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- Tax Credit
IRA Statuatory Location:
13701
Tax Code Location:
26 U.S. Code § 45Y
New or Modified Provision:
New
Eligible Recipients:
Facilities generating electricity for which the greenhouse gas emissions rate is not greater than zero.
Tribal Eligibility:
Yes
Funded by:
U.S. Department of Treasury
Description
Provides a technology-neutral tax credit for production of clean electricity. Replaces the production tax credit for electricity generated from renewable sources (extended in Section 13201 through 2024).
Direct Pay Eligibility:
Credit is increased by 5 times for projects meeting prevailing wage and registered apprenticeship requirements. Initial guidance on the labor provisions is available here. Credit is increased by 10% for projects meeting certain domestic content requirements for steel, iron, and manufactured products. Credit is increased by 10% if located in an energy community.
Transferability:
Yes
Stackability:
Credit reduced for tax-exempt bonds with similar rules as section 45(b)(3).
Energy Community Bonus:
Yes
Relevant Announcements
Related Resources
Additional information is available on the Resources page.Key Details
Period of Availability
Facilities placed in service after 12/31/24. Phase-out starts the later of (a) 2032 or (b) when U.S. greenhouse gas emissions from electricity are 25% of 2022 emissions or lower.
Tax Mechanism:
Production tax credit
Base Credit Amount:
$0.03/kW, inflation adjusted
Bonus Credit Amount:
Credit is increased by 5 times for projects meeting prevailing wage and registered apprenticeship requirements. Initial guidance on the labor provisions is available here. Credit is increased by 10% for projects meeting certain domestic content requirements for steel, iron, and manufactured products. Credit is increased by 10% if located in an energy community.