7 LONG TITLE
8 General Description:
9 This bill amends the individual income tax credit for certain residential renewable
10 energy systems.
11 Highlighted Provisions:
12 This bill:
13 ▸ phases out the individual income tax credit for certain residential renewable energy
14 systems; and
15 ▸ amends the maximum individual income tax credit for certain residential renewable
16 energy systems.
17 Money Appropriated in this Bill:
19 Other Special Clauses:
21 Utah Code Sections Affected:
23 59-10-1014, as last amended by Laws of Utah 2016, Third Special Session, Chapter 1
25 Be it enacted by the Legislature of the state of Utah:
26 Section 1. Section 59-10-1014 is amended to read:
27 59-10-1014. Nonrefundable renewable energy systems tax credits -- Definitions --
28 Certification -- Rulemaking authority.
29 (1) As used in this section:
30 (a) (i) "Active solar system" means a system of equipment that is capable of:
31 (A) collecting and converting incident solar radiation into thermal, mechanical, or
32 electrical energy; and
33 (B) transferring a form of energy described in Subsection (1)(a)(i)(A) by a separate
34 apparatus to storage or to the point of use.
35 (ii) "Active solar system" includes water heating, space heating or cooling, and
36 electrical or mechanical energy generation.
37 (b) "Biomass system" means a system of apparatus and equipment for use in:
38 (i) converting material into biomass energy, as defined in Section 59-12-102; and
39 (ii) transporting the biomass energy by separate apparatus to the point of use or storage.
40 (c) "Direct use geothermal system" means a system of apparatus and equipment that
41 enables the direct use of geothermal energy to meet energy needs, including heating a building,
42 an industrial process, and aquaculture.
43 (d) "Geothermal electricity" means energy that is:
44 (i) contained in heat that continuously flows outward from the earth; and
45 (ii) used as a sole source of energy to produce electricity.
46 (e) "Geothermal energy" means energy generated by heat that is contained in the earth.
47 (f) "Geothermal heat pump system" means a system of apparatus and equipment that:
48 (i) enables the use of thermal properties contained in the earth at temperatures well
49 below 100 degrees Fahrenheit; and
50 (ii) helps meet heating and cooling needs of a structure.
51 (g) "Hydroenergy system" means a system of apparatus and equipment that is capable
53 (i) intercepting and converting kinetic water energy into electrical or mechanical
54 energy; and
55 (ii) transferring this form of energy by separate apparatus to the point of use or storage.
56 (h) "Office" means the Office of Energy Development created in Section 63M-4-401.
57 (i) (i) "Passive solar system" means a direct thermal system that utilizes the structure of
58 a building and its operable components to provide for collection, storage, and distribution of
59 heating or cooling during the appropriate times of the year by utilizing the climate resources
60 available at the site.
61 (ii) "Passive solar system" includes those portions and components of a building that
62 are expressly designed and required for the collection, storage, and distribution of solar energy.
62a Ĥ→ (j) "Photovoltaic system" means an active solar system that generates electricity from
64 constitutes the cost a person incurs in acquiring a residential energy system.
65 (ii) "Principal recovery portion" does not include:
66 (A) an interest charge; or
67 (B) a maintenance expense.
68 Ĥ→ [
68a or for a
69 residential unit:
70 (i) an active solar system;
71 (ii) a biomass system;
72 (iii) a direct use geothermal system;
73 (iv) a geothermal heat pump system;
74 (v) a hydroenergy system;
75 (vi) a passive solar system; or
76 (vii) a wind system.
77 Ĥ→ [
78 unit that:
79 (A) is located in the state; and
80 (B) serves as a dwelling for a person, group of persons, or a family.
81 (ii) "Residential unit" does not include property subject to a fee under:
82 (A) Section 59-2-404;
83 (B) Section 59-2-405;
84 (C) Section 59-2-405.1;
85 (D) Section 59-2-405.2; or
86 (E) Section 59-2-405.3.
87 Ĥ→ [
87a capable of:
88 (i) intercepting and converting wind energy into mechanical or electrical energy; and
89 (ii) transferring these forms of energy by a separate apparatus to the point of use or
91 (2) A claimant, estate, or trust may claim an energy system tax credit as provided in
92 this section against a tax due under this chapter for a taxable year.
