IRS Publishes Guidance for Determining Beginning of Construction for Solar and Wind Projects

On September 12, 2025, Cravath prepared a memo for its clients entitled “IRS Publishes Guidance for Determining Beginning of Construction for Solar and Wind Projects.” The memo examines the Internal Revenue Service’s recently issued Notice 2025-42 (“New Guidance”), which sets forth new rules for determining “beginning of construction” for solar and wind projects seeking to claim clean electricity credits under Sections 45Y and 48E of the Internal Revenue Code.

The New Guidance follows the enactment of the One Big Beautiful Bill Act on July 4, 2025, which accelerated the phase-out of tax credits for wind and solar projects (read the Firm’s previous memo on the OBBBA here), and the subsequent issuance of Executive Order 14315 on July 7, 2025, which directed the Department of the Treasury and the IRS to, among other things, issue new and revised guidance to prevent circumvention of policies concerning “beginning of construction.”

Please click here to read the memo.