Saturday, March 25th, 2017 - 9:40 pm 
(Arizona time)
Updated February 16, 2014

Arizona tax credit and incentive programs are generally divided by whether they target residential installations or non-residential industrial, commercial, agricultural, institutional, and governmental installations. The information presented below is an unofficial overview of financial incentives and other policies. It does not constitute professional tax advice or other professional financial guidance, and it should not be used as the only source of information when making purchasing decisions, investment decisions or tax decisions, or when executing other binding agreements. Please refer to the individual contact provided below each summary to verify that a specific financial incentive or other policy applies to your project.

Arizona Residential Incentives


Arizona Non-Residential Incentives

Residential Incentives

Arizona Residential Solar and Wind Energy Systems Tax Credit

This incentive is an Arizona personal tax credit. The credit amount allowed against the taxpayer's personal income tax is 25% of the cost of the system with a $1,000 maximum regardless of the number of energy devices installed.

The eligible technologies are Photovoltaics, Solar Water Heat, Passive Solar Space Heat, Solar Space Heat, Wind, Solar Ovens, Solar Cooling, Solar Pool Heating, and Daylighting. The system must be installed at the customer's residence.

2013 Form:
www.azdor.gov/LinkClick.aspx?fileticket=Dskl0IliYek%3d&tabid=252&mid=870

2013 Instructions:
www.azdor.gov/LinkClick.aspx?fileticket=mh4_qrZUFTw%3d&tabid=252&mid=870

Contact:
     Tax Assistance
     Arizona Department of Revenue
     1600 W. Monroe
     Phoenix, AZ 85007-2650
     (602) 255-3381
     (800) 352-4090
     Web Site: www.azdor.gov

Arizona Credit for Solar Hot Water Heater Plumbing Stub Out and Electric Vehicle Charging Station Outlet

This $75 credit is provided for in Arizona Revised Statutes §§ 43-1090 and 43-1176 and is a nonrefundable individual and corporate income tax credits for the installation of solar hot water heater plumbing stub outs and electric vehicle recharge outlets in houses or dwelling units constructed by the taxpayer. The houses or dwelling units must be located in Arizona. Qualifying installations of solar hot water heater plumbing stub outs must meet certain requirements.

Qualifying installations of electric vehicle recharge outlets must be connected to the utility system by a dedicated line and also meet certain requirements that are spelled out in the instruction document (see link below).

2013 Form:
www.azdor.gov/LinkClick.aspx?fileticket=Vxk898UIgdI%3d&tabid=252&mid=870

2013 Instructions:
www.azdor.gov/LinkClick.aspx?fileticket=J-kxk8Z_d48%3d&tabid=252&mid=870


Arizona Solar and Wind Equipment Sales Tax Exemption

This incentive is a state sales tax exemption. The exemption is for 100% of the sales tax on eligible equipment. The eligible technologies are Photovoltaics, Solar Water Heat, Solar Space Heat, Solar Thermal Electric, Passive Solar Space Heat, Wind, Solar Pool Heating, and Daylighting. Residential, Commercial, and General Public/Consumer installations are eligible and there is no maximum amount.

2013 Form:
www.azdor.gov/LinkClick.aspx?fileticket=Ps8eGb-koig%3d&tabid=264&mid=868

Contact:
     Tax Assistance
     Arizona Department of Revenue
     1600 W. Monroe
     Phoenix, AZ 85007-2650
     Phone: (602) 255-3381
     Phone 2: (800) 352-4090
     Web Site: www.azdor.gov


Arizona Energy Equipment Property Tax Exemption

This incentive is an Arizona property tax exemption. The exemption is for 100% of the increased value of the property from installing eligible energy systems. For property assessment and valuation purposes, the systems are considered to add no value. It applies to residential, commercial and industrial properties. Because investments in solar and other renewable energy systems add value, the exemption effectively provides a property tax break. Originally the exemption only applied to solar energy devices. The eligible renewable technologies include Photovoltaics, Solar Water Heat, Passive Solar Space Heat, Solar Space Heat, Solar Thermal Electric, Solar Thermal Process Heat, Solar Cooling, Solar Pool Heating, and Daylighting. In addition, other renewable energy technologies such as Wind, Biomass, and Geothermal Electric are eligible. Energy efficient building components are also eligible for the exemption.

Contact:
     Tax Assistance
     Arizona Department of Revenue
     1600 W. Monroe
     Phoenix, AZ 85007-2650
     Phone: (602) 255-3381
     Phone 2: (800) 352-4090
     Web Site: www.azdor.gov
Non-Residential Incentives

Arizona Corporate Non-Residential Solar and Wind Tax Credit

This incentive is a Corporate Tax Credit. Note that the credit may be applied towards corporate or personal income taxes. There is a maximum credit of $25,000 for any one building in the same year and a total credit of $50,000 per business in any year. The credit is available to Agricultural, Commercial, Industrial, Nonprofit, Schools, and Institutional entities as well as, Local, State and Tribal Governments. There is no restriction on the size of the system however the program budget is $1 million annually. The eligible technologies include Photovoltaics, Solar Water Heat, Passive Solar Space Heat, Solar Space Heat, Solar Thermal Electric, Solar Thermal Process Heat, Solar Cooling, Solar Pool Heating, Wind, and Daylighting. Program expiration is set for 12/31/2018. To qualify for the tax credits, a business must submit an application to the Arizona Commerce Authority (ACA).

