0323 Publ 5886 (PDF)

Official source: IRS Forms, Instructions & Publications (https://www.irs.gov/pub/irs-pdf/p5886.pdf), retrieved 2026-10-03. U.S. Government work (17 U.S.C. § 105).

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IRS.gov/CleanEnergy

Tax Provision Description

Production Tax Credit for Electricity from Renewables (§ 45, pre-2025)

For electricity sold to an unrelated person and produced from the following renewable sources: wind, biomass, geothermal, solar, landfill and trash, hydropower, and marine and hydrokinetic energy. Credit Amount (for 2023): 0.55 or 0.03 cents (depending on source) per kilowatt hour (kW) for facilities placed in service (PIS) after 12/31/21; 2.8 or 1.4 cents (depending on source) per kW for facilities PIS before 1/1/22; 0.55 cents per kW for marine and hydrokinetic for facilities PIS after 12/31/22. ^1,2,3,7

Clean Electricity Technology-neutral tax credit for production of clean electricity. Replaces § 45 for facilities that are placed in Production Tax Credit service after December 31, 2024. (§ 45Y, 2025 onwards) Credit Amount: 0.3 cents/kWh; 1.5 cent/kWh if PWA requirements are met. ^1,2,3,6,7

Investment Tax Credit for Energy Property (§ 48, pre-2025)

For investment in renewable energy projects including fuel cell, solar, geothermal, small wind, energy storage, biogas, microgrid controllers, and combined heat and power properties. Credit Amount: Generally, 6% of qualified investment (basis); 30% if PWA requirements are met. ^1,4,5,6,8

Clean Electricity Technology-neutral tax credit for investment in facilities that generate clean electricity and qualified energy Investment Tax Credit storage technologies. Replaces § 48 for facilities that begin construction and are placed in service after 2024 (§ 48E, 2025 onwards ) Credit Amount: 6% of qualified investment (basis); 30% if PWA requirements met ^1,4,5,6

Low-Income Additional investment tax credit for small-scale solar and wind (§ 48(e)) or clean electricity (§48E(h)) facilities Communities Bonus (<5MW net output) on Indian land, federally subsidized housing, in low-income communities, and benefit low-income Credit (§ 48(e), 48E(h)) households. Allocated through an application process. Application required Credit Amount: 10 or 20 percentage point increase on base investment tax credit

Credit for Carbon Oxide Sequestration (§ 45Q)

Credit for carbon oxide sequestration coupled with permitted end uses in the United States. Credit Amount: $12-36 per metric ton of qualified carbon oxide captured and sequestered, used as a tertiary injectant, or utilized, depending on the specified end-use; $60-$180 per metric ton if PWA requirements met. ^1,7

Zero-Emission Nuclear For electricity from nuclear power facilities. Facilities in operation prior to August 16, 2022. Power Production Credit Credit Amount (for 2023): 0.3 cents/kWh (reduced rate for larger facilities); 1.5 cent/kWh if PW requirements met ^1,7 (§ 45U)

New Energy Efficient Provides a tax credit for construction of new energy efficient homes Credit Amount: $2,500 for new homes Homes Credit meeting Energy Star standards; $5,000 for certified zeroenergy ready homes. For multifamily, base amounts are $500 (§ 45L) per unit for Energy Star and $1000 per unit for zero-energy

Energy Efficient Commercial Buildings Deduction (§ 179D)

Provides a tax deduction for the cost of energy efficiency improvements to commercial buildings, installed as part of the building envelope; interior lighting systems; or the heating, cooling, ventilation, and hot water systems. Maximum Deduction Amount: $0.50-$1 per square foot, depending on increase in efficiency, with deduction over three or four-year periods capped at $1 per square foot. Inflation adjusted. A new alternative deduction for energy efficient building retrofit property is also available.

Publication 5886 (Rev. 03-2024) Catalog Number 94466Y Department of the Treasury Internal Revenue Service www.irs.gov

Notes: The information in this document may be subject to change as guidance is issued or finalized. For all IRA clean energy tax credits, please see IRS.gov/ CleanEnergy for further details and eligibility requirements.

1 Credit is multiplied by 5 for projects that meet prevailing wages and apprenticeship requirements or other requirements under § 45(b)(6)(B). Apprenticeship requirements do not apply for §§ 45L and 45U. Under the one megawatt exception for the credits available under sections 45, 45Y, 48, and 48E, a facility that has a maximum net output of less than one megawatt of electrical energy (as measured in alternating current) may be eligible for the increased credit amount without satisfying the prevailing wage and apprenticeship requirements. The one-megawatt exception may also apply to qualified projects under section 48 with a maximum net output of less than one megawatt of thermal energy; and to energy storage technology under section 48E with a capacity of less than one-megawatt. 2 Credit is increased by 10% if the project meets certain domestic content requirements. 3 Credit is increased by 10% if the project is located in an energy community. 4 Credit is increased by up to 10 percentage points for projects meeting certain domestic content requirements for steel or iron, and manufactured products. 5 Credit is increased by up to 10 percentage points if located in an energy community. 6 Section 168(e) provides favorable depreciation treatment for facilities or property qualifying for this tax credit.These facilities or property will be treated as a 5-year property for purposes of cost recovery, leaving them with lower taxable income in the earlier years of a clean energy investment. 7 Credit is adjusted annually for inflation.

8 See section 48 for more detail and applicable exceptions to the credit rate.