§235-12.5  Renewable energy technologies;income tax credit.  (a)  When the requirements of subsection (d) are met,each individual or corporate taxpayer that files an individual or corporate netincome tax return for a taxable year may claim a tax credit under this sectionagainst the Hawaii state individual or corporate net income tax.  The taxcredit may be claimed for every eligible renewable energy technology systemthat is installed and placed in service in the State by a taxpayer during thetaxable year.  The tax credit may be claimed as follows:

(1)  For each solar energy system:  thirty-five percent of the actual cost or the cap amount determined in subsection (b),whichever is less; or

(2)  For each wind-powered energy system:  twenty percent of the actual cost or the cap amount determined in subsection (b),whichever is less;

provided that multiple owners of a single systemshall be entitled to a single tax credit; and provided further that the taxcredit shall be apportioned between the owners in proportion to theircontribution to the cost of the system.

In the case of a partnership, S corporation,estate, or trust, the tax credit allowable is for every eligible renewableenergy technology system that is installed and placed in service in the Stateby the entity.  The cost upon which the tax credit is computed shall bedetermined at the entity level.  Distribution and share of credit shall bedetermined pursuant to section 235-110.7(a).

(b)  The amount of credit allowed for eacheligible renewable energy technology system shall not exceed the applicable capamount, which is determined as follows:

(1)  If the primary purpose of the solar energy systemis to use energy from the sun to heat water for household use, then the capamounts shall be:

(A)  $2,250 per system for single-familyresidential property;

(B)  $350 per unit per system for multi-familyresidential property; and

(C)  $250,000 per system for commercialproperty;

(2)  For all other solar energy systems, the capamounts shall be:

(A)  $5,000 per system for single-familyresidential property; provided that if all or a portion of the system is usedto fulfill the substitute renewable energy technology requirement pursuant tosection 196-6.5(a)(3), the credit shall be reduced by thirty-five per cent ofthe actual system cost or $2,250, whichever is less;

(B)  $350 per unit per system for multi-familyresidential property; and

(C)  $500,000 per system for commercialproperty; and

(3)  For all wind-powered energy systems, the capamounts shall be:

(A)  $1,500 per system for single-familyresidential property; provided that if all or a portion of the system is usedto fulfill the substitute renewable energy technology requirement pursuant tosection 196-6.5(a)(3), the credit shall be reduced by twenty per cent of theactual system cost or $1,500, whichever is less;

(B)  $200 per unit per system for multi-familyresidential property; and

(C)  $500,000 per system for commercialproperty.

(c)  For the purposes of this section:

"Actual cost" means costs related tothe renewable energy technology systems under subsection (a), includingaccessories and installation, but not including the cost of consumer incentivepremiums unrelated to the operation of the system or offered with the sale ofthe system and costs for which another credit is claimed under this chapter.

"Household use" means any use towhich heated water is commonly put in a residential setting, includingcommercial application of those uses.

"Renewable energy technology system"means a new system that captures and converts a renewable source of energy,such as solar or wind energy, into:

(1)  A usable source of thermal or mechanical energy;

(2)  Electricity; or

(3)  Fuel.

"Solar or wind energy system" meansany identifiable facility, equipment, apparatus, or the like that convertssolar or wind energy to useful thermal or electrical energy for heating,cooling, or reducing the use of other types of energy that are dependent uponfossil fuel for their generation.

(d)  For taxable years beginning after December31, 2005, the dollar amount of any utility rebate shall be deducted from thecost of the qualifying system and its installation before applying the statetax credit.

(e)  The director of taxation shall prepareany forms that may be necessary to claim a tax credit under this section,including forms identifying the technology type of each tax credit claimedunder this section, whether for solar or wind.  The director may also requirethe taxpayer to furnish reasonable information to ascertain the validity of theclaim for credit made under this section and may adopt rules necessary toeffectuate the purposes of this section pursuant to chapter 91.

(f)  If the tax credit under this sectionexceeds the taxpayer's income tax liability, the excess of the credit overliability may be used as a credit against the taxpayer's income tax liabilityin subsequent years until exhausted, unless otherwise elected by the taxpayerpursuant to subsection (g) or (h).  All claims for the tax credit under thissection, including amended claims, shall be filed on or before the end of thetwelfth month following the close of the taxable year for which the credit maybe claimed.  Failure to comply with this subsection shall constitute a waiver ofthe right to claim the credit.

(g)  For solar energy systems, a taxpayer mayelect to reduce the eligible credit amount by thirty per cent and if thisreduced amount exceeds the amount of income tax payment due from the taxpayer,the excess of the credit amount over payments due shall be refunded to thetaxpayer; provided that tax credit amounts properly claimed by a taxpayer whohas no income tax liability shall be paid to the taxpayer; and provided furtherthat no refund on account of the tax credit allowed by this section shall bemade for amounts less than $1.

The election required by this subsection shallbe made in a manner prescribed by the director on the taxpayer's return for thetaxable year in which the system is installed and placed in service.  Aseparate election may be made for each separate system that generates acredit.  An election once made is irrevocable.

(h)  Notwithstanding subsection (g), for anyrenewable energy technology system, an individual taxpayer may elect to haveany excess of the credit over payments due refunded to the taxpayer, if:

(1)  All of the taxpayer's income is exempt fromtaxation under section 235-7(a)(2) or (3); or

(2)  The taxpayer's adjusted gross income is $20,000or less (or $40,000 or less if filing a tax return as married filing jointly);

provided that tax credits properly claimed by ataxpayer who has no income tax liability shall be paid to the taxpayer; andprovided further that no refund on account of the tax credit allowed by thissection shall be made for amounts less than $1.

A husband and wife who do not file a joint taxreturn shall only be entitled to make this election to the extent that theywould have been entitled to make the election had they filed a joint taxreturn.

The election required by this subsection shallbe made in a manner prescribed by the director on the taxpayer's return for thetaxable year in which the system is installed and placed in service.  Aseparate election may be made for each separate system that generates a credit. An election once made is irrevocable.

(i)  No taxpayer shall be allowed a creditunder this section for the portion of the renewable energy technology systemrequired by section 196-6.5 that is installed and placed in service on anynewly constructed single-family residential property authorized by a buildingpermit issued on or after January 1, 2010.

(j)  To the extent feasible, using existingresources to assist the energy-efficiency policy review and evaluation, thedepartment shall assist with data collection on the following for each taxableyear:

(1)  The number of renewable energy technology systemsthat have qualified for a tax credit during the calendar year by:

(A)  Technology type; and

(B)  Taxpayer type (corporate and individual);and

(2)  The total cost of the tax credit to the Stateduring the taxable year by:

(A)  Technology type; and

(B)  Taxpayer type.

(k)  This section shall apply to eligiblerenewable energy technology systems that are installed and placed in service onor after July 1, 2009. [L 2003, c 207, §§2, 4; am L 2004, c 97, §1; am L 2006,c 240, §§2, 3; am L 2007, c 151, §1; am L 2008, c 204, §4; am L 2009, c 154, §1and c 155, §15]

 

Note

 

  The L 2009, c 154 amendment applies to taxable yearsbeginning after December 31, 2008.  L 2009, c 154, §3.