Excise Tax Deduction for Solar or Wind Powered Systems

In Massachusetts, businesses may deduct from net income, for state excise tax purposes, expenditures paid or incurred from the installation of any "solar or wind powered climatic control unit and any solar or wind powered water heating unit or any other type unit or system powered thereby," including labor expenditures. The installation must be located in Massachusetts and used exclusively in the business or trade of the business. Certain criteria must be met, see the Massachusetts Department of Revenue guidance for more information.

Furthermore, a system or unit that qualifies for this deduction will not be taxed under the tangible property measure of the state's corporate excise tax. This exemption is effective for the length of the equipment's depreciation period. A corporation may not take both this deduction and any other state credit against tax with respect to the same property.

Note: For information about what constitutes the corporate excise tax, please visit the official Massachusetts website.