Prevailing Wage Requirements

For any facility and any equipment placed in service at such facility, you must ensure that any laborers and mechanics employed by you or any contractor or subcontractor in (i) the construction of such facility or equipment, and (ii) for any tax year, for any portion of such tax year that’s within the period described in section 45Q(a)(3)(A) or (4)(A), the alteration or repair of such facility or such equipment, must be paid wages at rates not less than the prevailing rates for construction, alteration, or repair of a similar character in the locality in which such facility and equipment are located as most recently determined by the Secretary of Labor, in accordance with subchapter IV of chapter 31 of title 40, United States Code. See Notice 2022-61 for details.

For information on how to correct a failure to satisfy the prevailing wage requirements, and the penalty related to the failure, see section 45(b)(7)(B); Notice 2022-61 ; T.D. 9998, available at IRS.gov/irb/2024-34_IRB#TD-9998 , and the Instructions for Form 4255, Certain Credit Recapture, Excessive Payments, and Penalties.

For information on the penalty related to the failure to satisfy the apprenticeship requirements, see section 45(b) (8)(D) and the Instructions for Form 4255.

Beginning of construction. See Sections 2 and 5 of Notice 2022-61 and When Construction Begins , earlier, to establish whether construction of a facility or equipment at a facility began before January 29, 2023.