Investment Tax Credit

February 17, 2024

Summary

Vermont offers an investment tax credit for installations of renewable energy equipment on business properties, in order to encourage investment in rehabilitation and qualifying renewable energy projects. Vermont created this credit starting for Tax Year 2002 and provided an additional incentive for solar investments for Tax Year 2008 (via S.B. 209). The project must be eligible for and receive the federal tax credit to receive the state credit. The credit is equal to 24% of the "Vermont-property portion" of the federal business energy tax credit for project leaders.

For qualifying renewable energy projects the credit is calculated to be a 7.2% state-level credit for systems placed in service on or before 12/31/2032. This credit will step down (according to the federal tax credit's step-down schedule) to 6.24% for systems placed in service by 12/31/2033, then down to 5.28% for systems placed in service by 12/31/2034.

Program Overview

Implementing Sector:	State
Category:	Financial Incentive
State:	Vermont
Incentive Type:	Personal Tax Credit
Web Site:	http://tax.vermont.gov/business-and-corp/corp-and-business-income-taxes/tax-credits
Administrator:	Vermont Department of Taxes
Start Date:	01/01/2009
Eligible Renewable/Other Technologies:	Solar Water Heat Solar Space Heat Geothermal Electric Solar Thermal Electric Solar Thermal Process Heat Solar Photovoltaics Biomass Geothermal Heat Pumps Combined Heat & Power Wind (Small) Fuel Cells using Renewable Fuels Microturbines Lithium-ion
Incentive Amount:	7.2% for systems placed in service by 12/31/2032 6.24% for systems placed in service by 12/31/2033 5.28% for systems placed in service by 12/31/2034
Maximum Incentive:	No maximum specified.
Equipment Requirements:	All equipment must meet the same requirements as the Federal Investment Tax Credit

Incentives

This program has 1 incentives

Technologies:	Solar Water Heat, Solar Space Heat, Geothermal Electric, Solar Thermal Electric, Solar Thermal Process Heat, Solar Photovoltaics, Geothermal Heat Pumps, Combined Heat & Power, Wind (Small), Fuel Cells using Renewable Fuels, Microturbines, Lithium-ion
Sectors:	Commercial, Industrial, Agricultural
Parameters:	The incentive is 7.20 %

Authorities

Name:	32 V.S.A. § 5822 (d)
Date Enacted:	3/19/2008 (subsequently amended)
Effective Date:	07/01/2008
Expiration Date:	12/31/2016

Contact

Name:	Vermont Department of Taxes
Organization:	Business Tax Section
Address:	133 State St. Montpelier VT 05602
Phone:	(802) 828-2551
Email:	tax.business@vermont.gov

This information is sourced from DSIRE; the most comprehensive source of information on incentives and policies that support renewables and energy efficiency in the United States. Established in 1995, DSIRE is operated by the N.C. Clean Energy Technology Center at N.C. State University.