PDF document

- 1 -

Userid: CPM Schema: instrx Leadpct: 100% Pt. size: 9 Draft Ok to Print
AH XSL/XML Fileid: … ions/i3468/2023/a/xml/cycle04/source (Init. & Date) _______

Page 1 of 21 9:21 - 25-Jan-2024

The type and rule above prints on all proofs including departmental reproduction proofs. MUST be removed before printing.

Department of the Treasury
Internal Revenue Service
2023

Instructions for Form 3468

Investment Credit

Section references are to the Internal Revenue Code unless IRA 2022 provides $10 billion of allocations, directs a
otherwise noted. minimum share to section 48C(e) energy communities
census tracts, and expands eligibility to new types of
qualifying advanced energy projects. This credit is figured in
Future Developments Part III.
For the latest information about developments related to Form • Section 48 provides an energy credit for investment in
3468 and its instructions, such as legislation enacted after they energy property. This credit amount can be increased by 5
were published, go to IRS.gov/Form3468. times for projects meeting prevailing wage and
apprenticeship requirements or project requirements,
What’s New including energy storage technology property, qualified
biogas property, microgrid controllers property, and clean
2023 Form 3468. The form has been redesigned to support the hydrogen production facilities elected to be treated as
provisions created by the Inflation Reduction Act of 2022 (IRA energy property. This credit is figured in Part VI.
2022) and the Creating Helpful Incentives to Produce • Section 48 also provides 3 bonus credits if certain
Semiconductors Act of 2022 (CHIPS 2022). conditions are met.
Facility Information. Form 3468 and its instructions were • The energy credit is increased by up to 10% for
changed to require separate information and computation of projects meeting certain domestic content requirements
investment tax credit for each facility or property placed in for steel, iron, and manufactured products.
service in 2023. See Part I—Facility Information. • The energy credit is increased by up to 10% if located
Tax-exempt and governmental entities. For tax years in an energy community.
beginning after 2022, applicable entities (such as certain • The energy credit is increased by up to 20% on certain
tax-exempt and governmental entities) can elect to treat certain solar and wind facilities placed in service in connection
investment credits as a payment of income tax. See Applicable with low-income communities.
Entities, later. • The energy credit and any increased or bonus amounts are
figured in sections A-M of Part VI. See Lines 7 and 8 Line 9, ,
Transfer of certain investment tax credits. For tax years Line 10, and Lines 11 and 12, for the requirements to claim
beginning after 2022, eligible taxpayers, partnerships, and S these increased bonus amounts.
corporations can elect to transfer all or part of the credit amount
otherwise allowed as a general business credit to an unrelated
third-party buyer in exchange for cash. Eligible taxpayers don’t General Instructions
include applicable entities. See Credit Transfers, later.
Elective payment for advanced manufacturing investment Purpose of Form
credit. For a facility placed in service after 2022, eligible Use a separate Form 3468 to enter information and amounts in
taxpayers, partnerships, and S corporations can elect to treat the appropriate parts to claim a credit for each investment
advanced manufacturing investment credit under CHIPS 2022 property and any unused investment credit amount from
as a payment of tax. See Elective Payment Under Section cooperatives.
48D(d), later.
Complete a separate Form 3468 to claim an investment credit
Pre-filing registration. The IRS has established a pre-filing for each facility or property. You must complete Part I to report
registration process that must be completed prior to electing facility or property information and the appropriate part (Part II–
payment or transfer of the investment credit figured in Parts III, VII) to compute your investment credit for such facility or
IV, and VI. See Pre-filing Registration Requirement For Payments property.
and Transfers, later. • Part II—Qualifying Advanced Coal Project Credit, section A;
• Part II—Qualifying Gasification Project Credit, section B;
Reminders • Part III—Qualifying Advanced Energy Project Credit;
Advanced manufacturing investment credit. CHIPS 2022 • Part IV—Advanced Manufacturing Investment Credit;
added a new investment credit equal to 25% of the qualified • Part VI—Energy Credit, sections A through N; or
investment in any advanced manufacturing facility for the primary • Part VII—Rehabilitation Credit.
purpose of the manufacturing of semiconductors or Patrons, including cooperatives that are patrons in other
semiconductor manufacturing equipment under section 48D. cooperatives, file a separate Form 3468 to enter any unused
This credit applies to property placed in service after 2022, and, qualifying advanced coal project credit, qualifying gasification
for any property that construction of which begins prior to 2023, project credit, qualifying advanced energy project credit,
only to the extent of the basis attributable to the construction, advanced manufacturing investment credit, energy credit, or
reconstruction, or erection after August 9, 2022. This credit is rehabilitation credits allocated from cooperatives. Enter “Unused
figured in Part IV. Investment Credit from Cooperatives” on a separate Form 3468,
New and modified energy investment credits. IRA 2022 Part I, line 1, and enter the total unused amounts (if any) on the
modified and extended the following. applicable part below.
• Section 48C provides a tax credit of up to 30% of the • Part II, line 6.
qualified investment in an advanced energy project that • Part III, line 2.
meets the prevailing wage and apprenticeship requirements. • Part IV, line 2.

Jan 25, 2024 Cat. No. 12277P

- 2 -

Page 2 of 21           Fileid: … ions/i3468/2023/a/xml/cycle04/source                        9:21 - 25-Jan-2024

The type and rule above prints on all proofs including departmental reproduction proofs. MUST be removed before printing.

•   Part VI, section N, line 31.
•   Part VII, line 2.                                               At-Risk Limit for Individuals and 
                                                                    Closely Held Corporations
Note. If you are an individual and file electronically, you must 
send in a paper Form 8453, U.S. Individual Income Tax               The cost or basis of property for investment credit purposes may 
Transmittal for an IRS e-file Return, if attachments are required   be limited if you borrowed against the property and are protected 
for Form 3468.                                                      against loss, or if you borrowed money from a person who is 
                                                                    related or who has an interest (other than as a creditor) in the 
Investment Credit Property                                          business activity. The cost or basis must be reduced by the 
                                                                    amount of the nonqualified nonrecourse financing related to the 
Investment credit property is any depreciable or amortizable        property as of the close of the tax year in which the property is 
property that qualifies for the qualifying advanced coal project    placed in service. If, at the close of a tax year following the year 
credit, qualifying gasification project credit, qualifying advanced property was placed in service, the nonqualified nonrecourse 
energy project credit, advanced manufacturing investment credit,    financing for any property has increased or decreased, then the 
energy credit, or rehabilitation credit.                            credit base for the property changes accordingly. The changes 
                                                                    may result in an increased credit or a recapture of the credit in 
  You can't claim a credit for property that is:
                                                                    the year of the change. See sections 49 and 465 for details.
•   Used mainly outside the United States (except for property 
    described in section 168(g)(4));                                Recapture of Credit
•   Used by a governmental unit or foreign person or entity (see 
    exceptions below);                                              You may have to refigure the investment credit and recapture all 
•   Used for lodging or in the furnishing of lodging (see section   or a portion of it if:
    50(b)(2) for exceptions); or                                    • You dispose of investment credit property before the end of 
•   Certain MACRS business property to the extent it has been         5 full years after the property was placed in service 
    expensed under section 179.                                       (recapture period);
                                                                    • You change the use of the property before the end of the 
Exceptions                                                            recapture period so that it no longer qualifies as investment 
                                                                      credit property;
•   Investment credit property used by a governmental unit or         The business use of the property decreases before the end 
                                                                    •
    foreign person or entity for a qualified rehabilitated building   of the recapture period so that it no longer qualifies (in whole 
    leased to that unit, person, or entity; and property used         or in part) as investment credit property;
    under a lease with a term of less than 6 months;                  Any building to which section 47(d) applies will no longer be 
                                                                    •
•   A tax-exempt organization or governmental entity which is         a qualified rehabilitated building when placed in service;
    generally unable to claim an investment credit must               Any property to which section 48(b), 48A(b)(3), 48B(b)(3), 
                                                                    •
    complete and attach Form 3468 and Form 3800 to Form               48C(b)(2), or 48D(b)(5) applies will no longer qualify as 
    990-T, or other applicable income tax return, to claim a          investment credit property when placed in service;
    section 48C credit or section 48 credit for which an election     Before the end of the recapture period, your proportionate 
                                                                    •
    is made under section 6417 for any tax year. See the              interest is reduced by more than 1/3 in an S corporation, 
    Instructions for Form 3800, at IRS.gov/Form3800.                  partnership, estate, or trust that allocated the cost or basis of 
                                                                      property to you for which you claimed a credit;
Qualified Progress Expenditures                                       You return leased property (on which you claimed a credit) 
                                                                    •
Qualified progress expenditures are those expenditures made           to the lessor before the end of the recapture period;
before the property is placed in service and for which the          • A net increase in the amount of nonqualified nonrecourse 
taxpayer has made an election to treat the expenditures as            financing occurs for any property to which section 49(a)(1) 
progress expenditures. Qualified progress expenditure property        applied;
is any property that is being constructed by or for the taxpayer    • You engage in an applicable transaction, as defined in 
and which (a) has a normal construction period of 2 years or          section 50(a)(6)(D).
more, and (b) it is reasonable to believe that the property will be 
new investment credit property in the hands of the taxpayer         Exceptions to recapture. Recapture of the investment credit 
when it is placed in service. The placed-in-service requirement     doesn't apply to any of the following.
doesn't apply to qualified progress expenditures.                   1. A transfer due to the death of the taxpayer.
  Qualified progress expenditures for:                              2. A transfer between spouses or incident to divorce under 
•   Self-constructed property means the amount that is properly       section 1041. However, a later disposition by the transferee 
    chargeable (during the tax year) to a capital account with        is subject to recapture to the same extent as if the transferor 
    respect to that property; or                                      had disposed of the property at the later date.
•   Non-self-constructed property means the lesser of (a) the 
    amount paid (during the tax year) to another person for the     3. A transaction to which section 381(a) applies (relating to 
    construction of the property; or (b) the amount that              certain acquisitions of the assets of one corporation by 
    represents the proportion of the overall cost to the taxpayer     another corporation).
    of the construction by the other person, which is properly      4. A mere change in the form of conducting a trade or 
    attributable to that portion of the construction that is          business if:
    completed during the tax year.
                                                                      a. The property is retained as investment credit property in 
  For more information on qualified progress expenditures, see        that trade or business, and
section 46(d) (as in effect on November 4, 1990). For details on      b. The taxpayer retains a substantial interest in that trade 
qualified progress expenditures for the rehabilitation credit, see    or business.
section 47(d).
                                                                     A mere change in the form of conducting a trade or business 
  For details on qualified progress expenditures for the            includes a corporation that elects to be an S corporation and a 
advanced manufacturing investment credit, see section 48D(b)        corporation whose S election is revoked or terminated.
(5).

2                                                                                            Instructions for Form 3468 (2023)

- 3 -

Page 3 of 21 Fileid: … ions/i3468/2023/a/xml/cycle04/source 9:21 - 25-Jan-2024

The type and rule above prints on all proofs including departmental reproduction proofs. MUST be removed before printing.

Any required recapture is reported on Form 4255, Recapture to compute the credit amount with respect to the facility or
of Investment Credit. For more information, see the form and property.
instructions for Form 4255.
You must report any credit amount for a facility or property on
See section 46(g)(4) (as in effect on November 4, 1990), Part III, line 3; Part IV, line 3; or Part VI, line 32 of Form 3468, on
! and related regulations, if you made a withdrawal from a the applicable lines of Form 3800, Part III, and attach both to
CAUTION capital construction fund set up under the Merchant your return.
Marine Act of 1936 to pay the principal of any debt incurred in
connection with a vessel on which you claimed investment See the Instructions for Form 3800 for determining credits
credit. allowed (in the case of estates and trusts), reporting of elective
payment amount of section 48D credit and transferred amount
and non-transferred amount (if any) of section 48C and section
48 credits on Schedules K and K-1 of Form 1065, Form 1120-S,
Specific Instructions and Form 1041.

