We provide residential, commercial, and governmental solar energy solutions. Our projects can be scaled to all sizes and our contractors are trained and certified for both residential and industrial applications. Our financing department will work with you to insure that you are receiving and leveraging all tax benefits and incentives so that you can enjoy free cash flow as quickly as possible.

Federal Solar Energy Tax Incentives:
Federal Income Tax Credits apply for improvements “placed in service” from January 1, 2006, through December 31, 2007. They are not available in 2005. The IRS defines “placed in service” as when the products or materials are ready and available for use – this would generally refer to the installation, not the purchase.

What do I need to do to get the tax credit?
You will need to file IRS Form 5695 with your taxes. In addition, you will need to keep at least receipts proving that you purchased the improvements and a copy of the manufacturer’s certification (or the ENERGY STAR label for windows). Accountants and tax advisors should also be able to provide more guidance.

Tax Credits for Home Builders
Eligible contractors need to fill out IRS Form 8908 to get the tax credit. The IRS has provided the following guidance regarding the tax credits for constructing energy efficient new homes available under the Energy Policy Act of 2005: IRS Notice 2006–27 provides guidance for the credit for building energy efficient homes other than manufactured homes.

• IRS Notice 2006–28 provides guidance for the credit for building energy efficient manufactured homes.

• The tax credit information provided below is based on information contained in the Energy Policy Act of 2005. The IRS guidance provides specific information that home builders and housing manufacturers can rely on to take action to claim the tax credits. ENERGY STAR will study the IRS publications and provide updates as necessary.

Home builders are eligible for a $2,000 tax credit for a new energy efficient home that achieves 50 percent energy savings for heating and cooling over the 2004 International Energy Conservation Code (IECC) and supplements. At least 1/5 of the energy savings must come from building envelope improvements. This credit also applies to contractors of manufactured homes conforming to Federal Manufactured Home Construction and Safety Standards.

There is also a $1,000 tax credit to the producer of a new manufactured home achieving 30 percent energy savings for heating and cooling over the 2004 IECC and supplements (at least 1/3 of the savings must come from building envelope improvements), or a manufactured home meeting the requirements established by EPA under the ENERGY STAR program.

These tax credits apply to new homes located in the United States whose construction is substantially completed after August 8, 2005 and that are acquired from the eligible contractor for use as a residence from January 1, 2006 through December 31, 2008.

Washington Solar Energy Tax Incentives:
Washington State does not tax sales of equipment used to generate electricity from wind, sun or landfill gas, and with the passage of HB 1859 in 2001, fuel cells. Further amendments in 2006 (HB 2799) added solar water heating systems to the list of eligible technologies. The tax exemption applies to labor and services related to the installation of the equipment, as well as to the sale of equipment and machinery. Eligible systems are those with a generating capacity of at least 200 watts.

Qualifying tax-exempt solar water heating equipment includes:
•  OG-300 rated solar water heating systems
•  OG-100 rated solar water heating collectors
•  Solar heat exchangers
•  Differential solar controllers
•  Replacement parts for such equipment

Washington Renewable Energy Production Incentives
In May 2005, Washington enacted Senate Bill 5101, establishing production incentives of $0.12 to $0.54 per kilowatt-hour (kWh), capped at $2,000 per year for individuals, businesses, and local governments that generate electricity from solar power, wind power, or anaerobic digesters.

The incentive amount paid to the producer for the electricity starts at a base rate of $0.15/kWh and is adjusted according to how the electricity was generated by multiplying the incentive by the following factors:
* For electricity produced using solar modules manufactured in Washington state: 2.4
* For electricity produced using a solar or wind generator equipped with an inverter manufactured in Washington state: 1.2
* For electricity produced using an anaerobic digester, by other solar equipment, or using a wind generator equipped with blades manufactured in Washington state: 1.0
* For all other electricity produced by wind: 0.8

Ownership of the renewable-energy credits (RECs) associated with generation remains with the customer-generator and does not transfer to the state or utility.

The state's utilities will pay the incentives and earn a tax credit equal to the cost of those payments. The credit may not exceed the greater of $25,000 or 0.25% of a utility’s taxable power sales. The incentive amount may be uniformly reduced if requests for the incentive exceed the available funds.

The Washington Department of Revenue (DOR) is responsible for submitting a report measuring the impacts of this legislation, including any change in the number of solar energy system manufacturing companies in Washington, and the effects on job creation, such as the number of jobs created for Washington residents.

The incentives apply to power generated as of July 1, 2005, and remain in effect through June 30, 2014. A utility may not claim any tax credits for incentive payments after June 30, 2016.




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