2023 Louisiana Laws › Revised Statutes › Title 47 - Revenue and Taxation › §47:6030. Solar energy systems tax credit

RS 47:6030 - Solar energy systems tax credit
A.(1) There shall be a credit against the income tax for the cost of purchase and installation of a solar electric system hereinafter referred to as "system", at a single-family residence located in Louisiana. The credit is allowed if a newly constructed home with such a system already installed is purchased or if such a system is purchased and installed at an existing home. In addition to eligibility requirements provided in Subsection B of this Section, to be eligible for a tax credit, the system shall have been sold by and installed by a person who is licensed by the Louisiana State Licensing Board for Contractors, and with respect to any system components purchased on or after July 1, 2013, the system shall be compliant with the requirements of the federal American Recovery and Reinvestment Act (ARRA), including but not limited to all major components such as the inverter, racking, and solar modules. Each eligible system shall be installed on the property of the residence to which the electrical energy is delivered. With respect to each residence, there shall be allowed only one tax credit for the purchase and installation of a system and no other tax credit is allowed for any other system installed at that residence. The provisions of this Section shall in no way be construed or interpreted to allow more than one tax credit authorized under this Section, including any tax credit claimed before July 1, 2013, for any residence. Once a tax credit authorized pursuant to this Section is claimed by a taxpayer for a particular system at a residence, regardless of the credit amount claimed, there shall be no additional or subsequent tax credit authorized for installation of any equipment at that residence pursuant to this Section. If the residential property or system is sold, the taxpayer who claimed the tax credit shall disclose his use of the tax credit to the purchaser.
(2) Notwithstanding the provisions of Paragraph (1) of this Subsection, any system component purchased prior to July 1, 2013, may be incorporated into systems that are placed in service prior to January 1, 2014, and such systems shall be eligible for the credit authorized by this Section; provided that such credit shall not be allowed for such system components unless the purchaser provides to the Department of Revenue written documentation of the purchase of such system components prior to July 1, 2013.
B.(1) Purchased systems. The tax credit for the purchase and installation of an eligible system at a Louisiana residence or for a system which is already installed in a newly constructed home located in Louisiana shall be subject to the following provisions:
(a) For a system purchased and installed on or after January 1, 2008, and before July 1, 2015, the amount of the credit shall be equal to fifty percent of the first twenty-five thousand dollars of the cost of the system.
(b) For a system purchased and installed on or after July 1, 2015, and before January 1, 2016, the tax credit shall be equal to the least of:
(i) Two dollars multiplied by the total size of the system as measured in DC watts.
(ii) Fifty percent of the cost of purchase and installation.
(iii) Ten thousand dollars.
(c) Beginning in Fiscal Year 2015-2016, the maximum amount of tax credits for purchased systems which may be granted by the department on any return, regardless of tax year, shall be as follows:
(i) For tax credits claimed on returns filed on or after July 1, 2015, and before July 1, 2016, no more than ten million dollars of tax credits shall be granted.
(ii) For tax credits claimed on returns filed on or after July 1, 2016, and before July 1, 2017, no more than ten million dollars of tax credits shall be granted.
(iii) For tax credits claimed on a return filed on or after July 1, 2017, no more than five million dollars of tax credits shall be granted.
(iv) The granting of credits shall be on a first-come, first-served basis. If the total amount of credits applied for in any particular fiscal year exceeds the amount of tax credits authorized for that year, the excess shall be treated as having been applied for on the first day of the subsequent year. All requests received on the same business day shall be treated as received at the same time, and if the aggregate amount of the requests received on a single business day exceed the total amount of available tax credits, tax credits shall be approved on a pro rata basis. Beginning in Fiscal Year 2015-2016 any claim or request for an allocation of credits under this Section shall be filed electronically.
(v)(aa) Notwithstanding the provisions of Items (i) through (iv) of this Subparagraph, any taxpayer whose claim for a credit was denied or would have been denied for any portion of the original claim for a credit pursuant to the provisions of Items (i) through (iv) of this Subparagraph shall be granted the full amount of the credit for which the purchased solar energy system is eligible based on the original claim provided the claim relates to a solar energy system that was purchased and installed on or before December 31, 2015, and the claim meets all other requirements of an eligible system. For taxpayers whose claim would have been denied, an amended return claiming a tax credit for a system which was purchased and installed on or before December 31, 2015, and which meets all other requirements of an eligible system shall be filed with the department before September 1, 2017, in order to be eligible for payment of the tax credit pursuant to this Item. For all claims, including those which were denied and which would have been denied, all supporting documentation necessary to constitute a complete and eligible claim shall be submitted to the department no later than November 1, 2017, in order to be eligible for payment of the tax credit pursuant to this Item. For purposes of this Item, no amendment concerning the date of purchase and installation of the solar energy system for which the claim relates shall be allowed.
