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Louisiana

Louisiana

Incentives/Policies for Renewables & Efficiency

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Tax Credit for Solar Energy Systems on Residential Property (Corporate)   

Last DSIRE Review: 07/10/2013
Program Overview:
State: Louisiana
Incentive Type: Corporate Tax Credit
Eligible Renewable/Other Technologies: Solar Water Heat, Solar Space Heat, Photovoltaics
Applicable Sectors: Commercial, Residential
Amount:50% of the first $25,000 of the cost of each system
Leased systems installed after December 31, 2013: 38% of the first $25,000 of the cost of each system
Maximum Incentive:$12,500 per installed system; 1 installed system per residence
Eligible System Size:Leased systems: 6 kW maximum
Equipment Requirements:Electrical equipment must be UL-listed. Solar-thermal equipment must be OG-300 certified
All systems must be compliant with the requirements of the federal American Recovery and Reinvestment Act (ARRA)
Installation Requirements:Systems must be sold by and installed by a person who is licensed by the Louisiana State Licensing Board for Contractors
Carryover Provisions:Excess credit is refundable
Start Date:01/01/2008
Expiration Date:12/31/2017
Web Site: http://www.revenue.louisiana.gov/sections/faq/default.aspx?type=G...
Authority 1:
Date Effective:
LAC 61:I.1907
1/1/2008
Authority 2:
Date Enacted:
Date Effective:
Expiration Date:
La. R.S. 47:6030
7/10/2007
1/1/2008
12/31/2017
Authority 3:
Date Enacted:
Date Effective:
Expiration Date:
HB 705
06/21/2013
07/01/2013
12/31/2017
Summary:

Note: HB 705 of 2013 made several significant changes to this tax credit. Among other changes, wind energy systems are no longer eligible, there is now an expiration date for the credit, and there are special provisions for leased systems. The Louisiana Department of Revenue (LDR) will be developing new rules to supplant the rules linked to here. The summary presented here describes the credit as amended by HB 705, but may have to be modified again after the LDR promulgates the new rules.     

Louisiana provides a tax credit for solar energy systems purchased and installed on or after January 1, 2008 and before January 1, 2018. The credit may be applied to personal, corporate or franchise taxes, depending on the entity which purchases and installs the system, but the system must be installed at a single-family residence to be eligible (systems installed at residential rental apartments were made ineligible by HB 705 of 2013). HB 858, enacted in July 2009, extended the tax credit to taxpayers that purchase and install systems. (The credit was previously only available to residential property owners). Only one credit may be taken per system, so if the property is sold, the taxpayer who originally claimed the credit must disclose this, as the new owner will not be eligible for another tax credit on the same system. Each residence is limited to just one credit. A second system installed at the same residence is ineligible for a credit. 

The tax credit may be applied both to solar-electric systems (photovoltaic systems) and solar-thermal systems, when the energy is used for space heating, space cooling or water heating. The amount of the credit is equal to 50% of the first $25,000 of the cost of each system, including installation costs. The credit must be fully claimed in the taxable year in which the system is installed and placed in service. Equipment added at a later date cannot utilize any existing system components in order to qualify for the tax credit. Any excess credit which exceeds the taxpayer's liabilities for that year shall be treated as an overpayment, and the DOR will issue a refund for the remaining amount within one year of receiving the claim.

For photovoltaic (PV) systems, the tax credit applies to AC or DC generation systems which are grid-connected, net-metered systems (with or without battery backup) and stand-alone systems. Solar-thermal systems must be used for the primary purpose of heating water, space heating or space cooling.

Electrical equipment must be tested and certified by a Federal Occupational Safety and Health Administration (OSHA) nationally recognized testing laboratory and installed in compliance with all applicable building and electrical codes. Solar thermal equipment must be certified to SRCC OG-300 by either SRCC or by listing agency such as International Association of Plumbing and Mechanical Officials (IAPMO) and installed in compliance with all applicable building and plumbing codes. Installations must be performed by a licensed contractor, the owner of the residence, or by a person who has received certification by a technical college in the installation of such systems. In order to claim a tax credit for a wind or solar energy system all components must be installed at the same time as the system.

This tax credit may be combined with any federal tax incentive, but it may not be combined with any other state tax incentive. Whenever additional incentives such as cash rebates, prizes or gift certificates are offered in addition to the tax credit, the eligible cost must be reduced by the value of the additional incentive received.

Leased Systems

Systems leased by a third party and used at a residence can qualify for a tax credit, but there are additional provisions in the law that apply to these systems. For leased systems that are installed after December 31, 2013, the value of the credit will be reduced to 38% of the first $25,000 of the cost of each system.  Additionally, leased systems can be no larger than 6 kilowatts (kW). The law also sets maximum system costs for leased systems. A leased system can claim system costs that do not exceed these limits depending on the year it is placed in service:

  • Placed in service between 7/1/13 - 6/30/14: $4.50 per watt
  • Placed in service between 7/1/14 - 6/30/15: $3.50 per watt
  • Placed in service between 7/1/15 - 12/31/17: $2.50 per watt

 
Contact:
  Public Information - LA DOR
LA Department of Revenue
PO Box 201
Baton Rouge, LA 70821-0201
Phone: (225) 219-0102
Web Site: http://www.revenue.louisiana.gov
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Disclaimer: The information presented on the DSIRE web site provides an unofficial overview of financial incentives and other policies. It does not constitute professional tax advice or other professional financial guidance, and it should not be used as the only source of information when making purchasing decisions, investment decisions or tax decisions, or when executing other binding agreements. Please refer to the individual contact provided below each summary to verify that a specific financial incentive or other policy applies to your project.

While the DSIRE staff strives to provide the best information possible, the DSIRE staff, the N.C. Solar Center, N.C. State University and the Interstate Renewable Energy Council, Inc. make no representations or warranties, either express or implied, concerning the accuracy, completeness, reliability or suitability of the information. The DSIRE staff, the N.C. Solar Center, N.C. State University and the Interstate Renewable Energy Council, Inc. disclaim all liability of any kind arising out of your use or misuse of the information contained or referenced on DSIRE Web pages.

Copyright 2013 - 2014 North Carolina State University, under NREL Subcontract No. XEU-0-99515-01. Permission granted only for personal or educational use, or for use by or on behalf of the U.S. government. North Carolina State University prohibits the unauthorized display, reproduction, sale, and/or distribution of all or portions of the content of the Database of State Incentives for Renewables and Efficiency (DSIRE) without prior, written consent.