Treasury Issues Guidance on "Beginning Of Construction" for 1603 Grants

The U.S. Treasury Department has clarified when construction begins in order to qualify for 1603 cash grants in lieu of tax credits.

Earlier this week, the U.S. Treasury Department released new guidance related to the cash grant program under Section 1603 of the American Recovery and Reinvestment Act of 2009. This guidance comes in the form of a set of FAQs regarding the "beginning of construction" as it relates to the grants.

Section 1603 provides a cash grant for placing in service certain renewable energy property. One of the requirements under the program is that the property be placed in service during 2009 or 2010, or placed in service after 2010 (and before that property's credit termination date) only if the construction of such property began during 2009 or 2010.