IRS Release Guidance On Beginning Construction Rules For PTC

The IRS released Notice 2013-29 (Notice) on April 15^th providing much anticipated guidance on methods for establishing "Beginning Construction" for purposes of qualifying renewable facilities for the renewable electricity production tax credit (PTC) under Section 45 or the energy investment tax credit (ITC) under Section 48.  The PTC is based on the amount of electricity sold to an unrelated taxpayer that is produced at a qualified renewable energy facility (including a wind facility) over a 10-year period beginning on the date the facility is placed in service. Over the 10 years, the owners of the qualified facilities are able to offset federal taxes due with the credits generated from the sale of this electricity.   The ITC provides a tax credit equal to 30 percent of the qualified basis of the energy property.  As discussed on January 2nd in this blog, the "American Taxpayer Relief Act of 2012" extended the provisions of the PTC and ITC for qualified facilities by