Iowa Administrative Code › Agency 199 - Utilities Division › Utilities and Transportation Divisions › Chapter 15 - Cogeneration and Small Power Production › Rule 199-15.20 - Applications for Wind Energy Tax Credits Under Iowa Code Chapter 476b

Current through Register Vol. 47, No. 3, July 24, 2024
The wind energy tax credits equal one cent per kilowatt-hour of electricity generated by eligible wind energy facilities under 199-15.18 (476B), which is sold or used for on-site consumption by the owner, for tax years beginning on or after July 1, 2006. The owners of an eligible facility may apply for wind energy tax credits for up to ten tax years following the date the facility is placed in service. Wind energy tax credits will not be issued for wind energy sold or used for on-site consumption after June 30, 2022. For purposes of this rule, wind energy used for on-site consumption means any electricity produced by an eligible facility and not sold.
For the first tax year for which tax credits can be claimed, the kilowatt-hours generated by and purchased from an eligible facility may exceed 12 months' production.
EXAMPLE: An eligible facility was placed in service on April 1, 2006, and the taxpayer files on a calendar year basis. The first year for which tax credits can be claimed is the year ending December 31, 2007, since that is the first tax year that began on or after July 1, 2006. The credits for the 2007 tax year can include energy produced and purchased between April 1, 2006, and December 31, 2007.
(1)
Application process for wind energy tax credits.
A wind energy facility must be approved as eligible by the commission under 199-15.18 (476B) in order to qualify for wind energy tax credits.
If the facility is located in a city or county neither of which has enacted an ordinance under Iowa Code section 427B.26, or if the facility is not eligible for special valuation pursuant to an ordinance adopted by the city or county under Iowa Code section 427B.26, the wind energy facility must also be approved by the city council or county board of supervisors of the city or county in which the facility is located, in accordance with Iowa Code section 476B.6(1)  as amended by 2009 Iowa Acts, Senate File 456, section 4. Once the owners receive approval from their city council or county board of supervisors, additional approval from the city council or county board of supervisors is not required for subsequent tax years.
Tax credit applications for eligible facilities must be filed with the commission no later than 30 days after the close of the tax year for which the credits are to be applied. The tax credit applications must be filed in paper format and are not subject to the electronic filing requirements of 199-14.2 (17A,476). The tax credit applications will be held confidential by the commission and the department of revenue as, among other things, documents containing customer-specific or personal information (199-paragraph 1.9(5)
"c"
) and information related to tax returns (Iowa Code section 422.20). The information will be held confidential by the commission upon filing, and by the department of revenue upon receipt from the commission, and will be subject to the provisions of 199-subparagraph 1.9(8)
"b"
(3). Accordingly, the applicant should mark each of the pages of the tax credit application "CONFIDENTIAL" in bold or large letters.
a. If a facility is jointly owned, then owners applying for the tax credits must file their application jointly. For each application, an original and two copies must be filed according to the following format, including a cover letter that cites this rule (199-15.20(476B)), and the following 13 information items separately identified by item number:
(1) A copy of the original application for facility eligibility under 199-15.18 (476B), plus any subsequent amendments to the application.
(2) A copy of the commission's determination approving the facility as eligible for tax credits under 199-15.18 (476B).
(3) Either a copy of the city council's or county board of supervisors' approval, from the city or county in which the facility is located, issued pursuant to Iowa Code section 476B.6(1)  as amended by 2009 Iowa Acts, Senate File 456, section 4; or a statement explaining why such approval is not required under Iowa Code section 476B.6(1)  as amended by 2009 Iowa Acts, Senate File 456, section 4.
(4) A statement attesting that neither the owners nor the purchaser have received renewable energy tax credits for the facility under 199-15.21 (476C).
(5) For any electricity sold, a copy of the executed power purchase agreement or other agreement to purchase electricity. Alternatively, a copy of an executed interconnection agreement or transmission service agreement is acceptable if the owners have elected to sell electricity from the facility directly or indirectly to a wholesale power pool market.
(6) For any electricity sold, the owner must provide a statement attesting that the electricity for which tax credits are sought has been generated by the eligible facility and sold to an unrelated purchaser. For purposes of the wind energy tax credits, the definition of "related person" is the same as specified in department of revenue 701-subrules 42.25(2) and 52.26(2). That is, the definition of "related person" uses the same criteria set forth in Section  45(e)(4) of the Internal Revenue Code relating to the federal renewable electricity production credit. Persons shall be treated as related to each other if such persons are treated as a single employer under Treasury Regulation §1.52-1. In the case of a corporation that is a member of an affiliated group of corporations filing a federal consolidated return, such corporation shall be treated as selling electricity to an unrelated person if such electricity is sold to the person by another member of the affiliated group.
For any electricity used for on-site consumption, the owner must provide a signed statement attesting under penalty of perjury that the electricity for which tax credits are sought was generated by the eligible facility and not sold.
(7) The date that the eligible facility was placed in service (that is, between July 1, 2005, and July 1, 2012).
(8) The total number of kilowatt-hours of electricity generated by the facility during the tax year.
(9) For any electricity sold, invoices or other information that documents the number of kilowatt hours of electricity generated by the eligible facility and sold to an unrelated purchaser during the tax year.
For any electricity used for on-site consumption, the number of kilowatt-hours of electricity generated by the eligible facility during the tax year and not sold.
(10) Information regarding the facility owners, including the name, address, and tax identification number of each owner, and the percentage of equity interest held by each owner during the period for which wind energy tax credits will be sought under Iowa Code chapter 476B as amended by 2009 Iowa Acts, Senate File 456. If an owner is other than a natural person, information regarding the equity owners must also be provided. This information shall be consistent with information provided in the original application for facility eligibility, as amended, under 199-15.18 (476B).
(11) The type of tax for which the credits will be applied and the first tax year in which the credits will be applied.
(12) Identification of any applicants that are eligible to receive renewable electricity production credits authorized under Section  45 of the Internal Revenue Code. This identification should include a statement from the applicant attesting to the applicant's eligibility and any available supporting documentation.
(13) If any of the applicants is a partnership, limited liability company, S corporation, estate, trust, or any other reporting entity, all of whose income is taxed directly to its equity holders or beneficiaries for taxes imposed under Iowa Code chapter 422, division II or III, the application shall include a list of the partners, members, shareholders, or beneficiaries of the entity. This list shall include the name, address, tax identification number, and pro-rata share of earnings from the entity, for each of the partners, members, shareholders, or beneficiaries of the entity. The wind energy tax credits will flow through to the entity's partners, shareholders, or members in accordance with their pro-rata share of earnings from the entity.
If the entity is also eligible to receive renewable electricity production credits authorized under Section  45 of the Internal Revenue Code, the entity may designate specific partners if the business is a partnership, shareholders if the business is an S corporation, or members if the business is a limited liability company, to receive the wind energy tax credits issued under Iowa Code chapter 476B as amended by 2009 Iowa Acts, Senate File 456, and the percentage allocable to each. Such an entity may also designate a percentage of the tax credits allocable to an equity holder or beneficiary as a liquidating distribution or portion thereof, of a holder or beneficiary's interest in the applicant entity. Otherwise, in the absence of such designations, the wind energy tax credits will flow through to the entity's partners, shareholders, or members in accordance with their pro-rata share of earnings from the entity.
Alternatively, the tax credits will be issued directly to the entity if the entity is a partnership, limited liability company, S corporation, estate, trust, or any other reporting entity, all of whose income is taxed directly to its equity holders or beneficiaries for taxes imposed under Iowa Code chapter 422, division V, or under Iowa Code chapter 423, 432, or 437A.