Wage Requirements
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Wage requirements for enhanced credits/deductions

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The U.S. Treasury Department and the IRS recently announced guidance providing taxpayers information on how to satisfy the prevailing wage and apprenticeship requirements for enhanced tax benefits under the Inflation Reduction Act.

Notice 2022-61 explains how taxpayers, generally builders, developers, and owners of clean energy facilities, receive the increased tax credits or deduction amounts by satisfying the wage and apprenticeship requirements as provided for in this notice. For example, the notice provides guidance on what constitutes a prevailing wage and the determination of qualified apprenticeships with accompanying examples.

The publication of this notice in the Federal Register began a 60-day period in which taxpayers must begin construction of a facility (or installation under the rules for expensing energy efficient commercial building property) to receive the enhanced tax benefits without satisfying the prevailing wage and apprenticeship requirements as described in this notice.

Finally, this notice provides guidance for determining the “beginning of construction” (and “installation” for purposes of the rules for deductions for the cost of energy efficient commercial building property placed in service during the tax year).

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