As a synopsis, the Qualifying Advanced Energy Project Credit was enacted by the American Recovery and Reinvestment Act of 2009 on February 17, 2009, as I.R.C. § 48C. This credit provides an investment tax credit of up to 30 percent of qualified investment in a qualifying advanced energy project, which is defined to be a project which establishes, expands or re-equips a manufacturing facility for the production of any of the following types of property:

• Property designed to be used to produce energy from the sun, wind, geothermal deposits, or other renewable resources;
• Fuel cells, microturbines, or an energy storage system for use with electric or hybrid-electric motor vehicles;
• Electric grids to support the transmission of intermittent sources of renewable energy, including storage of such energy;
• Property designed to capture and sequester carbon dioxide emissions;
• Property designed to refine or blend renewable fuels or to produce energy conservation technologies (including energy-conserving lighting technologies and smart grid technologies);
• New qualified plug-in electric drive motor vehicles, qualified plug-in electric vehicles, or components which are designed specifically for use with such vehicles, including electric motors, generators, and power control units; or
• Other advanced energy property designed to reduce greenhouse gas emissions as may be determined by the Secretary.

To qualify for this credit, a project must be certified in advance by the Internal Revenue Service. To obtain certification for projects, taxpayers must do the following:

• Apply in advance;
• Receive an allocation of a specific amount of credit from the Service;
• Sign an agreement with the Service agreeing to meet certain requirements;
• Request certification within 1 year after the credit was allocated and show that they have taken certain steps toward implementing their projects;
• Receive a certification letter from the Service; and
• Place the facility in service within 3 years after the date of certification.

Please contact me directly at Engineered Tax Services for a complimentary consultation that encompasses a Phase 1: Feasibility Analysis to see if you may qualify for this advantageous energy tax incentive.