S Corporations, Partnerships, Applicable Entities
Estates, and Trusts For tax years beginning after 2022, applicable entities as defined
Complete and attach a separate Form 3468 to your return for under section 6417(d)(1)(A) that generally don't benefit from
each facility or property that you use in your trade or business, income tax credits can elect to treat the business credit under
even if the following apply. sections 48C and 48 as a payment of income tax. Resulting
overpayments may result in refunds.
1. You cannot claim the credit,
Applicable entities making the elective payment election for
2. You didn’t elect to treat section 48D credit as a payment the investment credits under section 48C or section 48 must file
under section 48D(d), or the following.
3. You didn’t elect to transfer section 48C credit or section 48 • Form 3468 with any required statements;
credit (or portion of such credits) under section 6418. • Form 3800, General Business Credit; and
• Form 990-T, Exempt Organization Business Income Tax
To figure the cost or basis of each facility or property to pass Return, or other applicable tax return.
through to the individual shareholders, partners, or beneficiaries,
complete required facility information lines of Part I and only the For a discussion of what is an applicable entity, see
following. Applicable entity making elective payment election on IRA 2022
• Part II, lines 1a, 2a, 3a, 4a, 5a, and 6 (if applicable). credits in the Instructions for Form 3800. For more information on
• Part III, lines 1a, 1d, 1e, and 2 (if applicable). elective payment elections under section 6417, see Elective
• Part IV, lines 1a, 1b, and 2 (if applicable). Payment of Certain Business Credits Under Section 6417 or
• Part VI, lines 1a, 3a, 3e, 5a, 5f, 5o, 7a, 7j, 9a, 9b, 11a, 11d, Section 48D in the Instructions for Form 3800.
11h, 13a, 15a, 17a, 17e, 19a, 21a, 23a, 23e, 25a, 25d, 25g,
25j, 29a, and 31 (if applicable). Elective Payment Under Section
• Part VII, lines 1a through 1g, 1k, and 2 (if applicable). 48D(d)
Attach a statement to Schedule K-1 that provides this For qualified property placed in service after 2022 that is part of
necessary information and distributive share of amounts that an advanced manufacturing facility, a taxpayer can elect to treat
each partner, shareholder, and beneficiary will need to compute the credit as a payment against tax. A partnership or S
their share of the credit related to investment property on their corporation can elect to receive the credit as a payment. The
Form 3468. See the instructions for Form 1065, U.S. Return of following must be filed with your return to make an elective
Partnership Income; Form 1120-S, U.S. Income Tax Return for payment election under section 48D.
an S Corporation; Form 1041, U.S. Income Tax Return for • Form 3468; and
Estates and Trusts; and Schedules K and K-1 for details. • Form 3800.
If you reported any unused investment credits allocated from For more information on elective payment elections under
cooperatives on a Form 3468, Part I, line 1, “Unused Investment section 48D see Elective Payment of Certain Business Credits
Credit from Cooperatives,” see the reporting instructions for Under Section 6417 or Section 48D in the Instructions for Form
Schedules K and K-1 of Form 1120-S, Form 1065, or Form 1041. 3800.

Note. If you’re electing a payment under section 48D, Part IV; or Credit Transfers
electing to transfer a credit under section 48C, Part III; or electing For tax years beginning after 2022, under section 6418, eligible
a payment or transferring under section 48, Part VI, you must taxpayers, partnerships, and S corporations can elect to transfer
also report the current credit amount for such facility or property all or part of the credit figured in Part III and Part VI to an
on the applicable total line of Form 3468 and the applicable line unrelated third-party buyer in exchange for cash. For more
of Form 3800, Part III. information on credit transfers, see Transfer of Eligible Credits
Under Section 6418 in the Instructions for Form 3800.
This information and the partner's, shareholder's, or
! beneficiary's distributive share of amounts should not Pre-filing Registration Requirement
CAUTION include any investment credits for which an elective
payment election was made under section 48D(d) or a transfer For Payments and Transfers
election was made under section 6418. Before you file your tax return, if you intend to make an elective
payment election or transfer election on Form 3800 for the credit
If you elected to treat section 48D credit as a payment under in Part III, IV, or VI, you must complete a pre-filing registration for
section 48D(d)(2)(A) or elected to transfer section 48C credit or each property or facility. To register, go to IRS.gov/Register for
section 48 credit (or a portion of such credits) under section elective payment or transfer of credits. See Pub. 5884, Inflation
6418(c), you must complete all applicable parts and lines of Reduction Act (IRA) and CHIPS Act of 2022 (CHIPS) Pre-Filing
Form 3468 (including the registration number on line 2a of Part I) Registration Tool. Also see Registering For and Making Elective
Instructions for Form 3468 (2023) 3

- 4 -

Page 4 of 21 Fileid: … ions/i3468/2023/a/xml/cycle04/source 9:21 - 25-Jan-2024

The type and rule above prints on all proofs including departmental reproduction proofs. MUST be removed before printing.

Payment and Transfer Elections in the Instructions for Form Filers Completing Part III
3800.
For an increased tax credit under section 48C, a taxpayer must
Part I—Facility Information meet the prevailing wage and apprenticeship requirements with
If you’re claiming an investment credit with respect to a facility or respect to any qualified advanced energy project.
property, use the table below to enter the facility information that
corresponds to your credit(s). As part of a section 48C(e) application, an applicant must
confirm that it intends to meet the prevailing wage and
If You Are Completing. . . Then Complete Part I . . . apprenticeship requirements by filing the “Initial PWA
Confirmation” statement with the Department of Energy (DOE).
Part II Lines 1–5, and 14 When the taxpayer notifies the DOE that it has placed the project
Part III Lines 1–5, and 8 in service, the taxpayer must also confirm that it met the
prevailing wage and apprenticeship requirements by filing the
Part IV Lines 1–5, and 14 “Final PWA Confirmation” statement with the DOE.
Part VI Lines 1–14 (and Line A for credit
figured in section M) If a taxpayer doesn't provide an Initial and Final PWA
Confirmation statement to the DOE, the taxpayer will be required
Part VII Lines 1–5, and 14 to claim the section 48C credit at the 6% credit rate and the
remainder of the section 48C credits allocated to the project will
be forfeited.

See Notice 2022-61 and Notice 2023-18 for more detailed
Line A information. Also see Frequently asked questions about the
Provisional emissions rate. Indicate that you petitioned the prevailing wage and apprenticeship under the Inflation Reduction
Secretary for a provisional emissions rate (PER) by checking the Act.
box on Line A of Part I. As part of the process to petition for a Prevailing wage requirements. In general, the taxpayer must
PER, you must have submitted an application to the DOE for an ensure that laborers and mechanics employed by the taxpayer
emissions value that you used to figure your energy credit for a (or contractor or subcontractor) in the re-equipping, expansion,
clean hydrogen production facility. See Election to treat clean or establishment of a manufacturing facility are paid wages at
hydrogen production facilities as energy property, later, for rates not less than the prevailing rates for construction,
reporting requirements. alteration, or repair of similar character in the locality in which the
project is located, as most recently determined by the Secretary
Line 1 of Labor.
For Part II, Part III, and Part VI filers. Enter a detailed See Notice 2022-61 and Notice 2023-18 for more
technical description of the facility or property that is an integral information.
part of such facility.
Apprenticeship requirements. Each taxpayer (or contractor or
For Part IV filers. Enter a detailed technical description of the subcontractor) who employs four or more workers to perform
manufacturing process(es) and end product(s) for the advanced construction, alteration, or repair work on a facility must employ
manufacturing investment credit. one or more qualified apprentices from a registered
For Part VII filers. Enter a detailed description of the apprenticeship program.
rehabilitated building. A minimum percentage of the total labor hours of the
construction, alteration, or repair work must be performed by the
Note. If the owner of the facility in Part II, III, IV, VI, or VII is qualified apprentices. This percentage is:
different from the filer, also include the owner name and taxpayer • 10% for facilities beginning construction before 2023,
identification number in the description. • 12.5% for facilities beginning construction in 2023, and
• 15% for facilities beginning construction in 2024 or after.
Line 2a Taxpayers (or contractors or subcontractors) must also
If applicable, enter your pre-filing registration number for the ensure that any applicable ratios of apprentices to
facility or property that you received from the IRS prior to making journeyworkers established by the registered apprenticeship
an election under section 48D(d), section 6417, or section 6418. program are met. An exception may apply when a taxpayer (or
contractor or subcontractor) has requested qualified apprentices
Lines 3a and 3b from a registered apprenticeship program and no apprentices
On line 3a, enter the address of the facility or property. If there is are available. See sections 48C(e)(6), 45(b)(8), Notice 2022-61,
no address, enter the longitude and latitude coordinates of the and Notice 2023-18 for more detailed information.
facility or property on line 3b. Lines 7 and 8. For line 7, check box 7c. For line 8, check
box 8a or 8c, as appropriate.
Lines 7 and 8
Notice 2022-61 explains how filers receive increased tax credit Filers Completing Part VI
amounts under section 48C and section 48 by meeting the
prevailing wage and apprenticeship requirements. The notice
also provides guidance for determining the beginning of For an increased tax credit under section 48(a)(9)(A)(i), a
construction of a section 48 energy project. See Notice 2022-61, taxpayer needs to meet one of the project requirements in an
2022-52 I.R.B. 560. energy project.

If you are claiming a credit in Part III or Part VI, see See Notice 2022-61 for more information. Also see
information below about which box to check. Frequently asked questions about the prevailing wage and
apprenticeship under the Inflation Reduction Act.

4 Instructions for Form 3468 (2023)

- 5 -

Page 5 of 21 Fileid: … ions/i3468/2023/a/xml/cycle04/source 9:21 - 25-Jan-2024

The type and rule above prints on all proofs including departmental reproduction proofs. MUST be removed before printing.

Energy project. An energy project is a project consisting of one Increased Credit Amount Statement
or more energy properties that are part of a single project under
section 48. If you checked the box on line 7a or 8b to claim an increased tax
A project meets the project requirements if it's any of the credit amount in Part VI, you must also attach a statement for
following. each facility or property, at the time of filing your return. The
statement should include the following.
1. It has a maximum net output of less than 1 megawatt of
electrical (as measured in alternating current) or thermal 1. Your name, taxpayer identification number, the facility
energy; description (including the owner information, if different from
the filer), and, if applicable, the IRS-issued registration
2. Construction began before January 29, 2023; or number from Part I, line 2a.
3. The energy project meets the prevailing wage and 2. For the facility or property that began construction before
apprenticeship requirements in sections 48(a)(10)(A) and January 29, 2023, indicate that you met the continuity
(11). requirement under the physical work test or the 5% safe
harbor to establish the beginning of construction.
Beginning of construction. There are two methods that can
be used to establish that construction of a qualified facility has 3. For the facility or property that began construction on or
started, the physical work test and the 5% safe harbor. Although after January 29, 2023, include the following.
both methods can be used, only one method is needed to a. The applicable wage determinations (as defined below).
establish that construction of a qualified facility has begun.
b. The wages paid (including any correction payments as
See Notice 2018-59, 2018-28 I.R.B. 196, and Notice defined in section 45(b)(7)(B)(i)(l)) and hours worked for
2022-61, 2022-52 I.R.B. 560, or its successor for more each of the laborer or mechanic classifications engaged
information. in the construction of the facility or property.
Physical work test. Under this test, construction of a facility
begins when physical work of a significant nature begins, c. The number of workers who received correction
provided that the filer maintains a continuous program of payments.
construction. d. The wages paid and hours worked by qualified
5% safe harbor. Using this safe harbor, construction of a apprentices for each of the laborer or mechanic
facility will be considered as having begun if: classifications engaged in the construction of the facility
1. A taxpayer pays or incurs (within the meaning of or property.
Regulations section 1.461-1(a)(1) and (2)) 5% or more of e. The total labor hours for the construction of the facility or
the total cost of the facility, and property by any laborer or mechanic employed by the
2. Thereafter, the taxpayer makes continuous efforts to taxpayer or any contractor or subcontractor.
complete the facility. 4. A declaration, applicable to the statement and any
accompanying documents, signed by you, or signed by a
Prevailing wage requirements. In general, the taxpayer must person currently authorized to bind you in such matters, in
ensure, with respect to any energy project, that laborers and the following form: “Under penalties of perjury, I declare that
mechanics employed by the taxpayer or its contractor or I have examined this statement, including accompanying
subcontractor (and for the 5-year period beginning on the date documents, and to the best of my knowledge and belief, the
such project is placed in service, the alteration or repair of the facts presented in support of this statement are true,
project) are paid the prevailing wages, which includes basic correct, and complete.”
hourly rate and any fringe benefits rate, established by the
Secretary of Labor when performing construction, alteration, or Applicable wage determinations. Applicable wage
repair of a qualified facility, project, or property. See Notice determinations are the wage listed for a particular classification
2022-61 for more information. of laborer or mechanic for the type of construction and the
Apprenticeship requirements. Each taxpayer (or contractor or geographic area, or other applicable wage as determined by the
subcontractor) who employs four or more workers to perform Secretary of Labor. See Notice 2022-61 for more information.
construction, alteration, or repair work on a facility must employ
one or more qualified apprentices from a registered Line 9
apprenticeship program. Notice 2023-38 proposes rules for how filers receive a domestic
A minimum percentage of the total labor hours of the content bonus credit amount for certain investments in section
construction, alteration, or repair work must be performed by the 48 energy projects. This notice describes certain rules regarding
qualified apprentices. This percentage is: the domestic content bonus credit requirements, related
• 12.5% for facilities beginning construction in 2023, and recordkeeping, and certification requirements. It also describes a
• 15% for facilities beginning construction in 2024 or after. safe harbor regarding the classification of certain components in
representative types of qualified facilities, energy projects, or
Taxpayers (or contractors or subcontractors) must also energy storage technologies. See Notice 2023-38, 2023-22
ensure that any applicable ratios of apprentices to I.R.B. 872.
journeyworkers established by the registered apprenticeship
program are met. An exception may apply when a taxpayer (or Domestic content bonus credit amount. Section 48(a)(12)
contractor or subcontractor) has requested qualified apprentices (C) provides a domestic content bonus credit amount for a
from a registered apprenticeship program and no apprentices section 48 energy project by increasing the energy percentage
are available. See Notice 2022-61 for more information. provided in section 48(a)(2), by 10% if the domestic content
requirement is met and the requirement in either 2a, 2b, or 2c,
Lines 7 and 8. For line 7, if you are completing section M, below, is also met.
check box 7c. If completing any other section of Part VI, check
the applicable box. 1. The domestic content requirement is met with respect to
For line 8, check box 8b or 8c, as appropriate. any energy project under Notice 2023-38, if the taxpayer
certified to the Secretary (see Domestic Content
Instructions for Form 3468 (2023) 5

