Treasury Announces That Applications for Grants in Lieu of ITC and PTC Now Being Accepted

Jul 31, 2009 - Stoel Rives

The US Department of the Treasury announced today that applications are now being accepted for grants in lieu of income tax credits pursuant to the American Recovery and Reinvestment Act of 2009 (ARRA). ARRA, which was enacted in February, permits an applicant to receive a grant from the Treasury Department in lieu of claiming investment tax credits (ITCs) or production tax credits (PTCs). To qualify, the property must be placed in service in 2009 or 2010 or, if construction begins in 2009 or 2010, must be placed in service by the end of 2012 (for wind), 2013 (for biomass, geothermal and other resources) or 2016 (for solar). The grant functions similarly to a refundable tax credit. The amount of a grant generally is equal to the amount of the ITC for which the owner of the project otherwise would have been eligible (i.e., generally 30% of the qualified cost of the project).

For a full description of ARRA and guidelines previously issued by the Treasury Department, see our alert at http://www.stoel.com/showalert.aspx?Show=5682.

In addition to the announcement, the Treasury Department provided a program for completing and submitting applications electronically, and also provided a form for obtaining an accountant's certification for projects having a cost basis in excess of $500,000. The Treasury Department also provided a form notice of assignment for applicants wishing to assign grant payments to another person, as well as a link to register with the Central Contractor Registration, which is a prerequisite to qualify for the grant.

To review the Treasury Department application and other forms, see http://www.treas.gov/recovery/1603.shtml.

If you have questions about any of these funding opportunity announcements or other renewable energy issues, or if you would like assistance applying for these or other government funds, please contact:

Chris Heuer at (503) 294-3206 or ckheuer@stoel.com
Greg Jenner at (612) 373-8857 or gfjenner@stoel.com
Carl Lewis at (206) 386-7688 or cslewis@stoel.com
Kevin Pearson at (503) 294-9622 or ktpearson@stoel.com
Adam Kobos at (503) 294-9246 or ackobos@stoel.com

IRS Circular 230 notice: Any tax advice contained herein was not intended or written to be used, and cannot be used, by you or any other person (i) in promoting, marketing or recommending any transaction, plan or arrangement or (ii) for the purpose of avoiding penalties that may be imposed under federal tax law.