(bb) Interest at the annual rate established pursuant to R.S. 13:4202 shall be allowed to accrue beginning ninety days from October first of the year which relates to the fiscal year credit cap from which the credit or installment of credit is paid.
(cc) The amount of the credit granted under this Item to each taxpayer shall be allowed in equal parts over three fiscal years beginning in Fiscal Year 2017-2018 and ending in Fiscal Year 2019-2020 with the maximum amount of credits paid in each fiscal year limited to no more than five million dollars, exclusive of interest. If the aggregate amount of credits to be paid in a fiscal year exceeds the five million dollar maximum amount of credits to be paid in the fiscal year, then the credits shall be paid on a pro rata basis. If any taxpayer has not been allowed the full amount of credit after Fiscal Year 2019-2020, any remaining balance of the tax credit shall be allowed in Fiscal Year 2020-2021. Notwithstanding the provisions of Items (i) through (iv) of this Subparagraph, the amounts authorized pursuant to the provisions of this Item shall be exclusive of any amounts granted pursuant to the amounts authorized in Items (ii) and (iii) of this Subparagraph.
(dd) No tax credits shall be granted pursuant to this Item after Fiscal Year 2020-2021.
(d) There shall be no tax credits authorized, issued, or granted as provided in this Paragraph for systems installed on or after January 1, 2016.
(2) Leased systems. Tax credits authorized under this Section for the purchase and installation of a system at a Louisiana residence by a third party through a lease with the owner of the residence shall be subject to the following provisions.
(a)(i) The tax credit shall be equal to fifty percent of the first twenty-five thousand dollars of the cost of purchase for a system installed before January 1, 2014. For a system installed on or after January 1, 2014, and before July 1, 2015, the tax credit shall be equal to thirty-eight percent of the first twenty-five thousand dollars of the cost of the purchase. For a system installed on or after July 1, 2015, and before January 1, 2018, the tax credit shall be equal to thirty-eight percent of the first twenty thousand dollars of the cost of purchase.
(ii) The purchase and installation of a system shall be eligible for a tax credit during these periods under the following circumstances:
(aa) For a system purchased and installed on or after July 1, 2013, and before July 1, 2014, the system shall cost no more than four dollars fifty cents per watt and provide for no more than six kilowatts of energy.
(bb) For a system purchased and installed on or after July 1, 2014, and before July 1, 2015, the system shall cost no more than three dollars fifty cents per watt and provide for no more than six kilowatts of energy.
(cc) For a system purchased and installed on or after July 1, 2015, and before January 1, 2018, the system shall cost no more than two dollars per watt and provide for no more than six kilowatts of energy.
(b)(i) The maximum amount of tax credits for leased systems which may be granted by the department for credits not granted prior to June 1, 2015, during Fiscal Year 2014-2015 shall be nineteen million dollars.
(ii) Beginning in Fiscal Year 2015-2016 the maximum amount of tax credits for leased systems which may be granted by the department on any return, regardless of tax year, shall be as follows:
(aa) For tax credits claimed on returns filed on or after July 1, 2015, and before July 1, 2016, no more than ten million dollars of tax credits shall be granted.
(bb) For tax credits claimed on returns filed on or after July 1, 2016, and before July 1, 2017, no more than ten million dollars of tax credits shall be granted.
(cc) For tax credits claimed on returns filed on or after July 1, 2017, no more than five million dollars of tax credits shall be granted.
(iii) The granting of credits shall be on a first-come, first-served basis. If the total amount of credits applied for in any particular fiscal year exceeds the amount of tax credits authorized for that year, the excess shall be treated as having been applied for on the first day of the subsequent year. All requests received on the same business day shall be treated as received at the same time, and if the aggregate amount of the requests received on a single business day exceed the total amount of available tax credits, tax credits shall be approved on a pro rata basis. Beginning in Fiscal Year 2015-2016, any claim or request for an allocation of credits under this Section shall be filed electronically.
(c) There shall be no tax credits authorized, issued, or granted as provided in this Paragraph for systems installed after December 31, 2017.
(3)(a) The purchase and installation of a system shall be eligible for a tax credit if the system services the electrical energy needs of the homeowner's primary residence.
