On April 3, the Senate Finance Committee passed a modified extenders package that includes a two-year extension of the renewable energy production tax credit (PTC) under section 45 of the Internal Revenue Code as well as an extension of the option to claim the energy investment tax credit (ITC) under section 48 of the Code in lieu of PTC.
Under current law, an income tax credit is allowed for the production of electricity from qualified energy resources at qualified facilities (the PTC). Qualified energy resources include wind, biomass, municipal solid waste, and certain other identified alternative energy sources. Qualified facilities are, generally, facilities that generate electricity using qualified energy resources, provided the construction of the facility begins before January 1, 2014. Under current law, a taxpayer may make an irrevocable election to have certain property which is part of a qualified facility be eligible for a 30% investment tax credit (the ITC) in lieu of claiming the PTC. Continue reading this entry