26 C.F.R. § 1.48D-0

Current through November 30, 2024

Section 1.48D-0 - [Effective 12/23/2024] Table of contents

This section lists the table of contents for §§ 1.48D-1 through 1.48D-6 .

§ 1.48D-1 Advanced manufacturing investment credit determined.

(a) Overview.

(b) Determination of credit.

(c) Coordination with section 47.

(1) In general.

(2) Example.

(d) Applicability date.

§ 1.48D-2Definitions.

(a) In general.

(b) Applicable transaction.

(c) Basis.

(1) In general.

(2) Transition rule.

(d) Beginning of construction.

(e) Eligible taxpayer.

(f) Foreign entities.

(1) Foreign entity.

(2) Foreign entity of concern.

(g) Manufacturing of semiconductors.

(h) Manufacturing of semiconductor manufacturing equipment.

(i) Placed in service.

(j) Qualified investment.

(1) In general.

(2) Special rules for certain passthrough entities.

(i) Partnership.

(ii) S corporation.

(iii) Estate or trust.

(3) Qualified progress expenditures election.

(i) In general.

(ii) Special rules for certain passthrough entities.

(4) Examples.

(i) Example 1.

(ii) Example 2.

(k) Section 48D credit.

(l) Section 48D regulations.

(m) Semiconductor.

(n) Semiconductor manufacturing.

(1) Semiconductor wafer production.

(2) Semiconductor fabrication.

(3) Semiconductor packaging.

(4) Assembly.

(5) Testing.

(6) Advanced packaging.

(o) Semiconductor manufacturing equipment.

(p) Statutory references.

(1) Chapter 1.

(2) Code.

(3) Subtitle A.

(q) Applicability date.

§ 1.48D-3Qualified property.

(a) In general.

(b) Qualified property.

(c) Tangible depreciable property.

(1) In general.

(2) Exception.

(3) Buildings or portions of a building not excluded by section 48D(b)(2)(B)(ii).

(d) Constructed, reconstructed, or erected by the taxpayer.

(e) Original use.

(1) In general.

(2) Treatment of inventory.

(f) Part of an advanced manufacturing facility.

(1) In general.

(2) Property that is not located or co-located at an advanced manufacturing facility or on a contiguous piece of land to the advanced manufacturing facility.

(g) Integral to the operation of an advanced manufacturing facility.

(1) In general.

(2) Vertically integrated manufacturers.

(3) Specific examples of integral property.

(4) Research or storage facilities.

(5) Examples.

(i) Example 1.

(ii) Example 2.

(h) Applicability date.

§ 1.48D-4Advanced manufacturing facility of an eligible taxpayer .

(a) In general.

(b) Advanced manufacturing facility.

(c) Primary purpose.

(1) In general.

(2) No primary purpose.

(3) Examples.

(i) Example 1: Primary purpose; in general.

(ii) Example 2: Primary purpose; semiconductor wafer production.

(iii) Example 3: Primary purpose; vertically integrated manufacturer.

(iv) Example 4: No primary purpose; vertically integrated manufacturer.

(d) Applicability date.

§ 1.48D-5Beginning of construction.

(a) Termination of credit.

(1) In general.

(2) Property.

(3) Single advanced manufacturing facility project.

(i) In general.

(ii) Related taxpayers.

(A) Definition.

(B) Related taxpayer rule.

(iii) Example.

(iv) Timing of single advanced manufacturing facility project determination.

(v) Disaggregation.

(vi) Example.

(b) Beginning of construction.

(1) In general.

(2) Continuity requirement.

(c) Physical work test.

(1) In general.

(2) Physical work of significant nature.

(i) In general.

(ii) Exceptions.

(d) Five percent safe harbor.

(1) In general.

(2) Costs.

(3) Cost overruns.

(i) Single advanced manufacturing facility project.

(ii) Example.

(iii) Single property.

(iv) Example.

(e) Continuity requirement.

(1) In general.

(2) Continuous construction.

(3) Continuous efforts.

(4) Excusable disruptions to continuous construction and continuous efforts tests.

(i) In general.

(ii) Effect of excusable disruptions on continuity safe harbor.

(iii) Non-exclusive list of construction disruptions.

(5) Timing of excusable disruption determination.

(6) Continuity safe harbor.

(i) In general.

(ii) Example.

(f) Applicability date.

§ 1.48D-6Elective payment election.

(a) Elective payment election.

(1) In general.

(2) Partnerships and S corporations.

(3) Irrevocable.

(b) Pre-filing registration required.

(1) In general.

(2) Manner of registration.

(3) Members of a consolidated group.

(4) Timing of pre-filing registration.

(5) Each qualified investment in an advanced manufacturing facility must have its own registration number.

(6) Information required to complete the pre-filing registration process.

(7) Registration number.

(i) In general.

(ii) Registration number is only valid for one year.

(iii) Renewing registration numbers.

(iv) Amendment of previously submitted registration information if a change occurs before the registration number is used.

(v) Registration number is required to be reported on the return for the taxable year of the elective payment election.

(c) Time and manner of election.

(1) In general.

(2) Limitations.

(d) Special rules for partnerships and S corporations.

(1) In general.

(2) Election.

(i) Time and manner of election.

(ii) Effect of election.

(iii) Coordination with sections 705 and 1366.

(iv) Partner's distributive share.

(A) In general.

(B) Interim rule.

(C) Partnership requirements.

(v) S corporation shareholder's pro-rata share.

(vi) Timing of tax exempt income.

(3) Disregarded entity ownership.

(4) Electing partnerships in tiered structures.

(i) In general.

(ii) Electing partnerships in tiered structures; interim rule.

(5) Character of tax exempt income.

(6) Determination of amount of the section 48D credit.

(i) In general.

(ii) Application of section 49 at-risk rules to determination of section 48D credit for partnerships and S corporations.

(iii) Changes in at-risk amounts under section 49 at partner or shareholder level.

(7) Partnerships subject to subchapter C of chapter 63 of the Code.

(8) Example.

(e) Denial of double benefit.

(1) In general.

(2) Application of the denial of double benefit rule.

(3) Use of the section 48D credit for other purposes.

(4) Examples.

(i) Example 1.

(ii) Example 2.

(iii) Example 3.

(iv) Example 4.

(f) Excessive payment.

(1) In general.

(2) Reasonable cause.

(3) Excessive payment defined.

(4) Example.

(g) Basis reduction and recapture.

(1) In general.

(2) Basis adjustment.

(i) In general.

(ii) Basis adjustment by partnership or S corporation.

(iii) Basis adjustment of partners and S corporation shareholders.

(3) Recapture reporting.

(h) Applicability dates.

(1) In general.

(2) Prior taxable years.

26 C.F.R. §1.48D-0

T.D. 9989, 89 FR 17606 , Mar. 11, 2024

89 FR 17606 , 5/10/2024; 89 FR 84751 , 12/23/2024

Correction published at 89 FR 92793