Instructions For Form 3468 - 2016 (Page 3 of 8) in pdf

or to refit or repower an existing electric generation unit

Line 5c

(including an existing natural gas-fired combined cycle unit);

Enter the qualified investment in advanced coal-based

Has fuel input which, when completed, will be at least 75%

generation technology property placed in service during the tax

coal;

year for projects described in section 48A(d)(3)(B)(iii). Eligible

Has an electric generation unit or units at the site that will

property is any certified property located in the United States

generate at least 400 megawatts;

and which is part of a qualifying advanced coal project (defined

Has a majority of the output that is reasonably expected to be

earlier) which has equipment that separates and sequesters at

acquired or utilized;

least 65% of the project's total carbon dioxide emissions. This

Is to be constructed and operated on a long-term basis when

percentage increases to 70% if the credits are later reallocated

the taxpayer provides evidence of ownership or control of a site

by the IRS.

of sufficient size;

Will be located in the United States; and

The credit will be recaptured if a project fails to attain or

Includes equipment that separates and sequesters at least

maintain the carbon dioxide separation and sequestration

65% (70% in the case of an application for reallocated credits) of

requirements. For details, see section 48A(i) and Notice

the project's total carbon dioxide emissions for project

2011-24, 2011-14 I.R.B. 603, available at

applications described in section 48A(d)(2)(A)(ii).

2011-14_IRB/ar08.html.

Basis. Qualified investment for any tax year is the basis of

Qualifying Gasification Project Credit

eligible property placed in service by the taxpayer during the tax

year which is part of a qualifying advanced coal project. Eligible

A qualifying gasification project is a project that:

property is limited to property which can be depreciated or

Employs gasification technology (as defined in section 48B(c)

amortized and which was constructed, reconstructed, or erected

(2)),

and completed by the taxpayer; or which is acquired by the

Is carried out by an eligible entity (as defined in section 48B(c)

taxpayer if the original use of such property commences with the

(7)), and

taxpayer.

Includes a qualified investment of which an amount not to

exceed $650 million is certified under the qualifying gasification

Basis reduction for certain financing. If property is financed

program as eligible for credit.

in whole or in part by subsidized energy financing or by

tax-exempt private activity bonds, the amount that you can claim

The total amount of credits that may be allocated under the

as basis is the basis that would otherwise be allowed multiplied

qualifying gasification project program may not exceed $600

by a fraction that is 1 reduced by a second fraction, the

million.

numerator of which is that portion of the basis allocable to such

For more information on the qualifying gasification project

financing or proceeds, and the denominator of which is the basis

and the qualifying gasification program, see Notice 2009-23,

of the property. For example, if the basis of the property is

2009-16 I.R.B. 802, available at

2009-16_irb/

$100,000 and the portion allocable to such financing or

ar06.html, which is amplified by Notice 2014-81, 2014-53 I.R.B.

proceeds is $20,000, the fraction of the basis that you may claim

1001, available at 2014-53_IRB/ar09.html. Also,

the credit on is

(that is, 1 minus $20,000/$100,000).

see

Notice

2011-24.

Subsidized energy financing means financing provided under a

federal, state, or local program, a principal purpose of which is to

Basis reduction. If property is financed in whole or in part by

provide subsidized financing for projects designed to conserve

subsidized energy financing or by tax-exempt private activity

or produce energy.

bonds, figure the credit by using the basis of such property

reduced under the rules described in Basis reduction for certain

Line 5a

financing, earlier.

Enter the qualified investment in integrated gasification

Line 6a

combined cycle property placed in service during the tax year for

projects described in section 48A(d)(3)(B)(i). Eligible property is

Enter the qualified investment in qualifying gasification project

any property which is part of a qualifying advanced coal project

property (defined above) placed in service during the tax year for

using an integrated gasification combined cycle and is

which credits were allocated or reallocated after October 3,

necessary for the gasification of coal, including any coal

2008, and that includes equipment that separates and

handling and gas separation equipment.

sequesters at least 75% of the project's carbon dioxide

emissions. Qualified investment is the basis of eligible property

Integrated gasification combined cycle is an electric

placed in service during the tax year that is part of a qualifying

generation unit which produces electricity by converting coal to

gasification project.

synthesis gas, which in turn is used to fuel a combined-cycle

plant to produce electricity from both a combustion turbine

For purposes of this credit, eligible property includes any

(including a combustion turbine/fuel cell hybrid) and a steam

property that is part of a qualifying gasification project and

turbine.

necessary for the gasification technology of such project. The

IRS is required to recapture the benefit of any allocated credit if a

Line 5b

project fails to attain or maintain these carbon dioxide separation

and sequestration requirements. See section 48B(f) and

Notice

Enter the qualified investment in advanced coal-based

2011-24.

generation technology property placed in service during the tax

year for projects described in section 48A(d)(3)(B)(ii). Eligible

Line 6b

property is any property which is part of a qualifying advanced

coal project (defined earlier) not using an integrated gasification

Enter the qualified investment, other than line 6a, in qualifying

combined cycle.

gasification project property (defined above) placed in service

during the tax year.

-3-

Instructions for Form 3468 (2016)

Instructions For Form 3468 - 2016 Page 3

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