Bill > A545

Introduced Session

This bill provides a tax credit under the corporation business tax and the gross income tax for certain solar energy system expenditures. Under the bill, a taxpayer is eligible to claim a credit in an amount equal to 35 percent of qualified solar energy system expenditures up to $5,000 for residential properties, $350 per unit for apartment buildings, and $500,000 for commercial and industrial properties. For purposes of the bill, qualified solar energy system expenditures include the cost of components utilizing solar radiation to produce energy, and expenditures for materials, labor costs for on-site preparation, assembly, and original installation, in addition to architectural and engineering services and designs or plans directly related to the construction or installation of the solar energy system equipment. The bill also specifies that a taxpayer may still receive the tax credit if the taxpayer leases the solar panels on their property from another entity, or if the taxpayer purchases energy produced by the solar panels on their property from another entity that owns the panels. The bill provides that a taxpayer must first qualify for a credit to be eligible to claim the credit. To qualify, a taxpayer must file an application with the Commissioner of Environmental Protection who is responsible for issuing a certification confirming that the expenditures meet the requirements of qualified solar energy system expenditures. The bill provides that the commissioner has 90 days after receipt of a complete application to make a determination as to the issuance of a certification. If the application is certified, the commissioner must submit the certification to the Director of the Division of Taxation in the Department of the Treasury and to the taxpayer. The taxpayer then uses that certification when filing a tax return that includes a claim for the credit. The bill provides that the first privilege period or taxable year in which a taxpayer may use the credit is the privilege period or taxable year in which the certification is granted. The bill also provides that the amount of any unused credit may be carried forward, if necessary, to each of the seven privilege periods or taxable years following the period or year in which the credit is first allowed, but stipulates that a credit is not allowed if the qualified solar energy system expenditures are used to secure another credit in the same or prior period or year by the same or another taxpayer. The bill requires the commissioner to establish a pre-certification process through which a taxpayer can determine if expected solar energy system expenditures are eligible for a credit, and to develop and adopt regulations, in consultation with the Director of the Division of Taxation, establishing technical specifications and certification requirements for the qualification of solar energy system expenditures. The bill specifies that pre-certification established by the commissioner may require submission of certain written information describing the equipment to be purchased and how it is intended to be used or consumed, but that obtaining pre-certification is not required to qualify for a credit. The maximum cumulative amount of credits permitted is limited to $25 million Statewide per year, and the program would expire after five years. The purpose of this bill is to encourage taxpayers to install solar panels on their homes and businesses by providing financial incentives to do so.

AI Summary

Committee Categories

Clinton Calabrese (D)*,  Sterley Stanley (D)*, 

Introduced, Referred to Assembly Telecommunications and Utilities Committee (on 01/09/2024)

Official Document