93 (3) [
94 beginning on or before December 31, 2021, a claimant, estate, or trust may claim a
95 nonrefundable tax credit under this [
96 the claimant, estate, or trust owns or uses if:
99 the energy required for the residential unit; or
101 part of the energy required for the residential unit;
103 or after January 1, 2007; and
105 accordance with Subsection [
107 (4) (a) For a residential energy system, other than Ĥ→ [
108 solar system
108a lesser of:
109 (i) 25% of the reasonable costs, including installation costs, of each residential energy
110 system installed with respect to each residential unit the claimant, estate, or trust owns or uses[
112 (ii) $2,000.
113 (b) Subject to Subsection (5)(d), for a residential energy system that is Ĥ→ [
114 system or a passive solar system
114a is equal to the lesser of:
115 (i) 25% of the reasonable costs, including installation costs, of each system installed
116 with respect to each residential unit the claimant, estate, or trust owns or uses; or
117 (ii) (A) for a system installed on or after January 1, 2007, but before December 31,
118 2017, $2,000;
119 (B) for a system installed on or after January 1, 2018, but on or before December 31,
120 2018, $1,600;
121 (C) for a system installed on or after January 1, 2019, but on or before December 31,
122 2019, $1,200;
123 (D) for a system installed on or after January 1, 2020, but on or before December 31,
124 2020, $800; and
125 (E) for a system installed on or after January 1, 2021, but on or before December 31,
126 2021, $400.
127 (c) (i) The office shall determine the amount of the tax credit that a claimant, estate, or
128 trust may claim and list that amount on the written certification that the office issues under
129 Subsection (5).
130 (ii) The claimant, estate, or trust may claim the tax credit in the amount listed on the
131 written certification that the office issues under Subsection (5).
133 for the taxable year in which the residential energy system is [
136 certification exceeds a claimant's, estate's, or trust's tax liability under this chapter for a taxable
137 year, the claimant, estate, or trust may carry forward the amount of the tax credit exceeding the
138 liability [
142 residential energy systems or parts of residential energy systems for a subsequent taxable year
143 if the total amount of tax credit the claimant, estate, or trust claims does not exceed $2,000 per
144 residential unit.
146 that leases a residential energy system installed on a residential unit may claim a tax credit
147 under [
148 elects not to claim the tax credit.
149 (ii) A claimant, estate, or trust described in Subsection [
150 residential energy system may claim as a tax credit under [
151 principal recovery portion of the lease payments.
152 (iii) A claimant, estate, or trust described in Subsection [
153 residential energy system may claim a tax credit under [
154 does not exceed seven taxable years after the date the lease begins, as stated in the lease
157 the claimant, estate, or trust claims the tax credit under [
158 (i) the claimant, estate, or trust may assign the tax credit to the other person; and
159 (ii) (A) if the other person files a return under Chapter 7, Corporate Franchise and
160 Income Taxes, the other person may claim the tax credit as if the other person had met the
161 requirements of Section 59-7-614 to claim the tax credit; or
162 (B) if the other person files a return under this chapter, the other person may claim the
163 tax credit under this section as if the other person had met the requirements of this section to
164 claim the tax credit.
166 the claimant, estate, or trust shall obtain a written certification from the office.
167 (b) The office shall issue a claimant, estate, or trust a written certification if the office
168 determines that:
169 (i) the claimant, estate, or trust meets the requirements of this section to receive a tax
170 credit; and
171 (ii) the office determines that the residential energy system with respect to which the
172 claimant, estate, or trust seeks to claim a tax credit:
173 (A) has been completely installed;
174 (B) is a viable system for saving or producing energy from renewable resources; and
175 (C) is safe, reliable, efficient, and technically feasible to ensure that the residential
176 energy system uses the state's renewable and nonrenewable energy resources in an appropriate
177 and economic manner.
178 (c) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
179 office may make rules:
180 (i) for determining whether a residential energy system meets the requirements of
181 Subsection [
182 (ii) for purposes of determining the amount of a tax credit that a claimant, estate, or
183 trust may receive under Subsection [
184 energy system, as an amount per unit of energy production.
185 (d) A claimant, estate, or trust that obtains a written certification from the office shall
186 retain the certification for the same time period a person is required to keep books and records
187 under Section 59-1-1406.
190 (6) A tax credit under this section is in addition to any tax credits provided under the
191 laws or rules and regulations of the United States.
192 (7) A purchaser of one or more solar units that claims a tax credit under Section
193 59-10-1024 for the purchase of the one or more solar units may not claim a tax credit under this
194 section for that purchase.