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For the solar tax credit to appear on next year’s real estate tax bill, final inspections and installation must be complete by the end of the calendar year (December 31) and complete application forms with all required documentation must be submitted by January 15. The City’s Building Inspectors will contact the applicant if the application is incomplete or if there are other issues (such as lack of a final inspection) that would delay approval of the application. Applications completed or submitted after January 15 will be processed and will appear on the following year’s real estate tax bill.
For example: If a solar energy system is fully installed and inspected by December 31, 2015, a complete application is submitted on January 5, 2016, and the application is approved, the solar tax credit will first appear as a line item on the April 2016 real estate tax bill. If the same application was completed or submitted in February 2016 (instead of before January 15) and was approved, the solar tax credit would first appear as a line item on the April 2017 real estate tax bill. View more information on the Solar Tax Credit page.
The amount credited will be calculated by applying the current tax rate to the amount of the purchase and installation costs of the certified solar energy equipment, facilities or devices. The credit applies for five years and becomes effective beginning the first day of the tax year next succeeding the certification by the division of building and life safety and will remain in effect for that tax year and the following four tax years.
Example: A property is assessed at $300,000. A solar system is then installed with $10,000 of labor and purchased certified solar equipment, facilities or devices. The property’s assessed value remains $300,000.
The property owner submits the solar tax credit application and is approved. The credit amount would be equal to ($10,000 x Tax Rate) and will be applied every year for five years. With a tax rate of 0.95%, the solar tax credit for this property would be: $10,000 x 0.95% = $95 annually ($475 in total over 5 years).