Services

Alternative Energy Services

Andersen Tax can support you in all stages of your company’s lifecycle including assistance with minimizing the tax liability of the company, maximizing the after-tax return on investment to the investors, and ensuring compliance with various federal and state income and non-income based taxes. Renewable energy credits and incentives vary greatly from state to state. As a national practice, we have individuals throughout the country who understand these complicated issues.

Andersen Tax has significant experience in all aspects of assisting clients in analyzing investments in alternative or green energy—for the investors in alternative energy companies and the companies themselves—including the review of financial/tax models and the substantive elements of various investment structures. Andersen Tax has experience working with project developers in the creation of investment structures to assist them in maximizing the value of production tax credits, investment tax credits or grants in their financial model. Andersen Tax has also worked with outside investors and a number of solar panel installers. In addition, our state and local tax personnel have assisted clients in maximizing the value of available state and local incentives, including state sales tax opportunities and refunds.

Our professionals have expertise in many services specific to our alternative energy clients. These services include:

Alternative or Green Energy-Related Federal Tax Incentives

Congress enacted significant tax legislation that encourages investment in alternative or green energy including:

  • Production Tax Credits (PTCs) [Sec. 45] based on the per kilowatt hour for electricity generated from renewable resources such as wind power
  • Investment Tax Credits (ITCs) [Sec. 48] for investments in alternative energy property of 30%
  • Manufacturing Tax Credits (MTCs) [Sec. 48C] provide 30% credit (based on a joint application process between the Department of Energy and the U.S. Treasury) for certain investments in domestic manufacturing capabilities for the production of renewable energy (e.g., manufacturing plants for the production of solar modules or wind turbines) or the production of electric vehicles

PTCs and ITCs

Developers of projects involving PTCs and ITCs, particularly wind and solar power projects, are often syndicated in so-called flip limited partnerships whereby investors with tax credit capacity are allocated credits throughout the term of credit availability subject to a buy-out option. Taxpayers with tax credit capacity can invest in solar power for their business energy consumption needs, generating a 30% credit on qualified property. Developers of solar projects often effectively monetize the value of energy tax credits and/or grants through either a partnership flip-type structure or through a sale-leaseback structure.

MTCs

While the initial allocation of MTCs has been exhausted, both President Obama and a number of Congress members sought an additional allocation of MTCs to encourage greater investment in this sector.

Additional guidance and answers to frequently asked questions have been recently provided to add some clarity. However, the application process can be complicated and our tax professionals can assist to maximize the potential of obtaining a grant. Andersen Tax can:

  • Evaluate the best credit program that is aligned with the objectives of the company
  • Identify appropriate direct and indirect costs to qualify for the investment tax credit
  • Develop or review future tax credit benefit for the investors or the company
  • Review the tax implications of proposed corporate or partnership structures
  • Assist in developing tax efficient structures that meet the objectives of the investors and the company

Other Alternative Energy Tax Planning

Tax Planning and Compliance for Non-Income Based Taxes 

Prior to the company commencing operations in a state, Andersen Tax can:

  • Identify filing obligation requirements
  • Develop a tax filing calendar
  • Identify exemptions for qualified property
  • Assist in the preparation of filings

For existing state filing obligations, we can:

  • Determine if filings are in compliance with state requirements
  • Determine if existing filings have benefited from state specific exemptions
  • Identify exposures for incorrect filings or non-filing
  • Assist with voluntary disclosure to minimize tax liability, interest and penalties
  • Provide guidance on specific tax treatment of transactions, including state ruling preparation, and refund claim preparation and defense

Energy Efficient Commercial Building Deductions [Sec. 179(D)] Qualification and Accounting Method Changes

Andersen Tax can:

  • Identify qualified property eligible for deduction for the current year or prior year additions
  • Quantify eligible costs
  • Prepare technical and costs source documentation support
  • Prepare Form 3115 for any required changes in accounting method