Notice 2009-52

Election of Investment Tax
Credit in Lieu of Production
Tax Credit; Coordination
With Department of Treasury
Grants for Specified Energy
Property in Lieu of Tax Credits
Notice 2009–52
This notice describes the procedures
that taxpayers will be required to follow to
make the irrevocable election to take the
investment tax credit determined under
§ 48 of the Internal Revenue Code in lieu
of the production tax credit under § 45
with respect to certain renewable energy
facilities. This election was created by
the American Recovery and Reinvestment
Tax Act of 2009, Division B of Pub. L.
111–5, 123 Stat 115 (the Act), which was
enacted on February 17, 2009. This notice
includes information about election procedures and the documentation required to
complete the election. The notice also describes the coordination of the tax credits
under §§ 45 and 48 with Treasury Department grants for specified energy property
under § 1603 of the Act (Section 1603
Grants).
SECTION 1. Background

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June 22, 2009

.01 In General. Section 48(a)(5) allows taxpayers to irrevocably elect to take
the investment tax credit determined under § 48 in lieu of the production tax credit
under § 45 with respect to certain renewable energy facilities. Section 46 provides for the investment tax credit and includes in that credit the energy credit determined under § 48. Except as otherwise provided in § 48(c)(1)(B), (2)(B), and
(3)(B), the energy credit for any taxable
year is the energy percentage of the basis

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of each energy property placed in service
during the taxable year. Section 48(a)(1).
Section 48(a)(5)(A) provides that qualified
property that is part of a qualified investment credit facility shall be treated as energy property for purposes of § 48, and
that the energy percentage with respect to
such property shall be 30 percent. Section 48(a)(5)(C) provides that taxpayers
may elect to treat certain qualified facilities (within the meaning of § 45) as qualified investment credit facilities. Section
48(a)(5)(B) provides that no credit shall be
allowed under § 45 for any taxable year
with respect to any qualified investment
credit facility.
.02 Qualified Investment Credit Facility. Section 48(a)(5)(C) provides that the
term “qualified investment credit facility” means a qualified facility (within the
meaning of § 45)—
(1) that is described in § 48(a)(5(C)(i)
or (ii);
(2) for which the taxpayer makes an irrevocable election to have § 48(a)(5) apply; and
(3) with respect to which no credit has
been allowed under § 45.
SECTION 2. Election Procedures
.01 In General. An election to treat a
qualified facility as a qualified investment
credit facility and take the investment tax
credit determined under § 48 in lieu of the
production tax credit under § 45 will be effective if it is made in the form and manner set forth in this notice. To make the
election with respect to a qualified facility, a taxpayer must claim the energy credit
with respect to qualified property that is
an integral part of the facility on a completed Form 3468 and file such form with
the taxpayer’s income tax return for the
year in which the property is placed in service. The taxpayer must make a separate
election for each qualified facility that is to
be treated as a qualified investment credit
facility. The taxpayer must also attach a
statement to the Form 3468 that includes
the following information:
(1) The name, address, taxpayer identification number, and telephone number of
the taxpayer.
(2) For each qualified investment credit
facility:
(i) A detailed technical description of
the facility, including generating capacity.

2009–25 I.R.B.

(ii) A detailed technical description of
the energy property placed in service during the taxable year as an integral part of
the facility, including a statement that the
property is an integral part of such facility.
(iii) The date that the energy property
was placed in service.
(iv) An accounting of the taxpayer’s basis in the energy property.
(v) A depreciation schedule reflecting
the taxpayer’s remaining basis in the energy property after the energy credit is
claimed.
(3) A statement that the taxpayer has not
and will not claim a Section 1603 Grant for
property for which the taxpayer is claiming
the energy credit.
(4) A declaration, applicable to the
statement and any accompanying documents, signed by the taxpayer, or signed
by a person currently authorized to bind
the taxpayer in such matters, in the following form:
“Under penalties of perjury, I declare
that I have examined this statement, including accompanying documents, and
to the best of my knowledge and belief,
the facts presented in support of this
statement are true, correct, and complete.”
.02 Effective Date. The election to take
the investment tax credit determined under
§ 48 in lieu of the production tax credit
under § 45 is available for facilities placed
in service after December 31, 2008.
.03 Deadline for Making Election. The
election to take the investment tax credit
determined under § 48 in lieu of the production tax credit under § 45 must be made
on a timely filed return (including extensions) for the taxable year in which facility
that is to be treated a qualified investment
credit facility is placed in service.
.04 Revocation. Section 48(a)(5)(C)
makes the election to treat a facility as a
qualified investment credit facility irrevocable.
SECTION 3. Documentation Required
In order to satisfy the recordkeeping requirements of § 6001 and the regulations
thereunder, a taxpayer that elects to claim
the investment tax credit determined under
§ 48 in lieu of the production tax credit under § 45 must retain adequate books and
records. This requirement specifically includes the statement described in section 2

2009–25 I.R.B.

of this notice, the Form 3468, and all supporting documentation relevant to the election and the taxpayer’s credit claim under
§ 48, so that, for any taxable year, the IRS
may verify that the property with respect to
which the taxpayer claimed the credit satisfies the applicable requirements of § 48
and this notice.
SECTION 4. Coordination with
Department Of Treasury Grants
Section 48(d) governs the interaction
between the investment tax credit determined under § 48 and Section 1603 Grants.
Generally, § 1603 of the Act requires the
Treasury Department to make grants to
persons who place in service specified
energy property (including certain energy
property eligible for the investment tax
credit determined under § 48 or the production tax credit under § 45). Section
48(d)(1) provides, in the case of property
with respect to which the Treasury makes
a Section 1603 Grant, that no credit may
be determined under § 48 or § 45 with
respect to such property for the taxable
year in which such grant is made or any
subsequent taxable year.

in lieu of the production tax credit under
§ 45. The estimated total annual reporting
burden is 100 hours. The estimated annual
burden per respondent varies from 50 to 70
minutes, depending on individual circumstances, with an estimated average burden
of 60 minutes to complete the statement required to claim the credit. The estimated
number of respondents is 100. The estimated frequency of responses is once.
Books or records relating to a collection
of information must be retained as long
as their contents may become material in
the administration of any Internal Revenue
law. Generally, tax returns and tax return
information are confidential, as required
by 26 U.S.C. 6103.
SECTION 6. Drafting Information
The principal author of this notice is
Jennifer C. Bernardini of the Office of
Associate Chief Counsel (Passthroughs
& Special Industries). For further information regarding this notice, contact
Jennifer C. Bernardini at (202) 622–3110
(not a toll-free call).

SECTION 5. Paperwork Reduction Act
The collection of information contained
in this notice has been reviewed and approved by the Office of Management and
Budget in accordance with the Paperwork
Reduction Act (44 U.S.C. 3507) under
control number 1545–2145.
An agency may not conduct or sponsor,
and a person is not required to respond
to, a collection of information unless the
collection of information displays a valid
OMB control number.
The collection of information is in section 2 of this notice. This information is
required to be collected and retained in order to ensure that energy property meets
the requirements for the investment tax
credit determined under § 48. This information will be used to determine whether
the property for which the energy credit is
claimed is energy property that qualifies
for the credit.
The collection of information is required to obtain a benefit.
The respondents are taxpayers providing a statement and filing a Form 3468 in
order to make the election to claim the investment tax credit determined under § 48

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