(b) The cost of the system and installation shall not be financed by the Solar Installer or an Installer Affiliate.
C. As used in this Section:
(1) "Cost of purchase" or "cost" means the reasonable and prudent costs for the equipment and installation of the solar electric or solar thermal systems. "Cost of purchase" or "cost" shall not include any lease management fee or any inducement to make a purchase, including but not limited to: rebates; prizes; gift certificates; trips; additional energy items or services, except energy audits offered at no charge to the purchaser; or any other thing of value given by a seller, installer, or equipment manufacturer as an inducement to buy a solar electric or solar thermal system.
(2) "Home" means a single-family detached dwelling.
(3) "Installer Affiliate" means (a) any person who is the direct or indirect beneficial owner of any Solar Installer or Company; (b) any person who is related by blood or marriage to a person described in Subparagraph (a) of this Paragraph; (c) any entity directly, indirectly, nominally or beneficially owned by a Solar Installer or any person described in Subparagraphs (a) or (b) of this Paragraph, or in which such a person or entity has an economic interest; (d) any entity directly or indirectly owning, owned by, under common ownership with, or having any economic interest in any Solar Installer, Solar Company or any entity described in Subparagraphs (a), (b) or (c) of this Paragraph.
(4) "Residence" means a single-family detached dwelling.
(5) "Solar electric system" means a system consisting of photovoltaic panels with the primary purpose of converting sunlight to electrical energy and all equipment and apparatus necessary to connect, store, and process the electrical energy for connection to and use by an electrical load. "Solar electric system" shall include grid-connected net metering systems with or without battery backup, stand-alone alternating current (AC) systems, and stand-alone direct current (DC) systems. The eligible system components for a solar electric system include the following:
(a) For grid-connected, net metering solar electric systems, the components include photovoltaic panels, mounting systems, inverters, charge controllers, batteries, battery cases, alternating current (AC) and direct current (DC) disconnects, lightning and ground fault protection, junction boxes, remote metering display devices, and related electrical wiring materials from the photovoltaic panels to point of interconnection with the residence or electrical load.
(b) For stand-alone solar electric AC systems, the components include photovoltaic panels, mounting systems, inverters, charge controllers, batteries, battery cases, AC and DC disconnects, lightning and ground fault protection, junction boxes, remote metering display devices, and related electrical wiring materials from the photovoltaic panels to point of interconnection with the residence or electrical load.
(c) For stand-alone solar electric DC systems, the components include photovoltaic panels, mounting systems, charge controllers, batteries, battery cases, DC disconnects, lightning and ground fault protection, junction boxes, remote metering display devices, and related electrical wiring materials from the photovoltaic panels to point of interconnection with the residence or electrical load.
(6) "Solar Installer" means any person or business selling or installing solar improvements eligible for the generation of tax credits pursuant to R.S. 47:6030.
(7) "System" means a solar electric system. The following types of equipment are specifically excluded: solar thermal energy system, solar air conditioning system, solar attic fan or ventilation system, solar powered light, solar day lighting apparatus, solar powered pool pump or heating system, solar gate operating system, all other stand alone devices, and other equipment further prohibited by administrative rule.
D. The provisions of this Subsection shall apply to all tax credits for purchase or lease and installation of a system authorized under this Section.
(1) The credit may be used in addition to any federal tax credits earned for the same system. However, a taxpayer shall not receive any other state tax credit, exemption, exclusion, deduction, or any other tax benefit for property for which the taxpayer has received a tax credit under this Section.
(2) The credit shall be claimed on the tax return only for the taxable year in which the system is completed and placed in service. If a taxpayer purchases a newly constructed home with a system already installed, the credit shall be claimed on the tax return only for the taxable year in which the act of sale occurred.
(3) To claim the credit, a taxpayer shall submit all of the following:
(a) Proof of system installation.
(b) A copy of a contract signed by the taxpayer demonstrating either full payment, with evidence of payment from cash on hand, or payment through financing obtained from a person other than the Solar Installer or an Installer Affiliate.
(c) The serial number, model number, and energy output for each solar panel installed.
(d) Department of Revenue Form R-1086, which shall contain the following sworn statements by the licensed dealer who sold or leased the system and the licensed installer who installed the system:
The undersigned is an authorized principal in ___________, is licensed by the Louisiana Board of Contractors as required by R.S. 47:6030, and certifies under penalty of law, particularly R.S. 14:202.2(A), that the system sold or leased to the homeowner of the residence located at _____________ has a total nameplate value of ________ kilowatts, that no solar dealer, solar installer, or installer affiliate financed the repayment obligations, and that a reasonable good faith belief exists that the residence is eligible for the credit provided for in this Section in the amount claimed on a Louisiana income tax return.
