Corporate Tax Credit for Solar Water Heating Systems

In Massachusetts, businesses may take a credit against the state excise tax for the purchase and installation of a solar water-heating system. The system must be installed at a commercial building, and the credit may not exceed $300 or 15% of the system cost, whichever is less. This credit expires December 31, 2007. A business may carry over unused portions of the credit for use in taxable year 2007. Note that a credit for the installation of a solar water heating system in a commercial building between November 1, 2005 and March 31, 2006 may be applied for the taxable year 2006. A business that takes this credit may not also take the state tax deduction allowed under MGL ch. 63, § 38H for the same solar water-heating system.