Form 8933 Filing: 45Q Credit Rate, Schedules, and Recapture

To file Form 8933, the Carbon Oxide Sequestration Credit, you register each qualified facility through the IRS Energy Credits Online portal, complete the main form and the schedules that match your role in the project, carry the Part III total to Form 3800, and attach the package to your income tax return by its normal due date. The credit rate you use depends on when the capture equipment was placed in service, how the carbon oxide is stored or used, and whether the facility meets prevailing wage and apprenticeship rules. Everything below walks through that filing in the order you actually do it.

Who Files the Form

You file Form 8933 if you own carbon capture equipment at a qualified facility and either dispose of, use, or arrange for the disposal or use of the captured carbon oxide. You also file if the equipment owner elected under Section 45Q(f)(3)(B) to let you — the party actually handling the disposal, injection, or utilization — claim the credit instead.¹

One exception matters up front. If you’re a partner in a partnership or a shareholder in an S corporation, and your only 45Q credit comes through that entity’s Schedule K-1, you don’t file Form 8933 yourself. You report the credit directly on Form 3800, line 1x.

What to Have Ready Before You File

Pre-Filing Registration Number

You cannot claim the credit without a registration number from the IRS for each qualified facility. Registration runs through the IRS Energy Credits Online (ECO) portal. An authorized representative creates an account, verifies identity, and enters the entity’s EIN, name, and address, then answers prompts about the credit property, including the date the equipment was placed in service.²

Register after the equipment is placed in service, and do it at least 120 days before the due date of the return (including extensions) where the credit will appear. Miss that window and you won’t have a valid number to enter on Line 1.

Documentation the IRS Expects to See

The IRS will disallow the credit for any tax year where complete documentation isn’t filed on time. Certifications must be filed annually by the due date of your federal income tax return, extensions included.¹

If you contract with another party for disposal, injection, or utilization, both parties must report the contract on Form 8933 every year, regardless of which one claims the credit. Required details include each party’s name and taxpayer identification number, the contract execution date, the metric tons each party handles per year, and identifying information for the disposal site or EOR field: operator name, field, unit, reservoir, county, state, and EPA e-GGRT ID if available.

Utilization projects need a lifecycle assessment (LCA) report performed or verified by an independent third party, conforming to ISO 14040:2006 and ISO 14044:2006. The report must demonstrate that the carbon oxide is permanently isolated from the atmosphere or that lifecycle greenhouse gas emissions are reduced.

Geological storage projects must comply with EPA monitoring and reporting under 40 CFR Part 98, Subpart RR. EOR projects must meet the EPA’s Underground Injection Control program requirements.³ Class VI well operators face additional obligations: site characterization, plume and pressure modeling, well-integrity and groundwater monitoring across the project’s life, and financial instruments covering corrective action and post-injection site care.⁴

Keep the underlying books and records as long as their contents may become material to administering the tax law. Practically, that means holding them through the recapture period (three years after the last year you claimed or were eligible to claim the credit) and at least through the general statute of limitations on the return.

Pick the Right Credit Rate

The per-metric-ton rate depends on when the equipment was placed in service, how the carbon oxide is handled, and whether the facility meets the Inflation Reduction Act’s labor standards. This choice drives the Part III math.

Equipment Placed in Service After 2022

For non-DAC facilities:⁵

Geological storage (no EOR): $17 per metric ton base, $85 with prevailing wage and apprenticeship compliance.
EOR or utilization: $12 per metric ton base, $60 with prevailing wage compliance.

Direct air capture facilities:

DAC with geological storage: $36 base, $180 with prevailing wage compliance.
DAC with EOR or utilization: $26 base, $130 with prevailing wage compliance.

The bonus rate is a fivefold jump. For any facility where construction began on or after January 29, 2023, hitting the bonus requires paying prevailing wages (posted on sam.gov by location and trade, fringe included) to all laborers and mechanics doing construction, alteration, or repair at the site, and meeting apprenticeship labor-hour thresholds.⁶ Keep the wage determination, worker classifications, hours, and pay records on file.

Equipment Placed in Service Before 2023

Older equipment uses inflation-adjusted rates. Where the equipment owner made a Section 45Q(b)(3) election letting the disposal party claim the credit, 2025 rates were $28.43 per metric ton for geological storage and $14.21 for EOR.⁷ For 2026, those adjusted to $29.28 and $14.64.⁸ Without a (b)(3) election, the current instructions list $46.96 for geological storage and $32.54 for EOR.¹ Check the current year’s instructions before filing; the figures adjust every year.

Working Through the Form

Form 8933 has a main body (Part I in four sections, Part III for the math) plus five schedules, A through E.

Part I, Section 1 — Facility and Equipment

Line 1 takes the pre-filing registration number. Line 3 is a three-letter alpha code for how the carbon oxide was handled: GEO for geological storage, EOR for enhanced oil or natural gas recovery, UTZ for utilization. If the facility owner and the filer are different entities, Line 4a captures the owner’s name and TIN. Lines 4b and 4c take the facility address; where no street address exists (common for remote injection sites), enter longitude and latitude. Line 5 is the construction start date.¹

Part I, Section 4 — Which Rate Applies

Line 28 asks whether the equipment owner made a Section 45Q(b)(3) election. The answer routes you to a rate track:

Line 28a (yes to the b(3) election): the inflation-adjusted (b)(3) rates ($29.28 geological / $14.64 EOR for 2026).
Line 28b (no election, equipment placed in service before 2023): the higher inflation-adjusted rates; use the current-year figures in the instructions.
Line 28c (no election, equipment placed in service after 2023): the IRA rates ($17/$12 base or $85/$60 with prevailing wage; higher for DAC).

