Solar tax credit changes ahead
New restrictions could go into effect Jan. 1, 2013
It's a case of "green," turning the bottom line "red."
Or at least that's a fear of number-crunching economists on the Council of Revenues.
With photovoltaic credits flying high, the tax collections are expected to shirk.
The state tax office said it is in the process of tightening up the criteria for what qualifies for the solar tax credits now pegged at $5,000 per system.
"It's coming down the pike. There was a lot of concern during the last legislative session. We would like to get something in place as soon as possible," said State Tax Director Fred Pablo.
Proposed changes to new administrative rules are expected in about a month and could take effect around the first of the year.
Pablo said there has been lots of confusion about what qualifies and how many credits homeowners can claim.
Over the past few months, the state has reached out to the industry to understand what impacts of reducing the credit or restricting what can be claimed on your taxes.
"The more information we can get out to the consumers, to the tax preparers they seek advice from, to the solar industry, the better guidelines on what would qualify for the credit," said Pablo.
The city says in the last two fiscal years the number of solar permits has soared dramatically.
In 2012, it issued 6,950 permits, compared to 3,102 in the previous fiscal year.
Hawaiian Electric Company says five years ago, solar systems generated 10 megawatts of power for the grid. That has doubled every year since.
As of June, that number hit 112 megawatts, indicating that 2012 appears to be on track for another record high number of solar installations statewide.
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