Treasury Department, IRS Releases Final IRA Applicable Wage and Apprenticeship Regulations

The U.S. Department of the Treasury and the IRS issued final regulations on June 18, 2024, regarding applicable pay and apprenticeship (PWA) requirements. If construction of the facility began on or after January 29, 2023, and the facility’s maximum net capacity exceeds 1 megawatt (MW) of alternating current (MWac), the PWA requirements generally must be met for the taxpayer to receive the full credit amount under sections 30C, 45 , 45L, 45Q, 45U, 45V, 45Y, 48, 48C and 48E of the Internal Revenue Code, as well as the increased deduction under Section 179D.

Summary of application of PWA requirements

A summary of the application of the PWA requirements to various points is provided below:

Additional resources

The IRS also published the Prevailing Wages and Apprenticeships Fact Sheet (Publication 5983) and updated the Prevailing Wages and Recorded Apprenticeships IRA (Publication 5855) and Prevailing Wages and Apprenticeships FAQ.

Additionally, the U.S. Department of Labor (DOL) and the IRS are working on a memorandum of understanding (MOU) that is expected to be signed by the end of the year. The MOU will facilitate DOL review and comment in the development of PWA tax forms and will formalize the process for DOL to share with the IRS any credible tips or information it receives regarding potential noncompliance with PWA requirements.