Section references are to the Internal Revenue Service, unless otherwise noted. These supplemental instructions explain how to: Report Advanced Energy Project Credit under new section 48C(e) program on Part II, line 6a; Attach required information to claim section 48D advanced manufacturing investment credit on Part II, line 7; Elect and report payment for any advanced manufacturing investment credit determined with respect to a facility under Section 48D(d) on Part II, line10; Report Low-Income Communities Bonus Credit for certain solar and wind facilities placed in service in the fiscal year on line 6 of "Line 12hh Worksheet"; Elect and report payment or transfer for energy credit for a qualified facility (or portion of, in case of transfer) on Part III, line 14 under section 6417 and 6418. Part II, Line 6a, Qualifying Advanced Energy Project Credit Notice 2023-18 establishes the section 48C(e) program to allocate $10 billion of section 48C credits ($4 billion of which may only be allocated to projects located in certain energy communities census tracts) and provides initial program guidance. For specific information on the new allocation round for section 48C(e), see Notice 2023-18, 2023-10 I.R.B 508 available at Notice 2023-18. Part II, Line 7, Advanced Manufacturing Investment Credit You must attach a statement to Form 3468 to claim Section 48D advanced manufacturing investment credit that includes the following information. For each qualified investment with respect to any advanced manufacturing facility, include the following: Owner information, including name, taxpayer identification number, telephone number (if different from filer), and location of the facility. A detailed technical description of the facility, including manufacturing process(es) and product(s). A detailed technical description of your qualified property with respect to each facility that you placed in service during the tax year for the primary purpose of manufacturing semiconductors or semiconductor manufacturing equipment. The date that the qualified property was placed in service. An accounting of your basis in the qualified property. A depreciation schedule reflecting your remaining basis in the qualified property after the advanced manufacturing investment credit is claimed. A statement whether you did or will claim an award or grant for the qualified investment under The Creating Helpful Incentives to Produce Semiconductors (CHIPS) Act of 2022, P.L. 117-167, sec. 103, Semiconductor Incentives. If so, disclose your treatment of the award or grant in computing taxable income, tax basis, and section 48D credit with respect to the qualified investment. A declaration, applicable to the statement and any accompanying documents, signed by you, or signed by a person currently authorized to bind you in such matters that state the following: "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." Part II, Line 10, Elective Payment for Advanced Manufacturing Investment Credit If you are an eligible taxpayer as defined under section 48D(c) and elect to treat advanced manufacturing investment credit with respect to advanced manufacturing facility on Form 3468, Part II, line 7 as an elective or deemed payment, the amount on Form 3468, Part II, line 10 must be reduced by the lesser of the credit amount with respect to the facility or any unused credit amount. The term "unused credit amount" is any amount not otherwise allowed as a business credit against the tax in Part I and II of Form 3800 for your taxable year. See "Credit Ordering Rule" in the Instructions for Form 3800. If you are partnership or S Corporation and elect payment for any advanced manufacturing investment credit under section 48D(d)(2)(A), the amount on Form 3468, Part II, line 10 must be reduced by the credit amount with respect to the facility. You must not include any basis and credit amounts treated as a payment on line 10 of your Schedule K. You must attach a statement to Schedule K-1 that provides the information and the partner's or shareholder's distributive share of the amounts the partner or shareholder will need to figure the amount to report on line 7 of the partner's or shareholder's Form 3468. However, this partner's and shareholder's distributive share must not include any amounts related to the elective payment. You must attach a statement to your return with additional information below to make a valid election under section 48(d). The attached information statement should be named "CHIPS22DPE." For example, if you attach a PDF with additional information, the name of the PDF should be "CHIPS22DPE." Provide the following: A statement that you are not a foreign entity of concern (as defined in section 9901(6) of the William M. (Mac) Thornberry National Defense Authorization Act for Fiscal Year 2021). For credit attributable to each facility treated as a payment under section 48D(d)(1) or 48D(d)(2)(A), schedule showing owner information, name and location of the facility, placed in service date, the credit amount on line 7, the current credit amount allowed against tax in Part I and II of Form 3800 (if any) and the unused credit amount deemed to be allowed to you as a payment for the year. A statement that the primary purpose of the facility for which you elected the payment is the manufacturing of semiconductors or semiconductor manufacturing equipment. A statement that the placed in-service date matches the date of readiness and availability for manufacturing semiconductors or semiconductor manufacturing equipment. A declaration, applicable to the statement and any accompanying documents, signed by you, or signed by a person currently authorized to bind you in such matters that state the following: "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." Use the appropriate line number of your return shown in the table to report total elective or deemed payment amount (credit amount or unused credit amount with respect to a facility) under section 48D(d)(1) or 48D(d)(2)(A). On the dotted line next to the line on the tax return write "CHIPS22DPE" followed by total elective or deemed payment dollar amount on line 10. If there is not a dotted line after the entry space to make this entry, put an asterisk next to the line number and put a footnote at the bottom of the page indicating the line number and write "CHIPS22DPE" followed by total elective or deemed payment dollar amount on line 10. For example, if you elected to treat credit attributable to two separate facilities ($100 and $200) as payment, enter CHIPS22DPE$300 next to the dotted line or footnote to the line which may include other amounts. Part III, Line 12hh Worksheet, Line 6, Credit for Certain Solar and Wind Facilities Placed in Service in Connection with Low-Income Communities Notice 2023-17 provides the initial guidance regarding the general eligibility requirements, a description of the four statutory facility categories for which an eligible facility may request an allocation, amounts of capacity limitation reserved