Dive Brief:
- Claims submitted by residents who invested in solar systems have exceeded the amount of money Louisiana has available to pay those claim, the state announced this week, the Associated Press reports. Under legislation passed last year, tax credits were capped at annual limit of $10 million the first two years and reduced to a $5 million cap the third year before ending in 2017.
- Consumers purchasing residential solar energy systems should not expect to receive tax credits from the state, from this point forward.
- Approved credits, combined with claims under review, exceed the funds available to pay claims on solar energy systems by $14 million, according to the Louisiana Department of Revenue.
Dive Insight:
Louisiana approves solar credits on a first-come first-served basis, and has already run out of funds for a program slated to end Dec. 31, 2017.
In a July 19 statement, the Department of Revenue said it is "reviewing previously submitted claims and the amount of approved credits and claims under review exceeds the funds available to pay claims on solar energy systems by $14 million. The agency said taxpayers who do not receive refunds under the 2016 fiscal year cap will be notified in writing if they are eligible for deferred claims under the $10 million cap for fiscal year 2016-2017 or the $5 million cap for the 2017-2018 fiscal year.
A taxpayer denied a solar energy system tax credit due to lack of funds will receive a certified letter of denial.
During the 2015 session, the Louisiana Legislature passed Act 131, placing annual limits on solar tax credits for both purchased and leased systems. When the total amount of credits claimed in any particular fiscal year exceeds the amount authorized to be granted, "the excess requests shall be treated as having been applied for on the first day of the subsequent year and the taxpayer may claim such credits by filing an original return in the subsequent fiscal year during which the taxpayer’s claim has priority," according to a Revenue Information Bulletin from the state.