The Internal Revenue Service (IRS) issued Notice 2023-44 to provide additional guidance for applicants seeking Section 48C credit allocations in the qualifying advanced energy project credit allocation program created by the Inflation Reduction Act.
Previously, the Treasury Department and the IRS issued Notice 2023-18 to establish the program to allocate $10 billion in credits, of which at least $4 billion will be allocated to projects located in certain energy communities census tracts. The notice also provided initial guidance as well as stating the intention to issue additional program guidance by May 31, 2023. The guidance is primarily of interest to owners of clean energy manufacturing and recycling projects, greenhouse gas emission reduction projects, and critical material projects.
Notice 2023-44 updates the earlier guidance, defining qualifying advance energy projects, with clearer definitions and examples, and updates the earlier version of the application process by adding technical review criteria and application content requirements. This notice also provides the process for submitting concept papers and joint applications for Department of Energy (DOE) recommendations and for IRS § 48C(e) certifications and clarifies the selection criteria used in the recommendation process.
The additional guidance contained in this notice provides general guidance for the § 48C(e) program, specifically including the following:
- Definitions of the term “facility” for purposes of §§ 48C and 45X,
- Clarification regarding projects placed in service prior to being awarded an allocation of qualifying advanced energy project credits (§ 48C credits),
- Process for submitting concept papers and joint applications for DOE recommendations and for IRS § 48C(e) certifications [§ 48C(e) applications],
- Information regarding § 48C(e) Energy Communities Census Tracts,
- Selection criteria used to evaluate whether a project merits a DOE recommendation,
- Procedure for informing the IRS and the DOE of a significant change in plans for a project that has received an allocation of § 48C credits, and
- Disclosure of certain information. In addition, this notice provides information regarding when the DOE online application portal will begin accepting concept papers and the timeline for submitting a § 48C(e) application.
Please contact our Ryan professionals for assistance with this application process.
TECHNICAL INFORMATION CONTACTS:
Ian Boccaccio
Principal
Ryan
469.399.4545
ian.boccaccio@ryan.com
Mary Bernard
Director
Ryan
401.272.3363
mary.bernard@ryan.com
The material presented in this communication is intended to provide general information only and should solely be seen as broad guidance and not directed to the particular facts or circumstances of any individual who may read this publication. No liability is accepted for acts or omissions taken in reliance upon the content of this piece. Before taking (or not taking) any action, readers should seek professional advice specific to their situation from Ryan, LLC or other tax professionals. For additional information about this topic, please contact us at info@ryan.com.