On August 29, 2023, the Department of the Treasury and the Internal Revenue Service (IRS) released a Notice of Proposed Rulemaking (NPRM) on the prevailing wage and apprenticeship provisions of the Inflation Reduction Act. Some of the information on this webpage may be out of date but will be updated soon. More information about the proposed rule can be found on the IRS Website.
On August 16, 2022, President Biden signed Public Law 117-369, 136 Stat. 1818, commonly known as the Inflation Reduction Act of 2022 (IRA), into law. The IRA amended the Internal Revenue Code to add prevailing wage and Registered Apprenticeship requirements for taxpayers constructing, and in some case performing alteration or repair, of qualified clean energy facilities, property, projects, or equipment to qualify for increased tax credit or deduction amounts. The U.S. Department of Labor’s (DOL) Office of Apprenticeship is committed to supporting the Department of the Treasury (Treasury) and the Internal Revenue Service (IRS) in the effective implementation of these apprenticeship requirements. The IRS has launched a page dedicated to providing the latest information and guidance on the implementation of the IRA.
By statute, the prevailing wage and apprenticeship requirements generally apply to qualifying facilities where construction begins 60 days or more after Treasury and the IRS publish guidance on those requirements. On November 30, Treasury and the IRS published initial guidance on the prevailing wage and apprenticeship requirements. The publication of guidance on November 30 starts the 60-day period, meaning the prevailing wage and apprenticeship requirements will be operative for facilities where construction begins on or after January 29, 2023.
This webpage provides resources on apprenticeship for background information purposes only. Please consult Notice 2022-61 published by the Internal Revenue Service for guidance on the prevailing wage and apprenticeship requirements.
The IRA is by far our nation’s largest investment in clean energy solutions to date. By pairing climate investment, with the creation of good paying jobs, the IRA’s unparalleled investments to fight the climate crisis will help improve job quality in clean energy industries and incentivize the expansion of workforce training pathways into these jobs. The inclusion of Registered Apprenticeship provisions also enables a talent pipeline for developing this critical workforce and ensures that it is an industry-driven approach with high-quality career pathway opportunities for all workers. By utilizing Registered Apprenticeships, employers can develop and prepare their future workforce, and individuals can obtain paid work experience, receive progressive wage increases, classroom instruction, and a portable, nationally-recognized credential.
The IRA’s prevailing wage and apprenticeship provisions apply to the:
- Alternative Fuel Refueling Property Credit
- Production Tax Credit
- Credit for Carbon Oxide Sequestration
- Credit for Production of Clean Hydrogen
- Clean Fuel Production Credit
- Investment Tax Credit
- Advanced Energy Project Credit
- Energy Efficient Commercial Buildings Deduction
In addition, the IRA’s prevailing wage provisions apply to the:
- New Energy Efficient Home Credit
- Zero-Emission Nuclear Power Production Credit
Frequently Asked Questions
Registered Apprenticeship FAQs for IRA
These FAQs are being provided for background information purposes only and do not constitute official IRS tax guidance. Publications in the Federal Register and Internal Revenue Bulletin represent authoritative Internal Revenue Service guidance. Please visit https://www.irs.gov/credits-deductions/prevailing-wage-and-apprenticeship-requirements for additional information on the prevailing wage and apprenticeship requirements.
Treasury and the IRS published a Notice of Proposed Rulemaking (NPRM) on August 30, 2023. The NPRM is proposed to apply facilities, property, projects, or equipment placed in service in taxable years ending after the date these regulations are published as final in the Federal Register and the construction or installation of which begins after the date these regulations are published as final regulations in the Federal Register. However, taxpayers may rely on the proposed regulations with respect to construction or installation of a facility, property, project, or equipment beginning on or after January 29, 2023, and on or before the date the regulations are published as final regulations in the Federal Register, provided, that beginning after the date that is 60 days after August 29, 2023, taxpayers follow the proposed regulations in their entirety and in a consistent manner. All references to sections of 26CFR 1.45 in these FAQs refer to regulatory provisions proposed in this NPRM.
If you have any questions that are not addressed by the following FAQs, please contact ApprenticeshipIRA@dol.gov. nterested parties are also requested to contact the Registration Agency for their state at: https://www.apprenticeship.gov/about-us/state-offices.