Geothermal Tax Credits to Be Reintroduced in Latest Republican Tax Reform Bill
Retroactive credit could be used dating back to Jan. 1, 2017
SPRINGFIELD, Ill. — The Geothermal Exchange Organization (GEO) is pleased to announce that the extension of the residential and commercial tax credits for geothermal heat pumps is contained in the tax bill just released by the U.S. House of Representatives.
The coordinated campaign led by GEO for the past two years has resulted in Kevin Brady, R-Texas, chairman of the House Ways and Means Committee, and Paul Ryan, R-Wis., Speaker of the House, agreed with GEO's position that Congress picked winners and losers when tax credits for solar and wind were extended in December of 2015. Since that time, GEO has worked tirelessly to fix this tax inequity.
While this marks a significant step toward achieving a goal of tax parity for geothermal heat pumps, this is not law yet, said GEO representatives in a press release. No business decisions or marketing efforts should be made in reference to this action today by Congress.
The language contained in the tax bill released today mirrors the language found in
HR 1090, which would extend the residential and commercial tax credits until Jan. 1, 2022. The residential income tax credit would be retroactive back to Jan. 1, 2017, at 30 percent and continue at that level until 2020 when it would drop to 26 percent and then at 22 percent for 2021 and end Dec. 31, 2021. The 10 percent commercial investment tax credit would be extended until Jan. 1, 2022, and change the language for placed in service to “property the construction of which begins before Jan. 1, 2022.
The tax bill will also provide for 100 percent expensing for capital expenditures until the end of 2022, which is another benefit for our industry.
For more information, visit www.geoexchange.org.
Publication date: 11/03/17