Notice 2023-44: Additional guidance on qualifying advanced energy project credit under section 48C(e)
Program under section 48C(e) to allocate credits for qualified investments in eligible qualifying advanced energy projects
Program under section 48C(e) to allocate credits for qualified investments
The U.S. Treasury Department and the IRS issued Notice 2023-44 [PDF 749 KB] (112 pages) to provide additional guidance on the program under section 48C(e) to allocate $10 billion in credits ($4 billion of which may only be allocated to projects located in certain energy communities census tracts) for qualified investments in eligible qualifying advanced energy projects, established under H.R. 5376 (commonly called the “Inflation Reduction Act” (IRA)).
Eligible projects that are placed in service prior to receiving an allocation under the 48C program are not eligible for the credit. Allocation letters are expected to be issued on or about March 31, 2024.
The program was launched under Notice 2023-18, which provided initial program guidance and announced that the Treasury Department and IRS anticipate allocating $4 billion of section 48C(e) credits in the first allocation round, with approximately $1.6 billion of these credits to be allocated to projects located in certain energy communities, and will allocate the remaining credits in future allocation rounds. Read TaxNewsFlash
Today’s notice updates the earlier version of Appendix A, defining qualifying advance energy projects with clearer definitions and examples, and updates the earlier version of Appendix B, providing the Department of Energy (DOE) application process by adding technical review criteria and application content requirements.
Notice 2023-44 also provides the process for submitting concept papers and joint applications for DOE recommendations and for section 48C(e) certifications and clarifies the selection criteria used to evaluate whether a project merits a DOE recommendation. The notice specifically states that DOE will accept concept papers on its online application portal from June 30, 2023, through July 31, 2023.
The notice also defines the term “facility” for purposes of sections 45X and 48C, provides the procedure for informing DOE and IRS of a significant change to the project plan, includes information regarding the disclosure of certain information, and clarifies that eligible property that is placed in service before being awarded an allocation of section 48C credits is ineligible for the section 48C(e) program.
Finally, the notice provides information regarding section 48C(e) energy communities census tracts, including new Appendix C [PDF 1.4 MB], which contains a list of those census tracts.
Read the related IRS release—IR-2023-108 (May 31, 2023)
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