S T A T E O F N E W Y O R K
________________________________________________________________________
2905
2015-2016 Regular Sessions
I N S E N A T E
January 30, 2015
___________
Introduced by Sen. ORTT -- read twice and ordered printed, and when
printed to be committed to the Committee on Investigations and Govern-
ment Operations
AN ACT to amend the tax law, in relation to establishing a credit for
geothermal energy systems
THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:
Section 1. Section 606 of the tax law is amended by adding a new
subsection (g-3) to read as follows:
(G-3) GEOTHERMAL ENERGY SYSTEMS CREDIT. (1) GENERAL. AN INDIVIDUAL
TAXPAYER SHALL BE ALLOWED A CREDIT AGAINST THE TAX IMPOSED BY THIS ARTI-
CLE EQUAL TO TWENTY-FIVE PERCENT OF QUALIFIED GEOTHERMAL ENERGY SYSTEM
EXPENDITURES, EXCEPT AS PROVIDED IN SUBPARAGRAPH (D) OF PARAGRAPH TWO OF
THIS SUBSECTION. THIS CREDIT SHALL NOT EXCEED FIVE THOUSAND DOLLARS FOR
A QUALIFIED GEOTHERMAL ENERGY SYSTEM PLACED IN SERVICE ON OR AFTER
SEPTEMBER FIRST, TWO THOUSAND FIFTEEN.
(2) QUALIFIED GEOTHERMAL ENERGY SYSTEMS EXPENDITURES. (A) THE TERM
"QUALIFIED GEOTHERMAL ENERGY SYSTEM EXPENDITURES" MEANS EXPENDITURES
FOR:
(I) THE PURCHASE OF GEOTHERMAL ENERGY SYSTEM EQUIPMENT WHICH IS
INSTALLED IN CONNECTION WITH RESIDENTIAL PROPERTY WHICH IS (I) LOCATED
IN THIS STATE AND (II) WHICH IS USED BY THE TAXPAYER AS HIS OR HER PRIN-
CIPAL RESIDENCE AT THE TIME THE GEOTHERMAL ENERGY SYSTEM EQUIPMENT IS
PLACED IN SERVICE;
(II) THE LEASE OF GEOTHERMAL ENERGY SYSTEM EQUIPMENT UNDER A WRITTEN
AGREEMENT THAT SPANS AT LEAST TEN YEARS WHERE SUCH EQUIPMENT OWNED BY A
PERSON OTHER THAN THE TAXPAYER IS INSTALLED IN CONNECTION WITH RESIDEN-
TIAL PROPERTY WHICH IS (I) LOCATED IN THIS STATE AND (II) WHICH IS USED
BY THE TAXPAYER AS HIS OR HER PRINCIPAL RESIDENCE AT THE TIME THE GEOTH-
ERMAL ENERGY SYSTEM EQUIPMENT IS PLACED IN SERVICE; OR
EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD04961-05-5
S. 2905 2
(III) THE PURCHASE OF POWER UNDER A WRITTEN AGREEMENT THAT SPANS AT
LEAST TEN YEARS WHEREUNDER THE POWER PURCHASED IS GENERATED BY GEOTHER-
MAL ENERGY SYSTEM EQUIPMENT OWNED BY A PERSON OTHER THAN THE TAXPAYER
WHICH IS INSTALLED IN CONNECTION WITH RESIDENTIAL PROPERTY WHICH IS (I)
LOCATED IN THIS STATE AND (II) USED BY THE TAXPAYER AS HIS OR HER PRIN-
CIPAL RESIDENCE AT THE TIME THE GEOTHERMAL ENERGY SYSTEM EQUIPMENT IS
PLACED IN SERVICE.
(B) SUCH QUALIFIED EXPENDITURES SHALL INCLUDE EXPENDITURES FOR MATERI-
ALS, LABOR COSTS PROPERLY ALLOCABLE TO ON-SITE PREPARATION, ASSEMBLY AND
ORIGINAL INSTALLATION, ARCHITECTURAL AND ENGINEERING SERVICES, AND
DESIGNS AND PLANS DIRECTLY RELATED TO THE CONSTRUCTION OR INSTALLATION
OF THE GEOTHERMAL ENERGY SYSTEM EQUIPMENT.
(C) SUCH QUALIFIED EXPENDITURES FOR THE PURCHASE OF GEOTHERMAL ENERGY
SYSTEM EQUIPMENT SHALL NOT INCLUDE INTEREST OR OTHER FINANCE CHARGES.