__________________________ ____________________________
Dealer's Name (printed) Dealer's Name (signature)
_______________________________
Dealer's Louisiana License Number
The undersigned is an authorized principal in ___________, is licensed by the Louisiana Board of Contractors as required by R.S. 47:6030, is a licensed installer, as required by R.S. 37:2156.3, and certifies under penalty of law, particularly R.S. 14:202.2(A), that the system installed at the residence located at _____________ has a total nameplate value of ________ kilowatts.
__________________________ ____________________________
Installer's Name (printed) Installer's Name (signature)
_____________________________
Installer's Louisiana License Number
_____________________________
Date the installation of the energy system was completed and placed in service
______________
Notary Public
(e) Any other documentation required by administrative rule.
E. Credits may be claimed in accordance with the following:
(1) Any entity taxed as a corporation for Louisiana income tax and franchise tax purposes shall claim any credit authorized according to the provisions of this Section on its corporation income and franchise tax return.
(2) Any individual, estate, or trust shall claim any credit authorized according to the provisions of this Section on its income tax return.
(3) Any entity not taxed as a corporation shall claim any credit authorized according to the provisions of this Section on the returns of the partners or members as follows:
(a) Corporate partners or members shall claim their share of the credit on their corporation income tax or franchise tax returns.
(b) Individual partners or members shall claim their share of the credit on their individual income tax or franchise tax returns.
(c) Partners or members that are estates or trusts shall claim their share of the credit on their fiduciary income tax returns.
F. Notwithstanding any other provision of law to the contrary, any excess of allowable credit over the aggregate tax liabilities against which such credit may be applied, as provided in this Section, shall constitute an overpayment, as defined in R.S. 47:1621(A), and the secretary shall make a refund of such overpayment from the current collections of the taxes imposed by Chapter 1, Chapter 2, Chapter 2-A, Chapter 2-B, or Chapter 5 of Subtitle II of this Title, together with interest as provided in R.S. 47:1624. The right to a credit or refund of any such overpayment shall not be subject to the requirements of R.S. 47:1621(B). All credits and refunds, together with interest thereof, must be paid or disallowed within one year of receipt by the secretary of any such claim for refund or credit. Failure of the secretary to pay or disallow, in whole or in part, any claim for a credit or a refund shall entitle the aggrieved taxpayer to proceed with the remedies provided in R.S. 47:1625. However, the department may withhold payment of a solar energy systems tax credit from a taxpayer if there are any existing state or federal liens, pending charges or investigations, or third party claims against such taxpayer or any of its affiliates or related parties. In such case, the department may withhold issuance of the tax credit until the department has received documentation which satisfactorily demonstrates that the matter has been resolved as determined by the secretary. For purposes of administering the first-come, first-served requirement, the return of any taxpayer whose claim for a tax credit is withheld for the aforementioned reasons shall be treated as received on the date the secretary deems such matters resolved. The secretary may exercise the right to withhold issuance of the tax credit for such purposes for any return, regardless of tax year or date received. Further, the secretary shall provide notice to the taxpayer upon determination that one or more of the aforementioned factors is applicable and the taxpayer's claim for a tax credit is being withheld.
G. The secretary of the Department of Revenue shall promulgate such rules and regulations in accordance with the Administrative Procedure Act as may be necessary to carry out the provisions of this Section. The rules and regulations shall be promulgated within ninety days of the effective date of this Section.
H. Commencing no later than January 31, 2016, the House Committee on Ways and Means and the Senate Committee on Revenue and Fiscal Affairs shall review the credit authorized pursuant to the provisions of this Section to determine if the economic benefit provided by such credit outweighs the loss of revenue realized by the state as a result of awarding such credit. The House and Senate committees shall make a specific recommendation no later than March 1, 2017, to either continue the credit or to terminate the credit.
Acts 2007, No. 371, §1, eff. July 10, 2007; Acts 2009, No. 467, §1, eff. July 8, 2009, applicable to taxable periods beginning after Jan. 1, 2009; Acts 2013, No. 428, §1, eff. July 1, 2013; Acts 2015, No. 131, §§1, 2, eff. June 19, 2015; Acts 2015, No. 357, §1, eff. June 29, 2015; Acts 2017, No. 413, §1, eff. June 26, 2017.