MONTPELIER, Vt. — The IRS has ruled that an owner of solar panels in a community-shared array is eligible for the 30 percent federal residential income tax credit known as the “residential ITC.” The IRS ruling applies only to a specific solar panel owner in Vermont, but it is a positive development for community-shared solar participants and project developers.
Community-shared solar allows electric customers to buy an interest in an offsite solar array and receive credit on their electricity bills. Stakeholders in Massachusetts and Vermont, and attorneys with Boston law firm Foley Hoag, LLP and the Clean Energy States Alliance (CESA) arranged the Private Letter Ruling request to the Internal Revenue Service to help clarify shared solar owners’ eligibility for the residential ITC.
Foley Hoag attorneys Nicola Lemay and Adam Wade provided legal services and facilitated discussions with the IRS.
“This new Private Letter Ruling represents the first instance in which the IRS has publicly weighed in on the applicability of the residential ITC to an owner of solar panels in a shared, offsite array,” said Warren Leon, the Executive Director of CESA. “The ruling suggests that the IRS may be receptive to claims for the residential ITC when a project mirrors the structure used in this case.”
About Foley Hoag, LLP: Foley Hoag provides innovative, strategic legal services to public, private and government clients across the globe. It has premier capabilities in the life sciences, healthcare, technology, energy, professional services and investment management fields, and in cross-border disputes. Its professionals possess the skills and experience to provide exceptional senior-level service to clients ranging from startups to multinational companies to sovereign states.
About the Clean Energy States Alliance: The Clean Energy States Alliance (CESA) is a national nonprofit coalition of public agencies and organizations working together to advance clean energy. CESA members—mostly state agencies—include many of the most innovative, successful, and influential public funders of clean energy initiatives in the country. CESA works with state leaders, federal agencies, industry representatives, and other stakeholders to develop and promote clean energy technologies and markets. CESA facilitates information sharing, provides technical assistance, coordinates multi-state collaborative projects, and communicates the positions and achievements of its members.