2013 Guidelines:
www.azcommerce.com/media/31817/Solar-Guidelines.pdf

2013 Form:
www.azdor.gov/LinkClick.aspx?fileticket=9qDGWmKUuds%3d&tabid=252&mid=870

2013 Instructions:
www.azdor.gov/LinkClick.aspx?fileticket=Fh6h-Ml3X_8%3d&tabid=252&mid=870

Contact:
     Blanca Carrillo
     Arizona Commerce Authority
     Financial Incentive Programs
     333 N. Central Ave., Suite 1900
     Phoenix, AZ 85004
     Phone: (602) 845-1235
     Fax: (602) 845-1201
     E-Mail: This email address is being protected from spambots. You need JavaScript enabled to view it.


Arizona Renewable Energy Production Tax Credit Corporate

This incentive is a Corporate Tax Credit for electricity produced by certain eligible renewable systems annually over a ten-year period. Note that the credit may be applied towards corporate or personal income taxes. The system size must be a minimum of 5 MW. It is applicable to systems installed after 12/31/2010. The eligible technologies are Photovoltaics, Solar Thermal Electric, Landfill Gas, Wind, and Biomass. The maximum incentive for any system is $2 million per year and the annual budget for the program is $20 million.

The tax credit for photovoltaics (PV) and solar thermal electric systems varies depending on the year of electricity production according to the following schedule:

Year 1: $0.04 per kWh
Year 2: $0.04 per kWh
Year 3: $0.035 per kWh
Year 4: $0.035 per kWh
Year 5: $0.03 per kWh
Year 6: $0.03 per kWh
Year 7: $0.02 per kWh
Year 8: $0.02 per kWh
Year 9: $0.01 per kWh
Year 10: $0.01 per kWh

 

The incentive amount for Wind and Biomass is $0.01/kWh, paid for 10 years.

2013 Program Guidelines:
www.azdor.gov/LinkClick.aspx?fileticket=FW9Ym9tAbMg%3d&tabid=316

2013 Form:
www.azdor.gov/LinkClick.aspx?fileticket=MRDmJbBEyMQ%3d&tabid=252&mid=870

2013 Instructions:
www.azdor.gov/LinkClick.aspx?fileticket=_RGZFb3mgQ4%3d&tabid=252&mid=870

Contact:
     Renewable Energy Production Tax Credit Program
     Office of Economic Research & Analysis
     Arizona Department of Revenue
     P.O. Box 29099
     Phoenix, AZ 85038
     Web Site: www.azdor.gov


Questions can be directed to Georganna Meyer (602-716-6927) or Elaine Smith (602-716-6924).


Arizona Renewable Energy Business Tax Incentives

The purpose of this incentive is to draw renewable energy product manufacturers to Arizona. Commercial and industrial entities are eligible. The eligible solar energy technologies are Photovoltaics, Solar Water Heat, Solar Thermal Electric, Solar Thermal Process Heat, and Solar Pool Heating. A number of other renewable technologies are eligible including Wind, Biomass, Hydroelectric, and Fuel Cells using Renewable Fuels.

The tax credit is up to 10% of the investment amount but there is no limit on individual property tax reductions offered as incentives to help convince a manufacturer of renewable energy products to locate in Arizona. The total tax credits that may be approved state-wide in one taxable year is $70 million. The program began 1/1/2010 and is set to expire 12/31/2019.

There are complex stipulations about qualifying for the incentives and the potential investor should seek further details at:

2013 Program Guidelines:
www.azcommerce.com/media/32094/RETIPGuidelines.pdf

2013 Form:
www.azdor.gov/LinkClick.aspx?fileticket=OckE5PZ_q4Y%3d&tabid=252&mid=870

2013 Instruction:
www.azdor.gov/LinkClick.aspx?fileticket=nWicEHQTedM%3d&tabid=252&mid=870

Contact:
     Renewable Energy Tax Incentives Program
     Arizona Commerce Authority
     333 N. Central Ave., Suite 1900
     Phoenix, AZ 85004
     Web Site: www.azcommerce.com/incentives/renewable-energy-tax-incentive

 

Questions regarding Renewable Energy Tax Incentives can be directed to This email address is being protected from spambots. You need JavaScript enabled to view it.


Disclaimer: The Arizona Solar Center disclaim all liability of any kind arising out of your use or misuse of the information contained or referenced on the Solar Center web pages.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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