Excise Tax Deduction for Solar or Wind Powered Systems
Administered by Massachusetts Department of Revenue
This deduction is not available to homeowners—it applies only to businesses that install solar or wind systems for their commercial or industrial operations in Massachusetts.
You can serve commercial and industrial clients in Massachusetts who install solar or wind powered systems for climate control, water heating, or other thermal applications. Your customers can deduct all installation expenditures, including labor costs, from net income for state excise tax purposes, and the system avoids tangible property taxation for its entire depreciation period. Note that a customer cannot claim both this deduction and any other state tax credit for the same property.
This corporate excise tax deduction allows Massachusetts businesses to deduct capital and labor expenditures for solar and wind thermal systems (including solar water heat, solar space heat, solar thermal process heat, and all wind applications) installed at in-state business locations. The exemption from tangible property taxation runs for the system's depreciation period. Administrators should refer businesses to Massachusetts Department of Revenue guidance for eligibility criteria and coordinate to prevent double-dipping with other state credits.
Program details
- Program ID
- 148
- Last updated
- 1/6/2026
Eligibility
- Sectors
- commercial industrial
- Technologies
- solar water heat solar space heat solar thermal process heat wind (all)
Program summary
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 climate 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.
Contact & resources
- Contact email
- dwayne.breger@state.ma.us
- Additional resources
Please verify current program details with the administering agency before making any financial decisions.
