Note: This tax credit is only available for installations that begin construction before the beginning of calendar year 2022. Eligible installations can still receive credits in 2022, but no new facilities can become eligible.
Iowa offers a corporate tax credit for solar energy systems. Specifically, the law allows individuals and corporations to claim a state tax credit worth 50% of the Federal Investment Tax Credit. Each taxpayer may claim up to $5,000 for residential systems and $20,000 for commercial systems under this program, and any excess credits may be carried over for up to 10 years.
A taxpayer may claim a credit for each separate and distinct solar installation. The cumulative value of the tax credits claimed by applicants under this program and the personal tax credit is limited to $5,000,000 per year, with a minimum of $1,000,000 reserved for credits for residential solar installations. Because of this limit, a taxpayer must complete an application to reserve the tax credit. The application for the Iowa credit cannot be made for individuals until the installation of the solar energy system is complete. An application for the Iowa credit for businesses cannot be made until the installation of the solar system is complete and the system is placed in service. Credits will be reserved on a first-come, first-serve basis.
Taxpayers taking a credit under this provision cannot claim a credit under the Iowa Production Tax Credit.
| Implementing Sector: | State |
| Category: | Financial Incentive |
| State: | Iowa |
| Incentive Type: | Corporate Tax Credit |
| Web Site: | https://tax.iowa.gov/solar-energy-system-tax-credits |
| Administrator: | Iowa Department of Revenue |
| Start Date: | 01/01/2012 |
| Eligible Renewable/Other Technologies: |
|
| Incentive Amount: | 50% of Federal ITC (15% for 2019 and earlier, 13% for 2020, 11% for 2021, 5% for 2022 and later). |
| Maximum Incentive: | $20,000 |
| Carryover Provisions: | Excess credit may be taken for up to 10 years |
| Technologies: | Solar Water Heat, Solar Space Heat, Solar Thermal Electric, Solar Thermal Process Heat, Solar Photovoltaics |
| Sectors: | Commercial, Investor-Owned Utility, Agricultural |
| Parameters: | The incentive has a minimum of $20000.00 |
| Name: | Iowa Code §422.11L |
| Date Enacted: | 05/25/2012 |
| Effective Date: | 01/01/2012 |
| Name: | 701 IAC 42.48 |
| Date Enacted: | 10/03/2012 |
| Effective Date: | 01/01/2012 |
| Name: | H.F. 645 |
| Date Enacted: | 06/26/2015 |
| Effective Date: | 01/01/2015 |
| Name: | Iowa Department of Revenue |
| Address: |
Hoover State Office Building - 1st Floor 1305 E. Walnut Des Moines IA 50319 |
| Phone: | (800) 367-3388 |
This information is sourced from DSIRE; the most comprehensive source of information on incentives and policies that support renewables and energy efficiency in the United States. Established in 1995, DSIRE is operated by the N.C. Clean Energy Technology Center at N.C. State University.
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