The IRS Guidance eliminated the so-called 5% Safe Harbor and now requires developers to satisfy the Physical Work Test (as defined in the IRS Guidance) to establish the "start of construction."

GameChange Solar, a leading global provider of solar tracker and fixed-tilt racking systems, is providing solutions for customers seeking to qualify projects for the federal Investment Tax Credit (ITC) under newly issued IRS Notice 2025-42 ("IRS Guidance"). The IRS Guidance eliminated the so-called 5% Safe Harbor and now requires developers to satisfy the Physical Work Test (as defined in the IRS Guidance) to establish the "start of construction."

As stated in the IRS Guidance, physical work of a significant nature may be performed either on-site or off-site by the taxpayer. Off-site physical work generally includes manufacturing of solar mounting equipment such as torque tubes, purlins, and posts, provided they are manufactured pursuant to a binding written contract that pre-dates the construction of the solar project, are customized for the project, and not drawn from inventory (or normally held in inventory). On-site physical work generally includes the installation of solar mounting equipment that affixes solar modules to the project site.

"Notice 2025-42 is clear that the IRS continues to view trackers and mounting equipment as property integral to energy projects that may satisfy the Physical Work Test," said Phillip Vyhanek, President and COO at GameChange Solar. "But the emphasis on customization and the removal of the 5% Safe Harbor mean that careful planning is essential. Generic components or raw materials will not count, so developers need to show fabrication of custom project-specific parts."
For project owners and developers, the IRS Guidance's shift highlights the importance of working with partners who provide custom-fabricated, project-specific mounting components and are able to assist with establishing the start of construction. GameChange Solar's advanced tracker designs and flexible fabrication capabilities place it in a unique position to help developers qualify under the Physical Work Test while maintaining module and design flexibility.

"Our ability to deliver job-specific fabricated tubes and structural components will be useful for customers as they seek to comply with the new rules under Notice 2025-42," added Vyhanek. "We're committed to helping developers capture the value of the credit and move projects forward in a timely way."

About GameChange Solar
GameChange is one of the top three global providers of solar tracker solutions used in utility-scale and ground-mounted distributed generation solar projects around the world. We have delivered over 43 GW of solar tracker and fixed tilt systems that combine fast installation, bankable quality, and unbeatable value through superior engineering, innovative design, and high-volume manufacturing. Our products enable solar panels at power plants to follow the sun's movement across the sky, optimizing plant performance while protecting the array from damaging weather conditions.

For more information, visit www.gamechangesolar.com

Disclosure
This communication does not constitute federal income tax advice. Any person seeking to claim federal tax benefits should discuss the requirements associated with any such tax benefits with their own tax advisors and make their own decisions regarding tax credit qualification and compliance.