US Treasury Department Issues Section 1603 Program Guidance on Evaluating Cost Basis for Solar PV Properties

Originally published June 30, 2011

Keywords: US Treasury Department, Section 1603, program guidance, solar PV properties, Grant program

On June 30, 2011, the US Treasury Department (Treasury) posted guidance (Guidance) to assist applicants in determining their cost basis for certain solar photovoltaic (PV) properties for purposes of the Section 1603 grant (Grant).

Under the Grant program, Treasury will make a payment equal to 30 percent of the basis of certain solar property (i) that is placed in service during 2009, 2010 or 2011 or (ii) for which construction began in 2009, 2010 or 2011 if the property is placed in service by the end of 2016. The Guidance provides that applications will be evaluated to determine whether the basis of solar PV property includes only eligible items and whether the basis represents the applicant's actual costs or, in the case of a pass-through lease, the fair market value of the eligible property. The principles underlying the