March 11, 2025
Earlier this year, the Treasury Department finalized regulations for the Low-Income Communities Bonus for the Section 48E Clean Electricity Investment Credit. And related to this, the IRS also issued Revenue Procedure 2025-11. The application window for the 2025 allocation opened in mid-January, so the initial 30-day window has passed, but applications will continue to be reviewed on a rolling basis.
Together, these two documents provide new or updated clarification on:
- How the annual 1.8 GW allocation will be divvied up.
- How applications are to be prioritized and evaluated.
- How “integrated operations” affect the 5 MW limitation.
- How direct current facilities may qualify.
- How RECs are treated in relation to Category 3 and Category 4.
Of additional note for LIHTC developers, there is specific guidance for Section 42 deals with qualified tax-exempt entities pursuing the Ownership Criteria for the Additional Selection Criteria.
Further details can be found here: www.irs.gov/licBonusCredit.
And as always, please reach out to The Sherbert Group if you have related questions on your project.
Aaron Mayer
Director of Sherbert Consulting and Moxie Investment Funds
704-926-8167