Additional Guidance Provided for the Qualifying Advanced Energy Project Credit Allocation Program, Notice 2023-44

The IRS has released additional guidance for the Qualifying Advanced Energy Project Credit Allocation Program. The new guidance clarifies and modifies Notice 2023-18, I.R.B. 2023-10, 508 (TAXDAY, 2023/02/14, I.2).

Background

The Inflation Reduction Act (P.L. 117-169) added Code Sec. 48C(e) to extend the Code Sec. 48C Qualifying Advanced Energy Project Credit and to provide an additional credit allocation of $10 billion. The Act also modified the definition of a “qualifying advanced energy project.”Notice 2023-18 established the program to allocate the $10 billion of credits for qualified investments in eligible qualifying advanced energy projects. Four billion dollars of this program must be allocated to projects located in Section 48C(e) Energy Communities Census Tracts.

Notice 2023-44

Notice 2023-44 provides additional and updated definitions, explains the interaction between Code Sec. 45C and the Advance Manufacturing Production Credit of Code Sec. 45X, and provides updated examples. It also includes requirements for eligible property to be considered placed in service, and that property placed in service before being awarded an allocation of section 48C credits is ineligible for the Section 48C(e) program. The Notice provides application requirements, decision, notification, and certification procedures, and selection and review criteria.

An online application portal is available at https://48C-exchange.energy.gov/.

In addition, the Notice provides a list of Energy Communities Census Tracts. A map of Section 48C(e) Energy Communities Census Tracts is available at www.energy.gov/infrastructure/48C.