- 6 -

Page 6 of 21 Fileid: … ions/i3468/2023/a/xml/cycle04/source 9:21 - 25-Jan-2024

The type and rule above prints on all proofs including departmental reproduction proofs. MUST be removed before printing.

Certification Statement, later) that any steel, iron, or to the special rule for beginning of construction under section
manufactured product that is a component of the facility 4.01(2) of Notice 2023-29. See Notice 2023-45, 2023-29 I.R.B.
(upon completion of construction) was produced in the 317.
United States. A qualified facility meets the domestic Notice 2023-47 has information that taxpayers may use to
content requirement if the steel or iron requirements and the determine whether they meet certain requirements under the
manufacturing products requirements are met. See Notice Statistical Area Category or the Coal Closure Category as
2023-38 for definitions and more information. described in Notice 2023-29 to qualify for energy community
2. Any of the following requirements is met: bonus credit rates under section 48. See Notice 2023-47,
2023-29 I.R.B. 318.
a. The energy project has a maximum net output of less
than 1 megawatt of electrical (as measured in Energy community bonus credit rate. An energy community
alternating current or thermal energy); bonus credit rate increase is allowed under section 48(a)(14) for
an energy project eligible for the credit under section 48 that is
b. Construction of the energy project began before placed in service during the tax year within an energy community
January 29, 2023; or (EC Project). For energy property that is part of an EC Project,
c. The energy project meets the prevailing wage and the energy percentage of the basis of each energy property
apprenticeship requirements in sections 48(a)(10)(A) under section 48(a)(2) is increased by 2% if none of the following
and (11). requirements are met, and by 10% if any one of the following
requirements is met:
Note. If the domestic content requirement in 2a, 2b, or 2c, 1. The energy project has a maximum net output of less than 1
above, is met, the energy percentage provided in section 48(a) megawatt of electrical (as measured in alternating current)
(2) is increased by 2% instead of 10%. or thermal energy;
Line 9. Check the appropriate box on line 9. If you checked 2. Construction of the energy project began before January
line 9c, you can’t claim the domestic content bonus credit 29, 2023; or
amount.
3. The energy project meets the prevailing wage and
apprenticeship requirements in sections 48(a)(10)(A) and
Domestic Content Certification Statement (11).
If you checked line 9a or 9b to claim a domestic content bonus Energy community categories. Energy community means the
credit amount in Part VI, you must also attach a domestic content following:
certification statement to Form 3468 at the time of filing your
return, for each applicable project. The domestic content 1. A brownfield site as defined in subparagraphs (A), (B), and
certification statement should include the following. (D)(ii)(III) of section 101(39) of the Comprehensive
Environmental Response, Compensation, and Liability Act
1. Your name and taxpayer identification number shown on the of 1980 (42 U.S.C. 9601(39));
return.
2. A metropolitan statistical or non-metropolitan statistical area
2. The facility description (including the owner information, if that:
different from the filer) and the IRS-issued registration
number (if applicable) of the applicable project from Part I, a. Has (or, at any time during the period beginning after
line 2a. 2009, had) .17% or greater direct employment or 25%
or greater local tax revenues related to the extraction,
3. A statement that any steel, iron, or manufactured product processing, transport, or storage of coal, oil, or natural
that is a component of the facility (upon completion of gas (as determined by the Secretary); and
construction) was produced in the United States (as
determined under section 661 of Title 49, Code of Federal b. Has an unemployment rate at or above the national
Regulations). average unemployment rate for the previous year (as
determined by the Secretary); or
4. A declaration, applicable to the statement and any
accompanying documents, signed by you, or signed by a 3. A census tract, or a census tract directly adjoining to such
person currently authorized to bind you in such matters, in census tract in which:
the following form: “Under penalties of perjury I declare that a. After 1999, a coal mine has closed; or
I have examined the information contained in this Domestic
b. After 2009, a coal-fired electric generating unit has been
Content Certification Statement and to the best of my
retired.
knowledge and belief, it is true, correct, and complete.”
Line 10. Check the appropriate box on line 10. If you checked
Line 10 the box on line 10c, you can’t claim the energy community bonus
Notice 2023-29 proposes rules on how filers receive the energy credit amount.
community bonus credit rate for certain investments in section
48 energy property. The notice describes certain rules for Lines 11 and 12
determining what constitutes an energy community as defined in If you received an allocation and a control number under the
section 45(b)(11)(B) and as adopted by section 48(a)(14) and for low-income community program, you may increase the amount
determining whether an energy project, or an energy storage of your energy credit for a qualified solar or wind facility
technology is located in an energy community. See Notice computed in Part VI, sections B, F, I, or L. Only filers who applied
2023-29, 2023-29 I.R.B. 1. for and received an allocation of environmental justice solar and
Notice 2023-45 clarifies section 5.02(3) of Notice 2023-29 wind capacity limitation and properly placed in service a
which describes requirements for a brownfield site safe harbor qualified solar or wind facility are eligible to claim an increased
for projects with a nameplate capacity of not greater than 5 credit.
megawatts in alternating current. This notice also describes a Notice 2023-17 establishes the program to allocate
prior modification that was made via an online update pertaining environmental justice solar and wind capacity limitation, as

6 Instructions for Form 3468 (2023)

- 7 -

Page 7 of 21 Fileid: … ions/i3468/2023/a/xml/cycle04/source 9:21 - 25-Jan-2024

The type and rule above prints on all proofs including departmental reproduction proofs. MUST be removed before printing.

required under section 48(e). This notice also provides initial appropriate box on line 12 and enter the nameplate capacity or
program guidance for potential applicants for allocations of storage capacity installed in connection with your property.
calendar year 2023 capacity limitation. See Notice 2023-17,
2023-10 I.R.B. 505. Line 14
Rev. Proc. 2023-27 provides the process under section 48(e) Generally, for purposes of eligibility for and figuring the amount of
to apply for an allocation of environmental justice solar and wind the investment credit, a lessor of property may elect to treat the
capacity limitation. See Rev. Proc. 2023-27, 2023-35 I.R.B. 655 lessee as having acquired the property. Once the election is
and Regs 1.48(e)-1. made, the lessee will be entitled to an investment credit for that
property for the tax year in which the property is placed in
Low-income communities bonus credit amount. Section service and the lessor will not be entitled to such a credit.
48(e) provides a low-income community bonus credit for certain
qualified solar and wind facility energy projects by increasing the If the leased property is disposed of or otherwise ceases to
energy percentage provided in section 48(a)(2), by either 10% or be investment credit property, the property will generally be
20%, depending on the category of the facility. subject to the recapture rules for early dispositions.
Energy percentage. The increased energy percentage with The lessor will provide the lessee with all the information
respect to categories of eligible property and limitation is: needed to complete Part VII, lines 1a through 1g, and 1k, if
applicable.
Percentage For a . . . For information on making the election, see section 48(d) (as
Facility that is located in a low-income in effect on November 4, 1990) and related regulations. For
10% limitations, see sections 46(e)(3) and 48(d) (as in effect on
community (as defined in section 45D(e))
November 4, 1990).
Facility that is located on Indian land (as
10% defined in section 2601(2) of the Energy Policy Line 14b
Act of 1992 (25 U.S.C. 3501(2))) Enter the lessor's full address on line 14b. Enter the address of
Facility that is part of a qualified low-income the lessor's principal office or place of business. Include the
20% suite, room, or other unit number after the street address. If the
residential building project
post office doesn't deliver mail to the street address and the
Facility that is a qualified low-income economic lessor has a P.O. box, show the box number instead.
20%
benefit project
Do not use the address of the registered agent for the state in
which the lessor is incorporated. For example, if a business is
incorporated in Delaware or Nevada and the lessor's principal
Credit reduction. The increase in the credit will not exceed the place of business is located in Little Rock, AR, you should enter
amount that bears the same ratio as the environmental justice the Little Rock address.
solar and wind capacity limitation allocated to such facility, bears
to the total megawatt nameplate capacity of such facility, as If the lessor receives its mail in care of a third party (such as
measured in direct current or in the case of wind, alternating an accountant or attorney), enter on the street address line “C/O”
current will be treated as direct current. followed by the third party's name and street address or P.O. box.
Eligible property and requirements. For purposes of this
increase, eligible energy property includes: Part II—Qualifying Advanced Coal
• Wind facility property defined in section 45(d)(1) for which
an election was made to treat qualified facilities as energy Project Credit and Qualifying
property; Gasification Project Credit
• Solar energy property to generate electricity defined in
section 48(a)(3)(i); Section A—Qualifying Advanced Coal Project
• Qualified small wind energy property defined in section
48(a)(3)(vi); and Credit Under Section 48A
• Energy storage technology described in section 48(a)(3)(A) A qualifying advanced coal project is a project that:
(ix) installed in connection with the above facility properties. • Uses advanced coal-based generation technology (as
defined in section 48A(f)) to power a new electric generation
The property also has to meet the following eligibility unit or to refit or repower an existing electric generation unit
requirements: (including an existing natural gas-fired combined cycle unit);
1. A maximum net output of less than 5 megawatts as • Has fuel input that, when completed, will be at least 75%
measured in alternating current; and coal;
• Has an electric generation unit or units at the site that will
2. The facility is one of the following: generate at least 400 megawatts;
a. Located in a low-income community (as defined in • Has a majority of the output that is reasonably expected to
section 45D(e)); be acquired or utilized;
• Is to be constructed and operated on a long-term basis
b. On Indian land (as defined in section 2601(2) of the when the taxpayer provides evidence of ownership or
Energy Policy Act of 1992 (25 U.S.C. 3501(2))); control of a site of sufficient size;
c. Is part of a qualified low-income residential building • Will be located in the United States; and
project; or • Includes equipment that separates and sequesters at least
65% (70% in the case of an application for reallocated
d. A qualified low-income economic benefit project. credits) of the project's total carbon dioxide emissions for
project applications described in section 48A(d)(2)(A)(ii).
Lines 11 and 12. Check the appropriate box on line 11. If you
checked the box on line 11a, 11b, 11c, or 11d, you must enter For more information on the new allocation round for section
the section 48(e) control number on line 11e. Check the 48A credits, see Notice 2020-88, 2020-53 I.R.B. 1795.
Instructions for Form 3468 (2023) 7

- 8 -

Page 8 of 21 Fileid: … ions/i3468/2023/a/xml/cycle04/source 9:21 - 25-Jan-2024

The type and rule above prints on all proofs including departmental reproduction proofs. MUST be removed before printing.

