SEIA Publishes White Paper on Fair Market Value for Income Tax Purposes

more+
less-

The Solar Energy Industry Association (SEIA) has published a white paper that addresses the income tax rules for determining fair market value. The white paper is available here

Fair market value is critical in analyzing the tax benefits of solar projects because in many structures it determines the amount of investment tax credit and accelerated depreciation available to the owner of the project. The white paper highlights both best practices and common pitfalls. For those involved in the renewable energy industry, even if not as a tax professional, the fair market value and tax basis concepts in the white paper are worth being familiar with.  Further, the tax principles described in the white paper are broadly applicable to tax planning generally, even outside of the renewables area.

The white paper was prepared by SEIA’s Tax Working Group (of which I am a member); however, the accounting firm CohnReznick deserves much of the credit for being the driving force in authoring it.

Currently, many solar developers and investors are in disputes with the U.S. Treasury regarding the fair market value of projects that have applied for the cash grant.  Special purpose entities affiliated with SolarCity have elevated one set of these disputes to the Court of Federal Claims.  This case is discussed in posts below and available here, here and here. Unless, the Department of Justice prevails in its motion to dismiss the case, which I think is unlikely, the case will give the industry an opportunity to see how the Court of Federal Claims applies the fair market value and tax basis principles discussed in SEIA’s white paper to actual solar projects.

 


DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Akin Gump Strauss Hauer & Feld LLP | Attorney Advertising

Written by:

more+
less-

Akin Gump Strauss Hauer & Feld LLP on:

Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:

Sign up to create your digest using LinkedIn*

*With LinkedIn, you don't need to create a separate login to manage your free JD Supra account, and we can make suggestions based on your needs and interests. We will not post anything on LinkedIn in your name. Or, sign up using your email address.
×
Loading...
×
×