tax and general off-grid cost

System · May 2007

Thought I would introduce myself first. I am a law enforcement officer, EMT/firefighter and part time soldier. And now I am beginning the long journey of teaching myself about alternate power. Please have a little patients with me I am very new to this.

I wanted to ask about taxes in Arizona and California. I currently own a home in Arizona. I am planning to buy land and build in AZ or CA. Time and money will help with that choice. I have been searching through posts on this board and noticed talk of tax being increased once it is found out that you are off-grid. Is this true in AZ and does it defeat the cost of going off-grid? And off-grid for me means any form of power... solar, wind or anything else.

I also wanted any advice about reading on power sources. I love to read and would like any recommendations for books, websites, etc...that anyone would suggest. I have used howstuffworks.com for the basics.

Thanks for everyones help.

Dave

mike95490 · May 2007

Re: tax and general off-grid cost

Calif exempts solar grid-tie installs from property tax re-assessment. Not sure about pure off-grid installs.

niel · May 2007

Re: tax and general off-grid cost

let me clarify this more. anytime you have an improvement to a property they can reassess it as you have made an improvement to that property regardless if you are offgrid or not. this can take away from the benefit of going with a renewable energy source. if they should try to up your taxes by your going re you should fight it with an arguement of why they aren't uping the taxes of those with generators? they may say, it is because the pvs became fixtures of the home and of course you could then put it on a pole or other mounts not on or attached to the home tax free by their own definition. most big generators could be considered fixtures as many don't move or move easily, especially those run by natural gas and i'll be willing to bet they don't tax them because they aren't viewing them as an improvement to the property even though the pvs are performing the same function of providing power. they may also claim generators don't last long, but pvs don't last forever either though longer than a generator lasts and if the generator were to last that long would they then tax it? no.
we need a national law that bans raising assessments because of using renewable power sources. if you checked in www.dsireusa.org and did not see mention of your state not raising assessments then they can and do raise the tax by asserting you have a higher valued property due to the installing of re.

mike95490 · May 2007

Re: tax and general off-grid cost

mike90045 wrote:

Calif exempts solar grid-tie installs from property tax re-assessment. Not sure about pure off-grid installs.

This is what I replied to the tax assessor with, when they sent my a notice. I attached a copy of the actual state law cited in the summary. Mike

http://tinyurl.com/2dxqyz

Property Tax Exemption for Solar Systems, California

Last DSIRE Review: 02/16/2007
Incentive Type: Property Tax Exemption
Eligible Renewable/Other Technologies: Solar Water Heat, Solar Space Heat, Solar Thermal Electric, Solar Thermal Process Heat, Photovoltaics, Solar Mechanical Energy
Applicable Sectors: Commercial, Industrial, Residential
Amount: 100% of system value
Max. Limit: None
Terms: 75% exemption for dual-use equipment
Authority 1: Cal Rev & Tax Code § 73

Summary:

Section 73 of the California Revenue and Taxation Code allows a property tax exemption for certain types of solar energy systems installed on or before December 31, 2009. (The original expiration year of 2005 was extended by AB 1099 [2005].) Qualifying active solar energy systems are defined as those that "are thermally isolated from living space or any other area where the energy is used, to provide for the collection, storage, or distribution of solar energy." These include solar space conditioning systems, solar water heating systems, active solar energy systems, solar process heating systems, photovoltaic (PV) systems, and solar thermal electric systems, and solar mechanical energy. Solar pool heating systems and solar hot-tub-heating systems are not eligible.

Components included under the exemption include storage devices, power conditioning equipment, transfer equipment, and parts. Pipes and ducts that are used to carry both solar energy and energy derived from other sources qualify for the exemption only to the extent of 75% of their full cash value. Likewise, dual-use equipment for solar-electric systems qualifies for the exemption only to the extent of 75% of its value.

niel · May 2007

Re: tax and general off-grid cost

mike,
i believe you did this recently? what was their reaction if any?

mike95490 · May 2007

Re: tax and general off-grid cost

niel wrote:

mike,
i believe you did this recently? what was their reaction if any?

I sent it in mid Oct 2006, and have not heard anything since.

Mangas · May 2007

Re: tax and general off-grid cost

I'm in Arizona and have a large off grid system. I am unaware of additonal property taxes beacuse of it.

Arizona has a tax credit for solar systems. I believe the maximum credit is $1,000.

As you know there is a Federal credit as well. If the Securing America's Energy Independance Act of 2007 Bill S. 590 passes, I believe the current law is extended to include larger credits for property placed into service this year. Bears watching.

In my case, looks like should have put the system in this year rather than last.

BB. · May 2007

Re: tax and general off-grid cost

Also, look at the other taxes for each state (property, income, property, and a real killer can be state disability insurance paied by employers, etc.)... California is not a low tax state. Only thing we have going for us is the old Prop 13 which limits property taxes to a maximum year to year of 2% increase (assuming no ownership change)... California Property tax on solar (and real estate in general) runs about 1.1-1.5% of assessed valuation (depending on local bonds and such).

-Bill

niel · May 2007

Re: tax and general off-grid cost

fortunately not ever place will tax you even if they are able to so just because they aren't doing it now, without it in the books in the form of law that they can't, they could sock it to you in the future.
they got around raising percentage taxes in allegheny county by just artificially raising everyone's assessed value. they tried in one year to up my valuation 3 fold. i appealed of course, but it still went up 50% even with the appeal. all other taxes are based on the county assessed value so you could imagine the impact to homeowners(except most of the upper class homes of course) and the windfall amounts of money flying to municipalities and school districts in addition to the county. they still cry they have no money and look for ways to stick it to us so count every blessing you have if they aren't taxing your solar.

tax and general off-grid cost

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