New York – Exemption for Commercial Solar Energy Systems

SALT Report 1960 – The New York Department of Taxation issued guidance regarding recently enacted legislation that provides a sales and use tax exemption for the sale and installation of commercial solar energy systems equipment. The exemption applies to the 4% state sales and use tax and the 3/8% sales and use tax imposed by the state in the Metropolitan Commuter Transportation District (MCTD).

The new law also allows cities and counties within New York to offer a similar exemption from their local sales and use taxes. However, unless the locality specifically enacts the exemption, receipts from the sale or installation of commercial solar energy systems equipment are exempt only from the state sales and use taxes and the MCTD sales and use tax.

Exclusions

Commercial solar energy systems equipment does not include equipment that is part of a non-solar energy system. Therefore, items such as pipes, controls, insulation, or other equipment that are part of a conventional gas, oil, or electric heating or cooling system are not exempt as commercial solar energy systems equipment.

Forms

To claim this exemption, contractors who purchases commercial solar energy systems equipment must submit Form ST-120.1 Contractor Exempt Purchase Certificate to their vendor.

Persons other than contractors who purchase commercial solar energy systems equipment or installation services must submit to their vendor or contractor Form ST-121 Exempt Use Certificate, using Part III, Box U.

Anyone who purchases exempt equipment or installation services and is not required to have a Certificate of Authority is not required to list a Certificate of Authority number on Form ST-121.

The exemption applies to sales made and services rendered on or after January 1, 2013.

For Further Information:

New York Department of Taxation – TSB-M-12(14)S