The Low-Income Communities Bonus Tax Credit Program – What is it?

The Low-Income Communities Bonus Tax Credit Program was established under the Inflation Reduction Act to drive clean-energy investments in low-income areas and on Indian lands. It’s seeing “robust demand,” according to the U.S. Dept. of the Treasury. The Sec. 48(e) bonus credit increases the Sec. 48 energy investment tax credit of 30% by 10% or 20%, depending on circumstances. In its first year, the program received over 54,000 applications from 48 states; over 49,000 of those were approved. The approved applications total nearly 1.5 gigawatts of expected energy capacity and approximately $3.5 billion in public and private investment in low-income communities and on Indian lands.