Rep. Norm Thurston — Voting Record

Bill

Number

H.B. 23 First Substitute (2017GS)

Sponsor

Rep. Peterson, J.

Final action

Governor Signed 3/17/2017

Outcome

Became law — signed by Gov. Gary R. Herbert

Summary

What it does

• This bill:
• phases out the individual income tax credit for certain residential renewable energy systems; and
• amends the maximum individual income tax credit for certain residential renewable energy systems.

Every vote on this bill

Bill text

INCOME TAX CREDIT MODIFICATIONS
GENERAL SESSION
STATE OF UTAH
Chief Sponsor: Jeremy A. Peterson
Senate Sponsor: 
Curtis S. Bramble
LONG TITLE
General Description:
This bill amends the individual income tax credit for certain residential renewable
energy systems.
Highlighted Provisions:
This bill:
▸ phases out the individual income tax credit for certain residential renewable energy
systems; and
▸ amends the maximum individual income tax credit for certain residential renewable
energy systems.
Money Appropriated in this Bill:
None
Other Special Clauses:
None
Utah Code Sections Affected:
AMENDS:
59-10-1014
, as last amended by Laws of Utah 2016, Third Special Session, Chapter 1
Be it enacted by the Legislature of the state of Utah:
Section 1. Section 
59-10-1014
 is amended to read:
59-10-1014.
Nonrefundable renewable energy systems tax credits -- Definitions --
Certification -- Rulemaking authority.
(1) As used in this section:
(a) (i) "Active solar system" means a system of equipment that is capable of:
(A) collecting and converting incident solar radiation into thermal, mechanical, or
electrical energy; and
(B) transferring a form of energy described in Subsection (1)(a)(i)(A) by a separate
apparatus to storage or to the point of use.
(ii) "Active solar system" includes water heating, space heating or cooling, and
electrical or mechanical energy generation.
(b) "Biomass system" means a system of apparatus and equipment for use in:
(i) converting material into biomass energy, as defined in Section 
59-12-102
; and
(ii) transporting the biomass energy by separate apparatus to the point of use or storage.
(c) "Direct use geothermal system" means a system of apparatus and equipment that
enables the direct use of geothermal energy to meet energy needs, including heating a building,
an industrial process, and aquaculture.
(d) "Geothermal electricity" means energy that is:
(i) contained in heat that continuously flows outward from the earth; and
(ii) used as a sole source of energy to produce electricity.
(e) "Geothermal energy" means energy generated by heat that is contained in the earth.
(f) "Geothermal heat pump system" means a system of apparatus and equipment that:
(i) enables the use of thermal properties contained in the earth at temperatures well
below 100 degrees Fahrenheit; and
(ii) helps meet heating and cooling needs of a structure.
(g) "Hydroenergy system" means a system of apparatus and equipment that is capable
of:
(i) intercepting and converting kinetic water energy into electrical or mechanical
energy; and
(ii) transferring this form of energy by separate apparatus to the point of use or storage.
(h) "Office" means the Office of Energy Development created in Section 
63M-4-401
.
(i) (i) "Passive solar system" means a direct thermal system that utilizes the structure of
a building and its operable components to provide for collection, storage, and distribution of
heating or cooling during the appropriate times of the year by utilizing the climate resources
available at the site.
(ii) "Passive solar system" includes those portions and components of a building that
are expressly designed and required for the collection, storage, and distribution of solar energy.
(j) "Photovoltaic system" means an active solar system that generates electricity from
sunlight.
[
(j)
] 
(k)
 (i) "Principal recovery portion" means the portion of a lease payment that
constitutes the cost a person incurs in acquiring a residential energy system.
(ii) "Principal recovery portion" does not include:
(A) an interest charge; or
(B) a maintenance expense.
[
(k)
] 
(l)
 "Residential energy system" means the following used to supply energy to or
for a residential unit:
(i) an active solar system;
(ii) a biomass system;
(iii) a direct use geothermal system;
(iv) a geothermal heat pump system;
(v) a hydroenergy system;
(vi) a passive solar system; or
(vii) a wind system.
[
(l)
] 
(m)
 (i) "Residential unit" means a house, condominium, apartment, or similar
dwelling unit that:
(A) is located in the state; and
(B) serves as a dwelling for a person, group of persons, or a family.
(ii) "Residential unit" does not include property subject to a fee under:
(A) Section 
59-2-404
;
(B) Section 
59-2-405
;
(C) Section 
59-2-405.1
;
(D) Section 
59-2-405.2
; or
(E) Section 
59-2-405.3
.
[
(m)
] 
(n)
 "Wind system" means a system of apparatus and equipment that is capable of:
(i) intercepting and converting wind energy into mechanical or electrical energy; and
(ii) transferring these forms of energy by a separate apparatus to the point of use or
storage.
(2) A claimant, estate, or trust may claim an energy system tax credit as provided in
this section against a tax due under this chapter for a taxable year.
(3) [
(a) Subject to the other provisions of this Subsection (3),
] 
For a taxable year
beginning on or before December 31, 2021,
 a claimant, estate, or trust may claim a
nonrefundable tax credit under this [
Subsection (3)
] 
section
 with respect to a residential unit
the claimant, estate, or trust owns or uses if:
[
(i)
] 
(a)
 the claimant, estate, or trust:
[
(A)
] 
(i)
 purchases and completes a residential energy system to supply all or part of
the energy required for the residential unit; or
[
(B)
] 
(ii)
 participates in the financing of a residential energy system to supply all or
part of the energy required for the residential unit;
[
(ii)
] 
(b)
 the residential energy system is [
completed and placed in service
] 
installed
 on
or after January 1, 2007; and
[
(iii)
] 
(c)
 the claimant, estate, or trust obtains a written certification from the office in
accordance with Subsection [
(4)
] 
(5)
.
[
(b) (i) Subject to Subsections (3)(b)(ii) through (vi), the tax credit is equal to
]
