Advanced Manufacturing Production Tax Credit

Advanced Manufacturing Production Tax Credit

New Renewable Energy Technology Tax Credit for Manufacturers

The Inflation Reduction Act of 2022 (the “Act”) extends and expands many credits for renewable energy project developers, including some significant credits for United States manufacturers of renewable energy technology. The Act includes proposed amendments to §48C for updates to the Manufacturers’ Tax Credit, as well as the creation of a new §45X to the Code in order to establish the Advanced Manufacturing Production Credit (“AMPC”).

Section 45X provides that the AMPC for the taxable year is an amount equal to the sum of the credit amounts determined under §45X(b) with respect to each eligible component.

What clean energy components qualify for the AMPC?

Examples of eligible components include:

  • Items used in production of solar equipment
    • solar modules
  • Offshore and onshore wind equipment
    • wind energy components
    • blades
    • towers
  • Inverter equipment
  • Batteries
    • electrode active materials
    • battery cells
    • battery modules

Each eligible component has a specific way to calculate the credit. Read the full list of eligible components, their definitions, and credit calculations.

Additional AMPC requirements

  • Components must be produced in the United States and sold by a manufacturer to an unrelated person
  • Credit will apply to components produced after December 31, 2022, and will begin to phase out in 2030
  • Any credits from §45X will not be available for components produced in a factory that benefitted from any credits in §48C

Please contact your Keiter Opportunity Advisor or Email us | Call: 804.747.0000 if you have questions regarding the new tax credit for your manufacturing business.

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The information contained within this article is provided for informational purposes only and is current as of the date published. Online readers are advised not to act upon this information without seeking the service of a professional accountant, as this article is not a substitute for obtaining accounting, tax, or financial advice from a professional accountant.


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