U.S. Sen. Thom Tillis (R-NC) recently commended a notice issued by the U.S. Treasury Department and Internal Revenue Service (IRS) that provides flexibility to American companies using the energy investment tax credit (ITC) and production tax credit (PTC) during the coronavirus pandemic.
“This is a win for renewable energy companies in North Carolina and across the country who have been affected by the coronavirus pandemic,” Sen. Tillis said on May 28. “I want to thank the Trump administration for listening to our concerns and providing companies facing supply chain disruptions as a result of COVID-19 additional time to put their projects in service and continue expanding our renewable energy industry.”
Renewable energy facilities are eligible for certain tax credits if construction of the facilities proceeds according to timelines designated by the IRS. The COVID-19 pandemic is causing delays in the construction of such facilities and, in response, the IRS on May 28 issued a notice providing taxpayers with additional time to complete construction.
Notice 2020-41 modifies prior IRS notices addressing the beginning of construction requirement for the PTC for renewable energy facilities under Section 45 of the Internal Revenue Code; and the ITC for energy property under Section 48 of the Code in response to the COVID-19 pandemic.
The Treasury Department previously received numerous requests from renewable energy interests and congressional members requesting extensions of the safe harbor provided under current guidance for the PTC and ITC.
In fact, Sen. Tillis, along with Sens. Susan Collins (R-ME) and Lisa Murkowski (R-AK), sent a May 21 letter to U.S. Treasury Secretary Steven Mnuchin urging that additional regulatory relief be granted.
Specifically, they asked that Mnuchin extend safe harbor requirements for the “start of construction” as provided by Treasury’s guidance for both the ITC and PTC.
“These modifications will help account for COVID-19 and other current impacts, which have affected supply chains and construction operations but are out of the control of those seeking to claim the PTC or ITC for qualifying energy properties,” wrote Sen. Tillis and his colleagues.