Every business owner is constantly looking for ways to improve cash flow, ease financial strain, and optimize tax strategy. But what if your company had an untapped financial resource waiting to be unlocked?

If your business earns tax credits—such as Research & Development (R&D) tax credits, renewable energy credits, or film tax incentives—but is waiting for a refund, you might be able to sell those credits for immediate cash instead of dealing with long processing delays. This is a legitimate and strategic move that many businesses overlook, yet it can provide instant liquidity and financial flexibility.

In this blog, we’ll explore how selling your business tax credit can boost cash flow, which industries benefit the most, and how the process works—including typical processing times and key factors that impact funding speed.

What Are Tax Credits and Why Sell Them?

Tax credits are powerful government incentives designed to encourage businesses to invest in areas like renewable energy, research & development (R&D), historic preservation, and film production. These credits can significantly reduce a company’s tax liability, but not every business can fully take advantage of them in the year they are earned.

Instead of waiting for long refund processing times or letting these credits go unused, businesses that qualify may be able to:

✔ Sell eligible refundable tax credits to investment firms or companies with high tax liabilities. ✔ Receive an upfront payment for credits that are already filed and approved.

By monetizing tax credits, businesses can enhance cash flow and reinvest in operations immediately—without taking on debt or waiting years to benefit from the credit.

Industries That Benefit from Selling Tax Credits

Certain industries frequently generate tax credits that they may not fully utilize. Some of the top industries that benefit from selling tax credits include:

• Renewable Energy – Companies involved in solar, wind, and alternative energy projects often accumulate tax credits they cannot fully use, making them ideal candidates for tax credit sales. (Investment Tax Credit (ITC) and Production Tax Credit (PTC) are now transferable under the Inflation Reduction Act.)
  

• Film & Entertainment – Many states offer lucrative film tax credits to attract productions. Studios and independent filmmakers often sell these credits to offset costs.
  

• Technology & R&D – Businesses investing in innovation and research may qualify for federal and state R&D tax credits, some of which are transferable or refundable at the state level.
  

• Historic Preservation & Real Estate Development – Developers restoring historic buildings frequently earn tax credits, but if they can’t use them, they can sell them to generate additional project funding.
  

• Manufacturing & Industrial Projects – Businesses that make significant investments in new equipment, facilities, or workforce development may qualify for transferable tax credits.

How Long Does It Take to Get Refundable or Transferable Tax Credits?

Processing times for refundable or assignable tax credits vary depending on whether they are federal or state-level and the type of credit. Here’s a general breakdown:

Federal Refundable Tax Credits (IRS Processing Times)

• Fuel Tax Credits (IRS Form 8849 or 4136) → 4 to 8 weeks

• Alternative Fuel Tax Credits (Form 8849 Schedule 3) → 4 to 12 weeks

• Payroll Tax Offset for R&D Credit (Form 941-X) → 6 to 9 months

• Clean Energy Direct Pay Credits (ITC, PTC under IRA 2022) → 6+ months (guidance still evolving)

• Employee Retention Credit (ERC) Claims Are Delayed – Processing takes 6 months to over a year due to IRS backlog.
  

State Refundable Tax Credits

• Film Production Tax Credits (e.g., Georgia, Louisiana, New Mexico) → 3 to 6 months

• Refundable R&D Tax Credits (States like Connecticut, Montana, Arizona, etc.) → 6 to 12 months

• Renewable Energy State Tax Credits → 6 to 18 months

The Benefits of Selling or Financing R&D Tax Credits ✔ Immediate Cash Flow – Unlocks capital that can be used for business expansion, payroll, or other operational needs.

✔ Optimized Financial Strategy – Reduces the risk of unused tax credits expiring or going unclaimed.

✔ Non-Debt Financing – Selling credits provides liquidity without taking on loans or giving up equity.

✔ Competitive Advantage – Gives businesses the flexibility to reinvest in growth opportunities and innovation.

Final Thoughts: Should Your Business Sell Tax Credits?

If your company has unused tax credits and needs additional cash flow, selling them could be a smart financial move. This strategy allows businesses to convert unused tax incentives into immediate working capital, helping them strengthen operations and reinvest in growth.

If you're interested in learning how your business can benefit from selling tax credits, feel free to reach out at info@njordcapitalgroup.com or drop a comment! Let’s turn those unused credits into cash.