Implementing Sector | State |
Category | Financial Incentive |
State | Hawaii |
Incentive Type | Corporate Tax Credit |
Web Site | http://tax.hawaii.gov/geninfo/renewable/ |
Administrator | Hawaii Department of Taxation |
Start Date | 07/01/2009 |
Expiration Date | None |
Eligible Renewable/Other Technologies | Solar Water Heat, Solar Space Heat, Solar Thermal Electric, Solar Photovoltaics, Wind (All), Wind (Small) |
Applicable Sectors | Commercial, Residential, Multifamily Residential |
Incentive Amount |
Solar Thermal and PV: 35% Wind: 20% |
Maximum Incentive | Varies by technology and property type (see summary for details) |
Eligible System Size | PV Systems installed on or after January 1, 2020: 5 MW maximum capacity |
Equipment Requirements | System must be new and in compliance with all applicable performance and safety standards. |
Carryover Provisions | Credit may be carried forward until exhausted. |
Originally enacted in 1976, the Hawaii Energy Tax Credits allow individuals or corporations to claim an income tax credit of 20% of the cost of equipment and installation of a wind system and 35% of the cost of equipment and installation of a solar thermal or photovoltaic (PV) system.*
For solar thermal water heating systems, the maximum allowable credits are as follows:
For photovoltaic and solar space heating systems, the maximum allowable credits are as follows:
For wind powered energy systems the maximum allowable credits are as follows:
For a system that is business property, it is important to note that the costs that exceed the amount allowable for the maximum energy tax credit may be used for the Capital Goods Excise tax credit. In addition, for taxable years beginning after December 31, 2005, the dollar amount of any utility rebate must be deducted from the cost of the qualifying system and its installation before applying the state tax credit.
A new provision was added to the tax credits in June 2009, with the passage of SB 464. This legislation, effective July 1, 2009, allows the tax credit to be refundable under certain conditions. For solar energy systems, a taxpayer can reduce the eligible credit amount by 30%. If this reduced amount exceeds the amount of income taxes to be paid by the taxpayer, the excess credit will be refunded to the taxpayer. If the tax credit exceeds a tax payer’s income liability, the excess credit over liability may be used as a credit against the taxpayer’s income liability until exchausted. Taxpayers whose entire income is exempt or whose adjusted gross income is $20,000 or less (or $40,000 or less if filing jointly) may receive the tax credit as a refund.
Name | HRS §235-12.5 |
Date Enacted | 1976, subsequently amended |
Effective Date | 7/1/2003 |
Expiration Date | None |