GENERAL ASSEMBLY OF NORTH CAROLINA
1993 SESSION

CHAPTER 584
SENATE BILL 1045

AN ACT TO BROADEN EXISTING INCOME TAX CREDITS FOR THE PRODUCTION AND INSTALLATION OF SOLAR AND PHOTOVOLTAIC EQUIPMENT BY INCREASING THE AMOUNTS OF THE CREDITS AND EXTENDING THE SOLAR EQUIPMENT CREDITS TO INCLUDE EQUIPMENT THAT GENERATES ELECTRICITY.

The General Assembly of North Carolina enacts:

Section 1.  G.S. 105-130.23 reads as rewritten:
"§ 105-130.23.  Credit against corporate income tax for solar energy equipment in residential buildings.
(a)	Any corporation that causes to be constructed or installed solar energy equipment for water heating, space heating or cooling, or electricity in residential buildings used or sold by the corporation for commercial or business purposes in North Carolina is allowed a credit against the taxes imposed by this Division equal to forty percent (40%) of the installation and equipment cost of the solar energy equipment.  A credit allowed under this section shall not exceed one thousand five hundred dollars ($1,500) per system or per year for any single building or each family dwelling unit of a multi-dwelling building that is individually metered for electric power or natural gas or has a separate furnace for oil heat paid for by the occupant.  To obtain the credit the taxpayer must own or control the use of the building at the time of the installation, except that in the case of a building constructed or modified for sale in which solar energy equipment is constructed or installed, the credit is allowed to the owner who first occupies the building for use after the construction or installation of the equipment or the owner-lessor who first leases the building for use after the construction or installation of the equipment.  The credit shall not be allowed to the extent that any of the cost of the equipment was provided by federal, State, or local grants.  If the credit allowed by this section exceeds the taxes imposed by this Division reduced by all other credits allowed, except payments of tax made by or on behalf of the taxpayer, the excess shall be allowed against the taxes imposed by this Division for the next five succeeding years.
(b)	For the purpose of this section, the term 'solar energy equipment for water heating, space heating or cooling, or electricity' means any solar energy equipment for water heating, space heating or cooling, or electricity that meets the performance criteria approved and published by the Secretary."
Sec. 2.  G.S. 105-130.28 reads as rewritten:
"§ 105-130.28.  Credit against corporate income tax for construction of a photovoltaic equipment facility.
(a)	Any corporation that constructs in North Carolina a facility for the production of photovoltaic equipment is allowed a credit against the tax imposed by this Division equal to twenty-five percent (25%) of the installation and equipment costs of construction. This credit shall not be allowed to the extent that any of the costs of the equipment were provided by federal, State, or local grants. To secure the credit allowed by this section, the taxpayer must own or control the facility at the time of construction. The credit allowed by this section may not exceed the amount of the tax imposed by this Division for the taxable year reduced by the sum of all credits allowable under this Division, except payments of tax made by or on behalf of the taxpayer.
(b)	As used in this section, 'photovoltaic equipment' means those products designed, manufactured, and produced to convert sunlight directly into electricity.
(c)	The amount of credit allowed under this section may be carried over for the next succeeding five years."
Sec. 3.  G.S. 105-130.32 reads as rewritten:
"§ 105-130.32.  Credit against corporate income tax for installation of solar energy equipment for the production of heat or electricity in certain processes.
(a)	Any corporation that constructs or installs solar energy equipment for the production of heat or electricity in the manufacturing or service processes of its business located in this State is allowed a credit against the tax imposed by this Division equal to thirty-five percent (35%) of the installation and equipment costs of the solar energy equipment. The credit allowed under this section may not exceed twenty-five thousand dollars ($25,000) for any single installation. This credit shall not be allowed to the extent that any of the costs of the equipment were provided by federal, State, or local grants. To secure the credit allowed by this section, the taxpayer must own or control the business at the time the solar energy equipment is installed. The credit allowed by this section may not exceed the amount of the tax imposed by this Division for the taxable year reduced by the sum of all credits allowable under this Division, except payments of tax made by or on behalf of the taxpayer.
(b)	As used in this section, 'solar energy equipment' means equipment and materials designed to collect, store, transport, or control energy derived directly from the sun."
Sec. 4.  G.S. 105-151.2 reads as rewritten:
"§ 105-151.2.  Credit for solar energy equipment.
(a)	A person or partnership who causes to be constructed or installed solar energy equipment for water heating, space heating or cooling, or electricity in any building in North Carolina is allowed a credit against the tax imposed by this Division equal to forty percent (40%) of the installation and equipment cost of the solar energy equipment. A credit allowed under this section shall not exceed one thousand five hundred dollars ($1,500) per system or per year on any single building or for each family dwelling unit of a multi-dwelling building that is individually metered for electric power or natural gas or has a separate furnace for oil heat paid for by the occupant.  To obtain the credit the taxpayer must own or control the use of the building at the time of the installation, except that in the case of a building constructed or modified for sale in which solar energy equipment is constructed or installed, the credit shall be allowed to the owner who first occupies the building for use after the construction or installation of the equipment or the owner-lessor who first leases the building for use after the construction or installation of the equipment.  The credit shall not be allowed to the extent that any of the cost of the equipment was provided by federal, State, or local grants.  If the credit allowed by this section exceeds the taxes imposed by this Division reduced by all other credits allowed, except payments of tax made by or on behalf of the taxpayer, the excess shall be allowed against the taxes imposed by this Division for the next five succeeding years.
(b)	In the case of property owned by the entirety, if both spouses are required to file North Carolina income tax returns, the credit allowed by this section may be claimed only if the spouses file a joint return. If only one spouse is required to file a North Carolina income tax return, that spouse may claim the credit allowed by this section on a separate return.
(c)	For the purpose of this section, the term 'solar energy equipment for water heating, space heating or cooling, or electricity' means any solar energy equipment for water heating, space heating or cooling, or electricity that meets the performance criteria approved and published by the Secretary."
Sec. 5.  G.S. 105-151.8 reads as rewritten:
"§ 105-151.8.  Credit for installation of solar energy equipment for the production of heat or electricity in certain processes.
(a)	A person who constructs or installs solar energy equipment for the production of heat or electricity in the manufacturing or service processes of the person's business located in this State is allowed a credit against the tax imposed by this Division equal to thirty-five percent (35%) of the installation and equipment costs of the solar energy equipment. The credit allowed under this section may not exceed twenty-five thousand dollars ($25,000) for any single installation. This credit shall not be allowed to the extent that any of the costs of the equipment were provided by federal, State, or local grants. To secure the credit allowed by this section, the taxpayer must own or control the business at the time the solar energy equipment is installed. The credit allowed by this section may not exceed the amount of tax imposed by this Division for the taxable year reduced by the sum of all credits allowable under this Division, except payments of tax made by or on behalf of the taxpayer. In no case shall a tax credit be allowed under both this section and G.S. 105-151.2.
(b)	In the case of property owned by the entirety, if both spouses are required to file North Carolina income tax returns, the credit allowed by this section may be claimed only if the spouses file a joint return. If only one spouse is required to file a North Carolina income tax return, that spouse may claim the credit allowed by this section on a separate return.
(c)	As used in this section, 'solar energy equipment' means equipment and materials designed to collect, store, transport, or control energy derived directly from the sun."
Sec. 6.  This act is effective for taxable years beginning on or after January 1, 1994.
In the General Assembly read three times and ratified this the 30th day of June, 1994.

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Dennis A. Wicker
President of the Senate

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Daniel Blue, Jr.
Speaker of the House of Representatives