for each facility category, a general description of the program design and goals, the application review process, and the proposed timeline for opening two 60-day application periods in 2023 based on project categories. This guidance applies to owners of certain solar and wind facilities placed in service in connection with low-income communities that are eligible for the section 48 energy investment credit. For specific information on the new allocation round for section 48(e), see Notice 2023-17, 2023-10 I.R.B 508 available at Notice 2023-17. Section 6417 Elective Payment for Energy Credit If your 2023 tax return form is not available at the time you are required to file a return for a short tax year that begins in 2023 and ends before December 31, 2023, you must file that 2023 return using the 2022 tax return form and make all necessary modifications taking into account all tax law changes effective for tax years beginning after 2022. If properly elected by completing and attaching additional information to a version of Form 3800, Part III, noted as "IRA22DPE", an "applicable entity", as described in section 6417(d)(1)(A) (generally, a tax-exempt entity) with a short tax year beginning after December 31, 2022 and ending before December 31, 2023, may treat the energy credit amount reported in Form 3468, Part III, lines 12a–12c, 12e, 12f, 12h, 12i, 12k, 12l, 12q, 12r, 12t, 12u, 12w, 12y, 12z, 12bb, and lines 1-8 for "Line 12hh Worksheet" (if any), as an elective or deemed payment of taxes under section 6417. The credit for a qualified facility or property is deemed to be allowed to the applicable entity for short tax year. See supplemental instructions for Form 3468, line 14 below and latest instructions for Form 3800, Part III, posted at IRS.gov/form3800. An applicable entity as described in section 6417(d)(1)(A) includes: any organization exempt from the tax imposed by subtitle A; any State or political subdivision thereof; the Tennessee Valley Authority; an Indian tribal government (as defined in section 30D(g)(9)); any Alaska Native Corporation (as defined in section 3 of the Alaska Native Claims Settlement Act (43 U.S.C. 20 1602(m)); or any corporation operating on a cooperative basis which is engaged in furnishing electric energy to persons in rural areas. If you are a section 6417(d)(1)(A) applicable entity which is required to file an annual information return, you must file a Form 990-T, "Exempt Organization Business Income Tax Return" and attach and complete Form 3468 and Form 3800 to elect payment for energy credit with respect to qualified facility or property placed in service after 2022. If you are a section 6417(d)(1)(A) applicable entity for which no return is required under section 6011 or 6033(a), the IRS will issue future guidance concerning the appropriate time and manner for you to treat energy credit as an elective or deemed payment under section 6417. If you are an applicable entity with "Unrelated business taxable income" (as defined in section 512) related to the facility, your elective payment amount is the lesser of the amount of credit with respect to the facility or any unused credit amount. The term "unused credit amount" is any amount not allowed as a business credit against the tax imposed on your taxable income for the tax year. If elected, your current credit is reduced to zero and deemed allowed to you for the tax year. See "Credit Ordering Rule" in the Instructions for Form 3800. Section 6418 Transfer of Energy Credits If properly elected by completing and attaching additional information to a version of Form 3800, Part III, noted as "IRA22TRE", an "eligible taxpayer" defined as any entity not described in section 6417(d)(1)(A), including partnerships and S corporations, may elect under section 6418 to transfer or sell all of its energy credit with respect to a new qualified facility or property (or any portion of) to an unrelated `transferee taxpayer' for cash in 2023 short tax year. The cash payment received by the eligible taxpayer is not treated as taxable income, and the cash paid by the transferee taxpayer cannot be deducted against taxable income. If elected, your current general business credits are reduced by the transferred amount. The transferee taxpayer is treated as taxpayer with respect to such credit (or such portion thereof). Once a credit is transferred to an unrelated party, the unrelated party can't transfer it again. See latest instructions for Form 3468, Part III, line 14, below, and latest instructions for Form 3800, Part III. If you are a transferee taxpayer which acquired energy credit with respect to a new facility or property (or any portion of) from an eligible taxpayer, see the latest instructions for Form 3800, Part III to take into account your acquired credit. You are not required to complete the source credit form. For the latest information about developments related to Form 3800 and its instructions, go to IRS.gov/form3800. Part III, Line 14 for Certain Short Tax Year Filers to Elect Payment or Transfer of the Energy Credits If you do not or cannot elect payment or transfer of any energy credit (or portion, in case of transfer), follow reporting instructions on Form 3468, line 14. If you are an applicable entity as defined under section 6417(d)(1)(A) and elect to treat any energy credit amount on Line 14 as an elective payment for your short tax year beginning 2023, you must report the lesser of the credit amount with respect to a facility or property or any unused credit amount in Line 4a of a version of Form 3800, Part III, noted as "IRA22DPE". You must also attach additional information to Form 3800, Part III, Line 4a. See the latest instructions for Form 3800 at IRS.gov/form3800. If you are an eligible taxpayer, including partnerships and S corporations, and elect to transfer any energy credit (or portion of) reported in Form 3468, Lines 12a through 12hh, you must report the transfer amount of energy credit with respect to a new facility or property in Line 4a of a version of Form 3800, Part III, noted as "IRA22TRE". You must also attach additional information to Form 3800, Part III, Line 4a. See the latest instructions for Form 3800 at IRS.gov/form3800. If you are partnership or S corporation and elected to transfer any energy credit under section 6418, the amount reported on Schedules K and K-1 should not include any transferred amounts reported in Line 4a of a version of Form 3800, Part III, noted as "IRA22TRE". You must attach a statement to Schedule K-1 that provides the necessary information and distributive share of amounts each partner or shareholder will need to report on Lines 12a, 12b, 12c, 12e, 12f, 12h, 12i, 12k, 12l, 12q, 12r, 12t, 12u, 12w, 12y, 12z, and 12bb–12hh of their Form 3468. (See instructions to Form 1065 and Form 1120S for details.) This information and the partner's or shareholder's distributive share of amounts should not include any transferred energy credits reported in Line 4a of a version of Form 3800, Part III, noted as "IRA22TRE".