Basis. The qualified investment for any tax year is the basis of Section B—Qualifying Gasification Project
eligible property placed in service by the taxpayer during the tax Credit Under Section 48B
year that is part of a qualifying advanced coal project. Eligible A qualifying gasification project is a project that:
property is limited to property that can be depreciated or Employs gasification technology (as defined in section
amortized and that was constructed, reconstructed, or erected •
48B(c)(2)),
and completed by the taxpayer; or that is acquired by the Is carried out by an eligible entity (as defined in section
taxpayer if the original use of such property commences with the •
48B(c)(7)), and
taxpayer. Includes a qualified investment of which an amount not to
•
Basis reduction for certain financing. If property is financed exceed $650 million is certified under the qualifying
in whole or in part by subsidized energy financing or by gasification program as eligible for credit.
tax-exempt private activity bonds, the amount that you can claim
as basis is the basis that would otherwise be allowed multiplied The total amount of credits that may be allocated under the
by a fraction that is 1 reduced by a second fraction, the qualifying gasification project program may not exceed $600
numerator of which is that portion of the basis allocable to such million.
financing or proceeds, and the denominator of which is the basis For more information on the qualifying gasification project and
of the property. the qualifying gasification program, see Notice 2009-23,
For example, if the basis of the property is $100,000 and the 2009-16 I.R.B. 802, which is amplified by Notice 2014-81,
portion allocable to such financing or proceeds is $20,000, the 2014-53 I.R.B. 1001. Also, see Notice 2011-24, 2011-14 I.R.B.
fraction of the basis that you may claim the credit on is / (that 4 5 603.
is, 1 minus $20,000/$100,000). Basis reduction. If property is financed in whole or in part by
Subsidized energy financing means financing provided under subsidized energy financing or by tax-exempt private activity
a federal, state, or local program, a principal purpose of which is bonds, figure the credit by using the basis of such property
to provide subsidized financing for projects designed to reduced under the rules described in Basis reduction for certain
conserve or produce energy. financing, earlier.

Line 1a Line 4a
Enter the qualified investment in qualifying gasification project
Enter the qualified investment in integrated gasification property placed in service during the tax year for which credits
combined cycle property placed in service during the tax year for were allocated or reallocated after October 3, 2008, and that
projects described in section 48A(d)(3)(B)(i). Eligible property is includes equipment that separates and sequesters at least 75%
any property that is part of a qualifying advanced coal project of the project's carbon dioxide emissions. Qualified investment is
using an integrated gasification combined cycle and is the basis of eligible property placed in service during the tax
necessary for the gasification of coal, including any coal year that is part of a qualifying gasification project.
handling and gas separation equipment.
For purposes of this credit, eligible property includes any
Integrated gasification combined cycle is an electric property that is part of a qualifying gasification project and
generation unit that produces electricity by converting coal to necessary for the gasification technology of such project. The
synthesis gas, which in turn is used to fuel a combined cycle IRS is required to recapture the benefit of any allocated credit if a
plant to produce electricity from both a combustion turbine project fails to attain or maintain these carbon dioxide separation
(including a combustion turbine/fuel cell hybrid) and a steam and sequestration requirements. See section 48B(f) and Notice
turbine. 2011-14, 2011-11 I.R.B. 554.

Line 2a Line 5a
Enter the qualified investment in advanced coal-based Enter the qualified investment, other than any amount included in
generation technology property placed in service during the tax line 4a, in qualifying gasification project property (defined earlier)
year for projects described in section 48A(d)(3)(B)(ii). Eligible placed in service during the tax year.
property is any property that is part of a qualifying advanced coal
project (defined earlier) not using an integrated gasification Line 6
combined cycle.
Patrons, including cooperatives that are patrons in other
Line 3a cooperatives, enter the unused investment credit from the
qualifying advanced coal project credit or qualifying gasification
Enter the qualified investment in advanced coal-based project credit allocated from cooperatives. If you are a
generation technology property placed in service during the tax cooperative, see the instructions for Form 3800, Part III, line 1a,
year for projects described in section 48A(d)(3)(B)(iii). Eligible for allocating the investment credit to your patrons.
property is any certified property located in the United States See General Instructions for filing Form 3468 to report
and that is part of a qualifying advanced coal project (defined TIP any unused credits from cooperatives.
earlier) that has equipment that separates and sequesters at
least 65% of the project's total carbon dioxide emissions. This
percentage increases to 70% if the credits are later reallocated
by the IRS.

The credit will be recaptured if a project fails to attain or
maintain the carbon dioxide separation and sequestration
requirements. For details, see section 48A(i) and Notice
2011-24, 2011-14 I.R.B. 603.

8 Instructions for Form 3468 (2023)

- 9 -

Page 9 of 21        Fileid: … ions/i3468/2023/a/xml/cycle04/source                                9:21 - 25-Jan-2024

The type and rule above prints on all proofs including departmental reproduction proofs. MUST be removed before printing.

                                                                  • Was not placed in service prior to being awarded an 
Part III—Qualifying Advanced Energy                                 allocation of section 48C credits under the section 48(c) 
                                                                    program. See Notice 2023-44, 2023-25 I.R.B. 924.
Project Credit Under Section 48C
Qualifying advanced energy project means a project that:          Certification. To be eligible for the qualifying advanced energy 
• Re-equips, expands, or establishes an industrial or a           project credit, some or all of the qualified investment in the 
  manufacturing facility for the production or recycling of       qualifying advanced energy project must be certified by the IRS 
  specified advanced energy property;                             under section 48C(d). See Notice 2023-18, 2023-10 I.R.B. 508, 
• Re-equips any industrial or manufacturing facility, with        for more information on the certification and program.
  equipment designed to reduce greenhouse gas emissions           See Notice 2023-44 for additional guidance for applicants 
  by at least 20% through the installation of:                    seeking section 48C credit allocations in the qualifying advanced 
   • Low- or zero-carbon process heat systems;                    energy project credit allocation program under IRA 2022. See 
   • Carbon capture, transport, utilization, and storage          Notice 2023-44, 2023-25 I.R.B. 924.
   systems;
   • Energy efficiency and reduction in waste from                Line 1a
   industrial processes; or                                       Enter the qualified investment in qualifying advanced energy 
   • Any other industrial technology designed to reduce           project property placed in service during the tax year. Qualified 
   greenhouse gas emissions, as determined by the                 investment is the basis of eligible property placed in service 
   Secretary;                                                     during the tax year that is part of a qualifying advanced energy 
• Re-equips, expands or establishes an industrial facility for    project.
  the processing, refining or recycling of critical materials (as 
  defined in section 7002(a) of the Energy Act of 2020);          Line 1b
• The Secretary has certified per section 48C(e)(3) that part     If you met the prevailing wage and apprenticeship requirements 
  or all of the qualified investment in the qualifying advanced   described earlier, and the certification for prevailing wage and 
  energy project is eligible for a section 48C credit; and        apprenticeship requirements was met, as part of the 48C(e) 
• The project does not include any portion of a project for the   application per Notice 2023-18, section 5.07, then enter 30%. 
  production of any property that is used in the refining or      Otherwise, enter 6%.
  blending of any transportation fuels (other than renewable 
  fuels).                                                         Line 1d
Specified advanced energy property. The term specified            Enter your 48C allocation control number for the qualifying 
advanced energy property means any of the following:              advanced energy property.
• Property designed for use in the production of energy from 
  the sun, water, wind, geothermal deposits (within the           Line 2
  meaning of section 613(e)(2)), or other renewable               Patrons, including cooperatives that are patrons in other 
  resources;                                                      cooperatives, enter the unused investment credit from the 
• Fuel cells, microturbines, or energy storage systems and        qualifying advanced energy property credit allocated from 
  components;                                                     cooperatives. If you are a cooperative, see the instructions for 
• Electric grid modernization equipment or components;            Form 3800, Part III, line 1d, for allocating the investment credit to 
• Property designed to capture, remove, use, or sequester         your patrons.
  carbon oxide emissions;                                                 See General Instructions for filing Form 3468 to report 
• Equipment designed to refine, electrolyze, or blend any fuel,   TIP     any unused credits from cooperatives.
  chemical, or product which is renewable, or low-carbon and 
  low-emission;
• Property designed to produce energy conservation                Line 3
  technologies (including residential, commercial, and 
  industrial applications);                                       If you’re a partnership or S corporation requesting an election to 
• Light-, medium-, or heavy-duty electric or fuel cell vehicles,  transfer a qualifying advanced energy credit with respect to a 
  as well as technologies, components, or materials for such      project (or portion of) under section 6418(c), you must report the 
  vehicles, and associated charging or refueling infrastructure;  total credit amount on line 3 and Form 3800, Part III, line 1d.
• Hybrid vehicles with a gross vehicle weight rating of not less 
  than 14,000 pounds as well as technologies, components,         Part IV—Advanced Manufacturing 
  or materials for such vehicles; or
• Other advanced energy property designed to reduce               Investment Credit Under Section 48D
  greenhouse gas emissions as may be determined by the            The advanced manufacturing investment credit is equal to 25% 
  Secretary.                                                      of the qualified investment with respect to any advanced 
Eligible property. Eligible property is property that:            manufacturing facility of an eligible taxpayer in the tax year.
• Is necessary for the production or recycling of property        Eligible taxpayer. An eligible taxpayer is a taxpayer who isn't a 
  described in section 48C(c)(1)(A)(i); re-equipping an           foreign entity of concern (as defined in section 9901(6) of P. L. 
  industrial or manufacturing facility described in section       116-283), and hasn't made an applicable transaction (as defined 
  48C(c)(1)(A)(ii); or re-equipping, expanding, or establishing   in section 50(a)) during the tax year.
  an industrial facility described in section 48C(c)(1)(A)(iii);
• Which depreciation or amortization is allowable;                Qualified investment. The qualified investment for any 
• Is tangible personal property or other tangible property (not   advanced manufacturing facility is the basis of any qualified 
  including a building or its structural components), but only if property placed in service by the taxpayer during the tax year 
  the property is used as an integral part of the qualifying      that is part of an advanced manufacturing facility.
  advanced energy project; and                                    Advanced manufacturing facility.      Advanced manufacturing 
                                                                  facility means a facility whose primary purpose is the 

Instructions for Form 3468 (2023)                                                                                                   9

- 10 -

Page 10 of 21 Fileid: … ions/i3468/2023/a/xml/cycle04/source 9:21 - 25-Jan-2024

The type and rule above prints on all proofs including departmental reproduction proofs. MUST be removed before printing.

