Engagement Letter and Client Consent Points for Tax Credit Purchases

Published October 28, 2026. This page is a discussion aid for CPAs and tax advisors, not legal advice. Use it with your firm's own risk-management policies and counsel; this is not a template or a professional standard.

Scope

• State what you will and will not do: tax advice on the client's use of the credit, return preparation, review of the transfer election statement.
• Say that you are not negotiating price or selecting the seller, if that is your approach.
• Confirm who is responsible for diligence on the credit property and by whom.

Reliance and third-party information

• Identify the documents you rely on, such as the seller's registration number, the credit calculation, the transfer agreement and any third-party engineering or tax opinions.
• Note that you are not validating the underlying eligibility of the credit unless you are engaged to.

Client acknowledgments

• The credit is allowed only if it is validly determined and the client has capacity under its own limits (§38(c) for C corporations; the passive activity rules for individuals).
• The credit can be subject to recapture or reduction, and an excessive credit transfer can trigger additional tax and a possible excess credit transfer penalty (Treas. Reg. §1.6418-5).
• Price and timing are set by the client and seller.

Referral relationships

If a referral relationship exists, consider what you must disclose to the client and how it fits your firm's policies. We do not provide guidance on compensation; read the partner program terms before deciding.

Related: transfer agreement checklist, due diligence guide and the client qualification checklist.

Educational information only, not tax, legal or investment advice, and no outcome is promised. Figures were checked against the cited sources on October 28, 2026; confirm with your CPA before acting.