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Minnesota Legislature

Office of the Revisor of Statutes

SF 2017

as introduced - 91st Legislature (2019 - 2020) Posted on 03/21/2019 03:22pm

KEY: stricken = removed, old language.
underscored = added, new language.

Current Version - as introduced

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A bill for an act
relating to taxation; income; providing a temporary credit for the purchase and
installation of solar energy systems.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

new text begin TEMPORARY SOLAR ENERGY SYSTEM CREDIT.
new text end

new text begin Subdivision 1. new text end

new text begin Definitions. new text end

new text begin (a) For purposes of this section, the following terms have
the meanings given.
new text end

new text begin (b) "Business property" means class 3a property, as defined in Minnesota Statutes,
section 273.13, subdivision 24.
new text end

new text begin (c) "Energy storage system" means a commercially available technology capable of:
new text end

new text begin (1) absorbing and storing electrical energy; and
new text end

new text begin (2) dispatching stored electrical energy at a later time.
new text end

new text begin (d) "Homestead" means class 1a and 1b residential property, as defined in Minnesota
Statutes, section 273.13, subdivision 22, or an agricultural homestead, as defined in
Minnesota Statutes, section 273.13, subdivision 23.
new text end

new text begin (e) "Photovoltaic device" has the meaning given in Minnesota Statutes, section 216C.06,
subdivision 16.
new text end

new text begin (f) "Solar energy system" means a photovoltaic device, solar water heater, or solar
thermal system installed alone or in combination or in conjunction with an energy storage
system.
new text end

new text begin (g) "Solar thermal system" has the meaning given in Minnesota Statutes, section
216B.2411, subdivision 2, paragraph (e).
new text end

new text begin (h) "Solar water heater" means an active, closed-loop system that pumps a nonfreezing
heat-transfer fluid through a flat-plate collector that collects solar energy and a heat exchanger
to heat water.
new text end

new text begin Subd. 2. new text end

new text begin Credit allowed; limitation. new text end

new text begin (a) A taxpayer receiving electric service at retail
from a municipal utility or a cooperative electric association that meets the requirements
of paragraph (g) and who purchases and places in service in this state a solar energy system
during the taxable year is eligible for a credit against the tax due under Minnesota Statutes,
chapter 290, equal to the lesser of the applicable percentage of the solar energy system's
purchase and installation costs or the maximum allowable credit.
new text end

new text begin (b) For solar energy systems first placed into service:
new text end

new text begin (1) after December 31, 2018, and before January 1, 2020, the applicable percentage is
15 percent;
new text end

new text begin (2) after December 31, 2019, and before January 1, 2021, the applicable percentage is
13 percent; and
new text end

new text begin (3) after December 31, 2020, and before January 1, 2023, the applicable percentage is
11 percent.
new text end

new text begin (c) The maximum allowable credit is:
new text end

new text begin (1) $5,000 for solar energy systems installed on the site of a taxpayer's homestead; and
new text end

new text begin (2) $20,000 for solar energy systems installed on each business property.
new text end

new text begin (d) For a nonresident or part-year resident the credit must be allocated based on the
percentage calculated under Minnesota Statutes, section 290.06, subdivision 2c, paragraph
(a).
new text end

new text begin (e) If the amount of the credit under this section for any taxable year exceeds the tax
due under Minnesota Statutes, chapter 290, the excess is a credit carryover to each of the
ten succeeding taxable years. The entire amount of the excess unused credit for the taxable
year must be carried first to the earliest of the taxable years to which the credit may be
carried. The amount of the unused credit that may be added under this paragraph may not
exceed the taxpayer's liability for tax, less the credit for the taxable year.
new text end

new text begin (f) Credits granted to a partnership, a limited liability company taxed as a partnership,
an S corporation, or multiple owners of property are passed through to the partners, members,
shareholders, or owners, respectively, pro rata to each partner, member, shareholder, or
owner based on their share of the entity's assets or as specially allocated in their
organizational documents or any other executed agreement, as of the last day of the taxable
year.
new text end

new text begin (g) A taxpayer receiving electric service at retail from a cooperative electric association
is eligible to receive a tax credit under this section only if the cooperative electric association
is subject to Minnesota Statutes, section 216B.164, subdivision 3, paragraph (a).
new text end

new text begin Subd. 3. new text end

new text begin Application. new text end

new text begin (a) A taxpayer must apply for the credit in a form and manner
prescribed by the commissioner of revenue. The application for 2019 must be made available
on the Department of Revenue's website by August 1, 2019. Applications for subsequent
years must be made available on the department's website by November 1 of the preceding
year. An individual cannot file an application until the solar energy system has been installed.
A business cannot file an application until the solar energy system has been placed in service.
new text end

new text begin (b) A taxpayer may apply separately to receive a credit for solar energy systems installed
on the taxpayer's homestead and on business property owned by the taxpayer.
new text end

new text begin (c) A taxpayer may apply separately to receive a credit for solar energy systems installed
on multiple business properties owned by the taxpayer.
new text end

new text begin Subd. 4. new text end

new text begin Certificates; limitations. new text end

new text begin (a) The commissioner of revenue shall issue credit
certificates on a first-come, first-served basis to taxpayers who submit applications that
meet the requirements of this section.
new text end

new text begin (b) The commissioner of revenue may not issue more than $5,000,000 in credit for any
taxable year, at least $2,500,000 of which is reserved for the installation of solar energy
systems on the site of taxpayers' homesteads.
new text end

new text begin (c) If any portion of a taxable year's credits is not allocated by September 30 of the
taxable year, the remaining amount is available beginning on October 1 for all claims for
installations of solar energy systems.
new text end

new text begin (d) Any amount of a taxable year's credits not allocated by December 31 of the taxable
year is available for the following taxable year in addition to the amount available under
paragraph (a).
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for taxable years beginning after December
31, 2018, and before January 1, 2023.
new text end