percentage (how to measure), and (iii) certification (how to substantiate).
4. Safe harbors are expected to be the preferred route where available. Where technologies fit within existing domestic content tables and certifications are obtainable, compliance can be significantly simpler than a direct-cost exercise.
5. Project timing remains critical. Projects beginning construction before the end of 2025 are exempt from material assistance; projects beginning construction in 2026 are fully subject, with phase-in percentages depending on the year of beginning construction.
6. Supplier diligence and contracting will drive bankability. Procurement terms, supplier/manufacturer vetting, and certification workflows will be central for developers and investors managing PFE risk and meeting safe harbor requirements.
7. Direct cost method adds targeted new rules, but for narrower fact patterns. The notice introduces additional mechanics (including de minimis and related grouping/assignment/timing concepts) that are most relevant where safe harbors or certifications are not available.