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Wednesday, August 29, 2012
New York Gov. Andrew M. Cuomo (D) recently signed three solar energy bills that are part of the NY-Sun Initiative. The legislation provides $107 million in incentives to encourage taxpayers to increase their use of solar energy, notes the Governor’s press release. Specifically, the state has enacted several tax exemptions and credits for solar energy system equipment, a recent Bloomberg BNA Weekly State Tax Report article reported.
In the wake of the Solyndra debacle, New York’s bet on solar might seem counter-intuitive. But the horrible publicity hasn’t stopped private sector power houses such as Google and Bank of America from making “enormous investments” in solar power, according to a recent article in The New York Times.
New York City appears particularly suited to harness the sun because, “two-thirds of . . . rooftops are suitable for solar panels and could jointly generate enough energy to meet half the city’s demand for electricity at peak periods,” according to another article in The New York Times. One piece of legislation, S.B. 3203, provides a state sales tax exemption for the installation and purchase of solar energy systems for commercial properties. The legislation also allows local governments to approve exemptions from local sales taxes.
A second piece of legislation, A.B. 34, creates a personal income tax credit for homeowners for the lease of solar equipment or purchase of solar power through an agreement with a third party. The legislation requires that leases and purchase agreements span at least 10 years to qualify for the credit. The credit, which will cost the state less than $1 million per year, is limited to $5,000 per year per individual. The third piece of legislation, A.B. 10620, extends New York City's real property tax abatement for solar equipment placed in service on or after Jan. 1, 2013, but before Jan. 1, 2015. The tax abatement, which was first created in 2008, covers residential, commercial, and industrial properties. Eligible taxpayers receive a tax break equal to 2.5 percent of expenditures on eligible solar electric generating systems, the amount of taxes payable in the tax year, or $62,500, whichever is less. In addition to solar energy, the New York Department of Taxation and Finance released a technical memorandum summarizing the recent extension of various sales tax exemptions for certain alternative fuels, according to an article in the Bloomberg BNA Weekly State Tax Report. In particular, the exemption from prepaid sales tax, as well as the full state and local sales tax exemption, is extended from Aug. 31, 2012, to Aug. 31, 2014, for compressed natural gas, hydrogen fuels, and E85.
For more information about these green incentives, check out Bloomberg BNA’s Green Incentives Navigator. ¬¬¬¬¬¬¬¬¬¬¬ In other developments . . . New Jersey increased the maximum amount of tax credits the state is authorized to award under the urban transit hub tax credit program by $250 million and extended the deadline for initial tax credit applications from Jan. 13, 2013, to July 1, 2014, according to an article in the Bloomberg BNA Weekly State Tax Report.
By: Kathleen Caggiano
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