PV tax credit for homeowner associations [RE-wrenches]

Randy Sadewic randy at positiveenergysolar.com
Wed Nov 14 09:22:07 PST 2007


Hi Sky,
Thanks for your input.  What I have been told is, the HOA is a legally
established HOA that is not-for-profit.  

We need access to a tax authority (SEIA?)to resolve some of these tax
issues that were not spelled out in the legislation. 

Randy

Randy Sadewic
randy at positiveenergysolar.com
NABCEP Certified PV Installer
Positive Energy, Inc.
Phone 505 424-1112
Fax     505 424-1113
 
Enjoy the Sun!
 

-----Original Message-----
From: Sky Sims [mailto:sky at ecologicalsystems.biz] 
Sent: Tuesday, November 13, 2007 12:41 PM
To: RE-wrenches at topica.com
Subject: RE: PV tax credit for homeowner associations [RE-wrenches]


Is the homeowners association a registered business entity? Is it a
non-profit? If the HOA is a for profit entity then they can get a no-cap
30% tax credit.

If it's a not-for-profit then it can't use the tax incentives but
perhaps you can find someone willing to do a tax lease for the entity.
The individual homeowners may even be able to provide a tax lease to
themselves by creating an entity willing to finance the system. In a tax
lease another entity assumes ownership of the system for a period of
at-least 66 months and utilizes the business tax incentives. At the end
of the lease the home owners association can buy the system back. The
tax lease basically allows the not-for-profit to sell the tax incentives
resulting in a lower overall system cost. 

If the home owners association isn't a true entity but actually just a
group of people teaming up to buy a single system for their entire
communities needs then I would treat the 50kw system as 10 individual
systems and bill each homeowner individually for their portion of the
overall system this should allow them each to get the $2000 tax credit. 

Mind you, I'm not a tax attorney or CPA, so for a legal interpretation
you should probably talk to a CPA or tax attorney.

Sky Sims
Ecological Systems
www.ecologicalsystems.biz
220 County Road 522
Manalapan, NJ 07726
ph)732-462-3858  fax)732-462-3962
 

-----Original Message-----
From: Randy Sadewic [mailto:randy at positiveenergysolar.com] 
Sent: Monday, November 12, 2007 7:30 PM
To: RE-wrenches at topica.com
Subject: PV tax credit for homeowner associations [RE-wrenches]



Wrenches,
I have a question about federal tax credit for PV installed on homeowner
association buildings.  I read the SEIA guide that explains that and the
specific requirements but the interpretation is unclear. My question has
to do with the tax credit limit of $2,000. Is that set based on each
home owner or based on each system?  In other words if a HOA installed a
$50,000 system distributed amongst 10 homeowners, can each person claim
$5,000 investment and $1,500 credit, or is the $2,000 credit distributed
between the 10 homeowners?
 
Thanks in advance.
 
Randy
 
Randy Sadewic
randy at positiveenergysolar.com
NABCEP Certified PV Installer
Positive Energy, Inc.
Phone 505 424-1112
Fax     505 424-1113
 
Enjoy the Sun!
 

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


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