On December 19, 2014, President Obama signed into law the Tax Increase Prevention Act of 2014 (H.R. 5771).  H.R. 5771 includes a retroactive one-year extension of the section 45 renewable electricity production tax credit (PTC) for wind and other renewable energy facilities including geothermal, biomass, landfill gas and certain hydropower and marine hydrokinetic energy projects. Taxpayers may alternatively elect to claim the section 48 investment tax credit (ITC) in lieu of the PTC.

Projects now have until December 31, 2014 to begin construction in order to claim the PTC. (See our prior blog post here summarizing recent IRS guidance (Notice 2014-46) explaining what it means to begin construction for purposes of the PTC and ITC.)

H.R. 5771 also modifies the bonus depreciation rules under section 168(k) and provides a retroactive one-year extension to the 50% first-year bonus depreciation deduction for qualifying property that is both acquired and placed in service during 2014 (and 2015 in the case of certain long production period and transportation property).