Federal business tax credits - not applicable if business uses AMT? [RE-

[Mark Frye]

Bob,

Since it depends on the specifics of your customers business and tax situation, I would tend to go along with the advisor.

Specifically, currently, individuals who file AMT cannot take advantage of the RE tax credit.  If your prospective customer is operating as a sole proprietorship or partnership, the income goes directly onto the 1040 thru the Schedule C and the tax credit could not be taken on the 1040 if the individual is filing AMT.

I am assuming that your prospecitve customer is not structured as a corp, s-corp, or LLC.  If he were I am pretty sure he could get the full RE credit for the business.

MPF

-----Original Message-----
From: Bob Clark [mailto:bclark at solar-wind.us]
Sent: Thursday, August 30, 2007 11:25 AM
To: RE-wrenches at topica.com
Subject: Federal business tax credits - not applicable if business uses
AMT? [RE-wre



WRENCHES:

PREFACE: This system is NOT in California; it is in Washington (state, the OTHER Washington).

A potential business customer told us that without being able to use the federal 30% tax credit for businesses, he could not afford to install the large PV system we designed for him (pay back time was too long). He said he talked to his tax consultant and that his tax consultant told him that he could not use the RE tax credit because he was using the alternative minimum tax (ATM).

How does the ATM work and how does it preclude using the RE tax credit? If indeed it does, why? Is there any movement afoot to change this? I am not looking for legally binding tax advice, just a layman's description of how these things work. Can anyone out there relate similar experiences?

This was a real bummer to hear this because this would have been quite a system (many electrons and substantial $s).

Bob Clark
SolarWind Energy Systems, LLC


[Non-text portions of this message have been removed]


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