Co-ops and Condos Would Benefit From Revised Solar Tax Credit

A likely revision to the state's solar tax credit could be a windfall for New York City co-op and condo boards struggling to pay for retrofits that will cut their buildings' carbon emissions and bring them in compliance with Local Law 97.

Under the current law, City Limits reports, homeowners can reduce their income tax payments by 25% of the cost of their solar panel system, up to a maximum of $5,000. The proposed legislation would double that cap to $10,000 — and give low-to-moderate-income residents the option to collect the credit as a tax refund. It would also make it easier for co-ops and condos to access the benefit by essentially removing a limit on the amount of solar power these properties can use the tax credit towards.

The bill was included in both the Senate and the Assembly’s “one-house” budget proposals. If it makes it into the final budget, which is due on April 1, it automatically passes both houses and just needs Gov. Kathy Hochul’s signature to become law.

“It’s a no brainer,” says Sen. Peter Harckham, who is sponsoring the bill in the Senate. “I don’t see who would be opposed to something like this. We’re cleaning our air, we’re adding clean energy to the grid, and we’re allowing the homeowners to save money on their electric bills.”

Under the current law, homeowners who don’t have taxable income — or retirees whose tax liability is less than the credit would be worth — can’t use much of the benefit. By giving people the option to collect the tax credit as a refund, the new bill addresses the equity issue and allows more homeowners to use the incentive, advocates argue.

Making it easier for more properties to switch to clean energy is urgent, supporters say, especially since only 29% of New York’s power comes from renewable sources right now. The state's goal of drawing 70% of its energy from renewable sources by 2030 is beginning to look unattainable.

“New York State is behind on its renewable energy goals," says Kate Selden, a senior policy manager at Solar One, a nonprofit that helps New Yorkers install solar panels. "And so anything we can do to accelerate solar will play a major role in helping expand renewable energy."