IRS Sets Interim FEOC Rules for Clean Energy Credits, Establishing MACR Test and Safe Harbors

Overview

• Notice 2026-15, issued February 12, outlines a Material Assistance Cost Ratio that projects must meet to claim Sections 45Y and 48E credits, starting at 40% for generation and 55% for storage in 2026 and rising by 2030.
• Taxpayers may rely on three interim safe harbors—the Identification, Cost Percentage, and Certification safe harbors—to calculate MACR without full upstream cost tracing.
• Supplier certifications must include specified statements and identifiers, be signed under penalty of perjury, be filed with the tax return for the first credit year, and be retained for six years.
• The notice provides limited aggregation and de minimis rules, addresses repowerings and interconnection property, and applies related principles to the Section 45X advanced manufacturing credit.
• Advisers caution that supplier attestations may not satisfy enforcement on their own, urging traceability audits and ownership and debt diligence, as unresolved issues like effective control and debt attribution await proposed regulations; taxpayers can rely on the notice until 60 days after those proposals are published.