Filed under: Sustainability | Tags: Renewable Energy, Incentives, IRS, Sustainability Practices, Alternative Energy, Tax Credits
As discussed previously on the blog, the IRS released Notice 2013-29 on April 15 which provided guidance on determining when construction has begun on a qualified renewable energy facility for purposes of the production tax credit. The Notice provided that when determining whether construction has begun, work performed for the taxpayer by other persons under a binding written contract is taken into account. The Notice defined a written binding contract as qualifying if it is enforceable under local law against the taxpayer or a predecessor and does not limit damages to a specified amount, such as by use of a liquidated damages provision. This was a slight departure from the 1603 grant rules which had a similar provision but the liquidated damages could qualify if the damages equaled or exceeded 5 percent of the total contract price. (more…)
Filed under: CleanTech, Sustainability | Tags: Alternative Energy, Incentives, IRS, Renewable Energy, Sustainability Practices, Tax Credits
The IRS released Notice 2013-29 (Notice) on April 15th providing much anticipated guidance on methods for establishing “Beginning Construction” for purposes of qualifying renewable facilities for the renewable electricity production tax credit (PTC) under Section 45 or the energy investment tax credit (ITC) under Section 48. The PTC is based on the amount of electricity sold to an unrelated taxpayer that is produced at a qualified renewable energy facility (including a wind facility) over a 10-year period beginning on the date the facility is placed in service. Over the 10 years, the owners of the qualified facilities are able to offset federal taxes due with the credits generated from the sale of this electricity. The ITC provides a tax credit equal to 30 percent of the qualified basis of the energy property. As discussed on January 2nd in this blog, the “American Taxpayer Relief Act of 2012” extended the provisions of the PTC and ITC for qualified facilities by requiring the facility to be placed in service or to have “begun construction” before January 1, 2014. The “beginning construction” language was new to the PTC and guidance from the IRS was needed in short order for developers to qualify this year. (more…)
Filed under: CleanTech, Climate Change, Sustainability | Tags: Alternative Energy, Alternative Fuel, Incentives, IRS, Renewable Energy, Solar, Sustainability Practices, Tax Credits
As discussed previously in the blog, Section 48 generally allows for an investment tax credit for qualified energy property, which includes equipment that uses solar energy to generate electricity. Section 50(b)(3) provides that no investment credit, which includeS the Section 48 investment tax credit, “shall be determined . . . with respect to any property used by an organization . . . which is exempt from the tax imposed.” In the past, this provision has deterred investment into significant solar projects that involved various tax-exempt and governmental bodies. It also deterred tax credit investors from purchasing partnership interests in tribal energy projects owned by Native American tribes as they were thought to be ineligible to pass-through the investment credits to investors. (more…)
Filed under: Sustainability | Tags: Alternative Energy, Incentives, IRS, Production Tax Credit, Renewable Energy
On April 3, the IRS released its inflation factors for calculating the production tax credit in 2013. The credit for renewable electricity production for calendar year 2013 is 2.3 cents per kilowatt hour (increased from 2.2 cents per hour) on the sale of electricity produced from the qualified energy resources of (more…)
In a March 4 message posted to its website, the Treasury Department said grants under the “1603” stimulus program would be reduced by 8.7 percent to meet obligations imposed by the March 1 across-the-board “sequestration” budget cuts. (more…)
