Property Tax Exemption for Solar and Wind Energy Systems
Administered by Maryland Department of Assessments and Taxation
If you install a solar PV, solar hot water, or solar thermal electric system, or a residential wind system, on your Maryland property, the equipment is exempt from real property taxes, so it should not raise your tax bill. The exemption applies to both state and local real property taxes, and covers systems that send power to the grid, such as under net metering. Wind equipment must be on residential property and produce electricity used in a structure there; check with your local assessment office or the Maryland Department of Assessments and Taxation about how to claim it.
You can tell customers that solar PV, solar hot water, solar thermal electric, and residential wind installations are exempt from state and local real property taxes, which improves the economics of a project. Since 2008 the exemption refers to a structure rather than a dwelling, so it appears to reach non-residential buildings as well, while wind equipment must be sited on residential property and generate electricity for a structure on that property. Systems that feed electricity to the grid also count, but confirm specific claim procedures with the administering Maryland tax authorities.
This is a statutory property tax exemption, not a grant or rebate, so it works by removing eligible equipment from the real property tax base at both state and local levels rather than by paying out program funds. It was created in 2007, replaced by H.B. 377 in 2008 to cover state and local taxes and to apply to a structure rather than a dwelling, then expanded by H.B. 1171 in 2009 to add residential wind and solar thermal electric, with S.B. 621 adding grid-connected generation, all effective July 1, 2009. It targets residential, commercial, and industrial owners of solar PV, solar water heating, solar thermal electric, and small wind systems, with wind limited to residential property.
Program details
- Program ID
- 2542
- Last updated
- 3/14/2025
Eligibility
- Sectors
- commercial industrial residential
- Technologies
- solar water heat solar thermal electric solar photovoltaics wind (all) wind (small)
Program summary
In May 2007, Maryland established a property tax exemption for residential solar energy systems. Under this law solar energy devices “installed to heat or cool a dwelling, generate electricity to be used in the dwelling, or provide hot water for use in the dwelling” were exempt from state -- but not local -- property taxes. However, in April 2008 H.B. 377 was enacted, repealing this exemption beginning July 1, 2008. In place of the rescinded exemption, H.B. 377 inserted another provision exempting solar photovoltaic (PV) and solar hot water systems from real property taxes. The exemption now applies equally to state and local real property taxes. In addition, by removing the term "dwelling" and replacing it with "structure", the revised exemption appears to no longer be limited to residential systems.
In May 2009 the exemption was amended yet again by H.B. 1171 to add "residential wind energy equipment" as an eligible technology. In order to qualify, equipment must be sited on residential property and produce electricity to be used in a structure on that property. The new law also revised the definition of eligible solar property to include devices that use "solar thermal electric energy" to generate electricity for use in a structure. A separate piece of legislation, S.B. 621, subsequently amended the definition of solar energy property to include property that generates electricity which is put on the electrical grid (e.g., as in a net metering arrangement). These new provisions took effect July 1, 2009.
Contact & resources
- Contact email
- inquiry@dat.state.md.us
Please verify current program details with the administering agency before making any financial decisions.
