On June 18, Treasury released final rules providing prevailing wage and registered apprenticeship (PWA) requirements affecting several IRA tax incentives. The final rules provide: the definition for a request for qualified apprentices, recordkeeping requirements, a guarantee for projects covered by qualifying labor agreements that they will not need to pay penalties, practices to encourage contemporaneous compliance, and information on the applicability of the good faith effort exception.
IRS and the White House both provided fact sheets with summaries of the new requirements.
A variety of tax incentives are impacted by the PWA requirements, including the production and investment tax credits under IRA sections 13101, 13102, 13701, and 13702, as well as the carbon capture and sequestration and clean hydrogen tax credits under IRA sections 13104 and 13204.
Opportunities for Participation and Additional Resources:
- IRS Press Release: https://www.irs.gov/newsroom/treasury-irs-release-guidance-on-the-prevailing-wage-and-apprenticeship-requirements-for-increased-credit-and-deduction-amounts-under-the-inflation-reduction-act
- Final Rules: https://www.federalregister.gov/documents/2024/06/25/2024-13331/increased-amounts-of-credit-or-deduction-for-satisfying-certain-prevailing-wage-and-registered
- IRS Fact sheet: https://www.irs.gov/pub/irs-pdf/p5983.pdf
- Treasury Press Release: https://home.treasury.gov/news/press-releases/jy2413
- White House Fact Sheet: https://bidenwhitehouse.archives.gov/briefing-room/statements-releases/2024/06/18/fact-sheet-biden-harris-administration-announces-historic-rules-to-create-good-paying-high-quality-clean-energy-jobs/
- FAQs: https://www.irs.gov/credits-deductions/frequently-asked-questions-about-the-prevailing-wage-and-apprenticeship-under-the-inflation-reduction-act