IRS released guidance for its Section 45Z Clean Fuels Production Credit, implementing a statutory exclusion of indirect land-use change (ILUC) emissions from the lifecycle GHG accounting used to calculate credit eligibility. ILUC emissions capture the real-world climate cost of diverting cropland to fuel-feedstock production, typically triggering new land conversion (and associated carbon release) to replace displaced food/feed production. Excluding ILUC from this calculation will systematically lower the computed emissions rate relative to a full-accounting baseline, without any corresponding change in the fuel's actual net atmospheric impact. Congress’s 2025 Working Families Tax Cuts required the ILUC exclusion.