manufacturing of semiconductors or semiconductor • Energy storage technology property.
manufacturing equipment. • Qualified biogas property.
Qualified property. Qualified property includes any building or • Microgrid controllers property.
its structural components and all of the following. • Qualified investment credit facility treated as energy
property under section 48(a)(5).
• Property that is tangible property.
• Property that is allowed depreciation or amortization. • Clean hydrogen production facility treated as energy
property under section 48(a)(15).
• Property that is constructed, reconstructed, or erected by
the taxpayer or acquired by the taxpayer if the original use of Property requirements. To qualify as energy property as
the property commences with the taxpayer. defined in section 48(a)(3), it must:
• Property that is integral to the operation of the advanced
manufacturing facility. 1. Meet the performance and quality standards, if any, that
have been prescribed by regulations and are in effect at the
Exception. Qualified property doesn't include a building or a time the property is acquired;
portion of a building used for offices, administrative services, or
other functions unrelated to manufacturing. 2. Be property for which depreciation (or amortization in lieu of
depreciation) is allowable; and
Coordination with rehabilitation credit. The qualified
investment with respect to any advanced manufacturing facility 3. Be property either:
for any tax year can’t include the portion of the basis of any a. The construction, reconstruction, or erection of which is
property that is attributable to qualified rehabilitation completed by the taxpayer; or
expenditures (as defined in section 47(c)(2)).
b. Acquired by the taxpayer if the original use of such
Certain progress expenditure rules made applicable. Rules property commences with the taxpayer.
similar to the rules of section 46(c)(4) and 46(d) (as in effect on
the day before the date of the enactment of P.L. 101-158) apply Energy property doesn’t include any property that is part of a
for purposes of the advanced manufacturing investment credit. production credit under section 45 for the tax year or any prior
tax year.
Line 1b Energy property doesn't include any property acquired before
Enter the basis in qualified property as part of the advanced February 14, 2008, or to the extent of basis attributable to
manufacturing facility (defined above) placed in service during construction, reconstruction, or erection before February 14,
the tax year. 2008, that is public utility property, as defined by section 46(f)(5)
The basis of property placed in service during the tax (as in effect on November 4, 1990), and related regulations.
You must reduce the basis of energy property by 50% of the
CAUTION includes the portion of basis attributable to the
! year, but the construction of which began prior to 2023, energy credit determined.
construction, reconstruction, or erection after August 9, 2022. You must reduce the basis of energy property used for
figuring the credit by any amount attributable to qualified
Line 2 rehabilitation expenditures.
Patrons, including cooperatives that are patrons in other Basis reduction. If energy property (acquired before 2009, or
cooperatives, enter the unused investment credit from the to the extent of its basis attributable to construction,
advanced manufacturing investment credit allocated from reconstruction, or erection before 2009) is financed in whole or in
cooperatives. If you are a cooperative, see the instructions for part by subsidized energy financing or by tax-exempt private
Form 3800, Part III, line 1o, for allocating the investment credit to activity bonds, reduce the basis of such property under the rules
your patrons. described in Basis reduction for certain financing, earlier.
See General Instructions for filing Form 3468 to report For energy property which was constructed, reconstructed, or
TIP any unused credits from cooperatives. erected after August 16, 2022, see the instructions for section N
to reduce the amount of the credit with respect to any facility for
tax-exempt bonds.
Line 3 Coordination with Department of Treasury grants. In the
If you are a partnership or S corporation requesting elective case of any property where the Secretary makes a grant under
payment with respect to the advanced manufacturing investment section 1603 of the American Recovery and Reinvestment Tax
credit under section 48D(d)(2)(A), you must report the credit Act of 2009, no credit will be determined under section 48 or
amount on line 3 and Form 3800, Part III, line 1o. section 45 with respect to the property for the tax year in which
the grant is made or any subsequent tax year.
Recapture. If a credit was determined with respect to a
Part VI—Energy Credit Under Section property for any tax year ending before the grant is made:
48 • The tax imposed on the taxpayer for the tax year in which
The energy credit for the tax year is the energy percentage of the the grant is made will be increased by the credit amount
basis of each energy property placed in service during the tax allowed under section 38,
year. The energy properties include the following. • The general business carryforwards under section 39 will be
• Geothermal energy property. adjusted to recapture the portion of the credit that was not
• Solar energy property to generate electricity, or solar energy allowed, and
property to illuminate. • The amount of the grant will be determined without regard to
• Qualified fuel cell property. any reduction in the basis of the property by the credit.
• Qualified microturbine property. Treatment of grants. Any grant will not be included in the
• Combined heat and power system property. gross income or alternative minimum taxable income of the
• Qualified small wind energy property. taxpayer, but will be taken into account in determining the basis
• Waste energy recovery property. of the property to which the grant relates, except that the basis of
• Geothermal heat pump system property.

10 Instructions for Form 3468 (2023)

- 11 -

Page 11 of 21 Fileid: … ions/i3468/2023/a/xml/cycle04/source 9:21 - 25-Jan-2024

The type and rule above prints on all proofs including departmental reproduction proofs. MUST be removed before printing.

such property will be reduced under section 50(c) in the same If the facility or property did not meet the requirements for the
manner as a credit allowed. domestic content bonus credit, leave line 1d blank, skip line 1e,
and go to line 1f.
Interconnection property. For purposes of determining the
energy credit, energy property shall include amounts paid or
incurred by the taxpayer for qualified interconnection property in Line 1f
connection with the installation of energy property placed in
service during the tax year that: Enter your applicable energy community bonus credit
• Has a maximum net output of not greater than 5 megawatts percentage. See Energy community bonus credit rate, in Part I,
(as measured in alternating current), to provide for the line 10, for more information.
transmission or distribution of the electricity produced or
stored by such property; and If the facility or property was not placed in service within an
• Are properly chargeable to the capital account of the energy community, leave line 1f blank, skip line 1g, and go to
taxpayer. line 2.
Qualified interconnection property. Qualified
interconnection property is, with respect to an energy project that Section B—Solar Energy Credit
isn't a microgrid controller, any tangible property that: Solar energy. Solar energy property is property that has the
• Is part of an addition, modification, or upgrade to a following.
transmission or distribution system that is required at or
beyond the point at which the energy project interconnects 1. Equipment that uses solar energy to illuminate the inside of
to such transmission or distribution system in order to a structure using fiber-optic distributed sunlight.
accommodate such interconnection;
• Is either constructed, reconstructed, or erected by the 2. Electrochromic glass that uses electricity to change its light
taxpayer, or that the cost with respect to the construction, transmittance properties in order to heat or cool a structure.
reconstruction, or erection of such property is paid or 3. Equipment that uses solar energy to:
incurred by the taxpayer; and
• The original use, pursuant to an interconnection agreement, a. Generate electricity,
commences with a utility. b. Heat or cool (or provide hot water for use in) a structure,
Interconnection agreement. Interconnection agreement or
means an agreement with a utility for the purposes of c. Provide solar process heat (but not to heat a swimming
interconnecting the energy property owned by the taxpayer to pool).
the transmission or distribution system of the utility.
Utility. For the purposes of section 48(a)(8), utility means the
owner or operator of an electrical transmission or distribution Line 3b
system that is subject to the regulatory authority of any the
following. Enter your applicable energy percentage. See Increased Credit
• A state or political subdivision thereof. Amount Statement, in Part I, lines 7 and 8, earlier, for more
• Any agency or instrumentality of the United States. information.
• A public service or public utility commission or other similar
body of any state or political subdivision thereof. Line 3d
• The governing or ratemaking body of an electric
cooperative. Enter your applicable low-income community bonus credit
Special rule for interconnection property. In the case of percentage in connection with your solar energy facility.
expenses paid or incurred for interconnection property, amounts However, if you checked the box for Part I, line 11f; or Part I,
otherwise chargeable to a capital account with respect to such line 12e (in relation to Part I, lines 11a, 11b, 11c, or 11d) you do
expenses will be reduced under rules similar to the rules of not qualify for the low-income community bonus credit in
section 50(c). connection with a solar energy facility. Enter -0- (zero) on lines
3d and 3j, and go to line 3k.
Section A—Geothermal Energy Credit
Geothermal energy. Geothermal energy property is used to See Low-income communities bonus credit amount, in Part I,
produce, distribute, or use energy derived from a geothermal lines 11 and 12, earlier, for more information.
deposit (within the meaning of section 613(e)(2)). For electricity
produced by geothermal power, equipment qualifies only up to, Line 3k
but not including, the electrical transmission stage.
Enter the applicable domestic content bonus credit percentage.
Line 1b See Domestic Content Certification Statement, in Part I, line 9,
earlier, for more information.
Enter your applicable energy percentage. See Increased Credit
Amount Statement, in Part I, lines 7 and 8, earlier, for more If the facility or property did not meet the requirements for the
information. domestic content bonus credit, leave line 3k blank, skip line 3l,
and go to line 3m.
Line 1d
Line 3m
Enter your applicable domestic content bonus credit percentage.
See Domestic Content Certification Statement, in Part I, line 9, Enter the applicable energy community bonus credit percentage.
earlier, for more information. See Energy community bonus credit rate, in Part I, line 10,
earlier, for more information.

Instructions for Form 3468 (2023) 11

- 12 -

Page 12 of 21 Fileid: … ions/i3468/2023/a/xml/cycle04/source 9:21 - 25-Jan-2024

The type and rule above prints on all proofs including departmental reproduction proofs. MUST be removed before printing.

If the facility or property was not placed in service within an If the facility or property did not meet the requirements for the
energy community, leave line 3m blank, skip line 3n, and go to domestic content bonus credit, leave line 5i blank, skip line 5j,
line 4. and go to line 5l.

Section C—Qualified Fuel Cell Property Line 5l
Qualified fuel cell property. Qualified fuel cell property is a
fuel cell power plant that has a nameplate capacity of at least 0.5 Enter the applicable energy community bonus credit percentage.
kilowatts (1 kilowatt in the case of a fuel cell plant with a linear See Energy community bonus credit rate, in Part I, line 10,
generator assembly) of electricity using an electrochemical or earlier, for more information.
electromechanical process and has electricity-only generation
efficiency greater than 30%. See section 48(c)(1) for further If the facility or property was not placed in service within an
details. energy community, leave line 5l blank, skip line 5m, and go to
Fuel cell power plant. Fuel cell power plant means an line 5n.
integrated system comprised of a fuel cell stack assembly or
linear generator assembly, and associated balance of plant Line 5o
components that converts a fuel into electricity using
electrochemical or electromechanical means.
Enter the applicable number of kilowatts of capacity attributable
Linear generator assembly. Linear generator assembly to the basis on line 5f. This entry must be a whole number.
doesn’t include any assembly that contains rotating parts.
Qualified fuel cell property that uses electromechanical Section D—Qualified Microturbine Property
! process or a fuel cell power plant that is comprised of a Qualified microturbine property. Qualified microturbine
CAUTION linear generator assembly are for property placed in
property is a stationary microturbine power plant that has a
service after 2022.
nameplate capacity of less than 2,000 kilowatts and has an
electricity-only generation efficiency of not less than 26% at
Line 5a International Standard Organization conditions. See section
48(c)(2) for further details.
Enter the basis, attributable to periods after 2005 and before Stationary microturbine power plant. Stationary
October 4, 2008, of any qualified fuel cell property placed in microturbine power plant means an integrated system comprised
service during the tax year, if the property was acquired after of a gas turbine engine, a combustor, a recuperator or
2005 and before October 4, 2008, or to the extent of basis regenerator, a generator or alternator, and associated balance of
attributable to construction, reconstruction, or erection by the plant components that converts a fuel into electricity and thermal
taxpayer after 2005 and before October 4, 2008. energy. It also includes all secondary components located
between the existing infrastructure for fuel delivery and the
existing infrastructure for power distribution, including equipment
Line 5c and controls for meeting relevant power standards, such as
voltage, frequency, and power factors.
Enter the applicable number of kilowatts of capacity attributable
to the basis on line 5a. This entry must be a whole number. Line 7a

Line 5f Enter the basis, attributable to periods after 2005, of any
qualified microturbine property placed in service during the tax
Enter the basis, attributable to periods after October 3, 2008, year, if the property was acquired after 2005, or to the extent of
and the construction of which began before 2021 or after 2022, basis attributable to construction, reconstruction, or erection by
of any qualified fuel cell property placed in service during the tax the taxpayer after 2005.
year.
Line 7b
See Qualified fuel cell property and Beginning of
construction, earlier. Enter your applicable energy percentage. See Increased Credit
Basis is attributable to periods after October 3, 2008, if Amount Statement, in Part I, lines 7 and 8, earlier, for more
information.
! the property was acquired after October 3, 2008, or to
CAUTION the extent of basis attributable to construction,
reconstruction, or erection by the taxpayer after October 3, 2008. Line 7d

Enter your applicable domestic content bonus credit percentage.
Line 5g See Domestic Content Certification Statement, in Part I, line 9,
earlier, for more information.
Enter your applicable energy percentage. See Increased Credit
Amount Statement, in Part I, lines 7 and 8, earlier, for more If the facility or property did not meet the requirements for the
information. domestic content bonus credit, leave line 7d blank, skip line 7e,
and go to line 7g.
Line 5i
Line 7g
Enter your applicable domestic content bonus credit percentage.
See Domestic Content Certification Statement, in Part I, line 9, Enter the applicable energy community bonus credit percentage.
earlier, for more information. See Energy community bonus credit rate, in Part I, line 10,
earlier, for more information.

12 Instructions for Form 3468 (2023)

- 13 -

Page 13 of 21 Fileid: … ions/i3468/2023/a/xml/cycle04/source 9:21 - 25-Jan-2024

The type and rule above prints on all proofs including departmental reproduction proofs. MUST be removed before printing.

