Low-Income Communities Bonus Credit 48(e) & 48E(h)
What qualifies
The following investments on Indian land, federally subsidized housing, in low-income communities, or as a qualified economic benefit project.
- 48(e): a small-scale solar, wind, and/or energy storage facility that generates less than 5MW bonus credit for 2023 and 2024.
- 48E(h): a small-scale technology-neutral clean electricity generation bonus credit for facilities with a less than 5MW net output from 2025 to 2032.
Incentive value
Base credit is 6% of qualified investments.
- Credit is increased by 10% for projects located in low-income communities or on Tribal land.
- Credit is increased by 20% for projects that are part of certain federally subsidized housing programs or that offer at least 50% of the financial benefits of the electricity produced to low-income households. This bonus amount will require an application by the taxpayer.
Tax credit can be combined with other credits.
Direct pay is available for tax-exempt organizations.
Who is eligible
Owners of eligible facilities, including tax-exempt organizations.
When the credit is available
48(e) is available for projects that come online through December 31, 2024. 48E(h) Clean Electricity Investment Tax Credit becomes available in 2025 through 2032.
How to claim the credit
Applications for 48(e) opened on May 28, 2024 here. Additional guidance may come on applying for 48E(h).
Disclaimer: None of the information presented on this website should be considered official legal or financial advice. Please contact a licensed tax professional for additional information.