Form 6497 (Rev. 12-2011)
Page 2
Instructions
Section references are to the Internal Revenue
Code.
Purpose of Form
Use Form 6497 to report nontaxable energy
grants or subsidized energy financing made
under government programs whose principal
purpose is to conserve or produce energy.
This reporting is required only for recipients
that are businesses (including sole
proprietors).
Form 6497 lists the information to be
furnished about the nontaxable energy grants
or subsidized energy financing, and about the
recipients. Only one program should be
reported on each form. This form should also
be used to report funds received from the
proceeds of tax-exempt bonds that have
been used to finance energy conservation or
production property.
Grants are always taxable to recipients
unless specifically exempted by the federal
statute authorizing the grants. The originator
of the grant or subsidy program should
advise all disbursing agents whether the
program is taxable or nontaxable. Taxable
grants are reported on Form 1099-G, Certain
Government Payments. For details, see the
Instructions for Form 1099-G.
Who Must File
Any person (including an Indian tribal
government) who administers a government
program for a federal, state, or local
governmental entity or agent of that entity
that provides nontaxable energy grants or
subsidized energy financing for energy
property to business recipients under
programs whose principal purpose is energy
production or conservation must file Form
6497. If a federal agency is providing the
funds to a state agency, and the state turns
the funds over to a bank or similar disburser
to act as its agent in disbursing the money for
the above purposes, only the bank, or
disburser, must file Form 6497 to show the
actual recipient information.
Generally, reporting on Form 6497 is
required only for nontaxable energy grants or
subsidized energy financing made for energy
property (as defined in section 48 and the
regulations under section 48).
When To File
File Form 6497 for the calendar year by the
last day of February following the year of the
payment.
Where To File
Ogden Submission Processing Campus
Exam Classification, Mail Stop 4140
Ogden, UT 84201
Definitions
Energy grant. An energy grant is a payment
given outright for property designed to
conserve or produce energy, with no
requirement to repay the money.
Subsidized energy financing. Subsidized
energy financing is financing (for example, a
loan) made directly or indirectly under a
federal, state, or local government program,
whose principal purpose is to provide
subsidized financing for projects designed to
conserve or produce energy. Subsidized
energy financing can also include financing
under a federal, state, or local program
having two or more principal purposes, but (a)
only if one of the principal purposes is to
provide subsidized financing for energy
conservation or production projects, and (b)
only if the financing is to be used for energy
production or conservation purposes (the
“use test”) or is provided out of funds
designated specifically for energy production
or conservation. Loan proceeds meet the use
test only if any loan-related documents
indicate that the funds are intended for that
use.
Financing is made when funds for
subsidized energy financing are disbursed.
The source of the funds for a program is not
a factor in determining whether the financing
is subsidized. Financing is subsidized if the
terms of the financing provided to the
recipient in connection with the program or
used to raise funds for the program are more
favorable than terms generally available
commercially. In addition, financing is
subsidized if the principal obligation of the
financing provided to the recipient is reduced
by funds provided under the program.
Payer. A payer is any person who administers
a federal, state, or local government program
that provides nontaxable grants or subsidized
financing under programs whose principal
purpose is the production or conservation of
energy. It includes agents (such as a bank)
that administer federal, state, or local
government programs and actually make the
payments to the recipient.
Recipient. A recipient is the business entity
(including a sole proprietor) that received the
grant or financing.
Specific Instructions
Line 1. Generally, this will be the name of the
federal, state, or local governmental entity
that makes the nontaxable energy grants or
provides the subsidized energy financing. If
an entity (such as a bank) is administering a
program as the designated agent of one of
the above governmental entities, enter the
name of the agent and be sure to fill in line 4.
Lines 2a and 2b. Enter the address where
any IRS questions about Form 6497 can be
directed.
Line 3. Use the employer identification
number (EIN) for the payer shown on line 1.
Do not use the social security number of an
officer or employee.
Line 4. If line 1 shows the name of an agent,
use line 4 to show the federal, state, or local
governmental entity for which the agent is
administering the program.
Line 5. Enter the program name or number
that authorizes the payment.
Line 6. Make an entry in columns 6(a)
through 6(e) for each recipient of a
nontaxable energy grant or subsidized energy
financing. If you need more space, attach
additional Forms 6497.
Column 6(a). Show the name and address
of the entity that received the nontaxable
energy grant or subsidized energy financing.
Do not show the name of an officer,
employee, etc.
Column 6(b). Complete this column for
sole proprietors without EINs.
Column 6(c). Complete this column if no
entry was made in column 6(b).
Column 6(d). Enter the total amount of
nontaxable energy grants provided to the
recipient during the calendar year under the
program shown on line 5.
Column 6(e). Enter the total amount of
subsidized energy financing provided to the
recipient during the calendar year under the
program shown on line 5. The amount of
subsidized energy financing may be different
from the actual amount of money expended.
Example. If a government agency spent
$1,000 to permit a $5,000 loan to be made
with an interest rate lower than it would have
been otherwise, the amount of subsidized
energy financing is $5,000.
Paperwork Reduction Act Notice
We ask for the information on this form to
carry out the Internal Revenue laws of the
United States. You are required to give us the
information. We need it to ensure that you are
complying with these laws and to allow us to
figure and collect the right amount of tax.
You are not required to provide the
information requested on a form that is
subject to the Paperwork Reduction Act
unless the form displays a valid OMB control
number. Books or records relating to a form
or its instructions must be retained as long as
their contents may become material in the
administration of any Internal Revenue law.
Generally, tax returns and return information
are confidential, as required by section 6103.
The time needed to complete and file this
form will vary depending on individual
circumstances. The estimated average time
is:
Recordkeeping . . . . 2 hr., 23 min.
Learning about the law
or the form . . . . . . . . 24 min.
Preparing, copying, and
sending the form to the IRS . . 27 min.
If you have comments concerning the
accuracy of these time estimates or
suggestions for making this form simpler, we
would be happy to hear from you. You
can write to the Internal Revenue Service, Tax
Products Coordinating Committee,
SE:W:CAR:MP:T:M:S, 1111 Constitution Ave.
NW, IR-6526, Washington, DC 20224. Do not
send this form to this address. Instead, see
Where To File on this page.