If the facility or property was not placed in service within an Combined heat and power system property doesn't include
energy community, leave line 7g blank, skip line 7h, and go to property used to transport the energy source to the facility or to
line 7i. distribute energy produced by the facility.
Biomass systems. Systems designed to use biomass for at
Line 7j least 90% of the energy source are eligible for a credit that is
reduced in proportion to the degree to which the system fails to
Enter the applicable number of kilowatts of capacity attributable meet the efficiency standard. For more information, see section
to the basis on line 7a. This entry must be a whole number. 48(c)(3)(D).
Section E—Combined Heat and Power System
Line 9d
Property
Combined heat and power system property. Combined heat Enter your applicable energy percentage. See Increased Credit
and power system property means property comprising a system Amount Statement, in Part I, lines 7 and 8, earlier, for more
that: information.
1. Uses the same energy source for the simultaneous or
sequential generation of electrical power, mechanical shaft Line 9f
power, or both; in combination with the generation of steam
or other forms of useful thermal energy (including heating Enter your applicable domestic content bonus credit percentage.
and cooling applications); and See Domestic Content Certification Statement, in Part I, line 9,
earlier, for more information.
2. Has an energy efficiency percentage determined on a
British thermal unit (BTU) basis over 60% and it produces: If the facility or property did not meet the requirements for the
domestic content bonus credit, leave line 9f blank, skip line 9g,
a. At least 20% (determined on a BTU basis) of its total and go to line 9h.
useful energy in the form of thermal energy that isn't
used to produce electrical and/or mechanical power,
and Line 9h

b. At least 20% (determined on a BTU basis) of its total Enter the applicable energy community bonus credit percentage.
useful energy in the form of electrical and/or mechanical See Energy community bonus credit rate, in Part I, line 10,
power. earlier, for more information.
For details, see section 48(c)(3).
If the facility or property was not placed in service within an
Taxpayers cannot take a credit for both combined heat energy community, leave line 9h blank, skip line 9i, and go to
! and power system property and waste energy recovery line 10.
CAUTION property for the same property. Taxpayers must elect not
to treat such property as combined heat and power system Section F—Qualified Small Wind Energy
property for section 48 purposes. Property
Limitation. In the case of combined heat and power system Qualified small wind energy property. Qualified small wind
property with an electrical capacity in excess of the applicable energy property means property that uses a qualifying small
capacity placed in service during the tax year, the credit for that wind turbine to generate electricity. For this purpose, a qualifying
year shall be equal to the amount that bears the same ratio to the small wind turbine means a wind turbine that has a nameplate
credit as the applicable capacity bears to the capacity of such capacity of not more than 100 kilowatts. For details, see section
property. 48(c)(4). In addition, for small wind energy property acquired (or
Applicable capacity. Applicable capacity means the placed in service in the case of property constructed,
following: reconstructed, or erected) after February 2, 2015, see Notice
• 15 megawatts; 2015-4, 2015-5 I.R.B. 407, as modified by Notice 2015-51,
• A mechanical energy capacity of more than 20,000 2015-31 I.R.B. 133, for performance and quality standards that
horsepower; or small wind energy property must meet to qualify for the energy
• An equivalent combination of electrical and mechanical credit.
energy capacities.
Maximum capacity. Combined heat and power system Line 11a
property shall not include any property comprising a system if:
• The system has a capacity of more than 50 megawatts, Enter the basis, attributable to periods after October 3, 2008,
• A mechanical energy capacity of more than 67,000 and before 2009, of any qualified small wind energy property
horsepower, or placed in service during the tax year, if the property was
• An equivalent combination of electrical and mechanical acquired after October 3, 2008, and before 2009, or to the extent
energy capacities. of basis attributable to construction, reconstruction, or erection
by the taxpayer after October 3, 2008, and before 2009.
Energy efficiency percentage. The energy efficiency
percentage of a combined heat and power system property is
the fraction of which the numerator is the total useful electrical, Line 11d
thermal, and mechanical power produced by the system at
normal operating rates (and expected to be consumed in its Enter the basis, attributable to periods after 2008 and the
normal application), and the denominator is the lower heating construction of which began before 2021 or after 2022, of any
value of the fuel sources for the system. qualified small wind energy property placed in service during the
tax year, if the property was acquired by the taxpayer or the basis
is attributable to construction, reconstruction, or erection by the
taxpayer.
Instructions for Form 3468 (2023) 13

- 14 -

Page 14 of 21 Fileid: … ions/i3468/2023/a/xml/cycle04/source 9:21 - 25-Jan-2024

The type and rule above prints on all proofs including departmental reproduction proofs. MUST be removed before printing.

See Beginning of construction, earlier. Line 13d

Line 11e Enter your applicable domestic content bonus credit percentage.
See Domestic Content Certification Statement, in Part I, line 9,
Enter your applicable energy percentage. See Increased Credit earlier, for more information.
Amount Statement, in Part I, lines 7 and 8, earlier, for more
information. If the facility or property did not meet the requirements for the
domestic content bonus credit, leave line 13d blank, skip
line 13e, and go to line 13f.
Line 11g
Line 13f
Enter your applicable low-income community bonus credit
percentage in connection with your small wind energy facility. Enter the applicable energy community bonus credit percentage.
However, if you checked the box for Part I, line 11f, or you See Energy community bonus credit rate, in Part I, line 10,
checked the box for Part I, line 12e (in relation to Part I, lines 11a, earlier, for more information.
11b, 11c, or 11d) you don't qualify for the low-income community
business credit in connection with a small energy wind facility. If the facility or property was not placed in service within an
Enter -0- (zero) on lines 11g and 11m, and go to line 11n. energy community, leave line 13f blank, skip line 13g, and go to
line 14.
See Low-income communities bonus credit amount, earlier,
for more information. Section H—Geothermal Heat Pump Systems
Geothermal heat pump systems. Geothermal heat pump
Line 11n systems constitute equipment that uses the ground or ground
water as a thermal energy source to heat a structure or as a
Enter your applicable domestic content bonus credit percentage. thermal energy sink to cool a structure. For details, see section
See Domestic Content Certification Statement, in Part I, line 9, 48(a)(3)(A)(vii).
earlier, for more information.
Line 15b
If the facility or property did not meet the requirements for the
domestic content bonus credit, leave line 11n blank, skip Enter your applicable energy percentage. See Increased Credit
line 11o, and go to line 11p. Amount Statement, in Part I, lines 7 and 8, earlier, for more
information.
Line 11p
Line 15d
Enter the applicable energy community bonus credit percentage.
See Energy community bonus credit rate, in Part I, line 10, Enter your applicable domestic content bonus credit percentage.
earlier, for more information. See Domestic Content Certification Statement, in Part I, line 9,
earlier, for more information.
If the facility or property was not placed in service within an
energy community, leave line 11p blank, skip line 11q, and go to If the facility or property did not meet the requirements for the
line 12. domestic content bonus credit, leave line 15d blank, skip
line 15e, and go to line 15f.
Section G—Waste Energy Recovery Property
Waste energy recovery property. Qualified waste energy Line 15f
recovery property means property that generates electricity
solely from heat from buildings or equipment if the primary Enter the applicable energy community bonus credit percentage.
purpose of such building or equipment is not the generation of See Energy community bonus credit rate, in Part I, line 10,
electricity. The term “waste energy recovery property” shall not earlier, for more information.
include any property that has a capacity in excess of 50
megawatts. For details, see section 48(c)(5). If the facility or property was not placed in service within an
energy community, leave line 15f blank, skip line 15g, and go to
Taxpayers cannot take a credit for both combined heat line 16.
! and power system property and waste energy recovery
CAUTION property for the same property. Taxpayers must elect not Section I—Energy Storage Technology Property
to treat such property as combined heat and power system
property for section 48 purposes. Energy storage technology. Energy storage technology is:
• Property (other than property primarily used in the
transportation of goods or individuals and not for the
Note. The transitional rules of section 48(m) (as in effect on production of electricity) that receives, stores, and delivers
November 4, 1990) apply to waste energy recovery property for energy for conversion to electricity (or, in the case of
periods after 2020. hydrogen, stores energy), and has a nameplate capacity of
not less than 5 kilowatt hours; and
Line 13b • Thermal energy storage property.
Modifications of certain property. In the case of any
Enter your applicable energy percentage. See Increased Credit energy storage technology property described above that was
Amount Statement, in Part I, lines 7 and 8, earlier, for more either (1) placed in service before August 16, 2022, and that has
information. a capacity of less than 5 kilowatt hours and is modified to where
the property has a nameplate capacity of at least 5 kilowatt

14 Instructions for Form 3468 (2023)

- 15 -

Page 15 of 21 Fileid: … ions/i3468/2023/a/xml/cycle04/source 9:21 - 25-Jan-2024

The type and rule above prints on all proofs including departmental reproduction proofs. MUST be removed before printing.

hours; or (2) is modified in a manner that increases the 1. Converts biomass (as defined in section 45K(c)(3), as in
nameplate capacity to at least 5 kilowatt hours, the modified effect on August 16, 2022), into a gas that:
property will be treated as energy storage technology property,
except for the treatment of the basis of the existing property prior a. Consists of not less than 52% methane by volume, or
to the modification. b. Is concentrated by such system into a gas that consists
Thermal energy storage property. Thermal energy storage of not less than 52% methane, and
property is property comprising a system that:
2. Captures such gas for sale or productive use, and not for
• Is directly connected to a heating, ventilation, or air
disposal by means of combustion.
conditioning system;
• Removes heat from, or adds heat to, a storage medium for Qualified biogas property includes any property, described
subsequent use; and above, that is part of a system that cleans or conditions gas.
• Provides energy for the heating or cooling of the interior of a
residential or commercial building. Line 19a
Thermal energy storage property doesn’t include:
• A swimming pool, Enter the basis of any qualified biogas energy property placed in
• Combined heat and power system property, or service during the tax year, to the extent of basis attributable to
• A building or its structural components. construction, reconstruction, or erection by the taxpayer.

Line 17a Line 19b
Enter the basis of any energy storage technology property Enter your applicable energy percentage. See Increased Credit
placed in service during the tax year, to the extent of basis Amount Statement, in Part I, lines 7 and 8, earlier, for more
attributable to construction, reconstruction, or erection by the information.
taxpayer.
Line 19d
Line 17b
Enter your applicable domestic content bonus credit percentage.
Enter your applicable energy percentage. See Increased Credit See Domestic Content Certification Statement, in Part I, line 9,
Amount Statement, in Part I, lines 7 and 8, earlier, for more earlier, for more information.
information.
If the facility or property did not meet the requirements for the
domestic content bonus credit, leave line 19d blank, skip
Line 17d line 19e, and go to line 19f.
Enter your applicable low-income community bonus credit
percentage in connection with your solar or wind facility. Line 19f
However, if you checked the box for Part I, line 11f, or you
checked the box for Part I, line 12e (in relation to Part I, lines 11a, Enter the applicable energy community bonus credit percentage.
11b, 11c, or 11d) you don't qualify for the low-income community See Energy community bonus credit rate, in Part I, line 10,
business credit in connection to a solar or wind energy facility. earlier, for more information.
Enter -0- (zero) on lines 17d and 17j and go to line 17k.
If the facility or property was not placed in service within an
See Low-income communities bonus credit amount, energy community, leave line 19f blank, skip line 19g, and go to
described in Part I, lines 11 and 12, earlier, for more information. line 20.

Section K—Microgrid Controllers Property
Line 17k
Microgrid controller. Microgrid controller means equipment
Enter your applicable domestic content bonus credit percentage. that is:
See Domestic Content Certification Statement, in Part I, line 9, • Part of a qualified microgrid, and
earlier, for more information. • Designed and used to monitor and control the energy
resources and loads on such microgrid.
If the facility or property did not meet the requirements for the Qualified microgrid. A qualified microgrid is an electrical
domestic content bonus credit, leave line 17k blank, skip line 17l, system that:
and go to line 17m.
1. Includes equipment that is capable of generating not less
than 4 kilowatts and not more than 20 megawatts of
Line 17m
electricity;
Enter the applicable energy community bonus credit percentage. 2. Is capable of operating:
See Energy community bonus credit rate, in Part I, line 10,
earlier, for more information. a. In connection with the electrical grid and as a single
controllable entity with respect to such grid,
If the facility or property was not placed in service within an b. Independently (and disconnected) from such grid, and
energy community, leave line 17m blank, skip line 17n, and go to
line 18. 3. Is not part of a bulk-power system (as defined in section 215
of the Federal Power Act (16 U.S.C. 824o)).
Section J—Qualified Biogas Property
Qualified biogas property. Qualified biogas property is
property comprising a system that:
Instructions for Form 3468 (2023) 15

- 16 -

Page 16 of 21 Fileid: … ions/i3468/2023/a/xml/cycle04/source 9:21 - 25-Jan-2024

The type and rule above prints on all proofs including departmental reproduction proofs. MUST be removed before printing.