(D) SUCH QUALIFIED EXPENDITURES FOR THE LEASE OF GEOTHERMAL ENERGY
SYSTEM EQUIPMENT OR THE PURCHASE OF POWER UNDER AN AGREEMENT DESCRIBED
IN CLAUSE (II) OR (III) OF SUBPARAGRAPH (A) OF THIS PARAGRAPH SHALL
INCLUDE AN AMOUNT EQUAL TO ALL PAYMENTS MADE DURING THE TAXABLE YEAR
UNDER SUCH AGREEMENT. PROVIDED, HOWEVER, SUCH CREDITS SHALL ONLY BE
ALLOWED FOR FOURTEEN YEARS AFTER THE FIRST TAXABLE YEAR IN WHICH SUCH
CREDIT IS ALLOWED. PROVIDED FURTHER, HOWEVER, THE TWENTY-FIVE PERCENT
LIMITATION IN PARAGRAPH ONE OF THIS SUBSECTION SHALL ONLY APPLY TO THE
TOTAL AGGREGATE AMOUNT OF ALL PAYMENTS TO BE MADE PURSUANT TO AN AGREE-
MENT REFERENCED IN CLAUSE (II) OR (III) OF SUBPARAGRAPH (A) OF THIS
PARAGRAPH, AND SHALL NOT APPLY TO INDIVIDUAL PAYMENTS MADE DURING A
TAXABLE YEAR UNDER SUCH AGREEMENT EXCEPT TO THE EXTENT SUCH LIMITATION
ON AN AGGREGATE BASIS HAS BEEN REACHED.
(3) GEOTHERMAL ENERGY SYSTEM EQUIPMENT. THE TERM "GEOTHERMAL ENERGY
SYSTEM EQUIPMENT" SHALL MEAN A SYSTEM WHOSE ORIGINAL USE BEGINS WITH THE
TAXPAYER; WHICH MEETS THE ELIGIBILITY CRITERIA, IF ANY, PRESCRIBED BY
THE DEPARTMENT; AND WHICH IS A GROUND COUPLED SOLAR THERMAL SYSTEM THAT
UTILIZES THE SOLAR THERMAL ENERGY STORED IN THE GROUND OR IN BODIES OF
WATER TO PRODUCE HEAT, AND WHICH IS COMMONLY KNOWN AS OR REFERRED TO AS
A GROUND SOURCE HEAT PUMP SYSTEM.
(4) MULTIPLE TAXPAYERS. WHERE GEOTHERMAL ENERGY SYSTEM EQUIPMENT IS
PURCHASED AND INSTALLED IN A PRINCIPAL RESIDENCE SHARED BY TWO OR MORE
TAXPAYERS, THE AMOUNT OF THE CREDIT ALLOWABLE UNDER THIS SUBSECTION FOR
EACH SUCH TAXPAYER SHALL BE PRORATED ACCORDING TO THE PERCENTAGE OF THE
TOTAL EXPENDITURE FOR SUCH GEOTHERMAL ENERGY SYSTEM EQUIPMENT CONTRIB-
UTED BY EACH TAXPAYER.
(5) PROPORTIONATE SHARE. WHERE GEOTHERMAL ENERGY SYSTEM EQUIPMENT IS
PURCHASED AND INSTALLED BY A CONDOMINIUM MANAGEMENT ASSOCIATION OR A
COOPERATIVE HOUSING CORPORATION, A TAXPAYER WHO IS A MEMBER OF THE
CONDOMINIUM MANAGEMENT ASSOCIATION OR WHO IS A TENANT-STOCKHOLDER IN THE
COOPERATIVE HOUSING CORPORATION MAY FOR THE PURPOSE OF THIS SUBSECTION
CLAIM A PROPORTIONATE SHARE OF THE TOTAL EXPENSE AS THE EXPENDITURE FOR
THE PURPOSES OF THE CREDIT ATTRIBUTABLE TO HIS PRINCIPAL RESIDENCE.
(6) GRANTS. FOR PURPOSES OF DETERMINING THE AMOUNT OF THE EXPENDITURE
INCURRED IN PURCHASING AND INSTALLING GEOTHERMAL ENERGY SYSTEM EQUIP-
MENT, THE AMOUNT OF ANY FEDERAL, STATE OR LOCAL GRANT RECEIVED BY THE
TAXPAYER, WHICH WAS USED FOR THE PURCHASE AND/OR INSTALLATION OF SUCH
EQUIPMENT AND WHICH WAS NOT INCLUDED IN THE FEDERAL GROSS INCOME OF THE
TAXPAYER, SHALL NOT BE INCLUDED IN THE AMOUNT OF SUCH EXPENDITURES.
(7) WHEN CREDIT ALLOWED. THE CREDIT PROVIDED FOR HEREIN SHALL BE
ALLOWED WITH RESPECT TO THE TAXABLE YEAR, COMMENCING AFTER TWO THOUSAND
S. 2905 3
FIFTEEN, IN WHICH THE GEOTHERMAL ENERGY SYSTEM EQUIPMENT IS PLACED IN
SERVICE.
(8) CARRYOVER OF CREDIT. IF THE AMOUNT OF THE CREDIT, AND CARRYOVERS
OF SUCH CREDIT, ALLOWABLE UNDER THIS SUBSECTION FOR ANY TAXABLE YEAR
SHALL EXCEED THE TAXPAYER'S TAX FOR SUCH YEAR, SUCH EXCESS AMOUNT MAY BE
CARRIED OVER TO THE FIVE TAXABLE YEARS NEXT FOLLOWING THE TAXABLE YEAR
WITH RESPECT TO WHICH THE CREDIT IS ALLOWED AND MAY BE DEDUCTED FROM THE
TAXPAYER'S TAX FOR SUCH YEAR OR YEARS.
S 2. This act shall take effect immediately and shall apply to taxable
years commencing on and after January 1, 2015.