Section 13703 of the IRA classifies any facility or investment qualifying for the Clean Electricity Production Credit or the Clean Electricity Investment Credit as a 5-year property under the Modified Accelerated Cost Recovery System (i.e., the system used to calculate asset depreciation for tax purposes).
Eligible Entities:
Current Status:
Section 70509 of the One Big Beautiful Bill Act of 2025 (Public Law 119-21) terminates the cost recovery for clean energy credit (IRA section 13703) by removing solar and wind energy facilities from the “five-year property” designation (26 USC 168(e)(3)(B)(vi)).
Trump Administration Actions:
- Congress Passes Budget Bill, Rescinding Funds and Repealing IRA Programs and Tax Credits [07/03/2025]
- OMB Orders Temporary Pause on Financial Assistance Programs, Later Rescinded [01/27/2025]
- OMB Clarifies Scope of the Order to Halt IRA Spending [01/21/2025]
- Trump Issues Executive Order to Halt All IRA Funding Disbursements [01/20/2025]
Implementation Status at End of Biden Administration:
The statute did not require any implementation actions to reclassify facilities eligible for the investment and production clean energy tax credits as five-year properties under the modified accelerated cost recovery system (MACRS). “Qualified facilities” are defined as those placed into service in 2025 and following emissions regulations laid out by sections 45Y and 48E.
Program Stakes:
Congress’s Joint Committee on Taxation projects $500 million in federal spending on five-year MACRS by 2028.