Line 21a f. Trash facility under section 45(d)(7).
g. Qualified hydropower facility under section 45(d)(9).
Enter the basis of any qualified microgrid controller property
placed in service during the tax year, to the extent of basis h. Marine and hydrokinetic renewable energy facility under
attributable to construction, reconstruction, or erection by the section 45(d)(11).
taxpayer. i. Is a qualified offshore wind facility. See Notice 2021-5,
2021-03 I.R.B. 479, for more information on beginning
Line 21b of construction requirements applied to offshore and
federal land projects.
Enter your applicable energy percentage. See Increased Credit
Amount Statement, in Part I, lines 7 and 8, earlier, for more 2. No credit has been allowed under section 45 for that facility
information. (see Note below); and
3. An irrevocable election was made to treat the facility as
Line 21d energy property.
Enter your applicable domestic content bonus credit percentage. Note. If a taxpayer retrofits an energy property that previously
See Domestic Content Certification Statement, in Part I, line 9, received a credit under section 45 by meeting the 80/20 Rule
earlier, for more information. provided in section 7.05 of Notice 2018-59, 2018-28 I.R.B. 196,
the taxpayer may claim an investment tax credit based on its
If the facility or property did not meet the requirements for the investment. However, if the energy property is within the
domestic content bonus credit, leave line 21d blank, skip recapture period for the section 45 credit, the taxpayer may have
line 21e, and go to line 21f. to recapture all or part of such section 45 credit accordingly.
Qualified offshore wind facility. For purposes of section
Line 21f 48(a)(5), qualified offshore wind facility means a qualified facility
(within the meaning of section 45(d)(1)) that is located in the
Enter the applicable energy community bonus credit percentage. inland navigable waters of the United States or in the coastal
See Energy community bonus credit rate, in Part I, line 10, waters of the United States.
earlier, for more information.
Section 48(a)(5) Election Statement
If the facility or property was not placed in service within an
energy community, leave line 21f blank, skip line 21g, and go to If you are electing to treat a qualified investment credit facility as
line 22. energy property, you must attach an election statement to Form
3468 for each qualified facility. The election statement must
Section L—Qualified Investment Credit Facility include the following information.
Property 1. Your name and taxpayer identification number shown on the
Qualified investment credit facility property. Qualified return.
investment credit facility property is property: 2. For each qualified facility, include the following:
• That is tangible personal property or other tangible property
(not including a building or its structural components), but a. The facility description (including the owner information,
only if the property is used as an integral part of the qualified if different from the filer) and the IRS-issued registration
investment credit facility; number (if applicable) of the qualified facility from Part I,
• That is constructed, reconstructed, erected, or acquired by line 2a.
the taxpayer; b. An accounting of your basis in the energy property.
• With respect to which depreciation or amortization is
allowable; and c. A depreciation schedule reflecting your remaining basis
• For which the original use begins with the taxpayer. in the energy property after the energy credit is claimed.
See section 48(a)(5) for details. 3. A statement that you haven’t and won’t claim a section 1603
grant for new investment in the property for which you are
Note. The transitional rules of section 48(m) (as in effect on claiming the energy credit.
November 4, 1990) apply to offshore wind facilities for periods
after 2016. Under the transitional rules of section 48(m) (as in 4. A declaration, applicable to the statement and any
effect on November 4, 1990), the phaseout of the section 48 accompanying documents, signed by you, or signed by a
credit provided for other types of qualified investment credit person currently authorized to bind you in such matters that
facilities under section 48(a)(5)(E), does not apply to qualified states the following: “Under penalties of perjury, I declare
offshore wind facilities. that I have examined this statement, including
Qualified investment credit facility. A qualified investment accompanying documents, and to the best of my knowledge
credit facility is a facility that: and belief, the facts presented in support of this statement
are true, correct, and complete.”
1. Is one of the following qualified facilities that is placed in
service after 2008. See Beginning of construction, earlier. Line 23b
a. Wind facility under section 45(d)(1).
Enter your applicable energy percentage. See Increased Credit
b. Closed-loop biomass facility under section 45(d)(2). Amount Statement, in Part I, lines 7 and 8, earlier, for more
c. Open-loop biomass facility under section 45(d)(3). information.
d. Geothermal or solar energy facility under section 45(d)
(4).
e. Landfill gas facility under section 45(d)(6).

16 Instructions for Form 3468 (2023)

- 17 -

Page 17 of 21 Fileid: … ions/i3468/2023/a/xml/cycle04/source 9:21 - 25-Jan-2024

The type and rule above prints on all proofs including departmental reproduction proofs. MUST be removed before printing.

Line 23d • An unrelated third party has verified (in such form or manner
as the Secretary may prescribe) that such facility produces
Enter your applicable low-income community bonus credit hydrogen through a process that results in lifecycle
percentage in connection with your wind facility. However, if you greenhouse gas emissions that are consistent with the
checked the box for Part I, line 11f, or you checked the box for hydrogen that the facility was designed and expected to
Part I, line 12e (in relation to Part I, lines 11a, 11b, 11c, or 11d) produce as specified in the Section 48(a)(15) Election
you don't qualify for the low-income community bonus credit in Statement, described below.
connection with a wind facility. Enter -0- (zero) on lines 23d and Qualified clean hydrogen. Qualified clean hydrogen means
23j and go to line 23k. hydrogen that is produced through a process that results in a
lifecycle greenhouse gas emissions rate of not greater than 4
See Low-income communities bonus credit amount, in Part I, kilograms of CO2e per kilogram of hydrogen.
lines 11 and 12, earlier, for more information.
Qualified clean hydrogen also requires the following.
• Hydrogen is produced in the United States (as defined in
Line 23k section 638(1)) or a territory of the United States (as defined
in section 638(2)).
Enter your applicable domestic content bonus credit percentage. • Hydrogen is produced in the ordinary course of a trade or
See Domestic Content Certification Statement, in Part I, line 9, business of the taxpayer.
earlier, for more information. • Hydrogen is produced for sale or use.
• The production and sale or use of such hydrogen is verified
If the facility or property did not meet the requirements for the by an unrelated party.
domestic content bonus credit, leave line 23k blank, skip line 23l,
and go to line 23m.
Section 48(a)(15) Election Statement

Line 23m If you are electing to treat qualified property that is part of a
specified clean hydrogen production facility as energy property,
Enter the applicable energy community bonus credit percentage. you must attach a statement to Form 3468 for each qualified
See Energy community bonus credit rate, in Part I, line 10, facility. The election statement must include the following
earlier, for more information. information.
If the facility or property was not placed in service within an 1. Your name and taxpayer identification number shown on the
energy community, leave line 23m blank, skip line 23n, and go to return.
line 24.
2. For each qualified facility, include the following:
Section M—Clean Hydrogen Production a. The facility description (including the owner information,
Facilities as Energy Property if different from the filer) and the IRS-issued registration
number (if applicable) of the qualified facility from Part I,
Election to treat clean hydrogen production facilities as en- line 2a.
ergy property. In the case of any qualified property (as defined
in section 48(a)(5)(D)) that is part of a specified clean hydrogen b. The lifecycle greenhouse gas (GHG) emission rate of
production facility, such property will be treated as energy the facility for the tax year.
property for purposes of this section, and the energy percentage c. A copy of the required verification report and if you are
with respect to such property is as follows. petitioning for a provisional emissions rate, a copy of the
• 1.2% in the case of a facility that is designed and reasonably documentation obtained from the Department of Energy
expected to produce qualified clean hydrogen that is providing an emissions value.
described in section 45V(b)(2)(A).
• 1.5% in the case of a facility that is designed and reasonably 3. An attestation that the facility produced hydrogen through a
expected to produce qualified clean hydrogen that is process that results in a lifecycle GHG emissions rate that is
described in section 45V(b)(2)(B). consistent with, or lower than, the lifecycle GHG emissions
• 2% in the case of a facility that is designed and reasonably rate of the hydrogen that such facility was designed and
expected to produce qualified clean hydrogen that is expected to produce.
described in section 45V(b)(2)(C). 4. A statement that you haven’t and won’t claim a section 45V
• 6% in the case of a facility that is designed and reasonably or 45Q credit for the facility which you are claiming the
expected to produce qualified clean hydrogen that is energy credit.
described in section 45V(b)(2)(D).
5. A declaration, applicable to the statement and any
Denial of production credit. No credit will be allowed under
accompanying documents, signed by you, or signed by a
section 45V or section 45Q for any tax year with respect to any
person currently authorized to bind you in such matters that
specified clean hydrogen production facility or any carbon
states the following: “Under penalties of perjury, I declare
capture equipment included at such facility.
that I have examined this statement, including
Specified clean hydrogen production facility. Specified accompanying documents, and to the best of my knowledge
clean hydrogen production facility means any qualified clean and belief, the facts presented in support of this statement
hydrogen production facility that meets the following. are true, correct, and complete.”
• Owned by the taxpayer.
• Produces qualified clean hydrogen.
• Construction begins before 2033. Line 25a
• Is placed in service after 2022.
• No credit has been allowed under section 45V or 45Q. Enter the basis of property placed in service during the tax year
• The taxpayer makes an irrevocable election to treat clean for the facility that is designed and reasonably expected to
hydrogen production facility as energy property under produce, through a process, qualified clean hydrogen that results
section 48(a)(15). in a lifecycle greenhouse gas emission rate no greater than 4
Instructions for Form 3468 (2023) 17

- 18 -

Page 18 of 21          Fileid: … ions/i3468/2023/a/xml/cycle04/source                              9:21 - 25-Jan-2024

The type and rule above prints on all proofs including departmental reproduction proofs. MUST be removed before printing.

kilograms of CO2e per kilogram of hydrogen and not less than         by the amount that is the product of the amount so determined 
2.5 kilograms as described in section 45V(b)(2)(A).                  for such year and the lesser of one of the following.
                                                                     • 15%, or
Line 25b                                                             • A fraction, which the numerator is the sum for the tax year 
                                                                       and all prior tax years, of proceeds of an issue of any 
Enter your applicable energy percentage. See Increased Credit          obligations the interest on which is exempt from tax under 
Amount Statement, in Part I, lines 7 and 8, earlier, for more          section 103 and that is used to provide financing for the 
information.                                                           qualified facility over the denominator, which is the 
                                                                       aggregate amount of additions to the capital account for the 
                                                                       qualified facility for the tax year and all prior tax years as of 
Line 25d                                                               the close of the tax year.
Enter the basis of property placed in service during the tax year    Note. The credit reduced for tax-exempt bonds, lines 29a 
for the facility that is designed and reasonably expected to         through 29e, applies to construction, reconstruction, or erection 
produce, through a process, qualified clean hydrogen that results    of an energy property which began after August 16, 2022.
in a lifecycle greenhouse gas emission rate less than 2.5 
kilograms of CO2e per kilogram of hydrogen and not less than         Line 31
1.5 kilograms as described in section 45V(b)(2)(B).
                                                                     Patrons, including cooperatives that are patrons in other 
Line 25e                                                             cooperatives, enter the unused investment credit from the 
                                                                     energy credit allocated from cooperatives. If you are a 
Enter your applicable energy percentage. See Increased Credit        cooperative, see the instructions for Form 3800, Part III, line 4a, 
Amount Statement, in Part I, lines 7 and 8, earlier, for more        for allocating the investment credit to your patrons.
information.
                                                                           See General Instructions for filing Form 3468 to report 
                                                                     TIP   any unused credits from cooperatives.
Line 25g

