Commercial/Industrial Solar Energy Tax Credit Program
The primary goal of the Commercial/Industrial Solar Energy Tax
Credit Program is to stimulate the production and use of solar
energy in commercial and industrial applications by subsidizing the
initial cost of solar energy devices. The program achieves this goal
by providing an Arizona income tax credit for the installation of
solar energy devices in Arizona business facilities.
Tax Credit Provisions &
An eligible applicant is a business that
installs a solar energy device at its Arizona facility. The tax
credit is equal to 10% of the installed cost of the solar energy
device not to exceed $25,000 in credits for one building in a single
tax year and $50,000 total credits per business per tax year. Tax
credits can be used to offset Arizona income tax liability; any
unused credit amounts can be carried forward for a five-year
Commerce cannot certify tax credits under this
program that exceed $1,000,000 in any calendar year. Therefore, tax
credits are authorized on a first come, first served basis,
according to a priority placement number issued by Commerce based on
the date of receipt of a completion report. Download the solar
energy allocation table to view the
tax credit amount remaining in the current calendar year.
Legislative Information NEW!
- Solar Tax Credit Statutes: A.R.S. §41-1510.01
- During the 2007 legislative session House Bill 2491 was
introduced, proposing amendments to the tax credit program. On May
4th the Governor signed 2491 into law. The provisions
of the amendment become effective in September 2007. Commerce will
soon begin implementation of the amendment and revised materials
will be published in September 2007. To view the amendment, please click here HB2491.
of Legislative Changes from 2007 Legislative
Application Process for Initial
A business that plans on installing
or has installed a solar energy device at an Arizona facility may
obtain initial certification through the following process:
- The business applies for initial certification by completing
for Initial Certification of a Solar Energy Device
and submit it to Commerce.
- If a solar energy device has been installed and is operational
the business may also submit a Completion
Report for a Solar Energy Tax Credit Certificate
concurrent with submittal of an application.
- Upon receipt of an application Commerce will assign a unique
identifying number to each solar energy device.
- Within 30 days of receipt of a complete application, Commerce
will notify the business of initial certification or denial.
- If a business receives initial certification, Commerce will
issue a Letter of Initial Certification to the business and
transmit the certification information to Arizona Department of
Revenue (Revenue). Initial certification does not guarantee
receipt of tax credits under this program because initial
certification is issued before Commerce determines final
Completion Report Process for a Credit
- Once a solar energy device is installed and operational a
business can request a credit certificate by submitting a Completion
Report for a Solar Energy Tax Credit Certificate.
- After receipt of a completion report Commerce will assign a
priority placement number to each solar energy device.
- If a business is eligible, Commerce will issue a Credit
Certificate to the business and transmit the certification
information to Revenue.
Claiming the Tax Credits
business has received a credit certificate from Commerce, it may
claim the certified tax credits with Revenue. The tax credit must be
claimed by the certified business on an Arizona income tax return
along with Revenue Form 336 for the tax year identified on the
credit certificate, which will be the year the completion report is
received by Commerce. For more information and to download Revenue’s
forms, visit http://www.azdor.gov/
Please Note: The commercial/industrial tax credit program
is administered through Commerce. However, the TPT and property tax
incentives provided by the bill are administered through Revenue.
For more information and to download Revenue’s forms, visit http://www.azdor.gov/
for the Residential Solar Tax Credit?
A solar energy
device installed at a residential location may be eligible for a tax
equal to 25% of the total installed cost of the device not
to exceed $1000 under A.R.S.
§43-1083. This credit is
administered solely by Revenue. Click here
to view brochure.
will soon begin the process of drafting rules for the Commercial
Solar Energy Tax Credit Program and will seek public comment. As
soon as rules are adopted, Commerce will place an update on this
website and will notify businesses and others who have requested
information. If you have not yet placed your e-mail address on our
list, please click here to send an e-mail
requesting notification. Please be sure to identify solar energy as
the program for which you would like notification.
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