Part III — The Math

Enter the metric tons of qualified carbon oxide on the applicable line, multiply by the rate identified in Section 4, and total. Line 1g is geological storage without EOR, Line 2g is EOR, and Line 3i is utilization; the split exists because different rates apply.

Which Schedules You Complete

The schedules track your role in the project:¹

Schedule A — filed by the owner of the geological disposal site or EOR project, reporting amounts pulled from the operator’s Schedule B or C.
Schedule B — filed by the operator of a geological disposal site (not EOR); provide a copy to each owner.
Schedule C — filed by the operator of an EOR project; provide a copy to each owner.
Schedule D — filed by the operator or owner to report a recapture event; the recaptured amount flows to Form 4255.
Schedule E — filed by the capture equipment owner electing under Section 45Q(f)(3)(B) to let another party claim the credit. A separate election is required for each facility.

More than one schedule often applies to a single project. A company that owns both the capture equipment and the disposal site completes the main form and Schedule A, while the operator of that site completes Schedule B and sends a copy back.

Attach It to the Return and File

Form 8933 doesn’t go to the IRS on its own. The Part III total carries to Form 3800, the General Business Credit, which aggregates all your business credits into the figure that offsets tax liability.⁹ Form 3800 then attaches to your income tax return: Form 1120 for C corporations, Form 1065 for partnerships, Form 1040 for sole proprietors.

The filing deadline is the return’s normal due date. Calendar-year corporations file by April 15; partnerships by March 15. Fiscal-year filers use the fifteenth day of the fourth month (corporations) or third month (partnerships) after fiscal year-end.¹⁰ Electronic filing is strongly encouraged; the schedule volume makes paper filing prone to processing errors.

If You’re Taking Direct Pay or Transferring the Credit

Two IRA provisions let you monetize the credit outside your own tax liability. Both require pre-filing registration through the ECO portal.

Under Section 6417, tax-exempt organizations, state and local governments, tribal governments, the Tennessee Valley Authority, Alaska Native Corporations, and rural electric cooperatives can elect direct pay automatically.¹¹ Any other taxpayer that places carbon capture equipment in service after December 31, 2022, can also elect direct pay specifically for the 45Q credit, for taxable years beginning through December 31, 2032.

Under Section 6418, you can sell the 45Q credit for cash to an unrelated buyer. The transfer requires a signed transfer election statement, both parties attach it to their returns, and both maintain minimum documentation substantiating the credit amount, including any prevailing wage bonus.¹² One detail worth noting for sellers: on transferred 45Q credits, the buyer bears recapture liability if the stored carbon oxide later leaks, split proportionally to the extent you retained any credits. You must notify the buyer if a recapture event occurs.

Reporting Recapture on Form 8933

If carbon oxide that generated a 45Q credit later leaks, you may owe some of it back. A recapture event occurs when the amount that leaked during a taxable year exceeds the amount properly stored in that same year.¹³

The recapture period runs three years after the last taxable year in which the credit was claimed or could have been, or until monitoring ends under the applicable EPA standard, whichever comes first. Excess leaks attribute to credit years on a last-in, first-out basis. Quantify the leaked amount under 40 CFR Part 98 Subpart RR or CSA/ANSI ISO 27916:2019; if you use the ISO method, a qualified independent engineer or geologist must certify the figures. Deliberate removal of stored carbon oxide also counts.

Report the event on Schedule D of Form 8933, then carry the amount to Form 4255, Certain Credit Recapture, to compute the addition to tax for the year.

One Boundary on Stacking

The 45Q credit is anti-stacking against the Section 45V clean hydrogen credit and the Section 45Z clean fuel credit. A facility claiming 45Q in a given year cannot also claim 45V or 45Z for that year, and in some cases electing one credit permanently disqualifies the facility from another.¹⁴ Run the numbers before committing to a path.

1
Internal Revenue Service. Instructions for Form 8933
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Internal Revenue Service. Register for Elective Payment or Transfer of Credits
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Internal Revenue Service. Credit for Carbon Oxide Sequestration
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U.S. Environmental Protection Agency. Class VI – Wells Used for Geologic Sequestration of Carbon Dioxide
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Congress.gov. The Section 45Q Tax Credit for Carbon Sequestration
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U.S. Department of Labor. Prevailing Wage and the Inflation Reduction Act
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Internal Revenue Service. Internal Revenue Bulletin 2025-20
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KPMG. IRS Notices Provide Inflation Adjustment Factor for Carbon Oxide Sequestration Credit
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Internal Revenue Service. About Form 8933, Carbon Oxide Sequestration Credit
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Internal Revenue Service. When to File
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Office of the Law Revision Counsel. 26 U.S. Code 6417 – Elective Payment of Applicable Credits
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Internal Revenue Service. Elective Pay and Transferability Frequently Asked Questions – Transferability
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eCFR. 26 CFR 1.45Q-5 – Recapture of Credit
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Internal Revenue Service. Notice 2025-10