Enter the basis of property placed in service during the tax year 
                                                                     Line 32
for the facility that is designed and reasonably expected to 
produce, through a process, qualified clean hydrogen that results    Elective payment phaseout for applicable entities.      If you 
in a lifecycle greenhouse gas emission rate less than 1.5            are making an elective payment election for a facility whose 
kilograms of CO2e per kilogram of hydrogen and not less than         construction began in calendar year 2024, and the facility does 
0.45 kilograms as described in section 45V(b)(2)(C).                 not satisfy the rules of section 48(a)(12)(B) or does not have a 
                                                                     maximum net output of less than 1 megawatt (as measured in 
Line 25h                                                             alternating current), multiply line 30 by 90% (0.90) and enter the 
                                                                     amount on line 32.
Enter your applicable energy percentage. See Increased Credit        Exception to elective payment phaseout.    For facilities 
Amount Statement, in Part I, lines 7 and 8, earlier, for more        whose construction began during calendar year 2024, Notice 
information.                                                         2024-09 provides transitional procedures to claim the statutory 
                                                                     exceptions to the elective payment phaseout related to the 
                                                                     domestic content requirement.
Line 25j
                                                                     To substantiate your claim of exception to the elective 
Enter the basis of property placed in service during the tax year    payment phaseout, you must complete and attach a statement to 
for the facility that is designed and reasonably expected to         Form 3468. The statement must say, under penalties of perjury, 
produce, through a process, qualified clean hydrogen that results    that you have reviewed the requirements for the increased cost 
in a lifecycle greenhouse gas emission rate less than 0.45           exception and the non-availability exception under section 45(b)
kilograms of CO2e per kilogram of hydrogen as described in           (10)(D), and have made a good faith determination that the 
section 45V(b)(2)(D).                                                qualified facility meets the requirements for the increased cost 
                                                                     exception and/or the non-availability exception, as applicable. 
                                                                     The statement must be signed by a person with the legal 
Line 25k                                                             authority to bind the applicable entity in federal tax matters. For 
                                                                     more information, see Notice 2024-09, 2024-02 I.R.B. 358.
Enter your applicable energy percentage. See Increased Credit 
Amount Statement, in Part I, lines 7 and 8, earlier, for more        Partnership or S corporation. If you are a partnership or S 
information.                                                         corporation electing to transfer the energy credit with respect to 
                                                                     a facility or property (or portion of) under section 6418(c), you 
Section N—Totals and Credit Reduction for Tax                        must report the total credit amount with respect to your facility on 
                                                                     line 32 and Form 3800, Part III, line 4a.
Exempt
Line 28
                                                                     Part VII—Rehabilitation Credit Under 
If proceeds of tax-exempt bonds were used to finance your            Section 47
facility, continue to line 29. If proceeds were not used to finance  You are allowed a credit for qualified rehabilitation expenditures 
your facility, skip lines 29a through 29e, and go to line 30.        made for any qualified rehabilitated building. You must reduce 
                                                                     your basis by the amount of the credit determined for the tax 
Line 29                                                              year. See Regulations section 1.47-7.
Credit reduced for tax-exempt bonds. The amount of the               If the adjusted basis of the building is determined in whole or 
credit with respect to any facility for any tax year will be reduced in part by reference to the adjusted basis of a person other than 

18                                                                                         Instructions for Form 3468 (2023)

- 19 -

Page 19 of 21 Fileid: … ions/i3468/2023/a/xml/cycle04/source 9:21 - 25-Jan-2024

The type and rule above prints on all proofs including departmental reproduction proofs. MUST be removed before printing.

the taxpayer, see Regulations section 1.48-12(b)(2)(viii) for 5. If the expenditures are in connection with the rehabilitation
additional information that must be attached. of a certified historic structure or a building in a registered
historic district, the rehabilitation must be certified by the
Qualified rehabilitated building. To be a qualified
Secretary of the Interior as being consistent with the historic
rehabilitated building, your building must meet all five of the
character of the property or district in which the property is
following requirements.
located. This requirement doesn't apply to a building in a
1. The building must be a certified historic structure. A registered historic district if:
certified historic structure is any building:
a. The building isn't a certified historic structure;
a. Listed in the National Register of Historic Places, or b. The Secretary of the Interior certifies that the building
b. Located in a registered historic district (as defined in isn't of historic significance to the district; and
section 47(c)(3)(B)) and certified by the Secretary of the c. If the certification in (b) occurs after the rehabilitation
Interior as being of historic significance to the district. began, the taxpayer certifies in good faith that the
Certification requests are made through your State taxpayer wasn't aware of that certification requirement
Historic Preservation Officer on National Park Service at the time the rehabilitation began.
(NPS) Form 10-168, Historic Preservation Certification 6. The expenditures can't include any costs allocable to the
Application. The request for certification should be made part of the property that is (or may reasonably be expected
prior to physical work beginning on the building. For to be) tax-exempt use property (as defined in section 168(h)
pre-1936 buildings under the transition rule, see Transitional except that “50%” shall be substituted for “35%” in
rule for amounts paid or incurred after 2017, later. paragraph (1)(B)(iii)). This exclusion doesn't apply for
2. The building must be substantially rehabilitated. A line 1f.
building is considered substantially rehabilitated if your
qualified rehabilitation expenditures during a self-selected Line 1a
24-month period that ends with or within your tax year are Check the appropriate box whether there was any charitable
more than the greater of $5,000 or your adjusted basis in conservation contribution deduction under section 170(h)
the building and its structural components. Figure adjusted claimed for the property on which you are claiming a credit for a
basis on the first day of the 24-month period or the first day certified historic structure.
of your holding period, whichever is later. If you are
rehabilitating the building in phases under a written Line 1b
architectural plan and specifications that were completed If you checked “Yes” to line 1a, you must provide the NPS project
before the rehabilitation began, substitute “60-month period” number. The NPS project number is assigned:
for “24-month period.” • By NPS to a certified historic structure;
3. Depreciation must be allowable with respect to the • To a building on a property that has multiple buildings which
building. Depreciation isn't allowable if the building is is individually listed in the National Register of Historic
permanently retired from service. If the building is damaged, Places referenced in section 170(h)(4)(C)(i); or
it isn't considered permanently retired from service where • To a building that is in a historic district referenced in section
the taxpayer repairs and restores the building and returns it 170(h)(4)(C)(ii).
to actual service within a reasonable period of time. If the property is a single building individually listed in the
4. The building must have been placed in service before National Register of Historic Places, enter five zeros (“00000”) in
the beginning of rehabilitation. This requirement is met if the NPS project number field. For more details on the NPS
the building was placed in service by any person at any time project number for easements on certified historic structures,
before the rehabilitation began. see the Instructions for Form 8283, Noncash Charitable
Contributions. For more information on charitable conservation
5. For a building under the transition rule: contribution deduction of certified historic structures, see Pub.
a. At least 75% of the external walls must be retained with 526, Charitable Contributions.
50% or more kept in place as external walls, and
Line 1c
b. At least 75% of the existing internal structural framework
For credit purposes, the expenditures are generally taken into
of the building must be retained in place.
account for the tax year in which the qualified rehabilitated
Qualified rehabilitation expenditures. To be qualified building is placed in service. However, with certain exceptions,
rehabilitation expenditures, your expenditures must meet all six you may elect to take the expenditures into account for the tax
of the following requirements. year in which they were paid (or, for a self-rehabilitated building,
when capitalized) if:
1. The expenditures must be for: • The normal rehabilitation period for the building is at least 2
a. Nonresidential real property, years, and
• It is reasonable to expect that the building will be a qualified
b. Residential rental property (but only if a certified historic rehabilitated building when placed in service.
structure; see Regulations section 1.48-1(h)), or For details, see section 47(d). To make this election, check
c. Real property that has a class life of more than 12.5 the box on line 1c. The credit, as a percent of expenditures paid
years. or incurred during the tax year for any qualified rehabilitated
building, depends on the type of structure and its location.
2. The expenditures must be incurred in connection with the
rehabilitation of a qualified rehabilitated building. Lines 1h, 1i, and 1j
3. The expenditures must be capitalized and depreciated
Transitional rule for amounts paid or incurred after 2017.
using the straight line method.
The 10% credit for pre-1936 buildings no longer applies and the
4. The expenditures can't include the costs of acquiring or 20% credit for a certified historic structure is generally modified
enlarging any building. to allow 100% of qualified rehabilitation expenditures ratably
Instructions for Form 3468 (2023) 19

- 20 -

Page 20 of 21          Fileid: … ions/i3468/2023/a/xml/cycle04/source                                 9:21 - 25-Jan-2024

The type and rule above prints on all proofs including departmental reproduction proofs. MUST be removed before printing.

over a 5-year period for amounts paid or incurred after 2017. For     Officer, together with proof that the building is a certified historic 
qualified rehabilitation expenditures paid or incurred during the     structure (or that such status has been requested).
transitional period stated below, the taxpayer can claim the 10%      After the final certification of completed work has been 
credit for pre-1936 buildings and the 20% credit for a certified      received, file Form 3468 with the first income tax return filed after 
historic structure (under section 47(a), as in effect before          receipt of the certification and enter the assigned NPS project 
December 22, 2017). The transitional rule applies to amounts          number and the date of the final certification of completed work 
paid or incurred as follows.                                          on the appropriate lines on the form. Also, attach an explanation 
In the case of qualified rehabilitation expenditures with             and indicate the amount of credit claimed in prior years.
respect to any building (a) owned or leased by the taxpayer 
                                                                      Failure to receive final certification of completed work with-
during the entirety of the period after 2017; and (b) with respect 
                                                                      in 30 months. If you didn’t receive final certification of 
to the 24-month period selected by the taxpayer under section 
                                                                      completed work prior to the date that is 30 months after the date 
47(c)(1)(B)(i) (as in effect after December 21, 2017) (or the 
                                                                      that you filed the tax return on which the credit was claimed, you 
60-month period applicable under section 47(c)(1)(B)(ii)), which 
                                                                      must submit, before the last day of the 30th month, a written 
begins no later than 180 days after December 22, 2017, the 
                                                                      statement to the IRS stating that fact. You will be asked to 
transitional rule applies to expenditures paid or incurred after the 
                                                                      consent to an agreement under section 6501(c)(4) extending the 
end of the tax year in which the 24-month period (or the 
                                                                      period of assessment for any tax relating to the time for which 
60-month period) ends.
                                                                      the credit was claimed.
If you have more than one property that qualifies for the 
                                                                      Mail the written statement to:
rehabilitation credit, attach a schedule showing the type of 
property (pre-1936 building or certified historic structure), NPS     Internal Revenue Service
number, date of final certification, and the partnership employer     Technical Services
identification number (EIN), if applicable. Also, indicate if the     31 Hopkins Plaza, Room 1108
transitional rule applies.                                            Baltimore, MD 21201
Line 1k
If you are claiming a credit for a certified historic structure on    Final certification of completed work. You must retain a copy 
line 1i or 1j, enter the assigned NPS project number on line 1k.      of the final certification of completed work as long as its contents 
                                                                      may be needed for the administration of any provision of the 
If the qualified rehabilitation expenditures are from an S            Code.
corporation, partnership, estate, or trust, enter on line 1k the EIN 
of the pass-through entity instead of the assigned NPS project                If the final certification is denied by the Department of 
number, and skip the second line assigned for the date on             !       the Interior, the credit is disallowed for any tax year in 
line 1k.                                                              CAUTION which it was claimed, and you must file an amended 
                                                                      return if necessary. See Regulations section 1.48-12(d)(7)(ii) for 
The lessor will provide the lessee with the NPS project               details.
number to enter on line 1k.
For the second line on line 1k, enter the date of the final           Line 2
certification of completed work received from the Secretary of        Patrons, including cooperatives that are patrons in other 
the Interior.                                                         cooperatives, enter the unused investment credit from the 
Certification of completed work not received by time of fil-          rehabilitation investment credit allocated from cooperatives. If 
ing. If the final certification hasn't been received by the time the  you are a cooperative, see the instructions for Form 3800, Part 
tax return is filed for a year in which the credit is claimed, attach III, line 4k, for allocating the investment credit to your patrons.
a copy of the first page of NPS Form 10-168, Historic                         See General Instructions for filing Form 3468 to report 
Preservation Certification Application (Part 2—Description of         TIP     any unused credits from cooperatives.
Rehabilitation), with an indication that it was received by the 
Department of the Interior or the State Historic Preservation 

20                                                                                           Instructions for Form 3468 (2023)

- 21 -

Page 21 of 21           Fileid: … ions/i3468/2023/a/xml/cycle04/source                                                                     9:21 - 25-Jan-2024

The type and rule above prints on all proofs including departmental reproduction proofs. MUST be removed before printing.

Paperwork Reduction Act Notice.            We ask for the information on this form to carry out the Internal Revenue laws of the United 
States. You are required to give us the information. We need it to ensure that you are complying with these laws and to allow us to 
figure and collect the right amount of tax.
You are not required to provide the information requested on a form that is subject to the Paperwork Reduction Act unless the form 
displays a valid OMB control number. Books or records relating to a form or its instructions must be retained as long as their contents 
may become material in the administration of any Internal Revenue law. Generally, tax returns and return information are confidential, 
as required by section 6103.
The time needed to complete and file this form will vary depending on individual circumstances. The estimated burden for individual 
and business taxpayers filing this form is approved under OMB control number 1545-0074 and 1545-0123 and is included in the 
estimates shown in the instructions for their individual and business income tax return. The estimated burden for all other taxpayers 
who file this form is shown below.

Recordkeeping. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18 hr., 39 min.
Learning about the law or the form. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .      6 hr., 21 min.
Preparing and sending the form to the IRS        . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   10 hr., 55 min.

If you have comments concerning the accuracy of these time estimates or suggestions for making this form simpler, we would be 
happy to hear from you. See the instructions for the tax return with which this form is filed.

Instructions for Form 3468 (2023)                                                                                                                            21

PDF file checksum: 2760078820

(Plugin #1/9.12/13.0)