E7-8747. Publication of Inflation Adjustment Factor, Nonconventional Source Fuel Credit, and Reference Price for Calendar Year 2006

AGENCY:

Internal Revenue Service (IRS), Treasury.

ACTION:

Notice.

SUMMARY:

Publication of the inflation adjustment factor, nonconventional source fuel credit, and reference price for calendar year 2006 as required by section 45K of the Internal Revenue Code (26 U.S.C. 45K). The inflation adjustment factor, nonconventional source fuel credit, and reference price are used in determining the tax credit allowable on the sale of fuel from nonconventional sources under section 45K during calendar year 2006.

DATES:

The 2006 inflation adjustment factor, nonconventional source fuel credit, and reference price apply to qualified fuels sold during calendar year 2006.

Inflation Adjustment Factor: In the cases of gas produced from biomass and liquid, gaseous, or solid synthetic fuel produced from coal, the inflation adjustment factor for calendar year 2006 is 2.3429. In the case of facilities producing coke or coke gas, the inflation adjustment factor for calendar year 2006 is 1.0605.

Credit: The nonconventional source fuel credit for gas produced from biomass and for liquid, gaseous, or solid synthetic fuel produced from coal for calendar year 2006 (adjusted to reflect the phase-out amount) is $4.72 per barrel-of-oil equivalent of qualified fuels. In the case of facilities producing coke or coke gas, the nonconventional source fuel credit for calendar year 2006 is $3.18 per barrel-of-oil equivalent of qualified fuels.

Reference Price: The reference price for calendar year 2006 is $59.68. Because the reference price exceeds $23.50 multiplied by the inflation adjustment factor, under section 45K(b)(1), the credit for gas produced from biomass and for liquid, gaseous, or solid synthetic fuel produced from coal is reduced by $2.31 per barrel-of-oil equivalent of qualified fuels for calendar year 2006. The phase-out of the credit does not apply to facilities producing coke or coke gas.

FOR FURTHER INFORMATION CONTACT:

 

For questions about how the inflation adjustment factor is calculated—Wu-Lang Lee, RAS:R:TSBR, Internal Revenue Service, 1111 Constitution Avenue, NW., Washington, DC 20224, Telephone Number [phone] (not a toll-free number).

For all other questions about the credit or the reference price—Jaime C. Park, CC:PSI:7, Internal Revenue Service, 1111 Constitution Avenue, NW., Washington, DC 20224, Telephone Number [phone] (not a toll-free number).

Dated: April 23, 2007.

William O'Shea,

Associate Chief Counsel (Passthroughs and Special Industries).