(4) (a) For a residential energy system, other than a photovoltaic system, the tax credit
described in this section is equal to the lesser of:
(i)
 25% of the reasonable costs
, including installation costs,
 of each residential energy
system installed with respect to each residential unit the claimant, estate, or trust owns or uses[
.
(ii) A tax credit under this Subsection (3) may include installation costs.
]
; and
(ii) $2,000.
(b) Subject to Subsection (5)(d), for a residential energy system that is a photovoltaic
system, the tax credit described in this section is equal to the lesser of:
(i) 25% of the reasonable costs, including installation costs, of each system installed
with respect to each residential unit the claimant, estate, or trust owns or uses; or
(ii) (A) for a system installed on or after January 1, 2007, but before December 31,
2017, $2,000;
(B) for a system installed on or after January 1, 2018, but on or before December 31,
2018, $1,600;
(C) for a system installed on or after January 1, 2019, but on or before December 31,
2019, $1,200;
(D) for a system installed on or after January 1, 2020, but on or before December 31,
2020, $800; and
(E) for a system installed on or after January 1, 2021, but on or before December 31,
2021, $400.
(c) (i) The office shall determine the amount of the tax credit that a claimant, estate, or
trust may claim and list that amount on the written certification that the office issues under
Subsection (5).
(ii) The claimant, estate, or trust may claim the tax credit in the amount listed on the
written certification that the office issues under Subsection (5).
[
(iii)
] 
(d)
 A claimant, estate, or trust may claim a tax credit under [
this
] Subsection (3)
for the taxable year in which the residential energy system is [
completed and placed in service
]
installed
.
[
(iv)
] 
(e)
 If the amount of a tax credit [
under this Subsection (3)
] 
listed on the written
certification
 exceeds a claimant's, estate's, or trust's tax liability under this chapter for a taxable
year, the 
claimant, estate, or trust may carry forward the
 amount of the tax credit exceeding the
liability [
may be carried forward
] for a period that does not exceed the next four taxable years.
[
(v) The total amount of tax credit a claimant, estate, or trust may claim under this
Subsection (3) may not exceed $2,000 per residential unit.
]
[
(vi)
] 
(f)
 A claimant, estate, or trust may claim a tax credit with respect to additional
residential energy systems or parts of residential energy systems for a subsequent taxable year
if the total amount of tax credit the claimant, estate, or trust claims does not exceed $2,000 per
residential unit.
[
(c)
] 
(g)
 (i) Subject to Subsections [
(3)(c)
] 
(4)(g)
(ii) and (iii), a claimant, estate, or trust
that leases a residential energy system installed on a residential unit may claim a tax credit
under [
this
] Subsection (3) if the claimant, estate, or trust confirms that the lessor irrevocably
elects not to claim the tax credit.
(ii) A claimant, estate, or trust described in Subsection [
(3)(c)
] 
(4)(g)
(i) that leases a
residential energy system may claim as a tax credit under [
this
] Subsection (3) only the
principal recovery portion of the lease payments.
(iii) A claimant, estate, or trust described in Subsection [
(3)(c)
] 
(4)(g)
(i) that leases a
residential energy system may claim a tax credit under [
this
] Subsection (3) for a period that
does not exceed seven taxable years after the date the lease begins, as stated in the lease
agreement.
[
(d)
] 
(h)
 If a claimant, estate, or trust sells a residential unit to another person before
the claimant, estate, or trust claims the tax credit under [
this
] Subsection (3):
(i) the claimant, estate, or trust may assign the tax credit to the other person; and
(ii) (A) if the other person files a return under Chapter 7, Corporate Franchise and
Income Taxes, the other person may claim the tax credit as if the other person had met the
requirements of Section 
59-7-614
 to claim the tax credit; or
(B) if the other person files a return under this chapter, the other person may claim the
tax credit under this section as if the other person had met the requirements of this section to
claim the tax credit.
[
(4)
] 
(5)
 (a) Before a claimant, estate, or trust may claim a tax credit under this section,
the claimant, estate, or trust shall obtain a written certification from the office.
(b) The office shall issue a claimant, estate, or trust a written certification if the office
determines that:
(i) the claimant, estate, or trust meets the requirements of this section to receive a tax
credit; and
(ii) the office determines that the residential energy system with respect to which the
claimant, estate, or trust seeks to claim a tax credit:
(A) has been completely installed;
(B) is a viable system for saving or producing energy from renewable resources; and
(C) is safe, reliable, efficient, and technically feasible to ensure that the residential
energy system uses the state's renewable and nonrenewable energy resources in an appropriate
and economic manner.
(c) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
office may make rules:
(i) for determining whether a residential energy system meets the requirements of
Subsection [
(4)
] 
(5)
(b)(ii); and
(ii) for purposes of 
determining the amount of
 a tax credit 
that a claimant, estate, or
trust may receive
 under Subsection [
(3)
] 
(4)
, establishing the reasonable costs of a residential
energy system, as an amount per unit of energy production.
(d) A claimant, estate, or trust that obtains a written certification from the office shall
retain the certification for the same time period a person is required to keep books and records
under Section 
59-1-1406
.
[
(5) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act,
the commission may make rules to address the certification of a tax credit under this section.
]
(6) A tax credit under this section is in addition to any tax credits provided under the
laws or rules and regulations of the United States.
(7) A purchaser of one or more solar units that claims a tax credit under Section
59-10-1024
 for the purchase of the one or more solar units may not claim a tax credit under this
section for that purchase.