Wage and Apprenticeship Requirements for Enhanced Tax Benefits

The Treasury Department and Internal Revenue Service provides 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 instance, the notice provides guidance on what constitutes a prevailing wage and the determination of qualified apprenticeships with accompanying examples.

The publication of guidance on November 30, 2022 started the 60-day period, meaning the prevailing wage and apprenticeship requirements will be operative for facilities where construction begins on or after January 29, 2023.

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).

Learn more about Notice 2022-61 HERE or reach out to your accounting professional.

Source: Internal Revenue Service | An official website of the United States government (irs.gov)