Indian coal production: 2015 inflation adjustment factor, credit amount

Indian coal production: Inflation adjustment factor

The Treasury Department and IRS today released for publication in the Federal Register a notice providing the 2015 inflation adjustment factor for Indian coal production under section 45.

Related content

Background

Provisions in the year-end tax legislation (enacted December 18, 2015) extended the production credit for Indian coal facilities for two years (through December 31, 2016), but with modifications removing the placed-in-service date limitation (thus permitting facilities placed in service after December 31, 2008, to qualify), changing the third-party sale requirement to permit related-party sales to qualify so long as the Indian coal is subsequently sold to an unrelated third person, and exempting the credit from the alternative minimum tax (AMT).

The extension of the credit is effective for Indian coal produced after December 31, 2014.  The removal of the placed-in-service limitation and the modification to the third-party sale requirement are effective for coal produced and sold after December 31, 2015. The provision exempting the credit from the AMT is effective for credits determined for tax years beginning after December 31, 2015.

Inflation adjustment factor, credit amount

Today’s notice [PDF 169 KB] provides:

  • The inflation adjustment factor for calendar year 2015 for Indian coal is 1.1772.
  • The credit amount, under section 45(e)(10)(B)(i), for Indian coal production for calendar year 2015 is $2.354 per ton on the sale of Indian coal.

© 2016 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

The KPMG logo and name are trademarks of KPMG International. KPMG International is a Swiss cooperative that serves as a coordinating entity for a network of independent member firms. KPMG International provides no audit or other client services. Such services are provided solely by member firms in their respective geographic areas. KPMG International and its member firms are legally distinct and separate entities. They are not and nothing contained herein shall be construed to place these entities in the relationship of parents, subsidiaries, agents, partners, or joint venturers. No member firm has any authority (actual, apparent, implied or otherwise) to obligate or bind KPMG International or any member firm in any manner whatsoever. The information contained in herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation. For more information, contact KPMG's Federal Tax Legislative and Regulatory Services Group at: + 1 202 533 4366, 1801 K Street NW, Washington, DC 20006.

Connect with us

 

Request for proposal

 

Submit

KPMG's new digital platform

KPMG International has created a state of the art digital platform that enhances your experience, optimized to discover new and related content.