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Sensiba San Filippo Update: Cash Payments for Energy Property Investments Extended Through 2011
Businesses investing in energy conservation, alternative energy and similar eco- and alternative energy-conscious projects have received another windfall from the US government.
A key pro-alternative energy provision originally introduced in the American Recovery and Reinvestment Act of 2009 (ARRA) has been extended through 2011. Originally expiring in 2010, the “1603 Program: Payments for Specified Energy Property in Lieu of Tax Credits” allows businesses eligible to take advantage of energy property investment tax credits to choose cash payments in lieu of tax credits – a provision that may be particularly useful for businesses not currently in a taxable position.
Businesses may apply for a cash payment from the government equal to the tax credit allowed for qualified investments in energy property. The credit and corresponding cash payment is generally 30% of the investment made in qualified energy property (solar, wind, fuel cell, geo thermal, etc.).
To qualify:
- The energy property must be placed in service in 2009, 2010 or 2011, or placed in service after 2011 if construction of the property began during the 2009 – 2011 period;
- Applications must be submitted by September 30, 2012.
Recent guidance from the Treasury Department has added some compliance complexity –payment applications reflecting eligible investments in excess of $500,000 must be accompanied by an independent accountant’s certification attesting to the accuracy of costs being claimed as part of the basis of the energy property subject to the credit calculation.
The practitioners at Sensiba San Filippo are experienced in the 1603 Program energy property certification, the reporting process and have successfully helped our clients prepare for their OIG (Office of the Inspector General) audits, and we are prepared to assist your company with analysis of eligible costs and/or actual certification.
Interested in applying for your cash payment in lieu of the energy investment tax credit? Click here to access the application.
For more information or for assistance in assessing your company’s eligibility, contact your SSF partner or send an email to info@ssfllp.com.
