Printer Friendly Document - Federal Incentives

Qualifying Adv. Energy Manufacturing Investment Tax Credit

Incentive Type
Industry Recruitment/Support
State
Federal
Eligible Efficiency Tech.
Lighting, Lighting Controls/Sensors, Energy Conservation Technologies; Smart Grid 
Eligible Renewable Tech.
Solar Water Heat, Solar Thermal Electric, Photovoltaics, Wind, Geothermal Electric, Fuel Cells, Geothermal Heat Pumps, Batteries and Energy Storage; Advanced Transmission Technologies that Support Renewable Energy Generation; , Renewable Fuels, Fuel Cells using Renewable Fuels, Microturbines 
Applicable Sectors
Commercial, Industrial, Manufacturing 
Amount
30% of qualified investment
Max. Limit
Total amount of credits to be allocated shall not exceed $2.3 billion
Terms
Apply first to the Department of Energy (DOE); must receive recommendation and ranking from DOE in order to apply to the Internal Revenue Service for certification of credits 
Web Site
http://www.energy.gov/recovery/48C.htm 
Authority
26 USCS § 48C 
Date Enacted
02/17/2009
Date Effective
02/17/2009 

Summary:
The U.S. Treasury Department, in consultation with the U.S. Department of Energy (DOE), has posted guidelines and the application for these tax credits on the website listed above. The applications may be submitted starting August 14, 2009 and preliminary applications are due to the DOE by September 16, 2009 with final applications due to DOE October 16, 2009. The DOE will provide its project review and ranking. In order to apply to the Internal Revenue Service (IRS), the applicant must receive its recommendation and ranking from the DOE. The applications to the Internal Revenue Service (IRS) are due on December 16, 2009 and must include the DOE recommendation and project ranking. IRS will certify or reject applications by January 10, 2010 and notify the certified projects of the approved amount of their tax credit.  
 
The American Recovery and Reinvestment Act of 2009 (H.R. 1), enacted in February 2009, established a new investment tax credit to encourage the development of a U.S.-based renewable energy manufacturing sector. In any taxable year, the investment tax credit is equal to 30% of the qualified investment required for an advanced energy project that establishes, re-equips or expands a manufacturing facility that produces any of the following: Qualified investments generally include personal tangible property that is depreciable and required for the production process. Other tangible property may be considered a qualified investment only if it is an essential part of the facility, excluding buildings and structural components.  
 
The U.S. Treasury Department will issue certifications for qualified investments eligible for credits to qualifying advanced energy project sponsors. In total, $2.3 billion worth of credits may be allocated under the program. After certification is granted, the taxpayer has one year to provide additional evidence that the requirements of the certification have been met and three years to put the project in service. There are provisions for credit recapture for non-compliance.  
 
In determining which projects to certify, the U.S. Treasury Department must consider those which most likely will be commercially viable, provide the greatest domestic job creation, provide the greatest net reduction of air pollution and/or greenhouse gases, have great potential for technological innovation and commercial deployment, have the lowest levelized cost of generated (or stored) energy or the lowest levelized cost of reduction in energy consumption or greenhouse gas emissions, and have the shortest project time.  
 
Any taxpayer receiving this credit may not also receive business energy investment tax credit.  
 
See U.S. DOE Advanced Energy Manufacturing Tax Credit (48C) Website for the DOE application and guidance, the IRS application, as well as the email for submitting the application.  
 
*Note: This credit may be expanded in the future to include other energy technologies that reduce greenhouse gas emissions, as determined by the U.S. Treasury Department.



Contact:
Public Information - IRS
U.S. Internal Revenue Service
1111 Constitution Avenue, N.W.
Washington, DC 20224
Phone: (800) 829-1040 
Web Site: http://www.irs.gov


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